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Drugs, Impunity & the CIA

From The Conspiracy Archives

A seminar sponsored by the Center for International Policy's Intelligence Reform Project

Dirksen Senate Office Building, November 26, 1996

Seminar participants

Jack A. Blum , former chief investigator, Senate Foreign Relations subcommittee investigating the Central Intelligence Agency-contra-drug connection in 1989; former chief of staff, Senate Foreign Relations subcommittee headed by Sen. Frank Church that investigated the CIA in the late 1970s

Jonathan Kwitny , former prizewinning Wall Street Journal investigative reporter, author of Endless Enemies: The Making of an Unfriendly World (New York: Congdon & Weed, 1984)

Alfred W. McCoy , professor of Southeast Asian history at the University of Wisconsin; author of The Politics of Heroin: CIA Complicity in the Global Drug Trade (Lawrence Hill, 1991) and The Politics of Heroin in Southeast Asia (1971).


Clarence Page , columnist, Chicago Tribune


Melvin A. Goodman , director of CIP's Intelligence Reform Project; former chief of Soviet-affairs division, CIA

Mr. Goodman welcomed the seminar participants and audience. He noted that it had just been reported that another former CIA ally faced drug charges. A Miami grand jury had indicted a former general in Venezuela on charges that he smuggled cocaine into the United States. Gen. Ramon Guillen headed a special CIA-financed Venezuelan National Guard antinarcotics unit. This was a sting operation that went massively awry. The CIA had said that it was regrettable.

It was right of the press to critically review the San Jose Mercury-News's series, Mr. Goodman considered. He just wished it had similarly gone after the CIA's activities in concert with drug dealers globally, particularly in Afghanistan.

I. CIA Complicity in the Global Drug Trade — A Presentation by Prof. Alfred W. McCoy

Professor McCoy said that this August, the San Jose Mercury News reported that a syndicate allied with Nicaragua's CIA- backed Contras delivered tons of cocaine to Los Angeles gangs during the 1980s. The Mercury concluded, "The contra- run drug network opened the first conduit between Colombia's . . . cartels and Los Angeles's black neighborhoods . . . It's impossible to believe that the Central Intelligence Agency didn't know."

At first, the story attracted little notice. But by mid-September Internet hits at the Mercury passed eight hundred thousand daily and black anger was rising.

On talk radio, some commentators—going far beyond what the Mercury said—accused the CIA of willfully destroying their communities with crack. The Congressional Black Caucus demanded an investigation. But CIA director John Deutch shot back that "the agency neither participated in nor condoned drug trafficking by Contra forces."

On October 4, the Washington Post published a front- page "investigation" denying that the rise of crack in Los Angeles was the work of just one syndicate and charging the Mercury's exposé merely "echoed decade- old allegations." Two weeks later, the New York Times and Los Angeles Times followed with their own investigations, attacking the Mercury's story and accusing that paper of fanning the flames of racial discord in America.

Questions: This racially- charged debate raised four questions about the CIA and drugs—questions which now demanded answers.

a.) Did the agency ever ally with drug traffickers?

b.) Did the CIA protect these allies from prosecution?

c.) Did such alliances and protection contribute significantly to an expansion of the global drug trade over the past forty years?

d.) And did the CIA encourage drug smugglers to target African-American communities?

Answers: For those of the audience who might have to leave early, the answers were:

a.) Yes. b.) Yes. c.) Maybe. d.) No.

For the past quarter century, Professor McCoy said, he had been looking at this question, focusing on the alliances between the agency and Asian drug lords during the forty years of the Cold War. He believed that this history could shed considerable light on the current debate over alleged CIA involvement in the contra cocaine trade.

Throughout the Cold War the CIA used gangsters and warlords, many of them drug dealers, to fight communism. As the Cold War ended, the list of CIA assets who used their alliance with the agency to deal drugs had grown longer—Marseilles Corsicans, Lao generals, Thai police, National Chinese irregulars, Afghan rebels, Pakistani intelligence, Haitian colonels, Mexican police units, and Guatemalan military.

During the forty years of the Cold War, government intelligence services, the CIA included, forged covert- action alliances with some of Asia's key opium traffickers, inadvertently contributing to an initial expansion of opium production. In one of history's accidents, the Iron Curtain fell along an Asian opium zone that stretched for five thousand miles from Turkey to Thailand—making these rugged highlands a key front of Cold War confrontation.

As the CIA and allied agencies mounted operations in the opium zone during the forty years of the Cold War it found that ethnic warlords were its most effective covert-action assets. These leaders exploited the CIA alliance to become drug lords, expanding opium production and exporting refined heroin. The Agency tolerated such trafficking and, when necessary, blocked investigations. Since ruthless drug lords made effective anti- communists and heroin profits amplified their power, CIA agents did not tamper with the requisites of success in such delicate operations.

Surveying the steady increase in America's drug problem, since the end of World War II, Professor McCoy discerned periodic increases in drug supply that coincided — rather approximately — with covert operations in the drug zones.

He turned to Southeast Asia, the site of the earliest CIA alliances with drug lords.

A. Southeast Asia—CIA Operations

On the eve of World War II, most Southeast Asian governments sponsored state monopolies that sold smoking opium to registered addicts and generated substantial tax revenues.

1. Golden Triangle.

Despite extensive opium consumption during the colonial era, Southeast Asia remained a major opium consumer but—very importantly for our story—a minor producer. In 1940, Southeast Asia harvested a total of only 15.5 tons in a region that today produced over 3,000 tons. Why? Since British India supplied these government monopolies with limitless low- cost opium, Southeast Asian governments had no reason to encourage local cultivation.

The sudden growth of Golden Triangle opium production in the 1950s appeared, in retrospect, a response to two stimuli—prohibition and protection.

a.) Prohibition: Responding to pressures from the United Nations, Southeast Asia's governments abolished legal opium sales between 1950 and 1961, thereby creating a sudden demand for illicit opiates in the cities of Southeast Asia.

b.) Protection: An alliance of three intelligence services—Thai, American and Nationalist Chinese—played a catalytic role in promoting the production of raw opium on the Shan Plateau of northern Burma.

During the early 1950s, the CIA covert operations in northern Burma fostered political alliances that, inadvertently, linked the poppy fields of Burma with the region's urban drug markets. After the collapse of the Nationalist Chinese government in 1949, some of its forces fled across the border into Burma where the CIA equipped them for several abortive invasions of China.

To retaliate against Communist China for its intervention in the Korean War, President Truman ordered the CIA to organize these Nationalist remnants inside Burma for an invasion of southwestern China. The records remain secret because, Professor McCoy suspected, it was one of the most foolish operations mounted by any agency of the U.S. government.

After their invasions of 1950–51 were repulsed with heavy casualties, the Nationalist troops camped along the Burma border for another decade and turned to opium trading to finance their operations. Forcing local hill tribes to produce opium, the Nationalist troops supervised a massive increase of poppy cultivation on the Shan Plateau. After the Burmese Army evicted them in 1961, the Nationalist forces established new base camps just across the border in Thailand and from there dominated the Shan States opium trade until the early 1980s.

By the early 1960s, Burma's opium production had risen from 15 to 300 tons—thus creating the opium zone that was now called the Golden Triangle.

2. Indochina

As in Burma, so in Laos distance would insulate the Agency from the consequences of complicity.

During their Vietnam war, the French military integrated opium trafficking with covert operations that the CIA would later inherit. After abolition of the opium monopoly in 1950, French military intelligence, SDECE, imposed centralized, covert controls over an illicit drug traffic that linked the Hmong poppy fields of Laos with the opium dens operating in Saigon—generating profits that funded French covert operations in their Vietnam war.

When America replaced the French in Vietnam after 1954, the CIA fell heir to these covert alliances and their involvement in opium trading. In Laos during the 1960s, the CIA battled communists with a secret army of thirty thousand Hmong highlanders—a secret war that implicated the CIA in that country's opium traffic. Although the Agency did not profit directly from the trade, the combat strength of its secret army was nonetheless integrated with the Laotian opium trade. Why? The answer lay in the CIA's doctrine of covert action and its consequent reliance upon the influence of local military leaders or warlords.

In Laos, a handful of CIA agents relied on tribal leaders to motivate their troops and Lao generals to protect their cover. After the fighting in Vietnam spilled over into Laos in 1965 CIA recruited some thirty thousand Hmong highlanders for its secret army—making this tribe a critical CIA asset.

Between 1965 and 1970, the Hmong recovered downed U.S. pilots, battled local Pathet Lao communists, monitored the Ho Chi Minh trail, and—most importantly—protected the radar that guided the bombing of North Vietnam. By 1971, according to a U.S. Air Force study, every Hmong family had lost members.

To fight this secret war, the CIA sent in American agents on a ratio of one per thousand Hmong guerrillas—numbers that made the Agency dependent upon tribal leaders who could mobilize their people for this bloody slaughter.

The CIA gave its chosen client, Hmong general Vang Pao, control over all air transport into the Hmong villages scattered across the mountaintops of northern Laos — over both the shipment of rice, the main subsistence commodity, into the villages, and the transport of opium, the tribe's main cash crop, out to markets.

With his chokehold over the household economy of every Hmong family, General Vang Pao was transformed into a tribal warlord who could extract boy soldiers for slaughter in an endless war. Since opium trading reinforced the authority of these Hmong officers, the CIA found it necessary to tolerate the traffic.

Heroin Production . The CIA's policy of tolerance towards its Laotian allies did not change even when they began producing heroin to supply U.S. combat forces fighting in South Vietnam. In 1968–69, CIA assets opened a cluster of heroin laboratories in the Golden Triangle—the tri- border area where Burma, Thailand, and Laos converge. When Hmong officers loaded opium on the CIA's Air America and the Lao Army's commander opened a heroin laboratory to supply U.S. troops in Vietnam, the Agency was silent. In a secret internal report compiled in 1972, the CIA's inspector-general said the following to explain their inaction:

The past involvement of many of these officers in drugs is well known, yet their goodwill . . . considerably facilitates the military activities of Agency- supported irregulars.

All this heroin was smuggled into South Vietnam where, by 1971, according to a White House survey, 34 percent of U.S. troops were addicted.

Instead of trying to restrain drug trafficking by its Laotian assets, the Agency engaged in concealment and cover- up. Professor McCoy recalled that when he went to Laos to investigate in 1971, the Lao army commander graciously opened his opium accounts but the U.S. mission stonewalled. In a Hmong village, where he was investigating opium shipments on Air America, CIA mercenaries ambushed his research team. A CIA operative threatened to murder his Lao interpreter unless he quit.

When his book was in press, the CIA's Deputy Director for Plans pressured his publisher to suppress it and the CIA's general counsel demanded deletions of all references to Agency complicity. After the book was published unaltered, CIA agents in Laos pressed his sources to recant and convinced investigators from the House Foreign Affairs Committee that his allegations were baseless.

Simultaneously, the CIA's inspector-general conducted a secret internal investigation that confirmed his allegations. "The war has clearly been our overriding priority in Southeast Asia and all other issues have taken second place," the inspector-general said in defense of their inaction on drugs. "It would be foolish to deny this, and we see no reason to do so."

By 1974, Southeast Asian syndicates were supplying a quarter of U.S. demand with Golden Triangle heroin. But Asia was too remote for allegations of CIA complicity to pack any political punch.

B. CIA in the 1980s—Central Asia and Central America

CIA operations again played a role in the revival of the U.S. drug problem in the 1980s. In 1979, the Soviets invaded Afghanistan and the Sandinistas seized Nicaragua, prompting two major CIA operations with some revealing similarities.

In 1980–81, heroin production in Southwest Asia—Afghanistan and Pakistan—suddenly expanded to fill gaps in the global drug market. Although Pakistan- Afghanistan had zero heroin production in the mid 1970s, by 1981 Pakistan had become the world's largest heroin producer.

Reporting from Teheran in the mid-1970s, U.S. ambassador Richard Helms, the former CIA director, insisted that there was no heroin production in this region—only a localized opium trade. This region then supplied zero percent of U.S. heroin supply.

In 1981, however, the U.S. attorney-general announced that Pakistan was supplying 60 percent of U.S. demand. And rising from zero heroin addicts in 1979, Pakistan had five thousand in 1980 and 1.2 million in 1985—the world's highest.

Why was Pakistan able to capture the world's heroin market so quickly?

After the Soviet Union invaded Afghanistan in 1979, the White House assigned the CIA to mount a major operation to support the Afghan resistance. Working through Pakistan's ISI, the CIA began supplying covert arms and finance to Afghan forces.

As they gained control over liberated zones inside Afghanistan, the Afghan guerrillas required that its supporters grow opium to support the resistance. Using CIA and ISI protection, Pakistan military and Afghan resistance opened heroin labs on the border. According to the Washington Post of May 1990, among the leading heroin manufacturers was Gulbuddin Hekmatyar, an Afghan leader who received half of the $2 billion in covert arms that the United States shipped to Pakistan.

Although there were many complaints about Hekmatyar's brutality and drug trafficking within the ranks of the Afghan resistance, the CIA maintained an uncritical alliance and supported him without reservation or restraint.

During the decade of this operation, the substantial DEA contingent in Islamabad brought about no arrests or seizures—allowing the syndicates a de facto free hand to export heroin.

Former CIA operatives had admitted that this operation led to an expansion of the Pakistan- Afghanistan heroin trade. In 1995, the former CIA director of this Afghan operation, Charles Cogan, admitted sacrificing the drug war to fight the cold war. "Our main mission was to do as much damage as possible to the Soviets. We didn't really have the resources or the time to devote to an investigation of the drug trade," he told Australian television.

"I don't think that we need to apologize for this. Every situation has its fallout . . . There was fallout in term of drugs, yes. But the main objective was accomplished. The Soviets left Afghanistan."

Again, distance insulated the CIA from political fallout. Once the heroin left Pakistan, Sicilian mafia exported it to the United States and local gangs sold it on the street. Most Americans did not make the equation between Afghan drug lords and the heroin in their cities.



C. Contra Operation

In Central America, however, simple proximity has made the fallout from the CIA's operation explosive. Unlike the CIA's Asian warlords, Nicaragua's contras did not produce drugs and had to make money by smuggling cocaine into America.

Proximity brought these operations to the attention of Congress, and in the late 1980s Sen. John Kerry's subcommittee investigated the contra- cocaine links. His investigators established that four contra- connected corporations hired by the State Department to fly "humanitarian relief" goods to Central America were also involved in cocaine smuggling. His committee heard the pilots give eyewitness testimony saying that they had seen cocaine loaded on their aircraft for the return flight to the United States.

The DEA operative assigned to Honduras, Thomas Zepeda, testified that his office had been closed in June 1983 since it was generating intelligence that the local military was involved in cocaine smuggling—thereby threatening the CIA's relationship with the Honduran military in this key frontline state for the contra operation. In effect, Agency operations had once again created a de facto zone of protection closed to investigators from outside agencies.

Read closely, the Kerry committee established a pattern of CIA complicity in Central America strikingly similar to the one seen in Laos and Afghanistan—tolerance for drug dealing by its assets and concealment to protect its larger covert operation.

1. San Jose Mercury-News story

The Mercury's story tried to go to the next step—establishing a direct link to the distribution of drugs in the United States. According to Mercury reporter Gary Webb, this "dark alliance" began in the early 1980s when the contra revolt against Nicaragua's leftist Sandinista government was failing for want of funds. His scenario was:

1.) In 1981, the CIA hired ex- Nicaraguan army colonel Enrique Bermudez to organize what became main contra guerrilla army, the FDN.

2.) Bermudez then turned to two Nicaraguan exiles in the United States to supplement meager agency support with drug profits. In California Danilo Blandon, the former director of Nicaragua's farm marketing program, used his formidable business skills to open a new crack distribution network for the contras.

3.) Sensing the potential of the Los Angeles ghetto, Blandon allied with the then neophyte, now legendary black dealer "Freeway Rick" Ross to convert tons of cocaine into low- cost crack and thus exploit what was still an untapped market among the city's poor blacks.

4.) During its decade of operation, this crack network enjoyed a de facto immunity from prosection.

a.) Whenever the DEA, Customs, or the Los Angeles County sheriffs tried to investigate, the CIA and the Justice Department denied information on grounds of national security.

b.) In 1986, Los Angeles sheriffs raided what their warrant called Blandon's "sophisticated cocaine smuggling and distribution operation," but found every location wiped clean of evidence. The police were convinced that their investigation "had been compromised by the CIA."

5.) By the late 1980s, the operation had lost its contra connection and both dealers were soon arrested on drug charges. While Freeway Rick started serving a ten- year sentence, the Justice Department intervened to free the contra- connected Danilo Blandon.

While the Agency's relations with Asian opium lords were lost in the mists of faraway mountains, Rep. Maxine Waters, the Black Caucus leader from Los Angeles, has police documents to charge the CIA with protecting contra cocaine dealers.


Professor McCoy returned to the four questions he asked at the outset:

a.) Question No. l: Did the Agency ever ally with drug traffickers? Yes, beyond any doubt. Although this question was once controversial, not even the CIA any longer bothered to deny that it had often allied with major and minor drug dealers.

b.) Question No. 2: Did the CIA protect these allies from prosecution? Yes, there was a recurring pattern of protection. During a major CIA operation, the operational zone became a special "protected area" where everything was subordinated to the prosecution of the covert operation. For the duration of the operation, key assets were given a de facto immunity to prosecution. To protect the integrity of the operation, the CIA blocked all investigation—by the DEA, Customs, Congress, and the police. Whenever anyone connected with this effort was arrested outside this protected area, the CIA blocked prosecution that would compromise its operations.

Lest it be forgotten, there was only element that any criminal needed to become a powerful entrepreneur of vice and violence — protection against prosecution.

c.) Question No. 3: Did such alliances and protections contribute significantly to an expansion of the global drug trade over the past forty years?

This was a question that was open to interpretation. If Clio, the muse of history, were to waft in and place perfect information on two tables for two academics, they would probably produce two books with two very different answers. Professor McCoy believed that in Burma, Laos, and Afghanistan, CIA operations provided critical elements—logistics, arms, and political protection—that facilitated the rapid growth of opium and heroin production in both areas.

Clearly, the agency alliance was central to the rise of some major drug dealers and catalytic in the expansion of production or processing in certain zones. It would not be unreasonable to conclude, therefore, that such CIA operations led to an increase the production and processing of illicit drugs in these covert war zones.

But it was difficult to state unequivocally that these individual dealers or zones did or did not shape the long- term trajectory of supply and demand within the vastness and complexity the global drug traffic.

d.) Question No. 4: Finally, did the CIA encourage drug smugglers to target African- American communities?

1.) The pattern of CIA complicity in drugs proceeded from the internal logic of its covert operations, an inadvertent consequence of indirect intervention abroad.

2.) There was a striking similarity in the patterns of CIA complicity with drug dealers in Laos, Afghanistan, and Central America.

3.) Just as Professor McCoy could find no evidence, nor any logic, to the proposition that the CIA in Laos wanted one- third of the GIs in South Vietnam to become heroin addicts, he could see no evidence or logic of any CIA targeting of blacks in south-central Los Angeles.

4.) During the 1980s, however, there was every indication that the CIA was aware that its Afghan and Central American allies contributed to the export of cocaine and heroin to the United States—and did nothing to slow this drug flow.

Since a substantial portion of the African- American community already suspected the worst—that the CIA willfully flooded their communities with drugs—the time had come for a unflinching search for the answers to these four questions.

As Congress investigated, Professor McCoy had a good idea what it would find. He doubted there was evidence that the CIA actually trafficked in drugs or targeted any Americans, whether GIs in South Vietnam or blacks in South Central.

But investigators would discover CIA alliances with warlords, colonels, and criminals who used its protection to deal drugs. Suffering from what Professor McCoy called "mission myopia," CIA agents regarded narcotics as mere "fallout." For CIA agents in Laos, the heroin epidemic among GIs in Vietnam was only fallout. For agents in Pakistan and Central America, drug shipments to America were just fallout.

For Vietnam veterans and African- Americans who lived with the pain of this fallout, these findings would be profoundly disturbing. That the CIA apparently regarded increased drug shipments to the United States as acceptable fallout from their Afghan and Central American operations might spark considerable controversy. But these findings would be better for this nation's political health than the CIA's blanket denials which could only fan the flames of allegations that it willfully targeted black communities for drug distribution.

II. Separating Fact from Fiction in the CIA's Drug Role —A Presentation by Jonathan Kwitny


Mr. Kwitny noted that he had written a review of Professor McCoy's book in 1971. He had told his editors that these were not wild charges, unsubstantiated or unverifiable. On the contrary, Professor McCoy had named every name. His reporting was factual. In his review, he had called for an official investigation of Professor McCoy's charges.

Twenty-five years later, Mr. Kwitny said, he was still waiting for that investigation.

Mr. Kwitny showed the audience a copy of a refueling slip from the Ilopango airport, the Salvadoran military facility, in the mid-1980s. They were refueling a C-47 identified as PPCED. It was signed by Marcus Agualdo, a contra, close to John Hull, the American who had a munitions base in Costa Rica. The plane was owned by Jorge Morales. He was then indicted for cocaine dealing in the United States and was serving sixteen years in a Florida jail.

He showed another refueling slip signed by Geraldo Duran, identified by the Department of Justice as a major drug dealer.

He showed a bill of sale for a Cessna 404 sold by Adolfo Calero to a front organization. The agent handling the sale was Sam Vieres of Memphis and the receiver was Dennis Martin. It was sold for $264,000 in small bills brought by Jorge Morales.

The importation of cocaine by CIA people and the use of dollars to buy equipment for the contras was a fact, Mr. Kwitny said. It had been known for nine years. At that time, he recalled that he had accumulated documents on it. No one was interested. The only one they were interested in prosecuting was Barry Seale because that would implicate Sandinista leaders. But they never had evidence that Sandinista leaders were involved in the drug trade. They only had an allegation against a minor official. The information was totally unreliable, which didn't keep it from being used in a U.S. president's speeches. These false charges got far more attention than the substantiated charges against the contras.

At the time, Mr. Kwitny recalled, he couldn't get the Wall Street Journal to run articles on the importance of cocaine-running by the contras. The Journal did run gutsy articles on a number of other issues.

So he was surprised that the San Jose Mercury-News's series sparked this major controversy. He noted, too, that the denials of the series' charges always lumped several quite distinct statements together. They accused the series of saying that the CIA intended to channel cocaine into the black community and was responsible for the epidemic of drugs in the community.

In fact, the San Jose Mercury-News articles were detailed and impressive on this point: that the CIA must have had knowledge of the contras' drug-running. Added to that were a couple of charges the reporters perhaps should not have made:

1. What the contras did with the money. Mr. Kwitny doubted that they used much of it for the war.

2. Implications about the attitude of the CIA. The series made no false statements but it made suggestions that should have been presented skeptically. There was no evidence that the CIA did it deliberately to target the black community.

In 1985, Robert Owen wrote a letter to Oliver North saying that a contra group they were allied with had a questionable past, including potential involvement in drug-running. The letter writers were disturbed that the contras were running drugs, and wished they could stop or minimize it. But the war was much more important to them. Drug-running on the side was inherent to the sort of war they were promoting.

In 1948, the CIA mounted an operation to remove socialists from the leadership of a Marseilles union and put in Corsican drug dealers in their place. The United States dealt with Noriega for many years, and knew that he was dealing in drugs. Lebanese working for the CIA in the early 1970s were engaged in it. The DEA found that they were responsible for an enormous volume of shipments. Its investigation was stopped by the CIA.

The Miami World Finance Corporation, involved with drugs, was set up with the involvement of CIA Cubans. An FBI and DEA taskforce investigated the corporation in the 1970s. The investigation was stopped. Mr. Kwitny recalled being told by a senior investigator that the CIA stopped the investigation because more than half of the people on the suspect list were CIA.

When investigating the Nugan Hand Bank, founded by CIA and DOD veterans, all DEA agents were told to back off. There were heavy drug deals by the bank.

Mr. Kwitny recalled that the Senate Intelligence Committee used questions that he had drafted in questioning CIA witnesses in the 1980s. The answers were classified.

Overall, when the government secretly used people who were pledged to secrecy, those lured to the operation would include people who wanted secrecy for criminal activity. Of these activities, drugs were the most lucrative. This was a necessary tradeoff of covert operations. At the height of the Cold War, a case could be made for it. But now, Mr. Kwitny asked, was the threat so serious as to justify it?

III. Investigating the CIA-Drugs Connection—A Presentation by Jack A. Blum

Mr. Blum said that if one made a list of covert operations involving drugs, there were many including the Vesco operation and many others. It would include Burma, Afghanistan, and Thailand. Covert action and criminality went together. Watergate was only the most reprehensible case of blowback.

The most important failure, however, was the failure to discuss a future policy to end this problem. Intelligence had a legitimate role to assess the real threats to the United States, and to equip the country's leaders with this knowledge.

But when intelligence agencies engaged in covert operations, this was something else altogether. Then the intelligence service became more interested in its daily operations than in gathering information about genuine threats. The massive inflow of drugs into the country was such a threat, Mr. Blum considered.

There were exposes of drug-running operations in the Bahamas — the Carlos Leder and Robert Vesco operations, which flew in drugs to the United States. But the U.S. ambassador to the Bahamas, Lev Dobriansky, said to leave Prime Minister Pindling alone. Pindling even hired a public-relations firm that put out the line that the root of the problem was demand. This was the origin of the Just Say No campaign. The firm also ran Paula Hawkins's campaign. Not only did they enter into the U.S. political process, they developed it into a wedge issue in U.S. politics. In so doing, they made the victims into the perpetrators.

How could the nation keep intelligence honest enough to focus on the real threat? The intelligence community had never learned that the Cold War was over.

This might be generic to intelligence services, Mr. Blum considered. Ten days after the wall came down, Stasi agents were arrested in Bonn. They were still doing their espionage work, even though they had no government to work for.

The intelligence agencies operated on the notion that a corrupt general was better to work with than an honest politician who might have some differences with U.S. policy. For example, in Panama and Chile. Why did they consider the general better? The corrupt general appeared to make a more reliable ally. This was a dilemma that went back to Thucydides, who wrote about how democratic city-states were reluctant to ally with generals.

The U.S. constitution gave Congress control of the purse and established a budget process. The U.S. black budget was growing bigger and bigger.

General Noriega got $200,000 a year from the CIA. This was only small change for him. But the serious money came from drug trafficking. It would be impossible for the CIA to directly pay a corrupt foreign leader enough money to make him a loyal agent. A hard-pressed intelligence agency kept them in line by giving them the opportunity to steal.

The nation couldn't stop the machinery of stealing in Mexico, Mr. Blum said. It could only protest it from afar. However, if the country didn't stop it now, it would get a more aggressive variant of the lawlessness of the 1980s.

Adolfo Calero was working for the United States, as a man who could lobby Congress. He influenced U.S. public opinion. That was out of the nation's tax dollars. That was about as dangerous to the constitution as it could get. If it was okay for the CIA to silence domestic criticism, the country was endangering its freedoms.

The agency picked its own leadership. If anyone who wanted genuine reform were nominated, that person wouldn't be confirmed. The agency vetoed Ted Sorenson after President Carter publicly chose him. After that, candidates were quietly "cleared."

If the nation cherished the constitution and wanted to protect its freedoms, it must take action now.

IV. Comment by Clarence Page

Mr. Page said that in his effort to make the black community take some responsibility for the problem, he had said that it must reduce demand. He was struck by what Mr. Blum had said about the demand argument being planted by the drug dealers themselves.

He still wrote in his columns that the community was a co-conspirator by consenting to use it. At the same time, the government should not be giving aid and comfort to the enemy — the international drug shippers.

He agreed with Professor McCoy that the black community had not been deliberately targeted. That was clear from the available evidence and argument. However, Mr. Blum had pinpointed the problem of the intelligence agencies allowing the drugs to come in.

Mr. Page said that if he were to write a book on the pathologies of the press, he would include:

1. If one could not recover the other guy's scoop, knock it down . This happened with the San Jose Mercury-News stories. As a variant of this, when the Kerry committee report came out, the press stories were full of the government's denials. But if one read further in the New York Times, Washington Post , and Los Angeles Times stories on the Mercury series, they said that the basic question was whether the CIA knew. The Los Angeles Times story even brought forward additional information on the connection to Blandon's nephew.

2. The old news syndrome. The editors said that this story was déjà vu . They said that they had heard all this before.

3. The other-than-beat-reporter syndrome. The story was done by a regional newspaper. Major newspapers found it hard to admit they were scooped.

4. Healthy skepticism could cross the line into cynicism . This accounted for the fact that the story was dismissed too rapidly.

In the African-American community, after the COINTELPRO revelations, the Tuskegee experiment, and the Black Panther ambushes, this episode reinforced paranoid notions that the community's problems were attributable to an external enemy. But Mr. Page recalled that Henry Kissinger had once said, "Paranoids have enemies, too."

All were in agreement that there was a degree of hype in the San Jose Mercury-News story, Mr. Page continued. But all editors had also admitted that one could not pursue the story this far without upsetting the black community.

One could not criticize the Mercury News for starting the debate, Mr. Page considered. Maybe it got too excited, but it started the debate.

But although the story about the conspiracy to commit genocide had not been published, it did not die.

It was not a conspiracy, but Louis Farrakhan made a good point when he said that there was an element of government criminal liability in letting the drugs in. It was the same as with tobacco. There was government liability there. Mr. Page asked why this argument should be left to Mr. Farrakhan to make.

Mr. Page said that he did not compare this scandal to COINTELPRO, where J. Edgar Hoover had thought that the Black Panthers were the number-one enemy of America.

V. Question-and-answer session

David MacMichael, Association of National Security Alumni

He referred to Mr. Blum's comment that it was the primary task of intelligence to identify and analyze the threat to the United States, not to engage in covert action. Mr. MacMichael questioned whether it was the job of the intelligence service to define the threat. He asked whether that was not the job of the elected leadership.

Mr. MacMichael recalled that the speakers had said that the drug-running was not used to fund the contras. He noted, however, that Mr. Casey had looked at that possibility.

He asked why the district attorney of Dade County, after all the evidence of drug-trafficking in his district, had not indicted anyone.

Mr. MacMichael noted that the seminar participants had said that the black community had not been targeted. However, he noted that the Mafia had very specifically targeted the black community.

Mr. MacMichael recalled that when he was in the government, he had laid out in a memo the links between the Colombian government and the MAS drug-trafficking group. The station chief in Colombia flew up and vetoed any mention of this in the paper.

One of the panelists, before commenting on Mr. MacMichael's questions, recalled an earlier remark that countries should be permitted to make their own mistakes; e.g., Chile should be allowed to elect a government that the U.S. government might not like. He recalled that he had met with an anti-Sandinista Nicaraguan businessman in 1985. This businessman acknowledged that the Sandinistas had brought honest government to Nicaragua. Nevertheless, he said that the ruin that was befalling Nicaragua was due to the fact that the United States would not permit the Sandinistas to rule. So, in the end it was the Sandinistas' fault.

Response by Clarence Page

Mr. Page addressed the question of targeting of the black community brought up by Mr. MacMichael. He noted that the country's racial misunderstanding could revolve around particular words. He asked whether it was targeting blacks, or merely poor people, when a cheap drug was invented that cost only ten dollars a hit. The biggest gangs in America were in Los Angeles. They constituted a ready-made network.

He asked Professor McCoy whether he believed the black community had been targeted.

Response by Alfred McCoy

Professor McCoy said that there was not a scintilla of evidence that the CIA had deliberately targeted the black community. Nor was there logic. What occurred was that the CIA made an operational compromise for the sake of the success of its covert action. It essentially said, "You mobilize for us and we'll look the other way."

In its operational zone, Professor McCoy said, the CIA kept the DEA away. Outside the zone, if anyone investigated or arrested its operatives, the CIA intervened to get the charges taken off. These were the tradeoffs it made to insure that the operation succeeded. The CIA did not concern itself with nor control the downstream trafficking. Inside the operational zone the CIA controlled, outside not.

Response by Jonathan Kwitny

Mr. Kwitny said that the word targeting implied will, intention. There was no evidence that the CIA so intended. The only possibility was that it favored it for its Laotian clients so that they could have a healthy economy. But he did not have evidence for that.

Response by Jack Blum

Mr. Blum said that it was necessary to separate the concept of targeting from the distribution network and recipients. An addict with money was not seen as a problem by society. The problem came when the addict had no money. Some of the top users had been NBC stars. The real money in drug-running was made there. The country focused on the inner city because there was a distribution network of talented risk-takers, people who were willing to take risks to make a hundred dollars overnight.

Commenting on the definition of the threat, Mr. Blum agreed with Mr. MacMichael that it was not the job of the CIA to define the threat. But it was the job of the intelligence community to advise of the threats. The objective reality was that the intelligence community was not telling the truth about the real threats to the nation, but was advancing the careers of its members by providing what the policy-makers wanted ideologically.

Question by Ambassador William DePree

Ambassador DePree asked about the CIA's blocking of prosecution to protect its operatives from drug charges. He wanted to know how much was on the public record of the CIA's actually blocking prosecution.

Professor McCoy said that there were two phases to the CIA's protection of its assets. First, when the CIA had an operational zone, it was closed to investigation by other agencies. The DEA and other agencies had elaborate investigatory capabilities. In the CIA's zone, however, assets made heroin with absolute impunity. For example, the DEA had seventeen agents in Islamabad. It had an elaborate network. Yet it was a detective from Oslo, using basic investigatory techniques, who first tracked the heroin back to Islamabad, even though the DEA had seventeen agents there.

The DEA set up an office in Honduras in 1981, but it was closed during 1983–86 during the period of clandestine CIA support of the contras. Then when the Boland amendment was rescinded in 1986, and the contras fully funded by Congress, the office was reopened.

Second, outside the zone, this raised the question whether Blandon's operation was protected. That needed further investigation but it would be unusual, because the protecting was usually in the zone, not downstream.

Mr. Kwitny said, in response to Ambassador DePree's question about whether the CIA's blocking of investigations was on the public record, that he had printed it.

Mr. Blum said that the protection was similar to the way in which the United States had handled Salvadoran human rights abuses — it had covered them up to advance the anti-guerrilla war.

He noted that it was policy that CIA agents would sit in in meetings with U.S. criminial prosecutors, when their assets were involved.

Question by William Root

Mr. Root asked whether the CIA was a rogue agency that was not disciplined, or whether there was discipline, and it was part of the country's foreign policy to contain Communism.

He also said that he found it troubling that presidents would operate in an unaccountable way.

Mr. Blum considered that the CIA was not a rogue agency at all. In Iran-contra, the record was clear that Admiral Poindexter and the others were all pushing for it.

He addressed Mr. Root's second question about how the public could hold the political leadership accountable. The country's political leaders had found it desirable to operate in secrecy. Governments liked to operate in secret.

As for the future, the question before the country was whether it would try to reinstall constitutional governance. For example, legally treaties were the law of the land. He asked how the CIA could legally intervene in another country in violation of a treaty. He noted that their response to this argument was laughter. What the nation ended up with was not a government of laws.

Question about militarization of the CIA

A member of the audience noted that there was a tendency in the CIA to militarize. The covert operations were military. The intelligence community involved the army and the other military services. And the CIA budget came under the Pentagon's. He asked how this problem should be handled.

Mr. Blum said that to have military people in intelligence was equivalent to their escaping the chain of command. It was a situation dangerous to constitutional government.


Mr. Kwitny said that when Senator Church made his famous remark about the rogue elephant, all the things he was investigating — the murder of Patrice Lumumba, for example — had come right out of the Oval Office. This included the contras. It was not a rogue agency at all.

Mr. Kwitny also saw a conflict of interest between the military and the CIA. There was a financial incentive for the military: the Pentagon budget was influenced by what the CIA had to say about the degree of threat.

Mr. Goodman said that CIA director Deutch was moving the CIA closer to the Pentagon than any other director. The national intelligence estimates had been downgraded. Most dangerous of all, the National Imagery and Mapping Agency had been put in the Pentagon. That meant that a policy-making organization was interpreting satellite data important to its budget. The CIA was supposed to be the honest broker.

Question by Robert H. Johnson, former National Security Council official

Mr. Johnson asked what the country could learn from the intelligence operations of other countries. How did they deal with the criminalization of clandestine operations? Were they more cynical, or more effective in handling the problem?

Mr. Blum considered that the other countries were more cynical. Britain had no constitution, and the French were totally cynical. There was no foreign model for the United States to follow. To the extent that there was a model, it was the Russians. The United States patterned itself after them.

Question by Louis Wolf

Mr. Wolf raised the issue of CIA proprietary companies and the huge sums they made.

Mr. Blum said that the intelligence game may have had to be played. But he asked whether this was necessary at all times.

Returning to Mr. Johnson's question about foreign models, Mr. Goodman acknowledged that Britain operated without a written constitution. But it at least clearly separated intelligence from policy agencies.

Comment by Kit Gage, National Committee Against Repressive Legislation

Ms. Gage noted that the FBI was expanding rapidly internationally, using some CIA assets.

Mr. Blum said that there did not exist an international civil society, even though reality had negated borders.

Question by Sean Cairncross, American University

First, he asked the panel whether it agreed that some secrecy was still necessary. He asked how much publicity could be allowed without destroying intelligence capabilities.

Second, what reforms did the panel propose?

Mr. Blum considered that these would be good questions for the Senate Intelligence Committee.

On the question of reforms, a member of the audience recalled that when he was at the CIA and a question of criminal activity arose, he had said that he wanted to call the FBI. He was shut down for saying that. He asked what the statutory chart was of the CIA's authority.

Mr. Blum agreed that that was essential.

On the question of the statutory chart, Mr. Goodman recalled that the National Security Act of 1947 creating the CIA said nothing about covert operations.

Question by Ambassador Robert E. White

Ambassador White said that as he listened to Professor McCoy and Mr. Kwitny, they were talking about paramilitary operations, not covert action. With the end of the Cold War, the paramilitary operations would diminish. Would the CIA link with drugs therefore also diminish?

Professor McCoy said he believed it would. The complicity of the CIA in the global drug trade arose from a series of alliances of the Cold War. That was less likely now. The whole debate about drug-running and CIA complicity was about history. The question was nevertheless a sensitive one for the war against drugs.

If it turned out, from an examination of that history, that a substantial amount of drug imports were encouraged by these operations, that raised big questions of money liability. It raised the question of whether there should not be an amnesty for all those caught using narcotics on the ground of entrapment.

Question by Ralph McGehee

Mr. McGehee said, commenting on Ambassador White's question, that there was no evidence of a diminution of paramilitary operations. They were going on in Iraq and Sudan, for example.

Mr. Goodman said that he also did not share Professor McCoy's optimism regarding the abatement of the problem with the end of the Cold War. The director of the CIA thought that covert action was a unique tool. The budget of the CIA was increasing. The agency was looking for a justification.

Question by Robert Dreyfuss

Mr. Dreyfuss referred to the record of the CIA's involvement in drug operations. There was operation in Marseilles in the 1940s. Earlier, there had been an operation in Sicily.

He noted that much of the convervative press in the 1980s referred to the Cuban government as engaged in drug-trafficking. Was there any evidence of that? Or was that a CIA covert operation itself? A general was executed by the Cuban government.

Mr. Blum considered that the parallels between what happened with Cuban and U.S. intelligence operations were striking. The Cubans wanted to get around the U.S. blockade. That sent them to Panama and soon got them into the drug trade.

Question by James Morrell, Center for International Policy

Mr. Morrell said that the rebuttals of the San Jose Mercury's story that appeared in the New York Times and Washington Post stressed that the Meneses-Blandon drug activities were only a drop in the bucket in the total U.S. drug market, whereas the story said that Blandon started the whole crack epidemic. In some other respects, the Times and Post reviews corroborated the Mercury series, but that on the question of volume the two newspapers found great fault with the story. That appeared to be their major objection to it. He asked the panelists to comment.

Mr. Blum said that Blandon and Meneses were not the principal movers. Ballasteros in Mexico was much bigger. There were many others involved, including the Haitian generals.

Professor McCoy said that the San Jose Mercury had overemphasized the "Johnny Appleseed" angle, maintaining that Blandon had spread the crack epidemic to Los Angeles, and that sparked the national debate over the question. In that respect, the rebuttal that appeared in the other newspapers was important and valid.

But if one stepped back and asks, Did CIA assets supply significant amounts of drugs to the black community, the answer was yes.

Mr. Page noted that the San Jose Mercury had been contrite.

A member of the audience, formerly a CIA and State Department official, said that the nation certainly needed a CIA. It could be called something else, but an intelligence capability was needed. It did not need a Murder, Inc. It did not need involvement with druggies. It needed a government agency that worked on the basis of a charter.

Although the Washington Post had been critical of the Mercury's articles, the Post's ombudsman, Geneva Overholser, had written ten days ago that the Mercury series provoked a debate and applied an important corrective.

Mr. Page noted that the First Amendment was sometimes messy, but it got results.

Mr. Blum said that as a result of the Mercury series, there was a constituency in the United States that saw that what went on overseas affected them. That might help undo the immunity of foreign policy from domestic criticism.

Index of participants

Blum 1, 13, 14, 17- 22

DePree 17

Dreyfuss 21

Gage 20

Goodman 1, 14, 19- 21

Johnson 19

Kwitny 1, 11- 13, 17- 20

MacMichael 16, 17

McCoy 1, 11, 14, 17, 18, 20, 21

Morrell 21

Page 1, 2, 14- 16, 22

Root 13, 18

White 5, 6, 20

Wolf 19


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