Democrats say Rice grossly mismanaged Iraq

Rice: Iran a bigger problem
Rice said militias are getting money in many ways, and corruption possibly could be one. But, she added, a bigger problem was financing from Iran.

On the issue of armed contractors such as Blackwater USA, Rice this month ordered new rules for the private guards that cover the use of deadly force.

Rice said Thursday that she and Defense Secretary Robert Gates might make further recommendations. She said legislation is needed to ensure contractors involved in overseas killings can be prosecuted legally.

A day earlier, Rice ousted the State Department's security chief, Richard Griffin, after a review panel she convened found serious deficiencies in his office's oversight of contractors.

Griffin, the assistant secretary of state for the Bureau of Diplomatic Security, resigned under pressure, becoming the first political casualty of the fallout from the Blackwater incident. He will be replaced on Nov. 1 on an acting basis by one of his deputies.

Meanwhile, State Department officials denied any double standard or impropriety in the firing of Griffin and this week's promotion of two of his subordinates who directly oversaw the hiring of contractors, including those in Iraq.

One official, who spoke on condition of anonymity to describe an internal personnel matter, said the promotions were based on performance reviews completed months earlier and took into account their work over the past seven years.

Rice's answers on the Blackwater scandal did not satisfy many Democrats during the hearing, including Rep. Paul Hodes of New Hampshire.

Congress taking on more accountability
Before giving Blackwater hundreds of millions of dollars, "didn't you or your subordinates ever stop to ask whether or not the legal framework was a place to hold these contractors accountable for its actions?" he asked.

Congress is moving to put all armed contractors operating in combat zones under military control and make them subject to U.S. criminal jurisdiction.

The Senate this month included a requirement in its 2008 defense authorization bill that would give combatant commanders authority over contractors.

Sen. Carl Levin, D-Mich., chairman of the Senate Armed Services Committee, told reporters Wednesday he is confident the House will go along with the idea and include it in a final bill sent to President Bush.

A separate bill to give U.S. courts jurisdiction to prosecute State Department contractors has passed the House and is being reviewed by the Senate Judiciary Committee.

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