The Economics of Private Army

The private security firm Blackwater is again on the news, here is a recent NYT headline story.


Are private security contractors really trigger happy cowboys as some pundits choose to believe they are?

Finally an insider says no. And this insider pretty much spells out the logic of why private security personnel is far more economically than formal military personnel.


Bottomline:

"[C]ontractors are cost-effective. Blackwater contractors, for example, are generally paid $450-$650 a day. More important, unlike U.S. servicemen, they usually receive no benefits and are paid only for the days they work."

Here is the story.

Question: I am curious whether the contractors or the companies which hire them pay for the ammunition used in the war zone. Who pays for ammunition, holding other factors constant, surely would determine the trigger pulling behaviour of the frontline private security contracters.