Tuesday, February 17, 2009
The paradigm-busting set of enterprises founded and built by Navy SEAL and entrepreneur Erik Prince is now a collection of disparate names.
"We've taken the company to a place where it is no longer accurately described as Blackwater," company spokeswoman Anne Tyrrell tells the Washington Post. "The idea is to define the company as what it is today and not what it used to be."
Blackwater Worldwide, best known for its diplomatic security services in Iraq and Afghanistan, and famous within the Pentagon and national security community for other defense and related services, has been re-named Xe.
Blackwater Target Systems is now GSD Manufacturing. Blackwater Airships will become Guardian Flight Systems. And so on.
The famous Blackwater Lodge and Training Center, which started it all to provide first-rate, efficient training for the US military and law enforcement, is now the US Training Center.
The company website, www.blackwaterusa.com, now leads to a scaled down version of its former self to feature the US Training Center.
Blackwater has undergone a gradual change in its brand. In 2007 it expanded its focus from Blackwater USA to Blackwater Worldwide, embracing a new, less edgy, New York-designed corporate logo. The rebranding was planned before the deadly Nisoor Square shootout in September of that year, but was implemented soon afterward. The new change seems to reflect the reality that the controversy has tarnished the companies' overall image and presented a misleading public image that Blackwater's main business line was intended to be diplomatic security. The company at its core is a training and logistics business, with security being a side line.
Saturday, February 14, 2009
Welcome to Xe.
That's pronounced "Zee."
Not as cool as Blackwater, but with none of the baggage that have cost the family-like company so much grief.
Kind of like Valujet, the revolutionary low-cost airline whose fortunes nosedived when one of its jetliners crashed into the Florida Everglades. Everyone aboard perished. Many in the industry hated Valujet, the upstart who dared challenge the creaky and expensive status quo.
Those who said that cheap, safe, reliable air travel would be impossible - that high-end, high-cost titans like Pan Am, TWA, Northwest and Delta would dominate the industry forever - called Valujet a menace to public safety. The Everglades crash proved it, with critics alleging that low-cost operations came at the price of safety. Valujet's fortunes sank into the swamp.
But the business model was sound. All signficant airlines occasionally suffer catastrophic accidents. Valujet's safety record was fine. But the company couldn't survive on its tarnished brand. So it re-named itself Airtran and spawned a whole new business model that helped put many of the high-cost behemoths out to pasture. Pan Am and TWA are no more. Northwest is being absorbed by Delta.
Enter Airtran's new world that includes other profitable upstarts like Jetblue and Southwest.
Dying airlines like United, with its high costs, lame service and customer-hostile attitudes had to take notice and change if they wanted to survive.
So we'll miss Blackwater. But we'll keep its memory alive on this blog - defending the honor of the people who built the company and made it the success it became, challenging the malicious detractors, and discussing the issues. And we'll watch as Blackwater's re-named components (see post above) continue to innovate, continue to revolutionize and - as with any innovator - to make mistakes and learn from them, becoming better with each tough experience.
Wednesday, February 4, 2009
Amy Ridenour of the National Center for Public Policy Research in Washington takes note:
Remember the ultra-mini Blackwater tax scandal of 2007? In it, liberal Senators Barack Obama, John Kerry and Dick Durbin kicked up a fuss because Blackwater treated security guards it employed in Iraq as independent contractors (making them responsible for paying their own taxes) rather than as employees whose income and payroll taxes were deducted from their paychecks.
Obama and Durbin sent a letter to Bush Administration Treasury Secretary Henry Paulson complaining that misclassification of employees as independent contractors contributes to the 'tax gap' (that is, the difference between the amount of taxes legally owned to the federal government versus the amount collected), and seeking a full investigation into Blackwater.
Fast forward 15 months. After sticking behind a Treasury Secretary nominee with 'tax gap' problems of his own, Barack Obama is pushing for an HHS Secretary, Tom Daschle, who somehow managed to leave $83,333 in consulting income off his 2007 tax return, deducted $14,963 in non-existent charitable contributions from his 2007 tax return, and accepted $73,031 worth of car and driver services in 2005, $89,129 worth in 2006 and $93,096 worth in 2007 without it occurring to him over three solid years that these benefits are taxable income.
And then there's the unresolved question of possible tax liability for luxury travel paid for by others. Of the Daschle nomination, John Kerry is saying 'there is a completely understandable, absolutely acceptable and rational explanation for what happened here.' (Blackwater had a stronger case than does Daschle, but never mind.)
For his part, Dick Durbin is assuring the country, 'If all you knew about Tom Daschle was that he used to be a Senator, and he made a mistake and had to pay over $100,000 in back taxes, you have a right to be skeptical, even cynical. But if you know Tom Daschle, you know better.' Where is the concern for the 'tax gap' now?>
The bottom line, of course, is that our leaders should not tolerate tax cheats. At the same time, the public should no tolerate politicians who use the tax laws as political weapons against people and companies they don't like. Blackwater's practice of hiring contractors is entirely lawful and ethical, but certain politicians wanted to beat up the company anyway. Those same politicians' excuses for Daschle and other obvious tax cheats shows how insincere they are. They have destroyed any credibility they might have had in criticizing Blackwater, and hopefully we've heard the last of them on this subject.