Excerpt #3 from
The Underground Empire -
Where Crime and Governments Embrace
by James Mills
Doubleday, New York, 1986

I was in a plane over the Atlantic, headed for what might be my last meeting with Dennis Dayle, a copy of this book's manuscript tucked in the baggage rack above my head. In the five years it had taken to produce that book I had been often in the company of federal agents or international drug traffickers commenting on President Reagan's so-called war on drugs. I never encountered anyone who thought it anything other than a joke. The traffickers tended to find more humor in the joke than did the agents, who responded to each new publicity extravaganza with the here-we-go-again resignation of troops ordered to bloody themselves, just once more, against a too-familiar target. They knew the war could be won only on the foreign policy front, and there the battle had rarely been joined.

The first war on drugs was declared in June 1971 by President Nixon, the only president ever to make the battle a serious foreign policy issue. His administration muscled Turkey into halting opium production, and heroin of any significant purity virtually disappeared from American streets. The advantage was not pressed, however, and soon availability of the drug, supplied by Mexico and Southeast Asia, soared once more.

Administrations following Nixon's regularly re-declared the war on drugs, and it became a political perennial whose appearance in Washington was as reliable and celebrated as cherry blossoms in spring. Back in 1976, the year after his Watergate conviction, Nixon's former assistant John D. Ehrlichman tried to explain some facts of life to Senator Sam Nunn and his colleagues during Senate hearings on federal drug law enforcement.

"In the year since I have been out of government ... I watched with interest what is really going on out there in the country. Believe me, the federal government is behind the power curve on this subject [narcotics] by miles and miles.... We can consolidate, we can reorganize, we can budget, and you can put up a lot of money. You can hire a lot more agents and put them out there. It is going to be marginal. You are going to affect maybe 25 percent [of the drugs entering the country] ... and the other 75 percent is just going to go along. I think there is a genuine question of hypocrisy in all of this, as to whether the federal government, people in the federal government, aren't just kidding themselves and kidding the people when they say we have mounted a massive war on narcotics when they know darned well that the massive war that they have mounted on narcotics is only going to be effective at the margins. If they don't know it, they ought to know it.... I think there is a lot of self-delusion to the federal approach to narcotics."

Six years later, nothing had changed. Nineteen days before the 1982 congressional elections, his party in need of anticrime votes, Reagan dragged out the war on drugs. Speaking over the radio, Reagan announced to the nation a "bold, confident plan" to halt the importation of drugs and pursue drug trafffickers. He was going to hire some 900 new agents, 200 federal prosecutors, create 150-man "special task forces" in twelve major cities, and build new prisons and jails, all at a cost of about $150 million (less than half what Nixon had asked for eleven years earlier).

"We're going to be on their tail," Reagan promised. "We intend to do what is necessary to end the drug menace."

The "bold, confident plan," however, included no new measures for forcing other governments to halt drug production. That would have put the problem in the foreign policy arena, already overcrowded with more serious issues of national defense.

The next month Reagan broadened his plan to include a special commission on organized crime, a project to increase state and federal anticrime cooperation, a Cabinet-level organized crime committee, and a new anticrime training center. Again, no mention of steps to induce foreign governments to stop producing narcotics.

Two months later, skepticism began to mount. A 94-page General Accounting Office report (directed by Ed Stephenson, whose earlier report had urged the enlargement of Centac) said Reagan's South Florida task force, a prototype created the previous year, was a failure. Only one in twenty task force arrests had been a major trafficker, and there was more cocaine on the streets than ever. At the same time, a United Nations report said worldwide production of cocaine was uncontrolled, undermining the economies and governments of countries producing and transporting the drug.

The Reagan administration dragged the navy and air force into the battle, and continued to shout of its success. But by mid-1983 Peru and Bolivia were producing bounty coca crops, and even Colombia, a processor rather than grower, had ten times more coca under cultivation than two years earlier. DEA was seizing a record-setting two thousand pounds of cocaine a month, yet the mounting supply kept prices tumbling. Since Reagan's election, despite his "war" and cries of imminent triumph, the Miami price of cocaine had plummeted 50 percent. By the end of the year the United States was flooded with heroin produced in Pakistan, whose leaders blithely claimed a lack of control over heroin-producing areas. ("Pakistan's rulers control what they want to control," said the New York Times.) The amount of Mexican heroin pouring across the border, now at a five-year high, was increasing. The chief of the Justice Department's criminal division, calling the drug problem "out of control," said it "represents a major threat to the integrity of government institutions."

Reagan's war on drugs was proving once again that America's narcotics problem cannot be controlled at the borders. The only thing that had ever worked, or was likely ever to work, was control at the source. But leaders of source country governments, seeking foreign exchange or personal enrichment, frequently participated in the traffic themselves, and the American State Department and CIA, seeking to retain military, diplomatic, and intelligence allies, were loath to blow the whistle.

The product of America's secret tolerance for international narcotics trafficking was dramatized by a two-week congressional "study mission" to Latin America in the summer of 1983. The committee members, perhaps shocked into candor, reported that millions of dollars of American aid to source countries had "failed to bring any meaningful and long-term reduction in the production and traffic of narcotic drugs in the countries affecting the United States ..." In most source countries narcotic production, manufacture, and traffic had "dramatically increased." Nowhere had it significantly declined.

Why this worldwide failure to control the international narcotics industry? Was it, as successive wars on drugs had suggested, a matter simply of too few agents, not enough courts, insufficient funds? Not at all. "Our failure," the congressmen found, "has been one of diplomacy."

Virtually everywhere the congressmen looked they found narcotics production increasing out of control. In Peru, whose coca accounted for half of all the cocaine consumed in the United States, coca production had increased 500 percent in fifteen years, and continued to expand. In one area alone, 86,000 acres -- six times the size of Manhattan Island -- were covered with coca. The committee reported that the "explosive expansion of the illicit production, manufacture, and traffic of coca and cocaine in Peru during the last decade" and Peru's unwillingness or inability to control that production, resulted from "a shirking of national responsibility, marked by indifference, lack of direction, and procrastination."

Peruvian police were overcome by "ever-increasing powerful Peruvian and international narcotics traffickers...." A "tidal wave of coca ... overwhelms, demoralizes, and corrupts government administrators, the police services, the court system, the agricultural sector...."

Peru's prime minister told the congressmen, "We are doing the best we can. We do not have the resources and we do not like to be threatened." When the committee's chairman pointed out, as unthreateningly as possible, that "success was achieved in Turkey when the government simply prohibited the production of opium," the prime minister responded that eradication of coca crops was a "complex problem to which Peru cannot find the answer or the resources."

The congressmen found "an explosion of production in Peru from 1977 onward, amounting to as much as a 30 percent increase annually." By 1983 coca leaf production, estimated at up to 600,000 acres, was "totally out of control and still expanding." In at least six large areas of Peru, coca production had "politically and economically taken over." Farmers had abandoned food crops to grow coca, and foreign emergency relief was needed to keep the population fed. The cocaine business was "turning vast sections of the countryside and urban areas over to criminal narcotic traffickers and their organizations" which were "challenging the administration of the government in the control of its territory."

In Bolivia, a country which only ten months earlier had been ruled by undisguised, well-known international cocaine traffickers, the horror story continued. Coca cultivation had "dramatically escalated out of control ... and is still increasing." Production had increased by 78 percent in four years Forty-five percent of the cocaine consumed in the United States was made from coca grown in Bolivia.

Farmers who had never grown coca were planting it in regions where coca had never before been known. There were no indications that the government of Bolivia had committed itself to reducing coca production "or that the United States government made clear its expectation that Bolivia should do so." Police narcotic enforcement efforts were "practically nonexistent." Bolivia's President Hernan Siles-Zuazo, speaking of "narcotic traffickers, and the political leaders and those in the army and police who have been corrupted by them," admitted that "some of our leaders get rich and take advantage of freedom." He did not name the leaders or explain why they were permitted to enrich themselves in the drug traffic.

One of President Siles's advisers himself admitted that "the narcotic traffic is now stronger than the state." He said the drug business had come to involve some 300,000 people, from farmers to major traffickers. Farmers were not only abandoning food crops for coca but were leaving their homes and land, pulling up stakes and moving to areas where coca was grown. He said it all began "like a small cancer cell, the government encouraged it, and some men in the government were even partners with the traffickers."

In Colombia, things were even worse. Manufacturer of 75 percent of the cocaine (and grower of 80 percent of the marijuana) consumed in the United States, coca cultivation had been started to augment supplies from Peru and Bolivia and "to ensure that the Colombian narcotics trafficking organizations can continue to increase their markets."

During more than ten years of American antidrug assistance to Colombia, "the drug problem has gotten progressively worse."

The congressmen flew over thousands of acres of recently planted high-grade coca. Production was "increasing at an alarming rate." On Colombia's north coast marijuana was flourishing over a 37,000-acre area, "mile upon mile ... as far as the eye can see." The government had allowed marijuana and coca production "to increase to huge proportions." The congressmen, "appalled at the magnitude of both the coca and marijuana cultivation," concluded that "the government of Colombia does not seem to clearly grasp its responsibilities."

Taking a look at drug smuggling from Colombia to the United States, the congressmen found "no evidence of any diminution." In the area of Cartagena, "No effective action has ever been taken to immobilize the great number of clandestine airstrips used by the hundreds of aircraft from light single-engine planes to huge DC-7s and Super Constellations. Similarly, no action has ever been taken to shut down the great number of clandestine loading docks" accommodating marijuana freighters. A Colombian Navy patrol boat, provided at a cost of $2 million by the United States, operating in the most smuggler-infested waters in the world, had in two years searched only fifteen vessels. It seized one kilo of cocaine, some marijuana residue, and a small amount of American currency. Of two hundred arrests made by a Colombian Customs boat (also a gift of the United States), only four defendants had been convicted and all of them subsequently "escaped."

In an area dotted by two thousand illegal airstrips, local police argued that prohibition of coca cultivation would be a disaster for these "poor people." How did these people exist four years ago, before they started growing coca? The cops said they didn't know. Tens of thousands of acres sat there, vulnerable to destruction by a few helicopters in a few days. Why not do it? After all, Colombia was already using herbicides extensively on legal crops. The national police said it was "a decision that would have to be made at the highest level of the government." Indeed.

The congressmen discovered that prosecution for narcotics crimes in Colombia, "particularly against major violators and organizations, have been totally ineffective." The few traffickers who were arrested were frequently not prosecuted or "soon evade conviction on technical rules or procedural grounds." Pursuit of major traffickers had been characterized by "the absolute failure and total indifference of the government of Colombia." DEA itself had enough evidence for the prosecution in Colombian courts of several hundred major violators. The Colombian government, however, has "shown no real interest in following up on this."

A "narcotics traffickers' lobby" had opposed implementation of a 1982 extradition treaty as well as aerial spraying of herbicide on marijuana and coca plants. Despite all this, Colombia's defense minister promised that "Colombia is ready to continue the fight against the narcotic traffic with all force." Continue? When did they start?

A top Colombian legislator, the president of the Chamber of Representatives, admitted that traffickers possessed great power and wealth, "the heavy use of which influences political campaigns Justice Minister Rodrigo Lara-Bonilla sounded helpful, explaining that priority was now being given to the arrest and prosecution of traffickers. But he had been in office only two weeks and no one could guess how sincere he might be, or how far sincerity might get him.

Colombian President Belisario Betancur admitted to the congressmen that traffickers were becoming involved in national politics. But, he said, Colombia "will not tolerate anything to do with drugs."

In Jamaica, there was more of the same. Production was increasing. Fields were cultivated in high-grade marijuana. There was little indication that a narcotics control program even existed.

In Mexico, the committee uncovered a "noticeable increase in the quantity and quality of Mexican heroin entering the United States" and indications "of increased opium production." The Mexican government appeared to be having the same difficulty as two previous administrations in pursuing joint drug prosecutions with the United States. "Existing evidence that could be used to prosecute and convict major sources of supply, heroin laboratory operators, and the financial bankers of the traffic" was unexploited. Even Mexico's attorney general admitted that "the organized illicit production and traffic of narcotics is very extensive and powerful." He said traffickers were often successful "in corrupting some of our men ..." He did not mention the corruption of high government officials, although accusations against former president Lopez-Portillo, who had succeeded also-suspect Luis Echeverria, were becoming more and more difficult to deny.

The study mission returned to Washington -- and the drugs kept coming. By January 1984, the Justice Department had experienced the largest percentage increase in money and people of any major federal agency, including the Defense Department, since Reagan took office. But you wouldn't have guessed it from the effect on the drug problem. The price of cocaine had dropped two thirds in the past year, and emergency room cocaine deaths had more than doubled. The Customs Service was catching only 6 percent of drug-smuggling vessels, and of thousands of smuggling flights a year into the United States, only one percent were intercepted. Only three of the Customs Service's thirty-three planes carried long-range tracking radar, and only eight -- covering the entire southern border from Key West to San Diego -- were fast enough to catch smuggling aircraft. The Los Angeles chief of police called the situation "totally out of hand," and a General Accounting Office report said, "More drugs are entering the United States now than entered five years ago."

In November 1984, two years after Reagan announced his "bold, confident plan" promising to "be on the tail" of drug traffickers, cocaine imports had jumped 50 percent and heroin was more plentiful than at any other time since the late 1970s. An estimated sixty-three tons of cocaine glutted the U.S. market in 1984, slashing the price by half.

Traffickers expanded coca and marijuana growing operations into Venezuela, Argentina, and Brazil. A classified DEA report called marijuana "the mainstay of the Jamaican economy." In Asia, Thai poppy acreage in 1984 increased 38 percent. In the three years preceding 1985, worldwide opium production increased more than 50 percent, coca 40 percent, marijuana almost 20 percent.

The United States, fearful as always of compromising military bases, political allies, and intelligence sources, fired off noisy barrages in its war on drugs, issued token protests, and looked the other way. An acting assistant secretary of state said, "We have other diplomatic interests in these countries, and if we alienate them over drugs we may be sorry when we need them for something else a few years later." Referring to the State Department, a White House official admitted that "nobody over there wants to have anything to do with drugs."

Traffickers in Peru benefitted enormously from collusion with the "Shining Path" Communist insurgents, who destroyed coca eradication efforts, killing nineteen workers. (Centac agent Pat Gregory recalled the Communist connections of men like Alfonso Rivera's attorney Luis Cornejo, whose political influence, according to a top PIP commander, had made him "untouchable.") The value of Peru's coca topped all other exports. Major traffickers, if arrested, easily bribed their way to freedom (the going price, according to one source, was $10,000; the average policeman's monthly wage: $38).

Top Bolivian traffickers continued to operate with impunity. A Bolivian army crackdown in a major coca growing area was announced three weeks in advance, assuring traffickers ample time to move out. There was little doubt they would shortly bribe their way back.

In Colombia, Justice Minister Lara-Bonilla, who had sounded so sincere to visiting American congressmen, was murdered. A passenger on a motorcycle riddled his Mercedes with twenty-two bullets. Lara died much as Judge Ana Cecilia had died in a similar attack in Medellin, and the captured killer said he had been paid $20,000 by unnamed men in Medellin, operational center of Centac-21 target Santiago Ocampo.

The Lara assassination touched off a paroxysm of antidrug rhetoric in Colombia, as well as enough action to send major traffickers temporarily out of the country. Gilberto "The Chessman" Rodriguez, owner of the Bar-J Ranch seized by Billy Mockler's men, lead a contingent of cocaine dealers to always-hospitable Panama. Barely a week after Lara's assassination they installed themselves in Panama City's Cesar Park Marriott Hotel and convened a cocaine summit conference with former Colombian president Alfonso Lopez-Michelsen.

They informed Lopez-Michelsen that they represented Colombia's top 100 traffickers, controlled all of the cocaine base coming from Bolivia and Peru and 80 percent of all Colombian cocaine entering the United States. They promised that if they were allowed to return safely to Colombia, and if Colombia's extradition treaty with the United States were revised to protect them, they would stop smuggling, abandon politics, repatriate their money, and help fight the drug traffic.

Lopez-Michelsen returned to Colombia to confer with President Betancur. Betancur must have liked what he heard, for ten days later his attorney general, Carlos Jimenez-Gomez, arrived in Panama to continue the negotiations. The attorney general asked Rodriguez and the others for a written proposal of surrender terms. The traffickers handed Jimenez a six-page "unconditional plan of surrender," suggesting, like so many heads of state, that he pass the plan to the government of the United States.

Jimenez couriered the proposal back to Bogota, where it was studied by Betancur and passed to the American embassy, which cabled it to Washington. It would be interesting to know what the official response would have been to this "surrender plan" (would Bogota and Washington have believed the promises of Rodriguez and the others?), but unfortunately it found its way into Colombian newspapers. President Betancur immediately vowed publicly that "under no circumstances" would he agree to such a proposal. American officials added their own outrage, announcing righteously that they were not in the habit of negotiating with criminals.

Rodriguez and another trafficker named Jorge Ochoa (his ranch on the Colombian coast included not only the usual speedboats, yachts, fast cars, airstrip, planes, and multiple swimming pools, but a bullring and immense outdoor zoo) departed Panama for Spain, where they began negotiations to buy a 12,000-acre, million-dollar ranch near Madrid.

Rodriguez was so confident of his security in Spain that he did not even bother to use a false name. He might have been more cautious had he looked back over his shoulder

Billy Mockler was gaining on him.

Why Gilberto Rodriguez and his drug-trafficking colleagues -- known international criminals, some of whom were under indictment in the United States -- were welcomed in Panama, not apprehended or even deported, was never publicly addressed. If the United States government, powerful as it is, had really been fighting a war on drugs, had really wanted to do something about the cocaine traffic, could it not have arranged the apprehension of those traffickers, resident more than three weeks in a supposedly friendly nation receiving $62 million in American aid?

A response to that question is implicit in the activities of one of Rodriguez's fellow authors of the ""surrender plan."

Even before Lara-Bonilla's murder, Carlos Lehder-Rivas, the young owner of a newspaper and founder of his own Colombian political party, had taken up part-time residence in the Bahamas. He and fugitive Robert Vesco (wanted in the United States for, among other things, illegally donating $200,000 to Nixon's reelection campaign) bribed Bahamas Prime Minister Lynden Pindling to allow them to smuggle multimillion-dollar quantities of drugs through an island called Norman's Cay.

Lehder and Vesco were not the only ones doing business with Pindling.

The Mafia was known to own two islands in the Bahamas. And Lynn Mizer's brother-in-law Paul Hindelang, who set Mizer and Donald Steinberg up with their first marijuana load, told police that a Pindling representative had received a million dollars for the release of captured smuggling boats. Salvatore Caruana, a Mafia partner of Frank Lepere, who kidnapped Donald Steinberg executive Mike Romanelli in Plymouth, Massachusetts, and later sent kidnappers after other Steinberg associates, reportedly laundered a million dollars through a Bahamian cabinet minister and member of parliament named Kendal Nottage. (Nottage was aboard Pindling's chartered jet when Pindling flew to London to be knighted by Queen Elizabeth.)

An American plan to expose the Lehder-Vesco-Pindling alliance by apprehending Nottage as he accepted a bribe (an operation that would have exposed widespread Bahamian corruption and possibly denied traffickers their Bahamian bases) was killed by the American ambassador to the Bahamas. The ambassador's reason for blocking the plan, delivered to newsmen with a candor he must have later regretted, was that such an action "might upset delicate negotiations with the Bahamians over a U.S. Navy submarine testing base in the Bahamas. This can be very embarrassing. When you look at the total picture, I mean, our relations with the Bahamas is not solely in the drug area. There are many other things which over the long pull would be more important than the drug."

More than 90 percent of the cocaine consumed in the United States was coming through the Bahamas. Which was more important, the coke or the submarine base? And was the United States really in danger of losing the base? If the Bahamian government was for sale to narcotics traffickers surely it would have been for sale to the United States government. In the Bahamas, in Panama, and in not a few other countries American drug investigators and diplomats frequently find themselves arriving simultaneously on the same doorstep, one with handcuffs, the other with roses.

Invariably, the roses win.

Excerpt 4 The "War on Drugs"
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