> Chapter 9

"THE POLITICS OF HEROIN"

(By Alfred W. McCoy. Pub. 1991 by Lawrence Hill Books, Brooklyn, NY.)

This book is subtitled CIA Complicity in the Global Drug Trade. It is the product of about 20 years of research and travel by Professor McCoy, primarily in Southeast Asia, tracking down the mechanics of the international drug trade. The first edition of the book was published in 1972 under the title The Politics of Heroin in Southeast Asia. McCoy is presently professor of Southeast Asian History at the University of Wisconsin-Madison.

We take up this and the two following books because they deal with entities utilized by the elites which concern themselves not with foundation grants, or monetary manipulation, or media propaganda, or secret diplomacy, but rather with highly physical, very illegal, and therefore always covert, means to attain various ends which the elites deem important enough to justify such means. We won't presume to assign a motivation to the elites' apparent effort to perpetuate the "drug war," though we can't refrain from pointing out its $400 billion annual cost to the American public which we estimated in the previous chapter, certainly an attractive source of "waste" which the Iron Mountain Study Group may actually have considered but left unrecorded.

McCoy starts by sketching the history of the drug trade. Opium was first mentioned in Greek texts in the fifth century BC and in Chinese texts in the eighth century AD. Its use remained local until western traders discovered its commercial potential, starting with the Portuguese in the sixteenth century, followed by the Dutch and then on a much larger scale by the British in the eighteenth and nineteenth centuries. Starting in 1773, the British East India Company established a monopoly on the production of Indian opium, transported it to China and bartered it for Chinese tea, silk, and porcelains, and shipped and sold those goods back in Britain and other European countries for vast profits. This triangular trade depended first upon political control in India and second upon military force in China, the latter necessitated by Chinese efforts to ban opium, efforts which were defeated by the two opium wars which the British successfully waged against the Chinese in 1839 and 1856. By 1900 the Chinese had become the world's greatest opium consumer, having about 13.5 million addicts in its population of 400 million. Its annual production had grown to over 35,000 tons, over 85 percent of the world's total, making China also the world's greatest producer.

The poppy produces the opium from which morphine and heroin are chemically derived. Germany's E. Merck and Co. discovered in 1805 how to extract morphine from the opium sap, and began commercial morphine manufacture in 1827. An English chemist first synthesized heroin (diacetyl-morphine) in 1874, and in 1898 Germany's Bayer Company commenced commercial production of heroin as a pain reliever. (One year later they discovered aspirin and began marketing it as well.) Bayer advertised heroin as non-addictive, and it was included in countless patent medicines in America, Europe, and Australia. The AMA in 1906 approved its use as a substitute for morphine, which was finally recognized as being addictive.

Cocaine likewise became known to the western world in the nineteenth century. Noting the Andean Indian practice of chewing coca leaves, European firms began efforts in the 1850's to extract the active element. Merck was successful, and began commercial manufacture of cocaine. Sigmund Freud experimented with it and gave it a ringing endorsement, including "its ability to cure morphine and alcohol addiction." For a few-score years it enjoyed legal manufacture, by Parke-Davis Company for example, and widespread use in medicines, tonics, and even foods of various kinds. Coca-Cola contained a dose of cocaine until 1903, around which time the medical community started becoming aware of its addictive nature.

It took 10 more years for Congress to get stirred to action, but in 1914 it passed a law requiring a doctor's prescription to purchase heroin or cocaine. The law was widely circumvented, but by 1923 was strengthened into an effective federal ban on sales of essentially all narcotics, accompanied by the creation of the first drug enforcement agency, the Treasury Department's Narcotics Division.

The termination of legal distribution of narcotics did not end addiction, however, and criminal syndicates grew up to supply the demand for both alcohol and narcotics. But whereas alcohol prohibition was terminated in 1933, ending its criminal involvement, the narcotics ban has remained permanent, says McCoy, "making the illicit heroin traffic the most constant source of income for organized crime in America."

The Treasury's Narcotics Division came a cropper in 1929 when a grand jury found it protecting New York City drug dealers, including the notorious Arnold Rothstein, the leading organizer of the city's criminal syndicates in the 20's. Congress then created in its place the Federal Bureau of Narcotics (FBN), and President Hoover named Harry Anslinger, a young Prohibition officer, as its director. Anslinger ran it with enthusiasm through the 30's, confining his efforts to domestic suppression.

But after World War 2, when the U.S. sought to extend its drug suppression activities overseas, Anslinger faltered. According to McCoy, "In retrospect, it seems that Anslinger's intelligence connections compromised his bureau's anti-narcotics mission. As a strong anti-Communist and a specialist in counterintelligence, Anslinger maintained close ties to the U.S. intelligence community. During World War 2, he had lent his bureau's key personnel to form the Office of Strategic Services (OSS), forerunner of the CIA [Central Intelligence Agency], thereby setting a post-war pattern of cross-fertilization between the two agencies." Anslinger thereafter denied the primacy of Southeast Asia's Golden Triangle as the prime source of postwar opium, claiming erroneously that the Chinese Communists controlled that trade, and otherwise steering his agency around any position or activity in opposition to the interests or positions taken by the CIA.

We noted in our own Chapter 1 on Engdahl's A Century of War that the British helped us form our international intelligence agencies, housing our OSS in the London offices of the British intelligence services. Staffed in part by Anslinger's drug fighters, the OSS metamorphosed into the CIA, which was formally created by President Truman in 1947 to prosecute espionage and covert action projects against the USSR in the Cold War which was then just starting. Whatever else may be said about the CIA, its genes may be seen to have come from persons involved for two centuries in the British Far Eastern drug trade, persons with extensive knowledge and involvement with the organized criminal syndicates handling illegal narcotics in the United States, and persons with anti-Communist mind-sets.

As a prelude to his main theme, McCoy goes into some detail concerning the organizational familiarity between the wartime intelligence agencies and the criminal syndicates. Very briefly, in 1942 the Office of Naval Intelligence (ONI) approached the Sicilian-American Mafia who were "in charge" of the New York waterfront to seek their help in preventing German espionage and sabotage on the docks. The ONI was shortly referred to Lucky Luciano, then in a New York prison for prostitution racketeering, and to his good friend Meyer Lansky, patriot, who assured the Navy that Luciano would be trustworthy. Luciano and Lansky represented the "new generation" (following the death of Arnold Rothstein in 1928) of the Italian and Jewish Mafia respectively, with their friendship and pact of assistance going back to their youthful boyhoods on the streets of New York. A deal was struck: the ONI would define its problems to Luciano, who would advise Lansky of what was to be done, and Lansky would relay the orders to "whomever he thought appropriate" to get the job done. Among other services, the ONI learned, via Luciano and Lansky, what it needed concerning coastal waters around Sicily, where Italian army files could be found on Sicily, and who (among the Sicilian Mafia) would be helpful to Patton in defeating the Italian garrison on Sicily. When the war was over, the Mafia in Sicily was stronger than ever, having earlier been reduced to near impotence by Mussolini. In addition, Lucky Luciano's prison sentence was commuted by New York Governor Thomas E. Dewey, upon the request of American military intelligence officers, and Luciano was deported back to Italy.

McCoy then lays out the theme of his book. The number of U.S. addicts had dropped from around 200,000 in 1924 to perhaps 20,000 by the end of World War 2, largely due to the wartime disruption of the heroin supply and transport organizations. McCoy observes:

"With American consumer demand reduced to its lowest point in fifty years and the international syndicates in disarray, the U.S. government had a unique opportunity to eliminate heroin addiction as a major American social problem. Instead, the government - through the CIA and its wartime predecessor, the OSS - created a situation that made it possible for the Sicilian-American Mafia and the Corsican under-world to revive the international narcotics traffic. These operations were the first signs of the CIA's willingness to form tactical, anti-Communist alliances with major narcotics dealers, whether in the cities of Europe or the jungles of the Third World. During the forty years of the Cold War, several of the CIA's covert action allies were to play a significant role in sustaining a global narcotics industry that supplied the United States."

McCoy then goes to the CIA's first involvement. Back in Sicily, Lucky Luciano proceeded to construct one of the most successful narcotic syndicates in the history of the trade. He started by diverting heroin legally manufactured by Schiaparelli, a respected Italian pharmaceutical firm, and smuggling it to destinations in North America where it was received and distributed by his long-time associate, Meyer Lansky. Luciano had himself visited Cuba in 1947, met with the American syndicate leaders, and distributed lavish bribes to appropriate Cuban officials. Cuba was to be the focal point of North American distribution. Lansky was placed in charge, not only of organizing the remaining American heroin distribution network, but also of managing Luciano's entire financial empire in America. In this role he was responsible for collecting the enormous flood of North American drug cash and seeing that it got properly distributed, i.e., to the workers within the cartel, to bribed authorities, and of course back to Luciano who saw to the monetary distribution within Europe and Asia, no doubt including his own Swiss bank accounts. It was reportedly planned that the heroin transshipments within Cuba were to be managed by Santo Trafficante, Jr., a Lansky lieutenant and son of a Sicilian-born Tampa gangster. (His name will crop up again in this and in our next chapter.)

In 1950, Italian pharmaceutical regulations underwent a tightening, and Luciano turned to an alternate source of supply which he had under development. He began receiving morphine base from a major Lebanese wholesaler who received opium grown in Turkey and processed it in Lebanon into the much more compact morphine base. The Lebanese operation was secured politically by extensive bribing of Lebanese airport directors, customs officials, narcotics police, etc., arrangements which Luciano had considerable experience with, and no doubt inquired carefully about when making his arrangement with his new supplier.

He was now in need of the sophisticated chemical labs which could produce heroin from the morphine base. He established and operated a number of such secret labs in Sicily under the watchful direction of local Mafiosi, but they only operated successfully for five years or so (up to 1954) when the Italian police and press became aware of what was going on. Luciano saw that it might be wise to shut down the chemical operations so close to his command center, and utilize instead the services of an alternate processing center being run by the Corsican criminal syndicates in Marseille, on the southern shore of France. Anticipating this usage, Meyer Lansky, on a trip he had made to Europe in 1949-1950 to help arrange the financial labyrinth for handling and hiding drug proceeds from tax authorities, had also toured through France and held lengthy discussions with Corsican syndicate leaders on matters of mutual concern. A year or so later, the first heroin labs began appearing in Marseille. The highly successful route from Turkey to Lebanon to Marseille to the United States was to dominate the international heroin trade for the next twenty years.

McCoy outlines the political history in and around Marseille in great detail. In brief, Marseille had for many years been a rough laboring town, strongly populated by Corsican gangster elements, but also a stronghold of the French Communist Party and powerful Communist labor unions. The Corsican syndicates struck bargains with local French fascists during the 30's, and with Nazis during the occupation years, to support those political regimes in return for relatively free rein in running their "businesses."

Upon the beginning of the Cold War, the European Recovery Plan (the Marshall Plan) was instituted, and in early 1947 Congress appropriated $400 million to "fight communism." According to McCoy's sources, President Truman "used it overtly in Greece and Turkey and covertly in France and Italy, through the CIA, to support ... democratic political parties." The CIA, established in September 1947, was going to be the operative agency to do this covert fighting.

Marseille was to be the primary port of entry of Marshall Plan goods. The dock workers and other Marseille working people, feeling economically put upon, commenced wildcat strikes and demonstrations, supported by the Communist Party. The strike spread throughout the country. Truman, fearing a Communist coup, ordered the CIA to help break up the strike. It did so, by providing millions of dollars to the French Socialist Party to procure their help in fighting the Communists. Thereupon the Socialist Minister of the Interior called up military reserves to fight the strikers, and the lead Communist union shortly backed out. In Marseille, the Socialist mayor purged Communist supporters from the police units. The CIA joined the physical fray by supplying arms and money to Corsican gangs so that they could help the Communist-purged police forces assault the Communist picket lines and harass their union officials. The CIA then mounted a media assault on the people, promising to withhold recently shipped foods unless the dock workers unloaded them immediately. All this pressure proved sufficient, and the strike was, for the moment, broken.

These events established the Corsican Guerini brothers as the new leaders of the Corsican under-world, with the CIA and the French Socialists beholden to them. A substantial repeat of the strike occurred 3 years later, with the CIA again supplying money, and the Corsicans the brawn. This time, the Communist unionists were ousted from the docks, and the Corsicans won control of the waterfront. The stage was now set for the "unforeseen consequence" which Lansky was just at that time discussing with the Corsican leadership. Marseille's first heroin laboratories were opened in 1951, just a year or so after the Marseille waterfront was secured, courtesy of the anti-Communist efforts of the American CIA.

The clinching political safeguard which guaranteed success appeared to be located at the apex of the French government. McCoy points out, "Under the terms of their informal alliance with France's Gaullist government, the Marseille syndicates manufactured their heroin exclusively for export. Marseille may have become the world's largest heroin producer, but France remained drug-free - an essential element in the political equation that allowed this illicit industry to operate. Protected and connected, the Corsicans, according to the Federal Bureau of Narcotics, produced an estimated 80 percent of America's heroin supply." McCoy further points out that, toward the end of the Guerini reign, around 1970, they could no longer enforce their prohibition on domestic drug trafficking, and France started developing its own heroin addiction problem.

It is thus apparent that during the 50's and most of the 60's, French national administrations were aware of the heroin traffic and secretly permitted it to operate. One French agency which was itself involved was the Service d'Action Civique (SAC). It was a force of some 5000 men, many of them French and Corsican gangsters, created by General de Gaulle for the purpose of providing street protection at proGaullist rallies, breaking up opposition demonstrations, providing bodyguards for government officials, and performing "dirty" (i.e., illegal) missions for French police and intelligence agencies. In return for their services they were granted broad immunities, which many abused to the point of being arrested for heroin smuggling.

A second, and much more important, French agency that was involved with the traffic was the French intelligence agency called the SDECE, the equivalent of our CIA. McCoy relates: "Moreover, informed observers were convinced that some of SDECE's top intelligence officers had been organizing narcotics shipments to the United States to finance SAC operations." McCoy describes an instance of an American undercover drug sting operation being exposed to the targeted French smugglers by a high-ranking SDECE officer. He continues, "The extent of SDECE's involvement in the heroin trade was finally exposed in November 1971 when a New Jersey prosecutor indicted Colonel Paul Fournier, one of SDECE's top supervisory agents, for conspiring to smuggle 45 kilos of heroin into the United States. On April 5 a U.S. customs inspector ... had discovered the heroin concealed in a Volkswagen camper and arrested its owner, a retired SDECE agent named Roger de Louette. After confessing his role in the affair, de Louette claimed that he was only working as a courier for Colonel Fournier. Fournier's indictment rated banner headlines in the French press and prompted former high-ranking SDECE officials to come forward with some startling allegations about SDECE's involvement in the heroin traffic."

In point of fact, France's official protection of their domestic heroin operations goes back to the early Corsican takeover of Marseille. McCoy reports: "After the CIA withdrew in the early 1950's, Marseille's Corsicans won political protection from France's intelligence service, the SDECE, which allowed their heroin laboratories to operate undisturbed for nearly 20 years." This will not be the only cooperative tie that we will discuss between the CIA and the SDECE, clearly two birds of a feather.

In the early 70's, the European drug traffic started into a steep decline, owing primarily to the start of serious French suppression efforts (because of the revelations noted above and of the growing French addiction problem) and also because of American pressure which resulted in Turkey's plan, announced in 1967, to reduce and eventually abolish opium production, a plan which was completed in 1972. Thus, in the late 60's, the Corsican and Mafia traffickers saw that they were going to have to rely upon an alternate source of supply. With Luciano having died in 1962, and Lansky retired at age 66 to Israel, the organization of the new source of supply fell to Lansky's heir apparent, Santo Trafficante, Jr. He observed that Southeast Asia seemed to be the Mafia's most promising source, since (1) it presently grew over 70 percent of the world's illicit opium, (2) Corsican syndicates were already there supplying morphine to the international markets, and (3) Chinese-operated laboratories in Hong Kong were producing some of the best high-grade heroin in the world. So in 1968, Trafficante boarded a plane for Southeast Asia.

McCoy then backs up in time to relate something of the history of the peoples and culture of Southeast Asia, with emphasis on opium production, and most particularly the central economic position accorded it by the French colonial administration. Colonial control was acquired over the bulk of the region by the late 1800's. The French managed their own opium distribution monopoly for the 40 years prior to World War 2, first utilizing opium grown and shipped from India, and later from Iran and Turkey. Its use was "taxed" and produced about 15 percent of French Indochina's tax revenues.

During the war, the opium flow was cut off and the French decided to raise it locally, to keep the taxes coming in from the addict populations. They granted power and influence to local leaders of the Hmong hill tribes in return for the efforts of those leaders to encourage the hill farmers to cultivate poppies. The system was very successful, except the French violated one of their own rules in northwestern Vietnam by recruiting Tai leaders of lowland rice-growing country to be the controlling brokers of the Hmong farmers in the surrounding hill country. This produced the animosity of the Vietnamese Hmong which resulted in the Dien Bien Phu catastrophe for the French when they attempted to re-establish postwar control over their former colonial regions in the first Indochina War in 1954, losing both the war and their Southeast Asian empire. McCoy's account provides a highly interesting view of Southeast Asian history from a uniquely different perspective. The official, deliberate French policy of using opium as a revenue producer is duly noted, and may help to explain how the French could rationalize their actions previously noted in Marseille.

Immediately after World War 2, Southeast Asia's home-grown opium was supplemented by some legal opium from Iran and a much greater illegal supply smuggled from China. In 1949 the Chinese supply was cut off by the Communist victory in China, its ban on opium production, and the massive detoxification program forced on the Chinese population. Iranian production was then banned, making that source illegal, and thus more uncertain. Domestic Southeast Asian production was therefore indicated, which would involve the United States this time, and would make the Southeast Asian Golden Triangle the largest single opium-producing area in the world. McCoy notes that these changes in the patterns of the international narcotic drug traffic came about primarily as a result of decisions made by governments (i.e., France, China, Iran, and the United States), and not due to unilateral decisions made by criminal syndicates, who could only be charged with taking advantage of the illegal cash flow that was made available to them.

The French were involved with raising opium in Laos and northern Vietnam and selling it to the opium dens of Saigon. The U.S. was involved with opium raised in Burma and Thailand, supplying the dens of Bangkok, Thailand's capitol city. McCoy details the history of each development at great length.

In French Indochina, the French army found that standard battle tactics didn't work, and that the guerrilla assistance of the Hmong hill dwellers was a necessity. The French bought that assistance covertly by purchasing the Hmong farmers' opium, transporting it to Saigon, and selling it to the large addict market there, with any surplus going to the Corsican under-world running the illicit export market. This secret operation, called Operation X, was run as a joint endeavor of the French military and the French Intelligence Service, the SDECE, all under the ultimate authority of the French Ministry of War. The American CIA in Vietnam, in the person of Col. Edward G. Lansdale, found out about Operation X in July 1953, "complained to Washington that the French military was involved in the narcotics traffic, and suggested that an investigation was in order." He was told by Washington to drop any investigation, since it would only serve to embarrass a good ally. "Washington" clearly knew what was going on.

The French defeat at Dien Bien Phu in May 1954 and the peace agreement negotiated in Geneva by Vietnamese, French, Russian, Chinese, British, and American delegates and signed on July 20 did not deter the French military from continuing the war covertly. They were supported by a criminal organization of river pirates known as the Binh Xuyen, who had been installed by the French as the legal administrators of Saigon, France's "Pearl of the Orient," the richest and most important city in French Indochina. The Binh Xuyen ran the opium dens in Saigon, along with the city's gambling, prostitution, and other criminal enterprises, and were sufficiently ruthless and locally knowledgeable to keep the Communist Viet Minh terrorists out of the city.

France's last gasp as a colonial power in Southeast Asia was in a war over the control of Saigon, and therefore over the source of funds (i.e., from heroin addicts) for any future military or other activities. Opposing the French military and the Binh Xuyen, in the spring of 1955, were the Vietnamese Army (the ARVN) and the American CIA, led locally by Edward Lansdale. The war was actually a fight between the United States and France over who was to control Saigon and South Vietnam. It was a battle by proxy, actually fought by the Binh Xuyen criminals against the ARVN. It was a savage house-to-house battle in which whole blocks of Saigon were leveled. In the end, Lansdale and the ARVN won, and immediately thereafter, in a May 8-11 meeting between French Premier Edgar Foure and the American Secretary of State John Foster Dulles, France agreed to leave Indochina and let the U.S try its hand at managing it.

Thus ended France's colonial empire in Southeast Asia. But why did the United States wish to get involved? Why did it fight France for the privilege? Part of the answer may be perceived in the fact that the U.S. in the early 50's had paid about 78 percent of the costs of the French Expeditionary Corps, and "hundreds of American advisors had served with the French units." It was only after Dien Bien Phu that cooperation between the French and the Americans began to unravel. A larger part of the answer may be seen by rolling the clock back to the end of World War 2 and looking at American activities in Southeast Asia, particularly in Burma and Thailand.

In January 1949, the Chinese Communists rolled into Yunnan province, and remnants of the Kuomintang's Nationalist army (KMT) straggled into neighboring Burma and Indochina. In the latter, the French disarmed, interned, and later repatriated the stragglers to Taiwan. The Burmese tried the same, but were initially unsuccessful due to their own military weakness. More importantly, in November 1950, upon the entry of massive Chinese forces into Korea, President Truman approved a plan put forward by the Office of Policy Coordination (OPC) and the CIA to covertly train and equip the KMT remnants in Burma for an invasion of southern China, presumably to relieve the pressure on Korea. Doubters were put aside by the CIA's insistence that, though the tiny force would start out as a pinprick, it would ultimately be successful because of the millions of patriotic Chinese who would join the counterrevolution once it was started.

With their authority in hand, the CIA set up covert channels for getting military equipment to the KMT, including a shipping front and a "commercial" airline actually purchased by the CIA, and it helped the KMT recruit and organize a viable army, which actually mounted three separate invasions of China - in June 1951, July 1951, and, after heavy-duty reinforcement by the CIA, again in August 1952. Each invasion force consisted of about 2000 men plus CIA advisors, several of whom were killed. Each invasion failed to attract any millions of supportive Chinese, and each was easily defeated by huge Communist forces and driven back into Burma. At that point, support from the existing CIA channels dried up, and the thrust of future KMT activities, coinciding in time with the incoming administration of Dwight Eisenhower, was entirely redirected.

Instead of training, arming, and organizing for exerting pressure on China, the KMT spread out into the great bulk of northeastern Burma, substantially conquering it. They then took over the opium production in that region, vastly increasing production by coercively imposing taxes on the farmers, to be paid in opium, just as the French were doing in Laos and northern Vietnam. The vastly expanded opium yields were shipped out to Thailand, mostly by a system of mule caravans which the KMT had organized soon after their arrival in Burma. Even before the failed Chinese invasions, the caravans had carried opium on the way out and arms on the way back into Burma, supplementing the arms and drug flows that were also carried in and out by unmarked CIA airplanes.

The Burmese government complained to the UN in March 1953. Publicly embarrassed, the U.S. called a conference in May with Burma, Taiwan, and Thailand at which KMT withdrawal from Burma was agreed to. (It was at about this time that Lansdale was "discovering" French drug operations in Vietnam.)  The KMT didn't go along, however, and various foot dragging was engaged in, involving, among others, the newly appointed U.S. ambassador to Thailand, William Donovan, who will be remembered as the founder of the OSS. When all the flak had died away, and some KMT had been removed to Taiwan, so many remained that the Burmese were finally led to mount a major military offensive against them in March 1954. The KMT were momentarily routed, and its general announced the dissolution of the KMT army. Nevertheless, some 6000 troops remained in Burma, and would remain in full control of opium production for another seven years. Only by 1961 were they finally defeated by the Burmese and driven into Laos. Upon this victory, the Burmese were enraged to fmd American arms and ammunition of recent manufacture left behind by the KMT. They also found three refineries for morphine base that had been operated by the KMT.  Opium production in Burma had by then expanded from the 1946 level of 80 tons per year to between 300 and 400 tons per year.

The clincher concerning the CIA involvement with Burmese opium took McCoy to Thailand. Very briefly, the official who received the Burmese opium in northern Thailand was, for about 10 years starting in 1948, General Phao Siyanan, the notoriously corrupt director of Thailand's national police, and the secret kingpin of Thailand's drug trade. General Phao, who had murdered his way into power, had about 40,000 national police at his disposal. His last obstacle to power was a rival who had about 45,000 army personnel at his disposal. Phao's final victory came upon the CIA's selection of Phao to receive its support, including, says McCoy, "naval vessels, arms, armored vehicles, and aircraft [delivered] to Phao's police force. The CIA denied similar aid to his rival, and by 1952 General Phao had consolidated his political power. "By 1953," says McCoy, "the CIA had at least 275 overt and covert agents working with Phao's police and had delivered [via the CIA shipping front] $35 million worth of assistance."

Phao took control of the Bangkok vice rackets, including the delivery of opium to Bangkok's addict population. His police protected the CIA's delivery of arms to the KMT in Burma, and obtained also the control of the opium delivered by the KMT into Thailand. He was shortly able to build "a virtual monopoly on Burmese opium exports." This man, says McCoy, "whom a respected Thai diplomat hailed as the 'worst man in the whole history of modern Thailand"' was nevertheless praised by U.S. Ambassador William Donovan, the founder of the OSS, saying that Phao's police constituted "a tough and well-trained police force." Accordingly, General Phao was awarded the Legion of Merit in 1954 for "exceptionally meritorious service" by the U.S. Secretary of the Army.

Phao's reign lasted only three more years, when he was finally overthrown by an army coup, and he flew off to Switzerland, no doubt to be closer to his ill gotten gains. The factions assuming power in Thailand threw the CIA agents in Phao's police out of the country, closed the existing opium dens, and in 1959 prohibited opium use or distribution. The addicts remained, however, and the trade simply went underground, to be run by Bangkok's Chinese syndicates rather than the army, but protected as usual by secret payoffs to the reigning politicians and the Thai military.

McCoy notes that by the beginning of the 60's, Thailand's opium production had grown from 7 tons per year to over 100 tons per year. The total production in the Burma-Thailand-Laos area had grown to perhaps 700 tons per year, making the Golden Triangle the largest single opium growing region in the world, courtesy of the French SDECE, the American CIA, and various purchased political and military officials in Southeast Asia. The region was fully capable at this time of supplying essentially the whole world should the need or opportunity arise.

McCoy's story then goes back to the 15 years or so following the French defeat in Saigon in 1955 by the American CIA. It's a fascinating account, including the naive years in support of Ngo Dinh Diem, in which the Americans attempted to create and run South Vietnam with a more or less honest officialdom, followed by their support of the overthrow (and murder) of Diem on November 1, 1963, and their acceptance in 1966 of the return of a corrupt and opium drenched administration, that of Premier Nguyen Cao Ky, which was capable of freeing Saigon of Communist terrorists. Ky in turn ultimately lost substantial power to General Nguyen Van Thieu in 1968, changing the names of the high-level officials dealing in drugs, but not the fact of drug-dealing and other corruption. Throughout the Ky/Thieu period, the CIA and the U.S. embassy in Saigon supported the regimes, denying charges raised in the U.S. Congress and elsewhere that the regimes were corrupt, or were supporting themselves by drug trafficking, though the evidence presented by McCoy to the contrary is overwhelming. He shows, for example, that Lansdale and his CIA subordinate and former OSS officer, Lucien Conein, were well aware in 1966 that then-Premier Ky had agreed to let the Corsican underworld "start making large drug shipments to Europe in exchange for a fixed percentage of the profits."

McCoy continues his narrative with the developments in the Golden Triangle in the period from 1960 to 1975. In Burma, the KMT were driven out and into Thailand, where they were protected and granted secret bases next to Burma from which to operate. They continued to run their heavily armed donkey caravans into Burma to pick up opium from the farmers and return most of it to Thailand, paying "duties" to the Thai officialdom, and selling the opium to Chinese syndicates for domestic distribution and export to Hong Kong. In Thailand, the KMT, being skilled in mountain warfare among the Hmong tribesmen, and with American financial support, helped the Thai military keep down Communist insurgency. In return, the KMT was given a free hand to manage their caravans into Burma and were also permitted to operate modern heroin labs in their secret bases.

But the main thrust of the American involvement in the Golden Triangle during these years was in Laos. This unfortunate country was bordered on the east by northern Vietnam, on the west by Burma, on the north by China, and on the south by Thailand. After the fall of Dien Bien Phu, it was subject to infiltrative attack by the Communist Pathet Lao. McCoy reports: "For 15 years, 1960-1974, the CIA maintained a secret army of 30,000 Hmong tribesmen in the mountains of northern Laos - participants in a covert war that remains the largest single operation in the agency's forty-year history [as of 1991]."

The strategy followed that of the French before them, except that the CIA was not directly involved with buying and selling opium, as the French had been. The CIA merely facilitated the trade. The CIA's purpose was to recruit an army of local tribesmen who were familiar with the terrain, who could be convinced that they had something to lose if the Communists were to take over, and who would fight in the stead of American combat contingents that would otherwise be necessary. The Hmong army would be mobilized via a Hmong commander chosen by the CIA, Major Vang Pao. He approached local tribesmen, offering to supply rice to them and buy opium from them if they would raise it instead of rice, provided they would supply young men to join the Laotian mercenary army. The later sale of the opium to Chinese or Corsican syndicates supplied funds for rice purchases and arms and other supplies for the secret army, thus reducing the CIA's direct costs. "In effect," says McCoy, "the CIA's support for the Hmong opium crop insured the economic survival of the tribal villages, thereby allowing the agency to make its annual harvest of Hmong children. More important, control over the opium crop reinforced the authority of the CIA's Hmong commander, General Vang Pao, transforming him from a minor officer into a tribal warrior who could extract adolescent recruits from villages no longer willing to accept the war's high casualties."

The strategy was successful, at least for a while, largely because of the CIA's Air America network of agile aircraft which tied the Hmong villages into an integrated whole, transporting rice to the villages, recruits to battle, and opium to market. However, in the larger picture, the strategy was substantially defensive, and the offense undertaken by the Communist forces eventually overran northern Laos. The CIA then turned to a scorched earth policy, forcing the Hmong to leave their villages and retreat away from the advancing Pathet Lao, denying the Hmong man-power to the conquerors. But by 1973, Vang Pao's army had been reduced from a peak of 40,000 to a remnant of 10,000, with the Pathet Lao threatening the Laotian capitol of Vientiane. The Royal Lao government then signed a cease-fire with the Pathet Lao, effectively ending the secret war. The CIA's Air America gave up all its Laotian facilities in June 1974. Vang Pao attempted to fight on for some time, but in May 1975 was evacuated by a CIA plane just prior to his capture, and shortly thereafter spent a half a million dollars on a cattle ranch and other real estate in Montana. By the end of 1975, some 30,000 Hmong refugees had fled Laos into Thailand.

By 1970, opium production in the Golden Triangle had reached nearly 1000 tons per year, and had by then become highly interesting to the Corsican, the Chinese, and the Mafia syndicates. The Corsicans had been there for years, having followed the French military into Indochina after World War 2, and having been engaged in narcotics smuggling with their compatriots in Marseille ever since. The Chinese had for some years received opium and morphine smuggled into Hong Kong, converted it into high-grade heroin, and shipped it to various world markets. They also sent master chemists skilled in that conversion into the Golden Triangle area to help the various local powers there set up heroin labs which came into production by early 1970. The Mafia showed interest starting in about 1965 with the arrival of John Pullman, Meyer Lansky's "courier and financial expert," for a visit with certain Chinese entrepreneurs in Hong Kong with whom he probably wished to make certain financial and other strategic arrangements. At about the same time, a "young Mafioso from Tampa, Florida" named Frank Furci arrived in Vietnam, engaged in various joint enterprises with the local Corsican gangsters there for about three years, was ejected and went to Hong Kong, where he introduced himself to the Chinese drug lords. While there, he was visited by Santo Trafficante, Jr. and one of his lieutenants, Dominick Furci, who also happened to be Frank Furci's father. Santo, of course, was probably there to discuss how the business empires of Meyer Lansky and of the Chinese drug kingpins might synergistically prosper.

The first visible upshot of these several events was that a plague of heroin addiction started among American GIs in 1970. Army medical officers estimated in 1971 that 10 to 15 percent of the GIs were users, and a White House task force in 1973 found that 34 percent of GIs in Vietnam had "commonly used" heroin. The heroin was smuggled from the Golden Triangle laboratories to every conceivable location in Vietnam close to American soldiers, where it was pressed upon them by an army of pushers, including street peddlers, roadside stands, pimps, prostitutes, and even officers in the Vietnamese army. The distribution network was set up by the Ky/Thieu political regimes, run for their financial benefit, and protected by their officialdom, including elements of their army, navy, customs, police, and anyone else they needed. Whenever questioned by U.S. newspapers or congressmen, the CIA and U.S. Embassy officials in Saigon denied the involvement of Vietnamese officials.

But why would the Vietnamese willingly bring this scourge on American soldiers who were trying to save Vietnam from the Communists? The answer, says McCoy, was money, about $88 million per year, coming from about 20,000 GI addicts each spending about $12 per day for heroin. That cash was used in the same way as the French found it useful - to hold together the politically corrupt infrastructure that seemed to be necessary in the post-colonial Vietnamese culture.

Following the American evacuation from Vietnam in 1975, the Golden Triangle heroin labs did not go out of business, but continued shipping their product out via Bangkok. The Hong Kong labs also continued in operation. Heroin destined for the U.S. was sent from Bangkok and Hong Kong to Chile and then to Paraguay. Morphine from Bangkok was also sent to Marseille, converted to heroin, sent to Argentina, and then sometimes to Paraguay. Santo Trafficante would then deal with the problem of getting it from Paraguay and Argentina into the Mafia distribution system in the U.S. This system was available to serve the American addicts coming home from Vietnam, and helped mightily to fuel the heroin plague with which our country is still struggling. Heroin made this sorry chapter of American history even worse than most of us realized at the time.

McCoy details what he knows of the Hong Kong Chinese syndicates. They originated in Shanghai, but moved out of there to Hong Kong just before the Chinese Communists arrived. They possessed the world's best expertise in the chemical process of creating high-grade heroin from morphine base. They organized the smuggling of opium and morphine by sea from Bangkok to Hong Kong. They created the heroin labs in the Golden Triangle. In the late 60's they had started significant heroin production and were heavy into it in the early 70's. They organized the heroin smuggling from Hong Kong to South America and elsewhere, for delivery to Mafia types who would get it to the American market.

During these same years, poppy cultivation in Turkey had been abolished, and the French were busily suppressing heroin production in Marseille, to protect the French population. Notwithstanding the growing evidence that the great bulk of the heroin arriving stateside originated in the Golden Triangle under the management of the Chinese criminal syndicates in Hong Kong, the U.S. State Department, says McCoy, "clung to its belief in Turkey's importance. Convinced that the root of the problem still lay in the Mediterranean and unwilling to confront the political consequences of thinking otherwise, America's diplomats were reluctant to apply the same political leverage in Southeast Asia as they had in France and Turkey."

What "political consequences?" We presume that McCoy is referring to the secret knowledge held by our political elites that the United States had just fought a war which had produced, with our complicity, the greatest illicit heroin production and delivery network that the world has ever seen, and that the population of the United States was the primary targeted market. We can't help but wonder how those Iron Mountain scholars would have graded this activity on its potential for promoting "economic waste."

McCoy isn't through. The United States was involved in a second anti-Communist war run covertly by the CIA which resulted in the development of a second major heroin production area, rivaling the Golden Triangle. The war lasted from 1979 to 1989. The battleground was Afghanistan. The Communist threat was supplied by Russia. The CIA client was the neighboring country of Pakistan, specifically in the persons of General Zia ul-Haq, who was newly running the country following a military coup, and his chosen Afghan guerrilla client, Gulbuddin Hekmatyar. Hekmatyar ended up being the enforcer for opium production in the neighboring Afghan highlands, plus its collection and delivery to heroin labs in Pakistan, all under the protection of General Zia, and using arms supplied by the CIA and American "military aid."

The origins of the above conflict are interesting. In April 1978, Communist elements in the Afghan army had thrown out the previous dictator and established a pro-Soviet regime. Then in April 1979 Zbigniew Brzezinski, President Carter's National Security Advisor and conduit to our elites, convinced the National Security Council to be "more sympathetic" to the fledgling anti-Communist resistance. A month later, a CIA special envoy arrived in Pakistan to interview Afghan resistance leaders, and selected Hekmatyar, the man recommended by Pakistan's Inter-Service Intelligence agency, through which General Zia intended to prosecute the upcoming conflict. A half-year later, Russia invaded Afghanistan, President Carter made a public display on TV denouncing Leonid Brezhnev, and sent Brzezinski out again to twist some arms and rustle up some arms for the resistance. He got them, from China, Egypt, and Saudi Arabia, plus of course some from the CIA itself. President Reagan later followed up with a $3 billion program of military aid to Pakistan.

President Carter had a White House advisor on drugs, Dr. David Musto, who warned Carter and his Council on Drug Abuse about militarily supporting the opium-growing guerrilla resistance. "I told the council," he recalled, "that we were going into Afghanistan to support the opium growers in their rebellion against the Soviets. Shouldn't we try to avoid what we had done in Laos? Shouldn't we try to pay the growers if they will eradicate their opium production? There was silence." By the end of the 10-year war, the Afghanistan-Pakistan border area had emerged into a major heroin production region, complete with political protection. World opium production was then up to 4200 tons, with 73 percent of it coming from the Golden Triangle and most of the rest coming from the CIA's Afghan guerrilla clients. The American public barely knew that anything was going on in Afghanistan, and certainly not anything that was going to exacerbate the American drug problem.

Finally, McCoy looks briefly at the CIA's covert war against the Nicaraguan Sandinista government, waged at the same time that the U.S. was being deluged in a sea of cocaine. Though much remains to be uncovered, some outlines have emerged. President Reagan in 1981 ordered the CIA to commence a covert action in support of the Contras' fight against the Sandinistas, following their overthrow in 1979 of the anti-Communist Somoza government. The U.S. Congress refused in 1984 to continue supporting the Contras, following which a "civilian" support effort was mounted, led by Lieutenant Colonel Oliver North. He recruited retired General Richard Secord, who in turn recruited Thomas Clines, an ex-CIA compatriot from their days together commanding the CIA's secret war in Laos. Clines and Secord raised money, bought airplanes, and hired veterans of former clandestine operations as pilots, mechanics, etc., as required to procure and ship arms to the Contras.

The planes flew arms and supplies from the U.S. to supply points in Costa Rica and Honduras on the borders of Nicaragua, and frequently returned to the U.S. loaded with cocaine. The cocaine had started in the high valleys of Peru and Bolivia, was accumulated in the town of Medellin, Columbia, and was thence sent by air and other means toward the United States, with at least some of it going to way-stations in Central America. The Medellin Cartel presumably paid the Contras to help deliver the cocaine to the United States, thus providing the Contras with money to pay for arms to fight their war. The CIA then acted as at least one of the smuggling agencies which brought the cocaine back into the U.S. Presuming all this to be accurate, the parallels to the CIA operations in Afghanistan, Laos, Burma, and Marseille can easily be drawn, which McCoy proceeds to do, quite adequately.

For a little more background on Somoza's overthrow during the Carter presidency, in Somoza's own words, see Nicaragua Betrayed (by A. Somoza, Western Islands, 1980). Roughly speaking, his book details how he was militarily overthrown because of various actions and inactions of the United States, creating the excuse for the later patriotic efforts of the CIA to save Nicaragua from the Communists. By 1982 Americans were spending annually about $29 billion on cocaine, more than on any other single illicit drug. Its use continued to rise through the rest of the 80's, particularly upon the advent of crack cocaine, a form which could be sold for as little as $10 a dose, and thus much more salable to juvenile users.

McCoy finishes up by summarizing America's 70-year history of trying to suppress or interdict narcotic drugs aimed at the United States, and then briefly discusses alternative ways of dealing with the drug plague. He toys with regulation, or partial legalization, but we believe that solutions which we ourselves have offered, and will discuss in the last chapter, better hit the mark. McCoy's only suggestion with which we wholly agree is contained in his final sentence, i.e., rescind the CIA's covert action authority and close down its covert action apparatus.