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you also can't make money at it when there's no war.
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Theres always need for supply and more often then not specialized security. So these companies make money during times of peace as well..just more so during war.
Alot of the military function if you look closely is "privatized" not in and of itself but for instance by using private contractors to deliver food, fuel, ammo, whatever to US military bases or whatnot.
These can include everything from Haliburton to UPS.
Companies like Blackwater provide more security oriented type support. IE you have a Diplomat in Iraq who needs security while he does his thing.
Now you can use regular military to do this..or you can hire these people thus getting the security as well as not using these regular soldiers up for such activities.
Way to much willy nilly well get rid of this and don't do that..without thinking what not doing that means in reality.
If you don't like the level of Privatization now then your going to have to increase the size of the military...becasue the roles being filled now by these private companies HAVE to be filled.
http://www.blackwaterusa.com/
(The Nazi compariosn adn such and disgusting crap. The people doing that are smearing people who are often 10-20 year veterans of the United States Military who have risked their lives in more 'undisclosed' operations then some of the people badmouthing them have likely been alive...and to put salt in the woudn they did it FOR the peace of mind the people badmouthing them enjoy)