WASHINGTON -- Three years ago, President Bush declared that he had "zero tolerance" for trafficking in humans by the government's overseas contractors, and two years ago Congress mandated a similar policy.

But notwithstanding the president's statement and the congressional edict, the Defense Department has yet to adopt a policy to bar human trafficking.

A proposal prohibiting defense contractor involvement in human trafficking for forced prostitution and labor was drafted by the Pentagon last summer, but five defense lobbying groups oppose key provisions and a final policy still appears to be months away, according to those involved and Defense Department records.

The lobbying groups opposing the plan say they're in favor of the idea in principle, but said they believe that implementing key portions of it overseas is unrealistic. They represent thousands of firms, including some of the industry's biggest names, such as DynCorp International and Halliburton subsidiary KBR, both of which have been linked to trafficking-related concerns.

Lining up on the opposite side of the defense industry are some human-trafficking experts who say significant aspects of the Pentagon's proposed policy might actually do more harm than good unless they're changed. These experts have told the Pentagon that the policy would merely formalize practices that have allowed contractors working overseas to escape punishment for involvement in trafficking, the records show.

The long-awaited debate inside the Pentagon on how to implement presidential and congressional directives on human trafficking is unfolding just as countertrafficking advocates in Congress are running into resistance. A bill reauthorizing the nation's efforts against trafficking for the next two years was overwhelmingly passed by the House this month, but only after a provision creating a trafficking watchdog at the Pentagon was stripped from the measure at the insistence of defense-friendly lawmakers, according to congressional records and officials. The Senate passed the bill last week.

Delay seen as weakness

The Pentagon's delay in tackling the issue, the perceived weakness of its proposed policy and the recent setbacks in Congress have some criticizing the Pentagon for not taking the issue seriously enough.

"Ultimately, what we really hope to see is resources and leadership on this issue from the Pentagon," said Sarah Mendelson, a senior fellow at the Center for Strategic and International Studies, a national security think tank in Washington. She also had called for creation of an internal Pentagon watchdog after investigating the military's links to sex trafficking in the Balkans.

Rep. Christopher Smith (R-N.J.), author of the original legislation targeting human trafficking, said there seems to be an institutional lethargy on the issue at the Pentagon below the most senior levels. He said he was concerned that the Pentagon's overseas-contractor proposal might not be tough enough and that the delays in developing it could mean more people "were being exploited while they were sharpening their pencils."

But he pledged to maintain aggressive oversight of the plan.

`We're addressing the issue'

Glenn Flood, a Pentagon spokesman, said he did not know why it has taken so long to develop a proposal but said, "From our point of view, we're addressing the issue."

An official more directly involved with the effort to draft a formal policy barring contractors from involvement in trafficking said it might not be ready until April, at least in part because of concerns raised by the defense contractors.

Bush declared zero tolerance for involvement in human trafficking by federal employees and contractors in a National Security Presidential Directive he signed in December 2002 after media reports detailing the alleged involvement of DynCorp employees in buying women and girls as sex slaves in Bosnia during the U.S. military's deployment there in the late 1990s.

Ultimately, the company fired eight employees for their alleged involvement in sex trafficking and illegal arms deals.

In 2003, Smith followed Bush's decree with legislation ordering federal agencies to include anti-trafficking provisions in all contracts. The bill covered trafficking for forced prostitution and forced labor and applied to overseas contractors and their subcontractors.

But it wasn't until last summer that the Pentagon issued a proposed policy to enforce the 2003 law and Bush's December 2002 directive.

The proposal drew a strong response from five defense-contractor-lobbying groups within the umbrella Council of Defense and Space Industries Associations: the Contract Services Association, the Professional Services Council, the National Defense Industrial Association, the American Shipbuilding Association and the Electronic Industries Alliance.

The response's first target was a provision requiring contractors to police their overseas subcontractors for human trafficking.

In a two-part series published in October, the Tribune detailed how Middle Eastern firms working under American subcontracts in Iraq, and a chain of human brokers beneath them, engaged in the kind of abuses condemned elsewhere by the U.S. government as human trafficking. KBR, the Halliburton subsidiary, relies on more than 200 subcontractors to carry out a multibillion-dollar U.S. Army contract for privatization of military support operations in the war zone.

Case of 12 Nepali men

The Tribune retraced the journey of 12 Nepali men recruited from poor villages in one of the most remote and impoverished corners of the world and documented a trail of deceit, fraud and negligence stretching into Iraq. The men were kidnapped from an unprotected caravan and executed en route to jobs at an American military base in 2004.

At the time, Halliburton said it was not responsible for the recruitment or hiring practices of its subcontractors, and the U.S. Army, which oversees the privatization contract, said questions about alleged misconduct "by subcontractor firms should be addressed to those firms, as these are not Army issues."

Once implemented, the new policy could dramatically change responsibilities for KBR and the Army.

Alan Chvotkin, senior vice president and counsel for the Professional Services Council who drafted the contractors' eight-page critique of the Pentagon proposal, said it was not realistic to expect foreign companies operating overseas to accept or act on U.S. foreign policy objectives.

"This is a clash between mission execution [of the contract] and policy execution," Chvotkin said. "So we're looking for a little flexibility."

He said that rather than a "requirement that says you have to flow this through to everybody," the group wants the policy to simply require firms to notify the Pentagon when their subcontractors refuse to accept contract clauses barring support for human trafficking.

Still, Chvotkin said, "We don't want to do anything that conveys the idea that we are sanctioning or tolerating trafficking."

In a joint memo of their own, Mendelson and another Washington-based expert, Martina Vandenberg, a lawyer who investigated sex trafficking for Human Rights Watch, told the Pentagon its draft policy "institutionalizes ineffective procedures currently used by the Department of Defense contractor community in handling allegations of human trafficking."

Without tough provisions requiring referrals to prosecutors, they said, contractors could still get their employees on planes back to the U.S. before investigations commenced, as they allege happened in several documented cases in the Balkans. They said some local contract managers even had "special arrangements" with police in the Balkans that allowed them to quickly get employees returned to the U.S. if they were found to be engaged in illegal activities.