Despite the Iraqi government's announcement earlier this year that it had canceled Blackwater's operating license, the US State Department continues to allow Blackwater operatives in Iraq to remain armed. A State Department official told The Nation that Blackwater (which recently renamed itself Xe Services) is now operating in Iraq under the name "US Training Center" and will continue its armed presence in the country until at least September 3. That means Blackwater will have been in Iraq nearly two years after its operatives killed seventeen Iraqi civilians in Baghdad's Nisour Square.

    "Authorized personnel under that task order are permitted to continue carrying weapons until that time," said a State Department diplomatic security official who spoke on condition that his name not be used. He added: "The purpose and mission of the Department of State's private security contractors is limited to protection of US diplomats and diplomatic facilities only and is defensive in nature."

    That last point will come as little comfort to Iraqis. The Blackwater operatives involved with the Nisour Square killings on September 16, 2007, were operating under that very description. "The public perception in Iraq is that Blackwater is no longer operating in the country; that they were kicked out and their license revoked," says Raed Jarrar, the Iraq consultant at the American Friends Service Committee. "The public perception is that they are gone already. This is very disturbing."

    The State Department's confirmation of Blackwater's continued armed presence in Iraq comes a week after a former Blackwater employee alleged in a sworn statement that the company's owner, Erik Prince, views his company's role as fighting a Christian crusade to "eliminate" Muslims and Islam globally, alleging that Prince's companies "encouraged and rewarded the destruction of Iraqi life."

    According to the State Department, Blackwater's sole remaining contract for diplomatic security in Iraq is an aviation contract. As The Nation recently reported, the Obama administration extended that contract on July 31, increasing Blackwater's payment by $20 million and bringing the total paid by the State Department to Blackwater for its "aviation services" in Iraq to $187 million. Blackwater has also been paid over $1 billion by the State Department for "diplomatic security." The large, publicly traded company DynCorp is scheduled to take over Blackwater's aviation contract in September, while Triple Canopy will get the lion's share of the protective security work in Iraq.

    On January 28, the Iraqi government announced that it was not issuing Blackwater a license to operate in Iraq, saying the company needed to leave once private security companies were officially placed under the jurisdiction of Iraqi law, as outlined in the Status of Forces Agreement. "Those companies that don't have licenses, such as Blackwater, should leave Iraq immediately," declared Iraqi Interior Ministry spokesman Maj. Gen. Abdul-Karim Khalaf. Despite these declarations, Blackwater remained. "Why were they allowed to stay for seven months without any operating license?" asks Jarrar.

    The language of the Status of Forces Agreement that took effect January 1, 2009, technically places Defense Department contractors under the jurisdiction of Iraqi law, but it appears to exempt State Department contractors such as Blackwater, Triple Canopy and DynCorp from Iraqi jurisdiction. Whether that has played a role in Blackwater's continued presence in Iraq is unclear. Prime Minister Nuri al-Maliki and other officials "gave a lot of lip service after the Nisour Square massacre, promising to prosecute Blackwater and ban them from Iraq, but they've done nothing," says Jarrar. "It seems they were deliberately deceiving the public without actually holding the State Department or Blackwater accountable."

    A week after Nisour Square, Maliki's government said it would ban the company. "The Iraqi government is responsible for its citizens, and it cannot be accepted for a security company to carry out a killing," Maliki said on September 23, 2007. "There are serious challenges to the sovereignty of Iraq." (The Iraqi government did not respond to a request for comment.)

    Meanwhile, Blackwater continues to have a substantial presence in Afghanistan as well. There it also operates under the banner of US Training Center on a diplomatic security contract for the State Department's Worldwide Personal Protection Program. It also works for the Department of Defense under the banner of Paravant LLC, another Prince-owned company. Four Paravant operatives are under investigation by the US military over the shooting deaths of two Afghan civilians in May.

    Blackwater is bidding on more contracts in Afghanistan, which is increasingly becoming the new gold mine for the war industry. Nearly 70,000 contractors are now deployed in Afghanistan on the US government payroll, meaning there are now more contractors than US soldiers (48,000) in Afghanistan. Afghanistan's Interior Ministry has licensed nearly forty private security companies who collectively employ 23,000 people in Afghanistan. These companies also control 17,000 weapons there. In addition to those hired by the State Department, the US Department of Defense has about 4,300 security contractors in Afghanistan, and these numbers are steadily increasing. In the second quarter of 2009, the Obama administration increased the number of armed private contractors in Afghanistan by 29 percent.

    "I'm not surprised that this transition is happening," says Sonali Kolhatkar, author of Bleeding Afghanistan: Washington, Warlords and the Propaganda of Silence. "We were warned before the election of Obama that Afghanistan was going to be the top war priority, so it is not surprising that Washington would dedicate much of its war machinery to Afghanistan." As for Blackwater, she says: "If they build the same record of killing civilians in Afghanistan that they had in Iraq, it will cement the Afghan resistance even further against the US occupation."

    On August 6, Representative Jan Schakowsky wrote letters to Secretary of State Hillary Clinton and Defense Secretary Robert Gates citing Blackwater's "history of abuse" and called on Clinton and Gates "not to award further contracts to Xe and its affiliates and to review all existing contracts with this company." Neither department has responded to Schakowsky.

    Jeremy Scahill, a Puffin Foundation Writing Fellow at The Nation Institute, is the author of the bestselling Blackwater: The Rise of the World's Most Powerful Mercenary Army, published by Nation Books. He is an award-winning investigative journalist and correspondent for the national radio and TV program Democracy Now!.