R et h i n k i n g I n t e r n a t i o n a l D r u g C on trolSERGIO GALVIS: Mr. Galvis is Partner...

Ret hink ingI n t e r n a t i o n a lD rug Control

New Directions for U.S. Policy

TA SK F O RCE RE P ORT

Sponsored by the Council on Foreign RelationsMathea Falco, Chair

Rethinking InternationalDrug Control:

New Directions for U.S. Policy

R e p o rtof an Independent Task Forc e

Sponsored by the Council on Foreign RelationsMathea Falco, Chair

C O N T E N T S

Members of the Task Force . . . . . . . . . . . . . . . . . . .i v

F o r e w o r d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Statement of the Task Force . . . . . . . . . . . . . . . . . . .3

Background Study . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Illegal Drugs: A Complex Global Problem . . . .1 2

International Drug Control:

A Multi-Agency Federal Eff o r t . . . . . . . . . . .2 2

Money Laundering: Hiding Drug Profits . . . . . .3 3

U.S. Source Country Programs:

Unintended Eff e c t s . . . . . . . . . . . . . . . . . . . .3 6

The Limits to International Supply Control . . . .4 4

Reducing the Demand for Drugs:

Key to Lasting Progress . . . . . . . . . . . . . . . .5 2

S u m m a r y . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5 7

Additional and Dissenting Vi e w s . . . . . . . . . . . . . .5 9

Discussions at Meetings in Four Cities . . . . . . . . . .6 2

The Council on Foreign Relations, Inc., is a nonprofit and nonpartisanorganization devoted to promoting improved understanding of interna-tional affairs through the free exchange of ideas.

The Council on Foreign Relations takes no institutional position onpolicy issues and has no affiliation with the U.S. government. Thisreport is the sole responsibility of the Task Force.

From time to time, the Council will select a topic of critical importanceto U.S. policy to be the subject of study by an independent, nonpartisanTask Force. The Council chooses members representing diverse viewsand backgrounds, including generalists as well as experts. Many, but notall, Task Force members are also members of the Council.

This study benefited from the advice of Task Force members as well asfrom the discussions of Council groups convened for one session each inLos Angeles, Chicago, Miami, and Atlanta. The statement reflects thepolicy judgments of the Task Force members, although not every mem-ber necessarily subscribes to every aspect.

For further information about the Council or this Task Force, please con-tact the Public Affairs Office, Council on Foreign Relations, 58 East 68thStreet, New York, NY10021.

For additional background material on international drug control policy,please contact Drug Strategies, 2445 M Street, NW, Suite 480,Washington, DC 20037; phone 202-663-6090, fax 202-663-6110. DrugStrategies is a nonprofit, policy research institute supported by severalnational foundations.

Copyright ©1997 by the Council on Foreign Relations, Inc.All rights reserved.Printed in the United States of America.

This document may not be reproduced in whole or part, in any form(beyond that copying permitted by Sections 107 and 108 of the U.S.Copyright Law and except by reviewers for the public press), withoutwritten permission from the publishers.

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JONATHAN A. CHANIS: Mr. Chanis is ManagingDirector of AIG Capital Partners, Inc.

W. BOWMAN CUTTER: Mr. Cutter is ManagingDirector at E. M. Warburg, Pincus, and Co. in NewYork. He has served as Deputy Assistant to thePresident for Economic Policy, the National EconomicCouncil at the White House.

MARK DANNER: M r. Danner is staff writer at T h eNew Yo r k e r magazine and author of The Massacre at ElM o z o t e ( Vintage, 1994). He is writing a book on Haitiand is author of two A B C - T V News documentaries:“While America Watched: The Bosnia Tragedy” and“House on Fire: A m e r i c a ’s Haitian Crisis.”

MATHEA FALCO: Ms. Falco is President of DrugStrategies, a nonprofit institute to promote effectiveapproaches to substance abuse. The author of TheMaking of A Drug- Free America: Programs that Work(Times Books, 1994), she was Assistant Secretary ofState for International Narcotics Matters from 1977 to1981.

STEPHEN E. FLYNN*: Dr. Flynn is a LieutenantCommander in the U.S. Coast Guard and MilitaryProfessor of International Relations at the Coast GuardAcademy. In 1991, he was selected as the CoastG u a r d ’s first Council on Foreign Relations’International Affairs Fellow.

M E M B E R S OF T H E T A S K F O R C E

BRUCE M. BAGLEY: Dr. Bagley is Professor ofInternational Relations at the Graduate School ofInternational Studies, University of Miami.

DAVID BEALL*: Mr. Beall is Executive Secretary ofthe Inter-American Drug Abuse Control Commission(CICAD) at the Organization of American States(OAS).

EVERETT BRIGGS: Ambassador Briggs is Presidentof the Americas Society and the Council of theAmericas. He served as U.S. Ambassador to Panama,Honduras and Portugal; Deputy Assistant Secretary ofState for Inter-American Affairs; and Special Assistantto the President for Latin America and the Caribbeanat the National Security Council.

JAMES E. BURKE: Mr. Burke is Chairman of thePartnership for a Drug-Free America and formerChairman of Johnson & Johnson.

ROBERT CARSWELL: Mr. Carswell is Partner atShearman & Sterling and Chairman of the CarnegieEndowment for International Peace. He served asDeputy Secretary of the Treasury from 1977-1981.

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* Individual participated in the Task Force discussions but was not askedto endorse the statement or the background study because of his or hero fficial capacity.

Note: Institutional affiliations listed for identification purposes only.

CLIFFORD KRAUSS*: Mr. Krauss is outgoing Chiefof the New York Times Police Department Bureau. Hehas also reported on the State Department andCongress and is author of Inside Central America: ItsPeople, Politics and History (Summit, 1991).

J E F F R E Y LAURENTI: M r. Laurenti is ExecutiveDirector of Policy Studies at the United NationsAssociations of the United States of America, and authorof B reaking the Drug Chain: Options for InternationalPolicy on Narcotic Dru g s (UNA-USA, 1990).

RENSSELAER LEE: D r. Lee is President of GlobalAdvisory Services, a research company specializing ininternational development and security issues. He is theauthor of The White Labyrinth: Cocaine and PoliticalP o w e r ( Transaction, 1989) and co-author of T h eAndean Cocaine Industry (St. Martins Press, 1996).

ELIZABETH LEEDS: Dr. Leeds is ExecutiveDirector of the Center for International Studies at theMassachusetts Institute for Technology.

KENNETH MAXWELL: Dr. Maxwell is Nelson andDavid Rockefeller Senior Fellow for Inter-AmericanAffairs and Director of the Latin America Program atthe Council on Foreign Relations.

ROBERT B. MILLMAN, M.D.: Dr. Millman is SaulP. Steinberg Distinguished Professor of Psychiatry andPublic Health at Cornell University Medical Collegeand Director of Drug and Alcohol Abuse Programs atNew York Hospital-Payne Whitney Psychiatric Clinic.

SERGIO GALVIS: Mr. Galvis is Partner at Sullivan& Cromwell, where he coordinates the firm’s LatinAmerican practice.

EDUARDO A. GAMARRA: Dr. Gamarra is Directorof Graduate Programs at the Latin American andCaribbean Center at Florida International University,where he is also Associate Professor of PoliticalScience and editor of Hemisphere Magazine.

SUSAN GINSBURG*: Ms. Ginsburg is SeniorAdvisor for Enforcement at the Department of theTreasury.

PETER HAKIM: Mr. Hakim is President of the Inter-American Dialogue.

MARGARET A. HAMBURG, M.D.*: Dr. Hamburgis Commissioner of Health for New York City andserves as Vice-Chairperson of the Board of DrugStrategies.

ALBERTO HART*: M r. Hart is Deputy Secretary ofthe Inter-American Drug Abuse Control Commission(CICAD) at the Organization of American States (OAS).

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K. JACK RILEY*: Dr. Riley is Acting Director of theDrug Use Forecasting/Arrestee Drug A b u s eMonitoring program at the U.S. Department of Justice,National Institute of Justice. He is author of SnowJob? The War Against International CocaineTrafficking (Transaction, 1996).

ROBERTO SALINAS-LEÓN: Dr. Salinas-León isExecutive Director of the Centro de InvestegacionesSobre la Libre Empresa (Center for Free MarketResearch), Mexico city. He is also Adjunct Professorof Political Economy in the Escuela Libra de Derechoand a member of the Mont Pelerin Society.

PETER H. SMITH: Dr. Smith is Professor of PoliticalScience, Simon Bolivar Professor of Latin AmericanStudies, and Director of Latin American Studies at theUniversity of California, San Diego.

HERBERT STURZ: Mr. Sturz is President of TheTrotwood Corporation and is on the Board of DrugStrategies. He was founding Director of the VeraInstitute of Justice, and also served as New York CityDeputy Mayor of Criminal Justice and as Chairman ofthe New York City Planning Commission.

WILLIAM J. VANDEN HEUVEL: Ambassador van-den Heuvel is former U.S. Deputy PermanentRepresentative to the United Nations and was SpecialAssistant to Attorney General Robert F. Kennedy. Heis Counsel to the law firm of Stroock & Stroock &Lavan and Senior Advisor to Allen & CompanyIncorporated.

ANNE NELSON: Ms. Nelson is InternationalC o o r d i n a t o r, Columbia Graduate School ofJournalism, and former Executive Director of theCommittee to Protect Journalists.

HERBERT S. OKUN*: Ambassador Okun is the U.S.member and First Vice-President of the UnitedNations International Narcotics Control Board(INCB). He has served as U.S. Ambassador to EastGermany and to the United Nations.

H O L LY PETERSON: Ms. Peterson is DomesticPolicy Producer for ABC-TV’s World News Tonight.

RENATE RENNIE: Ms. Rennie is President of TheTinker Foundation Incorporated.

PETER REUTER: Dr. Reuter is Professor in theSchool of Public A ffairs and Department ofCriminology at the University of Maryland. From1989 to 1993 he was Co-Director of RAND’s DrugPolicy Research Center.

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P R E S E N T E R S A TT A S K F O R C E M E E T I N G S

BRUCE M. BAGLEY*: Dr. Bagley is Professor ofInternational Relations at the Graduate School ofInternational Studies, University of Miami.

JAMIE FELLNER: Ms. Fellner is Associate Counselof Human Rights Watch and directs its projectaddressing the human rights implications of nationaland international drug policies. She is author of tworecent Human Rights Watch reports on drug policyand human rights in Bolivia.

ROBERT S. GELBARD: Ambassador Gelbard isAssistant Secretary of State for International Narcoticsand Law Enforcement A ffairs. A career ForeignService Officer, he was also Ambassador to Boliviaand Principal Deputy Assistant Secretary of State forInter-American Affairs.

ERNEST T. PATRIKIS: Mr. Patrikis is First VicePresident of the Federal Reserve Bank of New York.He is an alternate member of the Federal Open MarketCommittee and is responsible for the W h o l e s a l ePayments Product Office.

MIGUEL RUIZ-CABAÑAS: Mr. Ruiz-Cabañas isCoordinator for Special Affairs and Drug Control atthe Mexican Foreign Ministry. A career diplomat, hehas served as Mexico’s Director General for UnitedNations Affairs and as Chief of Staff of the DeputyForeign Minister.

J O N ATHAN M. WINER*: Mr. Winer is DeputyAssistant Secretary of State for International Narcoticsand Law Enforcement Affairs.

RapporteurJOHN M. WALSH-ALKER: Mr. Walsh-Alker is aconsultant to Drug Strategies and a graduate student atThe Johns Hopkins University Institute for PolicyStudies in Baltimore. He was Special Assistant forU.S. International Drug Policy at the WashingtonOffice on Latin America (WOLA) from 1990 to 1993.

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* Task Force Members



F O R E W O R D

In the post-Cold War world, where A m e r i c a ’s interna-tional interests are often viewed through the filter ofdomestic concerns, drug control plays an increasinglyimportant role in Wa s h i n g t o n ’s foreign policy formula-tion. This issue affects bilateral relations with more thana dozen countries, particularly in Latin America, the pri-mary source for cocaine and much of the heroin cominginto the United States. To examine the intersection ofdomestic and international interests, the Council o nF o r e i g n R e l a t i o n s c o n v e n e d an Independent Task Forceof experts from many disciplines to review U.S. inter-national drug strategy and to suggest possible futured i r e c t i o n s .1 During the course of the year, the Ta s kForce assessed the results of U.S. interdiction andsource country efforts on A m e r i c a ’s drug problems aswell as their impact in foreign countries. A central ques-tion for the Task Force was the extent to which thesee fforts advance U.S. foreign policy interests and/orachieve domestic policy goals.

Task Force members included both Council mem-bers and non-members drawn from diverse disciplines,with backgrounds in banking, law enforcement, diplo-m a c y, journalism, economic development, publichealth, judicial institutions, human rights, and multina-tional business. Prominent academics, government off i-cials, and policy experts presented a wide range of per-spectives for the group’s consideration. Drug Strategies,a n o n p r o f i t r e s e a r c h i n s t i t u t e in Washington, D.C., pro-

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1 The Task Force did not discuss legalization as an alternative strategy.

PETER H. SMITH*: Dr. Smith is Professor ofPolitical Science, Simon Bolivar Professor of LatinAmerican Studies, and Director of Latin AmericanStudies at the University of California, San Diego.

PAUL STARES: Dr. Stares is Senior Fellow inForeign Policy Studies at the Brookings Institutionand author of Global Habit: The Drug Problem in aBorderless World (Brookings, 1996).

FRANCISCO THOUMI: Dr. Thoumi is a Fellow atthe Smithsonian’s Woodrow Wilson Center forScholars, where he is writing a book on the politicaleconomy of illegal drugs in the Andes. He is author ofPolitical Economy and Illegal Drugs in Colombia(Lynne Rienner, 1995).

PHIL WILLIAMS: Dr. Williams is Director of theUniversity of Pittsburg h ’s Ridgway Center forInternational Security Studies and Professor at theGraduate School of Public and International Affairs.He is editor of the journal Transnational OrganizedCrime and serves as a consultant to the United NationsDrug Control Program.

COLETTA YOUNGERS: Ms. Youngers is a SeniorAssociate with the Washington Office on LatinAmerica (WOLA), where she analyzes human rights,political developments, and the impact of U.S. policyin the Andean region, especially Bolivia, Colombiaand Peru.

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S TAT E M E N T O F THE TA S K FORCE

In the past two decades, much has been learned aboutinternational drug control. Based on its review of U.S.efforts to curtail foreign drug production and traffick-ing, the Task Force believes that a major shift in strate-gic thinking is needed so that U.S. policy can moreeffectively address the nation’s drug problems.

Reassess the Effectiveness of InterdictionSince 1981, Americans have spent more than $25 bil-lion for foreign interdiction and source country pro-grams intended to reduce the supplies of drugs cominginto this country. These programs have created prob-lems of their own, including strained relations withother countries, particularly in Latin America; politicalunrest and violence among peasant farmers who relyon drug crops for their livelihood; human rights abus-es as governments try to suppress drug cultivation;increased corruption among local police forces; andexpanding roles for the military in internal securityand drug enforcement in countries where democracy isstill fragile.

More important, from a U.S. perspective, these pro-grams do not seem to have succeeded in reducing drugsupplies in this country. Despite impressive seizures atthe border, on the high seas, and in other countries,foreign drugs are cheaper and more readily availablein the United States today than two decades ago. Whilecurrent U.S. efforts send an important message that theUnited States will not allow drug traffickers to operatewith impunity, we should not hold unreasonable

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vided staff support for the project, which was funded bya grant from the John D. and Catherine T. MacArthurFoundation. The statement reflects the views of thosewho participated in the Task Force, except as indicatedin additional and dissenting views. The backgroundstudy was circulated to all participants and benefitedfrom their advice and suggestions.

The Task Force met four times at the Council inNew York. The Council also convened meetings inLos Angeles, Chicago, Miami, and Atlanta to discussU.S. international drug control policy. More than onehundred people participated in Task Force discussions,reflecting the depth of interest in these issues. Briefsummaries of the regional perspectives provided bythe meetings and names of participants appear at theend of this report. This project was greatly assisted bythe staffs of the Latin American Program and theNational Program of the Council on Foreign Relations,to whom the Task Force extends special thanks.

Mathea FalcoChair

February 1997

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laundering, which allows traffickers to hide their prof-its, has itself become big business. Although theAdministration has taken important first steps attack-ing these illegal financial flows, the Federal budgetspends more for source country programs—aimed atthe lowest level of the drug trafficking ladder—thanfor international programs to target high-end moneylaundering. Multilateral initiatives are particularly use-ful in this context, encouraging a global response tothe global political, financial and economic aspects ofdrug trafficking.

Rethink CertificationThe annual certification process, whereby the UnitedStates determines whether other countries have coop-erated fully with U.S. drug control efforts, appears tohave a number of problems. The criteria are vague andinconsistently applied, while the punishments areoften more apparent than real. More important, theprocess itself is corrosive in its effects on U.S. rela-tions with other countries, which often have a complexof problems that cannot be effectively addressed bythis type of intervention. The Task Force suggests thatCongress explore ways to ensure that nations are peri-odically assessed as to their performance in control-ling illegal drug production, traffic, and money laun-dering without linking this to automatic penalties andwithout having the United States as the sole judge.Since illicit drugs are now a global problem, broadlybased international bodies should be willing and ableto undertake the task, perhaps with assistance fromU.S. agencies that have special competence. If theCongress wishes to impose sanctions on a particular

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expectations that interdiction will keep significantamounts of drugs out of this country or that overseassupply reduction programs will solve America’s drugproblems. The record is clear: for twenty years, theseprograms have done little more than rearrange the mapof drug production and trafficking. Moreover, domes-tic production of illegal drugs is increasing, suggestingthat American sources could potentially meet futureforeign shortfalls, if any occur. Nonetheless, U.S.spending on interdiction and source country programsin Fiscal Year 1997 represents a 30 percent increaseover 1996 levels and the President’s proposed FiscalYear 1998 budget includes substantial new funds forsource country programs, primarily for Peru.

Strengthen Democratic InstitutionsThe United States has vital interests in attacking thepower and profits of the multinational drug cartels thatchallenge the integrity of political, financial and judi-cial institutions in this country and abroad. Powerfulnarcocriminal networks undermine the future ofdemocratic governments, particularly in this hemi-sphere. The Task Force believes that U.S. drug controlpolicy should balance efforts to reduce foreign drugproduction and trafficking with greater emphasis onefforts to strengthen democratic institutions in coun-tries threatened by these narcocriminal networks.

Target Money LaunderingFurther, the Task Force believes that the United Statesshould increase efforts to combat money launderingand drug-related corruption. The worldwide drug traf-fic generates as much as $400 billion annually: money

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demand serves as a magnet to drug dealers everywherewho will find ways to supply A m e r i c a ’s lucrative mar-ket—despite our best efforts to curtail foreign drug pro-duction and trafficking. Education and prevention areparticularly important: national surveys confirm adirect correlation between public perception of therisks of drug use and significantly lowered rates of use.Community law enforcement is also important, both inmaking neighborhoods safer and in driving up retaildrug prices. Sustained, intensive, rigorous treatmenthas proved effective in curbing both drug addiction anddrug crime. As Office of National Drug Control Policy(ONDCP) Director General Barry McCaffrey conclud-ed in a January 1997 National Public Radio interview,“If there is a single issue that I need to support, it is tobetter argue for treatment capabilities that can addressthis chronic relapsing disorder and to persuade men

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nation as a result of this assessment, then it can do so.Moreover, this change would remove a recurringsource of tension in U.S. relationships with LatinAmerican countries where the annual certificationdebate often exacerbates nationalistic anti-Americansentiment.

Develop Multilateral EffortsWhile U.S. strategies have continued to emphasizeunilateral or bilateral efforts internationally, drugshave become a global problem requiring global solu-tions. We cannot, and should not, do the job alone.International interdiction efforts could increasingly bemultilateralized through greater emphasis on the con-cept of shared responsibility among all countries con-cerned. The need for multilateralizing the internation-al effort is especially strong in areas where the UnitedStates and others must devote greater efforts, such ascombating money laundering, control of precursorchemicals, and building better judicial and lawenforcement institutions. Stronger legal systems areneeded to protect democratic institutions in countriesthreatened by growing drug-related corruption. A mul-tilateral approach is especially important in LatinAmerica, where any perception that the United Statesis imposing solutions can be a negative political forceworking against international drug control objectives.

Reduce Domestic DemandThe Task Force believes that reducing the domesticdemand for drugs is key in achieving sustainedprogress against drug abuse in this country. As theexperience of the past two decades demonstrates,

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B A C K G R O U N D S T U D Y

International drug control policy intersects both for-eign and domestic interests. U.S. drug control initia-tives abroad are intended to produce direct domesticbenefits, primarily reductions in drug availability, drugabuse and drug-related crime. Most U.S. foreign poli-cy makers do not involve themselves with domesticdrug abuse concerns, while prevention, treatment andlaw enforcement experts are often reluctant to engagein discussions of the foreign policy dimensions of drugcontrol. Each group defers to the expertise of the other.As a result, analyses of international and domesticdrug control priorities are rarely well integrated.

The Task Force review is timely in view of thegrowing importance of drug control relative to otherU.S. foreign policy objectives, particularly in LatinAmerica. Controlling illicit drugs has become a signif-icant issue in U.S. dealings with a number of countrieswhere Cold War concerns about Communist expan-sionism once dominated the bilateral agenda. A case inpoint is Pakistan, which emerged as a major illegalopium and heroin producer during the lengthy Sovietwar in Afghanistan in the 1980s. Pakistan’s role as akey ally assisting U.S.-financed cross-border opera-tions into neighboring Afghanistan took priority overdrug control issues in U.S. relations with Islamabad.With the Soviet threat ended, however, drug control isnow close to the top of Washington’s bilateral agendawith Pakistan.

In Latin America during the 1970s and 1980s,countering perceived Soviet and Cuban initiatives

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and women in public life, in Congress, state legisla-tures and city councils that effective drug treatmentprograms can markedly diminish the malignancy ofdrug abuse on cities and communities.” Demand reduc-tion programs currently receive about one-third of totalFederal drug control funding. The Task Force believesthat we need a more efficient approach to the nation’sdrug problems—one which will achieve greater resultsat less cost. This will involve rethinking our interna-tional drug control priorities.

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eign policy issue that has such an immediate and directdetrimental effect on so many Americans as the inter-national drug trade.”

During the 1996 Presidential election campaignboth Senator Dole and President Clinton pledged to domore to seal America’s borders against illegal drugsand to cut off foreign drug production in response togovernment reports of escalating teen drug use. If teendrug use continues to rise, domestic political pressurefor international solutions will probably increase. Inseeking those solutions, U.S. international drug policyshould reflect more accurately the growing complexi-ties of global drug trends as well as the importance ofreducing demand for drugs within this country.

U.S. efforts to cut off supplies of foreign drugsthrough interdiction and crop substitution in sourcecountries have not reduced the availability of drugs inthis country. Despite impressive, well-publicized tacti-cal successes, these supply reduction initiatives havebeen overwhelmed by expanded drug production andincreasingly sophisticated trafficking methods fueledby continuing worldwide demand for drugs.

The Task Force believes that the strategies of pastdecades, built on a world view divided into producerand consumer nations, are largely ineffective inachieving their purpose of reducing drug suppliescoming into the United States. New realities call for afundamental shift in thinking about U.S. foreign poli-cy interests related to drug control and how to realizethem through bilateral and multilateral initiatives thatstrengthen legitimate institutions in countries threat-ened by illicit drug production and trafficking. The

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often overrode other U.S. foreign policy goals. Withthe demise of the former Soviet Union, Cuba’s preoc-cupation with domestic problems, and the disappear-ance of military dictatorships in the region, LatinAmerican drug control has received increasing atten-tion from U.S. policy makers. That shift in emphasiswas signaled in December 1989, when PresidentGeorge Bush ordered the military invasion of Panama,which the Administration justified in part by GeneralManuel Noriega’s alleged involvement in drug traf-ficking.

Since the end of the Cold War, Washington’s drugcontrol assistance to Latin America has increasedwhile economic development and military assistancehas declined. United States annual foreign assistanceto Latin America and the Caribbean fell from $1.7 bil-lion in 1986 to $650 million in 1996. In contrast, nar-cotics related assistance to that region more than dou-bled during the same period, rising from $60 million to$134 million per year. U.S. anti-drug assistance nowcomprises 20 percent of total bilateral U.S. aid to LatinAmerica, compared with only 3 percent a decade ago.

According to a 1995 Chicago Council on ForeignRelations survey, 85 percent of the U.S. publicbelieves that stopping the flow of illegal drugs into theUnited States should be our most important foreignpolicy goal, ahead of protecting the jobs of Americanworkers, preventing the spread of nuclear weapons,and controlling illegal immigration. A s s i s t a n tSecretary of State Robert Gelbard captured this viewin recent Congressional hearings when he testified that“in the post-Cold War world, you can hardly find a for-

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it profits. The immensity of those profits gives majordrug trafficking organizations the power to subverteconomies, democratic institutions and, in some cases,entire governments.

For much of this century, the illegal drugs used byAmericans were produced abroad in a small number ofcountries. The United States targeted these sourcecountries with diplomatic pressure as well as econom-ic and enforcement assistance in return for their coop-eration. For example, in 1969 President Richard Nixonclosed a key crossing on the U.S.-Mexican border toforce Mexico to take action against heroin and mari-juana production, which were then supplyingA m e r i c a ’s burgeoning illicit drug market.Subsequently, the United States provided more than$100 million to support the Mexican government’sherbicide-spraying crop eradication campaign, aneffort which reduced Mexico’s opium and marijuanaproduction during the late 1970s. President Nixon alsothreatened to cut off foreign assistance to Turkeyunless that country stopped producing opium whichsupplied the ‘French Connection’ traffickers, then theprimary source of heroin entering the United States.The Turkish government banned traditional opiumcultivation but subsequently allowed a limited numberof farmers to cultivate the more easily controlledpapaver bracteatum , which requires a major industri-al process to extract its narcotic. With $50 million inU.S. assistance, Ankara helped find alternative liveli-hoods for farmers disadvantaged by its new policies.

Successes in Turkey and Mexico were short-lived,however, as traffickers in Asia and the Middle Eastquickly increased production and developed alterna-

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Task Force hopes that its work will contribute to shap-ing a more effective framework for future U.S. andmultilateral international drug control efforts.

ILLEGAL DRUGS: A COMPLEX GLOBAL PROBLEM

Drug trafficking is one of the world’s most lucrativecommercial activities. Current estimates of the valueof all retail sales of illicit drugs range from $100 to$400 billion annually. Growth of the international drugmarket from cottage industry to a multi-billion dollarglobal trade can be traced to the massive surge indemand for drugs in the United States and WesternEurope during the 1960s and 1970s. That surge trig-gered a rapid expansion in worldwide drug productionand trafficking to meet the demands of those growingmarkets. Meanwhile, improvements in communica-tions, transportation and information technology havemade international borders more porous. Illicit drugs,like licit goods, services, money and people, nowmove across international boundaries with unprece-dented speed and efficiency.

Globalization has also profoundly affected theincentives and opportunities to produce, traffic andconsume drugs. Diffusion of technical expertise hasmade it possible to cultivate and refine drugs in distantplaces, while the expansion in trade, transportationand tourism has made it easier to distribute drugs tofar-flung markets. Moreover, the growing integrationof the global financial system has provided drug traf-fickers with many more opportunities to launder illic-

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marijuana, methamphetamine, and LSD—are pro-duced here at home as well as imported.

While most of our marijuana continues to beimported through Mexico and the Caribbean, domesticproduction now supplies an estimated one-quarter toone-half of America’s consumption. Although a com-plete nationwide survey of illegal marijuana cultiva-tion has not been made, U.S. officials report major cultivation areas in states as diverse as New York,Kentucky, California and Hawaii. Increased indoorcultivation, which allows for more selective hybridiza-tion, has accelerated the trend toward higher-potencymarijuana. In 1996, the THC (tetrahydrocannabinol)content of high-grade “sinsemilla” (seedless) marijua-na ranged from 12 to 24 percent, according to the Drug

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tive smuggling routes to supply the American andWestern European heroin market. That pattern hascontinued, only now on a larger scale. Eff e c t i v eenforcement at one point in the supply chain bringsabout the opening of new fronts. As the U.S. CoastGuard’s Pacific commander, Vice Admiral Roger T.Rufe, Jr., observed about drug interdiction in theJanuary 30, 1997 Washington Post , “When you pressthe balloon in one area, it pops up in another....It’s amarket economy; with demand as it is in the U.S., theyhave plenty of incentive to try other routes.”

Distinctions Between Drug Producing and ConsumingNations Are FadingThe United States, which is the world’s largest drugmarket in terms of revenue, has traditionally beendefined as a consumer country. According to theNational Household Survey on Drug Abuse, 22.7 mil-lion Americans reported using illegal drugs at leastonce in 1995, while 12.8 million used drugs regularly(once a month or more).2

America’s drug habit has historically been suppliedfrom foreign sources: cocaine and marijuana fromLatin America and the Caribbean; heroin fromSoutheast Asia’s Golden Triangle (Burma, Laos, andThailand) and South A s i a ’s Golden Crescent(Afghanistan, Pakistan, and Iran). However, in recentyears, a substantial percentage of American demandhas been met by illegal domestic production. In partic-ular, the drugs gaining popularity among teenagers—

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2 Three-quarters of these regular abusers are employed and three-quarters are white.

officials. Western observers believe the actual numbermay be as high as four million.

In South America’s Andean countries, the smokingof coca paste (known as basuco) is increasing, espe-cially among children and teenagers. Cocaine use,once portrayed by Latin American governments as anexclusively North American vice, is also spreading. InBolivia, by some estimates, 300,000 people usedcocaine in 1994 compared to 25,000 in 1979—atwelvefold increase in 15 years. Ready drug availabil-ity, lower prices, and broad societal pressures havecombined to convert many producer countries intoconsumers of their own products.

Traditional categories have also blurred with regardto transit countries. A particularly striking example isMexico, which in the late 1960s and 1970s was a pri-mary producer of the heroin and marijuana coming intothis country. During that period, the United States con-centrated much of its drug control funding on coopera-tive drug eradiction programs in Mexico, which for afew years succeeded in reducing overall Mexican drugproduction. It did not, however, put Mexican traff i c k-ers out of business. In the mid-1980s, the United StatesCaribbean interdiction strategy, designed to preventcocaine and marijuana from coming into South Florida,essentially pushed the Colombian cocaine cartels intofinding new routes through Mexico. As one LatinAmerican scholar noted at a Task Force meeting, “theinflux of Colombian cocaine money transformedsmall-time Mexican drug families into world-classdrug cartels.” In addition to becoming a key transitroute for South American drugs, Mexico has remaineda major producer of heroin and marijuana for the U.S.

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Enforcement Administration (DEA), compared to lessthan 2 percent THC in marijuana cultivated in theearly 1970s. Even as potency has increased, marijuanaprices, after rising during the 1980s, have in the 1990sfallen back to levels of the early 1980s. Dependingupon quality, marijuana now sells for roughly the sameas its price in 1982—as little as $40 per ounce,although prices for high quality ‘boutique’ marijuanastrains can reach $900 per ounce.

Meanwhile, traditional drug producing countrieshave also become drug consumers. Indigenous use oflocal drug crops (opium and coca) has been prevalentin certain regions for generations. For example, the hilltribes of Burma, Laos and Thailand have traditionallysmoked and eaten opium to ease pain, hunger, anddysentery. So, too, have indigenous farmers and min-ers in Bolivia and Peru chewed coca leaves to ward offfatigue, altitude sickness, and hunger. Cultural prac-tices as well as expense generally precluded local useof heroin and cocaine refined from opium and cocacrops.

Over the past decade, however, secondary marketsfor heroin and cocaine in traditional societies havespread rapidly, made possible by expanded worldwidedrug production and falling prices. Asian opium pro-ducing countries have increasing numbers of heroinaddicts. China, where the Communist leadership useddraconian measures to eliminate widespread addictionin the early 1950s, once again faces a growing drugproblem. Supplied by opium produced and refined innorthern Burma and China’s southern Yu n n a nprovince, the People’s Republic of China now hasnearly 400,000 heroin addicts, according to Chinese

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previous history of coca cultivation. Opium poppy,too, has spread to non-traditional areas. Before 1991,opium cultivation in Colombia had been negligible,but when cocaine profit margins fell during the late1980s, Colombian traffickers diversified into produc-ing heroin from locally grown poppies. Opium culti-vation spread rapidly. According to DEA estimates, by1996 Colombia was supplying 60 percent of the hero-in coming into the United States. At the same time,farmers in Peru and Venezuela also started growingopium commercially in addition to coca.

Drug crops are the mainstay of some poor coun-tries, where farmers have few economic alternatives.In Bolivia, with an annual per capita gross domesticproduct (GDP) of about $770, an acre of coca yieldsits grower about $475 yearly. That has proved a farmore attractive return than prices ranging from $35-$250 an acre for crops such as bananas or grapefruit,which are far more susceptible to spoilage than coca.In 1992, coca generated an estimated $450 million inexport revenues, equivalent to about 9 percent ofBolivia’s GDP.

In the newly independent Central Asian states,most of which have high unemployment, weakeconomies and low standards of living, opium hasbecome an important revenue source. One hectare(2.47 acres) of poppies can produce 20 times theincome of a hectare of cotton, Central Asia’s mostimportant cash crop, and 35 times the income of ahectare of vegetables. In Kyrgyzstan, for example,where per capita gross national product (GNP) wasonly $610 in 1994, a pound of opium brings $400 inlocal markets or can be bartered for canned goods,

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market and has become a source for the primary pre-cursor to methamphetamine.

Drug Cultivation Is Rapidly Expanding WorldwideDrug crops can be cultivated easily and cheaply almostanywhere in the world, as can be seen from theincreased number of countries producing drugs overthe past two decades.3 Although coca has long been atraditional crop in Peru and Bolivia, which togetheraccount for three-quarters of world production, it isnow grown in other South American countries with no

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3 Production measures for illicit drugs are, of course, only rough esti-mates. The geographical remoteness that favors illicit crop cultiva-tion also hinders researchers from accurately measuring the level ofillegal production. Growers and marketers have obvious incentivesto conceal their activities, and governments themselves may exagger-ate or underestimate drug production and trafficking in their countriesin order either to attract foreign aid or to avoid sanctions.

to be involved in drug trafficking, from becomingPrime Minister of Thailand.

In this hemisphere, the power of drug traffickersu n d e r m i n e s f r a g i l e d e m o c r a t i c i n s t i t u t i o n s . I nColombia, the world’s primary cocaine producer, illicit drugs help finance guerrilla insurgency in thecountryside as well as subvert many governmentalinstitutions in the cities. Reports of drug corruptionamong politicians in Colombia have long been com-mon. Allegations that President Ernesto Samperaccepted cartel money in the 1994 election campaigncontributed to U.S. “decertification” of Colombia in1996.4 Colombia’s judiciary has been seriously com-promised by drug money and intimidated by violentattacks and assasinations. Widely publicized arrests ofmajor Colombian drug traffickers can be meaningless,critics argue, because of the lenient sentences theyreceive and then serve in relative comfort, while oftencontinuing to manage illicit enterprises.

In Mexico, drug traffickers are believed to havepenetrated the former Salinas Administration and maybe linked to several political assassinations. Althoughthe current president Ernesto Zedillo, like his prede-cessor, has pledged to clean up corruption, he may nothave sufficient power to do so in the face of the grow-ing influence exercised by traffickers and theirbankrolls. One example of the apparent influence of

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cooking oil and other commodities. Opium productionin Tajikistan, Turkmenistan and Uzbekistan has dou-bled since 1990.

Drug Trafficking Undermines Political, Financial andEconomic InstitutionsProfits from drug trafficking have grown enormouslyover the past two decades. The drug industry, nolonger limited to local or regional “families” or “car-tels,” is serviced by sophisticated legal and financialprofessionals, a few of whom manage cash flows larg-er than the annual budgets of many small nations.Drug traffickers buy political influence, corrupt gov-ernments and distort economies, threatening democra-tic institutions—especially in developing countries.

Drug traffickers and other transnational criminalsyndicates are undermining the political and econom-ic development of newly independent countries inCentral Asia, Eastern Europe and Russia. Burgeoningentrepreneurs in those countries have learned that harddrugs are a ready substitute for hard currency on theworld market. Of particular concern are inroads bycriminal enterprises into the Russian banking system,which allows them access to facilities for launderingillicit profits of all kinds, including from drugs.

In Southeast Asia, the Burmese economy is thoughtto rely heavily on the drug trade, according to a June1996 report by the U.S. Embassy in Rangoon. Somepoliticians and generals in neighboring Thailand andLaos are believed to have links to the drug trade. In1992, for example, intense U.S. pressure blockedinfluential Thai politician Narong Wongwan, alleged

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4 Decertification has potentially severe consequences for a country: the cutoff of U.S. aid (except for narcotics control assistance), U.S.opposition to World Bank and other multilateral development loans to the decertified country, and the stigma of being branded a drug-trafficking nation.

Intelligence Agency spending is classified, but thata g e n c y, like the military today, devotes more of itsassets to international drug control intelligence andoperations than during the Cold War years. In the pastdecade, Federal spending on international drug control,including interdiction efforts, reached nearly $20 bil-lion. Approximately 80 percent of that total supportedinterdiction while 20 percent funded source countryprograms to reduce drug production and traffic.

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these syndicates with senior police officials occurredin November 1995 when a jet owned by the Cali car-tel, loaded with cocaine, landed in the Mexican state ofBaja California Sur. Witnesses report that uniformedMexican Federal Judicial Police unloaded the plane.The cocaine, estimated to be worth $100 million onthe U.S. retail market, simply disappeared. In January1997, a senior Mexican drug prosecutor was assassi-nated in Tijuana, an event likely prompted by drug-related rivalries among corrupt factions within thestate and federal police. On February 6, 1997 Mexicanauthorities arrested army General Jesus GutierrezRebollo, a highly respected career military officer whohad been appointed Commissioner of Mexico’sNational Institute to Combat Drugs in December 1996.Gutierrez and some of his senior staff officers areaccused of taking bribes from Mexico’s largest drugcartel, the Carrillo Fuentes organization, in return forprotecting its operations. Gutierrez’ collusion withtraffickers is alleged to date from 1990.

INTERNATIONAL DRUG CONTROL:A MULTI-AGENCY FEDERAL EFFORT

Fourteen different Federal departments and agenciesare engaged in international drug control efforts. Sixprincipal agencies account for 95 percent of totalexpenditures: the Customs Service, Department ofDefense, Coast Guard, State Department (Bureau forInternational Narcotics and Law Enforcement A ff a i r s ) ,D r u g E n f o r c e m e n t A d m i n i s t r a t i o n , a n d the Immigra-tion and Naturalization Service. Information on Central

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total overseas U.S. drug control spending. LatinAmerica has been the primary focus of U.S. interna-tional drug control efforts, accounting for 90 percent oftotal bilateral narcotics assistance since 1981.

The U.S. Government’s Annual ‘Certification’ProcessDespite evidence that distinctions among producer,consumer and transit countries have blurred in recentyears, U.S. international drug policy reflects a worldview that still divides countries into these categories.This vision underlies the concept of “certification,”legislatively imposed upon the Executive Branch byCongress in 1986, which requires the President todetermine annually whether the governments of drugproducing and transit countries have fully cooperatedwith the United States in curtailing illicit productionand trafficking. Decertification results in the termina-tion of U.S. aid (except for narcotics control assis-tance), U.S. opposition to multilateral developmentloans to the decertified country, and the stigma ofbeing branded a drug-trafficking nation.

A “national interest” exception is used to justifywaiving the penalties for a country that would otherwisehave been decertified—a diplomatic lever to improveperformance without actually cutting off assistance. Forexample, in 1995, Peru, Bolivia, Colombia, Paraguayand Pakistan were certified under national interestexceptions. T h e t h re a t of decertification has been usedto try to pressure friendly countries into greater cooper-ation. However, potential cooperation is often limitedby the fact that governments are not able to exert eff e c-tive control over drug production areas.

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U.S. international drug control policy has been near-ly synonymous with supply control, primarily throughunilateral and bilateral enforcement programs. In addi-tion to unilateral interdiction efforts, American lawenforcement agencies work with foreign counterpartsin targeting major international drug trafficking org a n i-zations. These programs include interdicting drug ship-ments, arresting traffickers, disrupting transit routes,seizing drug assets and destroying drug processingfacilities. Washington also supports source countrydrug crop eradication programs as well as economicdevelopment programs to give farmers alternativelivelihoods. A substantial share of U.S. assistance goesto foreign military and police forces to strengthen theirdrug control capabilities. Reform initiatives to improvethe ability of local judicial systems to convict and sen-tence drug traffickers receive about three percent of

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there are two larger problems with the certificationprocess. First, certification implies that the source ofA m e r i c a ’s drug problems is foreign countries thatrefuse to cooperate. As one Task Force participantasked, “The U.S. is now a major drug producer, butwho will certify its anti-narcotics efforts?” (The StateD e p a r t m e n t ’s International Narcotics Control StrategyR e p o rt gives estimates of marijuana production forevery country except the United States.) Second, thedecertification process—by focusing on one aspect ofoften complex bilateral relationships—can distort themanagement of U.S. foreign policy. In Latin A m e r i c a ,the certification process has been particularly acrimo-nious and apparently at odds with President Clinton’sposition that the nations of the Western Hemisphereshould look to the United States as a partner in a broad-er effort to establish a community of democracies.

Actual decertification has been used sparingly. Thedecertification process’s potential political and eco-nomic costs make U.S. administrations reluctant to useit, especially in countries where the United States hasimportant strategic interests in addition to drug con-trol. Countries such as Burma, Iran and Syria, whereU.S. influence is slight or non-existent, are consistent-ly denied certification. Yet observers point out thatIran pursues a vigorous drug control effort, forciblyeradicating opium crops, seizing large stocks of drugs,arresting users, and executing traffickers. By contrast,Russia is both a substantial opium producer as well asa transit country and money laundering center ofgrowing importance but it is not included on the list ofcountries requiring annual certification.

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The dominance of broader U.S. interests have madethe use of decertification, actual or threatened, incon-sistent in practice. The United States is less likely todecertify countries where economic, trade and securityconcerns lead the bilateral agenda. In 1996, after exten-sive debate within the U.S. government, the UnitedStates decided to certify Mexico, but to decertifyColombia (largely because of allegations of illicit cam-paign contributions involving President ErnestoSamper). Many Latin American leaders and drug con-trol experts criticized this decision, which theybelieved did not take into account Colombian efforts in1995, including increased drug seizures, arrests of Calicartel members, and some drug eradication. The certi-fication process, they noted, harmed relations with bothMexico—which was certified amid intense public con-troversy—and Colombia—which was not certified—without producing any measurable benefits in terms ofnarcotics control.5 M o r e o v e r, critics pointed to whatthey saw as a double standard at work. Colombia’sannual trade with the United States is valued at $6 to $7billion, compared to annual commerce with Mexico ofabout $80-90 billion. A d d i t i o n a l l y, Mexico shares aborder with the United States, making Mexican coop-eration on a range of issues such as crime, immigrationand environmental protection essential to Wa s h i n g t o n .

In addition to apparent inconsistency in application,

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5 Decertification of Colombia has had mixed results. Nationalisticreaction to the U.S. decision buoyed President Samper’s flaggingpopularity. However, Samper’s government did move forward ondrug-related asset seizure legislation long urged by Washington.How that legislation will fare in a judicial system that is often lenientwith Colombian traffickers is not clear.

and that all countries, including those in the South, areat risk of drug abuse and drug-related violence in theirown societies. These changes have fostered a growingsense of shared responsibility for a shared problem.

This principle of shared responsibility formed thebasis of the Hemispheric Anti-Drug Strategy ratifiedby Latin American countries in December 1996, aninitiative President Clinton had proposed at the 1994Miami Summit of the Americas. The principle under-lay the December 1995 treaty between the Andeannations and the European Community (EC) on con-trolling precursor chemicals, the first direct program-matic link between hemispheres on drug control. TheEC subsequently negotiated a similar agreement withMexico, providing another example of how the inter-national community can be active partners in interna-tional drug control efforts.

Multilateral organizations provide important forafor addressing drug control problems of interest to theUnited States. By developing drug control programs ona multilateral basis, member nations can avoid makingnational sovereignty a domestic political issue, a fre-quent source of friction accompanying bilateral pro-grams with the United States. This multilateralapproach holds particular promise in promoting policeand judicial reform and is essential in counteringmoney laundering. The UNDCP, for example, is activein promoting judicial and law enforcement institutions.The Financial Action Task Force (FATF), establishedby the Group of Seven (G-7) following its 1989 ParisSummit, is a good example of how multilateral initia-tives can contribute to international drug control. T h eFAT F, with an expanded membership, has provided the

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Multilateral InitiativesThree major international treaties form the legal frame-work for international drug control cooperation: the1961 Single Convention on Narcotic Drugs; the 1971Convention on Psychotropic Substances; and the 1988Convention Against Illicit Tr a ffic in Narcotic Drugsand Psychotropic Substances. Since the Hague OpiumConvention of 1912, which pledged nations for the firsttime to control production and distribution of opium,the United States has taken a leading role in developingmultilateral treaties to curtail illicit drug production andt r a fficking. Indeed, ratification of these treaties is onemeasure of cooperation that the United States reviewsas part of its annual certification process.

U.N. agencies such as the United NationsInternational Drug Control Program (UNDCP) and theInternational Narcotics Control Board (INCB) andregional groups such as the Organization of A m e r i c a nStates (OAS) and the Andean Pact provide importantopportunities for developing drug control cooperationthrough the concept of shared responsibility.International agencies, however, by their very naturerely on persuasion and consensus-building, often a time-consuming process. U.S. support for drug control eff o r t sby multilateral organizations has been modest—onaverage about five million dollars annually since 1987.

U. N. debates of 15 years ago were generally polar-ized along traditional consumer/producer lines, with theSouth insisting that the drug problem was essentially thefault of the North (especially the United States) for fail-ing to address its own demand for drugs. Now U. N.members share a broad consensus that production ofnarcotics, and not just their use, is part of the problem,

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ed more than three years previously. An estimated26,000 hectares of old coca plants were eliminated.During those same years, Bolivian farmers plantedmore than 35,000 new hectares of coca, which soonreached much greater productivity than the plantseradicated. The unintended effect of U.S. assistancewas to create a coca price stabilization system.

Second, the value of drug seizures in the past hasoften been expressed in terms of the U.S. retail price,regardless of where the drugs are captured. Most of thed r u g ’s value is added after entering the United Statesdue to higher risks of apprehension and punishment andthe higher costs of U.S. labor. Assigning U.S. retail coststo seizures made overseas vastly overstates financiallosses suffered by traffickers. The closer the seizures areto the point of production, the cheaper the drugs are toreplace. (The Task Force is encouraged to note that U.S.agencies are moving away from this practice.)

Third, activity-based measures are open to conflict-ing interpretations. For example, while larger or morefrequent drug seizures might be offered as evidence ofsuccess, they may instead reflect increased productionand trafficking. Conversely, declining seizures at agiven site might also be presented as an indicator oflaw enforcement effectiveness, but may instead meanthat traffickers have shifted their routes.

The apparent logic of relying on interdiction andsource-country activities to reduce the supplies of drugsfor the U.S. market is compelling—no incoming drugs,no drug problem. (This logic overlooks illegal domesticdrug production.) Even if foreign drugs cannot be elim-inated entirely, the logic goes, the laws of the market-place dictate that reducing supplies will drive up price.

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major impetus in strengthening cooperation amongindustrialized countries to address money laundering.With FATF as an example, the OAS is now consideringa Colombian proposal to address money laundering ona cooperative regional basis.

Measuring Success by Operational Criteria Is Misleading The United States generally measures the progress ofits international drug control initiatives in terms ofoperational activities: hectares of drug crops eradicat-ed, numbers of drug laboratories destroyed, shipmentsseized and traffickers arrested. Since 1986, the annualcertification of other countries’ cooperation with theUnited States has served as an amalgam of these activ-ity-based indicators. Although the final determinationof which countries pass the test and which fail is sub-ject to larger political considerations, the underlyingyardstick remains operational.

These activity-based indicators, however, can bemisleading. Operating agencies, both in the UnitedStates and abroad, know their performance will bejudged by these statistical measures and tend to casttheir actions and successes accordingly. Activity mea-sures tend to ignore important qualitative distinctions.For example, the destruction of older, less productivecoca plants in their declining years is worth less insupply reduction terms than eradication of those justentering their productive phase. That distinction is notreliably made in crop eradication data. From 1987 to1993, the Bolivian government used $48 million inU.S. aid to pay farmers the equivalent of $2,000 foreach destroyed hectare of coca which had been plant-

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MONEY LAUNDERING: HIDING DRUG PROFITS

Money laundering6 is indispensable for puttingdrug profits to use. Sophisticated groups like theColombian cartels take advantage of the weakest linksin the global regulatory system by shifting transac-tions, communications and assets to countries with theweakest or most corruptible authorities, the mostrestrictive bank secrecy, extradition, or asset seizure

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That should, in turn, deter potential users from tryingdrugs and force addicts to seek treatment or stop usingon their own. Thus, the price and purity of foreign drugsseized in the United States or at the borders havebecome accepted benchmarks of progress. If A m e r i c a ’soverseas drug control initiatives are succeeding (throughinterdiction, crop eradication, destruction of laboratoriesand arrests of traffickers), drugs coming into this coun-try should be increasingly expensive and less pure.

Judged by these measures, U.S. strategic efforts toreduce foreign supplies of drugs have not succeeded.Although Federal spending on international drug con-trol has increased fourfold since 1981, drug prices onAmerican streets have declined. In March 1995, DEAAdministrator Thomas Constantine testified beforeCongress that “drug availability and purity of cocaineand heroin are at an all-time high.”

As availability and purity have increased, drugprices in the United States have decreased. Wo r l d w i d eopium production has more than doubled since the early1 9 8 0 s and now exceeds 4,000 tons a year—the roughequivalent of 400 tons of heroin. Since 1982, heroin’sU.S. retail price (per pure gram) has fallen by nearlytwo-thirds, and its national average purity exceeds 50precent, compared to only 10 percent 15 years ago.Over the same period, worldwide coca production hasalso doubled, and cocaine’s U.S. retail price (per puregram) has fallen by two-thirds even as its average retailpurity has risen from 47 to 70 percent. This increase indomestic availability of low cost, high purity drugs hascome despite numerous tactical successes by U.S. andcooperating foreign law enforcement authorities, whoestimate that they interdict about one-third of thecocaine destined for the United States.

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6 Money laundering is the process whereby illegal profits are maneu-vered through the financial system to conceal their source, confusethe money trail and return them to the owner, legitimized and readyfor use. The process can be broken down into three distinct phases:“placement” of the “dirty” money in a financial institution or pur-chase of an asset; “layering” to disguise the source of funds by dis-tributing them among other institutions as investments; and “integra-tion” into the legitimate financial and economic system.

to coordinate a hemispheric response to combatmoney laundering.

Effective implementation of these agreements hasthus far eluded the international community, in partbecause money laundering specialists use state-of-the-art methods to stay well ahead of law enforcement. Asecond problem is the huge volume of internationalfinancial transactions. In the United States alone, morethan a trillion dollars move in and out of the financialsystem daily. Hiding illicit transfers in that flow isbeing made easier with the growing use of cybercur-rency (electronic money) systems using on-lineencryption devices. Additionally, there are difficultsocial, political and legal challenges inherent inimposing a strict financial reporting regime on capitalflows in democratic societies where expanding inter-national trade, economic development and prosperityare believed to depend upon the free flow of globalcapital. Control regimes construed as hindering thatcapital flow get even less support in countries with tra-ditions of bank secrecy, whether to protect non-drugrelated flight capital or, as with many offshore bankinghavens, simply as a means of attracting new money.

There is no official accounting of the resourcesdedicated to money laundering controls by the numer-ous U.S. agencies involved.7 The best guess of oneveteran IRS agent is around $400 million per year,making no distinction between domestic and interna-tional operations and programs. Apart from the large

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laws, and the most ineffective bank supervision. It isestimated that drug traffickers pay commissions rang-ing from 15 to 25 percent for money laundering ser-vices. Within the last decade, targeting major drugassets has become an important focus of U.S. drugcontrol strategy.

As recently as the early 1980s, an anti-money laun-dering framework was lacking in most countries andwas totally absent at the international level. Althoughthe 1970 U.S. Bank Secrecy Act addressed moneylaundering, it was not criminalized in the United Statesuntil the 1986 Money Laundering Control Act. The1988 Convention Against Illicit Traffic in NarcoticDrugs and Psychotropic Substances was a major stepin enlisting the global community in a multilateral ini-tiative against drug trafficking. The Conventionrequires signatory governments to criminalize drug-related money laundering; to assert their legal author-ity to confiscate criminal profits; and to exclude banksecrecy as grounds for declining to act against moneylaundering. The 1988 Convention has been ratified bymore than 100 governments.

The G-7 decided in 1989 to create the FinancialAction Task Force (FATF) to harmonize global moneylaundering controls. The FATF produced 40 recom-mendations on measures to control money launderingthrough financial institutions and to improve interna-tional cooperation in money laundering investigations.The European Union passed a 1991 Directive onmoney laundering controls (patterned after the FATFrecommendations) that EU member countries arerequired to incorporate into their domestic laws. The1994 Summit of the Americas included commitments

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7 Federal agencies for money laundering enforcement and/or preven-tion include: Department of State, Customs Service, Internal RevenueService, Federal Bureau of Investigtions, Financial CrimesEnforcement Network (FinCEN) and the Postal Service.

large-scale coca eradication until viable economicalternatives are provided for coca growers. (TheShining Path insurgency, which paralyzed the countryfor almost a decade, drew some of its strength fromdisaffected coca farmers.) Since 1993, estimatedPeruvian coca leaf production increased 20 percent,which accounts for 60 percent of the world’s total.

In Bolivia, U.S.-funded eradication operations haveconsistently drawn strong opposition from well-orga-nized coca farmers, who comprise about 10 percent ofthe country’s agricultural work force. Faced with thethreat of decertification and the cut-off of $81 millionin annual foreign aid from the United States, theBolivian government in 1995 resumed coca eradica-tion efforts, despite demonstrations by farmers whichthe police forcibly suppressed. Although the govern-ment claimed a 5 percent reduction in potentially har-vestable coca leaf tonnage, additional plantingsincreased slightly the overall area under cultivation.Bolivia continues to produce approximately one-fourth of the world’s coca leaf, the third largest pro-ducer behind Peru and Colombia (which now growsslightly more than Bolivia).

In Colombia, U.S.-supported drug eradicatione fforts have had limited results. In 1995, theColombian military undertook a vigorous coca eradi-cation program. Coca farmers in southern Colombiastaged protests alleging government failure to keepprevious agreements to provide economic develop-ment for the region. Instead, they complained, theColombian military was depopulating the area anddestroying food crops by herbicidal spraying. In theend, government forces reported destroying nearly

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flows of legitimate money transfers in which to hidedrug profits, the advantage remains with the criminals.Uneven legislation among the world’s governments,‘offshore’ banking safe havens and the speed and easeof electronic commerce make enforcement difficult.Experience in the United States, the world’s largesteconomy and most lucrative drug market, suggeststhat not all of the enforcement challenges lie abroad.According to DEA estimates, three-quarters ofColombian drug proceeds are laundered through NewYork City. Moreover, according to the StateDepartment’s 1996 International Narcotics ControlStatus Report, “U.S. financial systems continue to beexploited, at levels probably not approached by anyother country.”

U.S. SOURCE COUNTRY PROGRAMS:UNINTENDED EFFECTS

U.S. drug control initiatives have had unintendedadverse consequences, particularly in Latin America,the primary focus of U.S. drug control funding for thepast two decades. Eradication campaigns stir politicalunrest and violence among farmers who depend upondrug crops as their principal source of income. Peru’spresident Alberto Fujimori’s stance offers an exampleof how domestic realities affect foreign political lead-ers, even those who otherwise cooperate closely withU.S. anti-drug efforts. Fujimori has endorsed the U.S.-financed Operation Laser Strike to intercept planessmuggling coca paste and cocaine from Peru toColombia. Fujimori, however, has refused to approve

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United States, citing many of the same reasons whythe U.S. military has traditionally been precluded fromdomestic law enforcement. Nevertheless, the Andeancountries eventually agreed to greater participation bytheir armed forces. One result has been to validate anew internal security role for Latin American mili-taries, further blurring the distinction between civilianand military responsibilities.

An enhanced military role in drug control alsoincreases the potential for corruption. Although corrup-tion plagues enforcement efforts regardless of theinstitution, the military’s power and traditional lack ofaccountability magnify this problem. As one Latin

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9,000 hectares of coca (and no opium). Nevertheless,new plantings increased Colombia’s total coca cultiva-tion by 14 percent, to 50,900 hectares in 1995.

In the United States, local opposition has impededFederal and state enforcement efforts to eradicate illic-it marijuana cultivation in California, Oregon andother states. In November 1996, voters in Californiaand Arizona approved state legislation permitting doc-tors to prescribe marijuana for medical purposes,which conflicts with Federal law. The courts have notyet clarified whether the new state laws permit mari-juana cultivation for personal medical use.

U.S. International Drug Control Efforts Can HinderDevelopment of Stable DemocraciesDrug crops are usually grown in remote areas wherecivilian government exercises limited authority, espe-cially when anti-government insurgencies are presentwhich rely on drug production and traffic for financialsupport. In pursuing crop eradication, the UnitedStates often has had little practical alternative to work-ing with host country armed forces rather than policeforces that may be under-trained, under-equipped andcorrupt. Critics note that the United States is thereby‘militarizing’ the drug war at a time when many LatinAmerican countries are working to consolidate fragiledemocracies after decades of military rule.

Beginning with the 1989 Andean Initiative, theU.S. has urged Latin American governments toinvolve their armed forces in drug control. At the time,Andean governments insisted that more attention bepaid to the economic aspects of drug production andresisted the full-blown military role advocated by the

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the Federal Judicial Police (MFJP), the lead drugenforcement agency for the past 25 years, has a longhistory of corruption. As the first step in a major judi-cial reform effort, former Mexican Attorney GeneralAntonio Lozano fired 737 police officials in September1996. Lozano’s successor, Jorge Madrazo P. Cuellar( M e x i c o ’s seventh attorney general in eight years) haspledged to continue the reforms. On February 21, 1997,Madrazo removed 87 MFJP o fficers in Baja CaliforniaNorte along the western U.S.-Mexico border whereMexican officials acknowledge the Tijuana cartel hascorrupted federal and state enforcement agencies. T h epolice officers were replaced by 46 army soldiers. T h i saction followed the government’s revelation two daysearlier that military General Jesus Gutierrez Rebollo,M e x i c o ’s top drug enforcement official and some of hissenior staff had been arrested on charges of takingbribes from major drug dealers.

Human Rights Abuses and Drug ControlThe protection of human rights and the strengtheningof democratic institutions are important U.S. foreignpolicy objectives. U.S. international drug control pro-grams in source countries have at times come into con-flict with those objectives. It is important to rememberthat human rights abuses in Latin American and othercountries are not new; nor will they disappear if theUnited States withdraws support for source countrydrug control activities. Every effort should be made,however, to ensure that U.S. drug control policy andprograms do not contribute to human rights problems.

U.S.-provided equipment is not always used for thedrug control purposes specified in the agreements

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American expert told the Task Force, “For the sake oflegitimate ends [drug control], U.S. policy relies onthe most anti-democratic, corrupt and unaccountableforces in Latin America. The U.S. is looking for ashort-cut to drug control by using these institutions,and letting one issue dominate all others.”

The presence of insurgencies further complicatesthe drug control picture in Latin America. For example,the Colombian military has at times pursued counterin-s u rgency—its top priority—through de facto a l l i a n c e swith private paramilitary organizations and othergroups reportedly involved in the drug traffic. T h eColombian government is now seeking to restore thea r m y ’s power to conduct judicial investigations, some-thing it lost 15 years ago, as the country strengthenedits democratic institutions. Charging military units withdrug enforcement responsibilities can exacerbate prob-lems of corruption, which has been noted as a recurringproblem in Bolivia and other Latin American countriesby the State Department’s annual I n t e r n a t i o n a lN a rcotics Control Strategy Report. Gonzalo Sanchezde Losada, former Planning Minister and currentPresident of Bolivia, described the threat posed by anunaccountable military when he said “When you havea corrupt chief of police, you fire him. When you havea corrupt chief of the army, he fires you.”

In Venezuela, the head of the National Guard’s anti-drug bureau from 1987 to 1991 was recently indictedby a U.S. grand jury for smuggling 22 tons of cocaineinto the United States. during his tenure, a period whenhe worked closely with the DEA and CIA. In Peru,hundreds of pounds of cocaine were seized in 1996 onPeruvian Navy ships and Air Force planes. In Mexico,

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Department’s Human Rights Report for 1996, theColombian government’s overall human rights recordremained poor: “Although extrajudicial killings by thesecurity force declined somewhat, the armed forcesand the police continued to be responsible for seriousabuses including, according to credible reports,instances of death squad activity within the army.”

In Mexico, the military used helicopters purchasedwith U.S. drug control aid to transport troops to thesouthern state of Chiapas to fight guerrillas in 1994.Meanwhile, a 1996 GAO report found that “U.S. andMexican efforts have had little, if any, impact on theoverall flow of drugs through Mexico into the U.S.”

Looking at the interplay between human rights andcommingling of drug control funding with counter-i n s u rgency efforts in Latin America, one Task Forcemember who served as U.S. ambassador to severalcountries in that region observed, “Based upon myexperience in the region, nothing is working againstdrugs, including the military strategy. We won’t see realimprovements before there is an effective transition todemocratic, accountable, market-oriented states.”

Charges of human rights violations have also beendirected at the actions of special U.S.-funded anti-drugunits in Bolivia, which have received more than $250million in U.S. military and police aid since 1989. U.S.assistance supports about two-thirds of the salaries and90 percent of the operating expenses of the anti-drugpolice known as UMOPAR. Human rights monitorsallege that UMOPAR has routinely conducted arbi-trary mass searches, arrests, thefts, and beatings ofcoca growers in the Chapare Valley, where most ofBolivia’s coca is grown.

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under which it is given. Recent General AccountingOffice (GAO) reports conclude that despite bilateralagreements governing the use of equipment, the U.S.cannot effectively monitor the ‘end-use’of its anti-nar-cotics enforcement assistance. The State Departmentconcedes that it generally must rely on reporting fromrecipient governments for that purpose.

Since 1989 the United States has provided theColombian armed forces and police with more than$500 million in drug control equipment, including heli-copters, utility vehicles, planes, and weapons. A r e c e n treport prepared by U.S. military personnel in Colombiafound that in 1992 and 1993 a large share of drug con-trol equipment that went to army units heavily involvedin counter- i n s u rgency activity was commingled withc o u n t e r- i n s u rg e n c y equipment. Although this reflectsthe Colombian government’s view that guerrillas anddrug traffickers are not easily distinguishable, commin-gling U.S.-provided equipment may violate legalrestrictions governing proper use of U.S. assistance.Plans by the U.S. Department of Defense to work withPeruvian military forces in a riverine drug interdictionprogram raise similar problems. A State Departmento fficial acknowledged in the February 3, 1997 N e wYork Ti m e s the difficulties of sorting out drug controlactivities from counter- i n s u rg e n c y, noting that “...youstill have to deal with the insurgency at night. What youare talking about is imposing control over areas that thecentral Government has never controlled.”

In 1997, the United States plans to provideColombia with $25 million in anti-narcotics equip-ment and support for the military and police, despiteconfirmed human rights abuses. According to the State

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results reflect more fundamental strategic flaws.Policy makers have not in the past questioned whetherthe strategy is appropriate, arguing instead that successsimply requires more resources, more time, and bettercoordination.

D i fferent Administrations and Congresses haveemphasized different tactics, arguably to the detrimentof program continuity. For example, President Reaganemphasized border interdiction, while PresidentClinton has stressed source country efforts. Drug con-trol is also one of several U.S. policy objectives in anycountry (which may be less than fully compatible witheach other). Lack of coordination among both U.S.agencies and national governments is a long-standing,serious problem. Moreover, in the present climate ofbudget austerity, interdiction and source country pro-grams may face future funding constraints or, at thevery least, level budgets.

The Task Force’s analysis suggests that while oper-ational problems—faulty coordination, lack of continu-i t y, and resource constraints—may contribute to thep o l i c y ’s poor record, they are not decisive, even whentaken together. As described below, certain basic obsta-cles severely limit the potential of international supply-control initiatives to reduce U.S. drug problems.

The Economics of Drug Cultivation Drug crops can be grown cheaply almost anywhere inthe world, and farmers have strong economic incen-tives to shift, expand or modify cultivation as requiredto protect their livelihoods. Enforcement directed atgrowers tends to disperse cultivation to ever moreremote areas, making detection and eradication even

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In Latin American societies, judicial institutionbuilding is an important objective of national govern-ments as well as U.S. international drug policy. Byreforming the courts which hear drug-related cases,policy makers hoped to see more traffickers convicted.However, human rights groups note that even the U.S.-supported Rule of Law (ROL) program to strengthenAndean judiciaries may be doing more harm thangood. In Colombia and Bolivia, the ROL program sup-ports special anti-drug legislation and courts whichoften violate fundamental due process guaranteeswithout speeding up drug trials and convictions—theirintended goal. Because of corruption within the judi-cial system, poor detainees remain in jail for yearsawaiting trial while drug traffickers pay bribes toobtain release or plea bargain for shorter sentences.

THE LIMITS TO INTERNATIONALSUPPLY CONTROL

The downward trend of drug prices indicates a gener-al failure of U.S. international drug control policy tomeet its goals, notwithstanding the increased profileand resources accorded interdiction and source-coun-try programs since the early 1980s. In the absence ofinternational supply control efforts, domestic drugprices might have fallen to even lower levels. But thegoal of raising prices high enough to keep drugs out ofreach for most consumers is still remote. The keyquestion for policy makers is whether the evident lackof success to date stems from inadequate implementa-tion of an otherwise sound policy or whether the poor

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more difficult. In Peru and Bolivia, for example, onlyone percent of land suitable for coca is now being cul-tivated, leaving vast areas for growers to use if theircurrent fields are targeted by eradication efforts.

Sustained eradication requires viable economicalternatives for drug crop farmers. The only exampleof prolonged, significant reductions in drug productionin the past two decades is Thailand, where rapid eco-nomic growth created real alternatives for opiumfarmers. Additionally, favorable political and securityconditions permitted Thai authorities to carry out lim-ited eradication while international development agen-cies as well as the United States supplied substantialdevelopment programs in the growing areas.

Placing the accomplishments of U.S. anti-drug pro-grams in the context of overall production trends pro-vides a better sense of program impact. The StateDepartment reports that eradication programs from1989 through 1995 eliminated about 55,000 hectaresof Andean coca, enough to have produced about 270metric tons of cocaine. However, over this six-yearperiod, net coca cultivation after eradication in thosesame Andean countries was still an estimated 1.45 mil-lion hectares, equivalent to about 7,250 metric tons ofcocaine. As General McCaffrey, Director of the Officeof National Drug Control Policy, concluded in aJanuary 23, 1997 interview with National PublicRadio, “If we look back on the last six years in Peru,we’ve made absolutely no progress reducing theacreage under coca cultivation until this last year whenwe appear to see President Fujimori’s energies startingto bear fruit. But essentially, production’s been levelfor six years. Bolivia...production’s gone up for six

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here. Recent anecdotal evidence from theSouthwestern border of the United States suggests thatsmuggling costs may now be higher, as Mexican traf-fickers are said to be offering as much as half theircocaine shipments in exchange for safe passage. Still,the value of the drugs at that point in the transitprocess remains only a fraction of the price at the retaillevel on American streets. As one DEA o ff i c i a lexplained, “The average drug organization can affordto lose as much as 80 percent of its product and still beprofitable.” Street level enforcement in the UnitedStates has proved the most effective way of raisingretail prices for illicit drugs; through a greater policepresence, it also helps deter violence generated bystreet drug markets.

U.S. Consumes a Small Portion of Worldwide Drug ProductionAccording to the DEA, Americans used 10 metric tonsof heroin in 1995, less than 3 percent of potentialworldwide production (for 1995, more than 400 metrictons) based upon current opium yield estimates. Ournearly 300 ton annual cocaine consumption representsonly about one-third of estimated worldwide produc-tion potential (for 1995, 780 metric tons). Apoppy fieldof about 30 square miles can supply the A m e r i c a nheroin market for a year while cocaine demand can bemet from coca fields of about 300 square miles.Americans consume a small amount of the estimatedworldwide production of marijuana (for 1995, 7,839metric tons, not including U.S. production for whichthere is no official U.S. estimate). Recognizing thatillicit drug imports constitute a minute fraction of the

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years. Production of opium in Colombia’s gone fromzero to sixty-five metric tons a year...So, it’s sort of adiscouraging situation.”

The Price Structure of the Drug MarketInterdiction continues to achieve impressive tacticalsuccesses against drug traffickers, but these effortshave been overwhelmed by the volume of drug pro-duction. Drugs are now so plentiful that even thelargest seizures have little impact on drug availabilityin the United States. Traffickers quickly move on tonew sources, shipments and routes.

Intensive U.S. interdiction efforts in the Caribbeanin the 1980s effectively turned Mexico into a majortransit zone by forcing Colombian traffickers intoalternative routes. In recent months, the eastern Pacifichas become a major maritime route for SouthAmerican drugs bound for the United States. TheU.S.-assisted Peruvian and Colombian campaign tointercept cocaine flights brought down 39 planes in1995, but only a few in 1996. Avoiding the more dan-gerous air routes, traffickers have shifted to riverroutes through dense, sparsely populated jungleswhich makes detection far more difficult. The U.S.Department of Defense is now studying ways to assistPeruvian forces in a major riverine interdiction effort.If, and when, these river routes become too risky, thetraffickers will move on to other areas.

The largest drug profits are made within the UnitedStates at the level of street sales, not in foreign poppyor coca fields or on the high seas. The total cost of cul-tivating, refining and smuggling cocaine to the UnitedStates accounts for less than 15 percent of retail prices

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annual commerce across U.S. borders puts the diff i c u l ttask of interdiction in perspective: each year an esti-mated 436 million people enter the United States byland, sea and air; 116 million motor vehicles cross U.S.borders; and more than 9 million shipping containersand 400 million tons of cargo enter U.S. ports.

Limits to Price as Drug Policy ToolA key goal of international drug control efforts is tomake drugs more expensive in the United States inorder to reduce drug abuse. However, only very steepprice increases are likely to curtail drug consumptionamong heavy drug users and addicts. Sufficientlysteep price increases appear unlikely based upon theexperience of the past two decades.

Task Force members noted that even if higher drugprices could be achieved, they would stimulateincreased drug-related crime as addicts seek addition-al money to buy more expensive drugs. The impor-tance of heavy users’demand for drugs is underscoredby the changing composition of America’s cocaine-using population. After peaking in the early 1980s, thenumber of cocaine users has declined by half, but theoverall quantity of cocaine consumed annually hasremained high. Increased cocaine use by addicts hascompensated for the decreased number of “light”users. In 1992, two-thirds of total cocaine consump-tion in this country was attributed to “heavy” usersmost resistant to price changes, who constitute onlyone-fifth of all American cocaine users.

Raising the price for domestic users can also raiseprofits for traffickers. Because most of the costs ofillicit drugs are added once they are in the United

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Federal drug policy moved toward enforcement, whichreceived about half of all funding from 1976 to 1981.By the end of the 1970s, the spread of heroin addictionhad been contained. The numbers of addits declinedfrom an estimated 800,000 to 500,000, a number whichremained relatively constant throughout the 1980s.

Declaring an all-out “war on drugs,” PresidentReagan radically changed the focus of Federal drugfunding, concentrating on law enforcement and inter-diction over demand reduction. Funding for drugenforcement more than doubled from $800 million in1981 to $1.9 billion in 1985. During the same period,Federal support for prevention, education and treat-ment declined from $404 million to $338 million.Subsequent Administrations have continued to empha-size law enforcement over demand reduction. In 1997,one-third of the Federal budget funding supports pre-vention, education and treatment, while two-thirdssupports interdiction, enforcement, and internationalsupply reduction efforts.

Much of the progress against drug abuse in the pastdecade comes from reduced demand, which hasdeclined in the face of increasing supplies of evercheaper drugs. Between 1986 and 1992, marijuana andcocaine use dropped by half, reflecting the power ofhealth concerns and negative social attitudes towardsdrugs (which sharpened after the sudden cocaine over-dose death of sports star Len Bias in 1986). The “JustSay No” campaign, led by Mrs. Nancy Reagan duringthe 1980s, also contributed to social disapproval ofdrug use. The recent increase in teen drug use (whichhas doubled since 1992) suggests that public percep-tions of the risks of drug use have changed and social

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States, a trafficker’s overhead outside this country isrelatively low. When U.S. retail prices go up, traffick-ers can increase short-term profits by increasing sup-plies destined to the U.S. market.

International drug control efforts do not reduce illic-it drug cultivation and production within the UnitedStates. As noted earlier, marijuana is produced in theUnited States, as are illicit synthetic drugs: metham-phetamine, lysergic acid diethylamide (LSD), PCP a n dthe hallucinogen MDMA (ecstacy). Abuse of thesesynthetics, while small in comparison with cocaine,heroin and marijuana abuse, is growing modestly.These drugs are potential substitutes if foreign drugsbecome unavailable. According to the United Nations’International Narcotics Control Board, clandestinemanufacture in the United States of methamphetamineis increasing, and U.S.-based LSD laboratories supplydrug markets in Europe as well as the United States.

REDUCING THE DEMAND FOR DRUGS:KEY TO LASTING PROGRESS

During the 1970s, U.S. international drug controle fforts were linked closely to domestic demand reduc-tion. In the face of a nationwide heroin epidemic,President Richard Nixon established the Special A c t i o nO ffice of Drug Abuse Prevention (SAODAP) in 1971to supervise all Federal prevention, treatment andresearch programs. Between 1970 and 1975, preven-tion, education and treatment received nearly two-thirds of the total Federal drug budget—$1.92 billionout of $3 billion. Under Presidents Ford and Carter,

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Treatment is far less expensive than the alternatives.An untreated addict can cost society an estimated$43,200 annually, compared with an average $18,000for a year of residential treatment or $2,000 in an out-patient program. A 1994 statewide study in Californiafound that $1 invested in alcohol and drug treatmentsaved taxpayers $7.14 in future costs. Drug courts,which divert nonviolent offenders from prison to court-supervised drug treatment, are also cost-effective: stud-ies report that drug courts cut recidivism by half amongtreated offenders at a small fraction of the cost of incar-ceration (about $30,000 a year on average).

Treatment is also more cost-effective than interna-t i o n a l s u p p l y r e d u c t i o n e ff o r t s . A 1 9 9 4 RAND study found that $34 million invested in treatmentreduced cocaine use as much as $783 million spent for foreign source country programs or $366 million for interdiction.

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attitudes have become more tolerant. These trends arereported in annual nationwide surveys of junior high,high school and college students. Reversing this pat-tern will require expanded prevention and educationefforts that build on the research of the past decade.

Extensive research shows that school prevention pro-grams can reduce new drug use by half and new alcoholuse by a third among early adolescents. These programs,built on social learning theory, teach children to recog-nize the internal and external pressures which influencethem to smoke, drink, and use drugs. They also learnhow to resist these pressures through role-playing in theclassroom. The cost of these programs ranges from $15to $25 per pupil, including classroom materials andteacher training. Program effects are stronger when pre-vention includes families, media, and the community ina comprehensive effort to discourage alcohol, tobacco,and drug use. Advertising by the Partnership for a Drug-Free America has accelerated negative attitudes towardsillegal drugs among some groups, particularly in mar-kets where their ads appear frequently.

Treatment has also proved effective in reducingdrug use and drug crime. National studies that havefollowed tens of thousands of addicts through differentkinds of programs report that the single most impor-tant factor is length of time in treatment. One-third ofthose who stay in treatment longer than three monthsare drug-free a year after leaving treatment. The suc-cess rate jumps to two-thirds when treatment lasts ayear or longer. And programs that provide intensive,highly structured treatment with supportive follow-upservices (like vocational education, job training, andhousing referral) report even better results.

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S U M M A RY

Since 1981, the U.S. government has spent more than$25 billion for foreign interdiction and source countryprograms intended to reduce the supplies of drugscoming into this country. Despite impressive seizuresat the border, on the high seas, and in other countries,foreign drugs are cheaper and more readily availablein the United States today than two decades ago.Domestic production of illegal drugs is increasing,suggesting that American sources could potentiallymeet future foreign shortfalls, if any occur. Moreover,these programs have created problems of their own,strained relations with other countries, particularly inLatin America; political unrest among peasant farmerswho rely on drug crops for their livelihood; humanrights abuses as governments try to suppress drug cul-tivation; increased corruption among police and mili-tary forces; and expanding roles for the military indrug enforcement and internal security in countrieswhere democracy is still fragile.

The Task Force believes that America’s internation-al drug control priorities should shift from a primaryfocus on foreign drug supplies to the growing powerand profits of the transnational drug cartels that chal-lenge the integrity of political, financial and judicialinstitutions in this country and abroad. The UnitedStates should place greater emphasis on efforts both tostrengthen democratic governments and to combatmoney-laundering, drug-related corruption and vio-lence through bilateral and multilateral initiatives. The

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Community law enforcement plays an importantrole in reducing demand: cleaning up street drug mar-kets makes neighborhoods safer by protecting resi-dents from violence and drug dealing. As the recentsuccess of New York City’s “broken windows”enforcement campaign attests, safer neighborhoodsproduce many benefits, including reductions in crimeand greater citizen involvement in community life.Community level enforcement also sends an importantsocial message that drug dealing will not be tolerated,reinforcing community and school prevention efforts.

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A D D I T I O N A L AND D I S S E N T I N G V I E W S

Task Force member Sergio Galvis endorses the overallconclusion of the report that continuing supply-sidecontrol measures should be complemented by furtherand more effective demand-reduction policies. In thatconnection, he considers it significant that, as thereport notes, between 1986 and 1992 negative socialattitudes toward illegal drugs contributed to a 50 per-cent reduction in the numbers of Americans who usedmarijuana and cocaine. He does not agree, however,with the implication in the report that supply-side con-trol policies, which rely in part on military actionagainst drug-producing and trafficking organizations,inevitably hinder democratic development in produc-ing and exporting countries and contribute to humanrights abuses. In Mr. Galvis’ view, in certain countrieswhere the nexus between illegal narcotics activitiesand insurgency groups is growing, effective andresponsible action by local professional militaryforces, combined with international support througheducation and materiel, can play a critical role in pro-tecting democratic institutions and improving socialconditions.

Sergio Galvis

Task Force member Peter Hakim considered it ques-tionable whether a group with primary expertise inforeign relations should focus its recommendations onU.S. domestic drug control policy. He agreed that U.S.policy should emphasize the strengthening of democ-

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Task Force also believes that international efforts,however successful, cannot be expected to reduce drugabuse within this country. Demand reduction—pre-vention, education, treatment, community lawenforcement—is key in achieving sustained progressin addressing America’s drug problems.

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York Times, was a foreign correspondent for theTimes at the United Nations for nine years and laterbecame the Executive Editor. Mr. Rosenthal won thePulitzer Prize for his work in Poland.

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ratic institutions to withstand drug-related violenceand corruption, and thought that the report would havebeen more useful if it had offered concrete guidanceon how this could be accomplished.

Peter Hakim

I have decided that it would be a mistake and mislead-ing for me to support or be associated with the reportor try to deal with my objections in footnotes.Certainly there is material in the report with which Iagree. But the report taken as a whole is so negative insubstance and tone about United States efforts to stemdrug use, production and distribution that it amounts toan invitation to drop those efforts and concentrate on‘demand reduction.’ The anti-drug war depends onlaw enforcement, interdiction, supply reduction, druguse reduction, education and therapy. Turning awayfrom any of these efforts would result in serious dam-age to the anti-drug movement. The report also makesit seem almost as if the human rights problems in theareas discussed are the fault of the United States anti-drug work. The fact that human rights abuses in thesecountries are largely the result of their governments,their police, the corruption within, is mentioned onlyglancingly, almost as a technicality. This is a distortionof historic and current reality that does disservice bothto the drug war, and to the cause of human rights.

A.M. Rosenthal

Although Mr. Rosenthal participated in the Ta s kForce, he did not wish to be associated with the TaskForce Report. Mr. Rosenthal, a columnist for The New

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United States remain at all-time lows, in part becauseproduction continues to expand.) In addition,improved border enforcement sends an important mes-sage that the United States is serious about attackingdrug crime and cross-border violence. The groupagreed that U.S. border efforts should be closely coor-dinated with Mexico, perhaps through the creation ofa special bilateral border commission composed ofgovernment officials as well as private citizens. Thedestabilizing of key countries by drug cartels makesthe drug problem a critically important foreign policyissue. However, the group was hesitant to suggestexpanded multilateral enforcement strategies, particu-larly in light of the recent rejection by a summit ofLatin American defense ministers of closer anti-drugcooperation with the United States. The group notedthe importance of disrupting money laundering net-works, seizing drug assets, and stemming the flow ofprecursor chemicals used in illicit synthetic drug pro-duction in this country.

Participants agreed that U.S. concentration onsource-country crop eradication and crop substitutionprograms has been futile, and that even if these effortscould succeed, domestic drug production within theUnited States would quickly compensate for anyshortfalls. From the Mexican perspective, illegal drugcultivation in the United States combined with risingteenage drug abuse raises questions about the sinceri-ty of the U.S. government’s commitment to drug con-trol. The group concurred that U.S. foreign policyinterests lie in reinforcing democratic governments,strengthening judicial and banking systems, and help-

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D I S C U S S I O N S A T M E E T I N G S I NFOUR C I T I E S ,

O C T O B E R — N O V E M B E R , 1 9 9 6

The summaries are intended to convey the broad senseof meeting discussions; they do not in any way repre-sent endorsement of policy recommendations by thelisted participants. Institutional affiliations are provid-ed for identification purposes only.

L O S A N G E L E S , C A L I F O R N I AO C T O B E R 1 0 , 1 9 9 6

Host: Abraham F. Lowenthal, PacificCouncil on International Policy

Comments: Mathea Falco, Drug Strategies

Miguel Ruiz-Cabañas, Mexican Foreign Ministry

Peter H. Smith, University of California, San Diego

In addition to discussing the broad findings of the TaskForce, Los Angeles participants provided a unique per-spective on the importance of border enforcementefforts. Several members noted that drug interdictionat the border can increase costs to traffickers: recentpress stories in California report that Mexican drugcartels take as much as half the Colombian drug ship-ments they deliver to the United States as payment fortheir services. (Nonetheless, drug prices within the

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Richarde Drobnick, University of Southern CaliforniaSusan Everingham, RANDMathea Falco, Drug StrategiesMike Farrell, Human Rights Watch-CaliforniaRodolfo O. de la Garza, University of Texas at AustinArthur Golden, San Diego Union-TribuneSusan Golding, Mayor of San DiegoMichael D. Intriligator, University of California,

Los AngelesJane Jaquette, Occidental CollegeKristin Johnson, Pacific Council on

International PolicyDavid Karl, Pacific Council on International PolicyAbraham F. Lowenthal, Pacific Council on

International PolicyDaniel C. Lynch, Pacific Council on

International PolicyVilma S. Martinez, Munger, Tolles & OlsonJames W. McGuire, Pacific Council on

International PolicyKristin McKissick, Pacific Council on

International PolicyMichael M. Murtaugh, AT&TCatherine O’Neill, Women’s Commission for

Refugee Women and ChildrenMichael B. Preston, University of

Southern CaliforniaDavid Richards, private investorMiguel Ruiz-Cabañas, Mexican Foreign MinistryPeter Rydell, RANDRobert Scheer, Los Angeles TimesStanley Sheinbaum, New Perspectives QuarterlyRichard M. Sloan, Southern California Edison Co.

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ing develop professional law enforcement capabilities,particularly in this hemisphere. These U.S. interestsare especially prominent in neighboring Mexico,where narco-violence, assassination, and corruptionthreaten the security of both countries. The Mexicancartels are now so affluent that they spend a reported$500 million a year in bribing officials—an amountdouble the annual budget of the Mexican AttorneyGeneral’s office, which has primary responsibility fordrug enforcement.

The group concluded that much more needs to bedone to reduce the demand for drugs in the UnitedStates, which one participant observed would require a“Copernican change” in traditional policy thinking.

LOS ANGELES MEETING PARTICIPANTS

Peter Andreas, University of California, San DiegoDouglas Anglin, University of California,

Los AngelesRamon Bahamonde, Pacific Council on

International PolicyGregory Berg, Los Angeles Police DepartmentAlan D. Bersin, U.S. Attorney for the Southern

District of CaliforniaRobert Bonner, Gibson, Dunn & CrutcherMark E. Buchman, financial consultantDan Caldwell, Pepperdine UniversityEmma Cherniavsky, Pacific Council on

International PolicyThomas Cowley, Kroll AssociatesEduardo Martinez Curiel, Pacific Council on

International Policy

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The U.S. market for illegal drugs, an enormousproblem in its own right, also poses a threat to othercountries by enriching criminal org a n i z a t i o n s .Mexico’s president has declared drugs a major nation-al security threat, as traffickers use violence and cor-ruption to subvert political, judicial, and financialinstitutions. The transnational reach of the major traf-ficking organizations requires a coordinated interna-tional response. From the Mexican perspective, theUnited States often does not seem committed to drugcontrol, since demand reduction remains a lower pri-ority and illicit marijuana production is expanding.The United States should understand the unique con-tribution it can make by reducing domestic drug use.

One participant reported that Sweden and otherEuropean countries are facing growing addiction prob-lems, supplied by drugs coming in from the formerCommunist countries. Compared to the United States,however, Sweden places much higher priority on pre-vention and treatment, which receive about two-thirdsof total anti-drug funding. Drug prevention and treat-ment programs have been shown to be far more cost-effective than international supply control programs inreducing drug abuse. But the U.S. policy debateremains driven by politicians’ fear of being labeled“soft” on drugs. The problem is that “tough” soundingapproaches—like overseas drug interdiction and erad-ication campaigns—make for safe politics but dubiouspolicy. As several participants pointed out, a focus onenforcement without due attention to the underlyingsocial pressures and attitudes that foster drug use is arecipe for frustration. U.S. policy should place greater

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Peter H. Smith, University of California, San DiegoDavid Sternlight, U.S./Costa Rica Presidential

Advisory CommissionGerald L. Warren, Pacific Council on

International PolicyMichael Woo, Corporation for National ServiceAdrian Woolridge, The Economist

C H I C A G O , I L L I N O I SO C T O B E R 2 4 , 1 9 9 6

Host: Adele Simmons, The John D. andCatherine T. MacArthur Foundation


Miguel Ruiz-Cabañas, Mexican Foreign Ministry

The Chicago participants agreed that curtailing U.S.drug consumption requires placing priority on demandreduction. Supply control efforts are important, but thegoals of supply control must be clear, and its limits keptin mind. Even if illegal drug imports could be elimi-nated entirely, the U.S. drug problem would continue,as demand is displaced to other drugs produced domes-t i c a l l y. At the same time, traffickers cannot have a freehand; coordinated international efforts must pressuret r a ffickers at the highest levels. However, decliningdrug prices and rising purity over the past 15 years sug-gest that international supply-control programs cannotachieve much if demand for drugs continues apace.

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Mary Page, MacArthur FoundationRobert H. Puckett, Indiana State UniversityMartin Rabinowitch, MacArthur FoundationVictor Rabinowitch, MacArthur FoundationRaymond Risley, Chicago Police DepartmentMiguel Ruiz-Cabañas, Mexican Foreign MinistryMary Scott-Boria, Youth Service Project, Inc.Adele Simmons, MacArthur FoundationJohn Walsh-Alker, Drug StrategiesWoodward Wickham, MacArthur FoundationWayne Wiebel, University of Illinois at Chicago

MI A MI , F L O R I D AO C T O B E R 2 9 , 1 9 9 6

Host: Edward T. Foote II, University of Miami


Eduardo A. Gamarra, Florida International University

Ambler Moss, University of Miami

Participants concurred that U.S. international drugcontrol policy should be built on a strong, comprehen-sive domestic strategy that effectively reducesAmerican demand for drugs. In that sense, the groupnoted, foreign policy cannot be separated from domes-tic efforts. The United States is now both a consumerand producer of illicit drugs: high potency “boutique”

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emphasis on prevention and treatment, and should beconceived as a long-term endeavor, not something tobe achieved before the next election. A balanced, long-term approach will not “solve” the drug problem, butit will make it more manageable.

CHICAGO MEETING PARTICIPANTSPatricia Abrams, Center for Neighborhood

TechnologyKennette Benedict, MacArthur FoundationPeter Bensinger, Bensinger, DuPont & AssociatesKelvy Brown, Mayor of Chicago’s Office on

Substance AbuseDorothy Burge, Associated Colleges of the MidwestIngrid and Ingvar Carlsson, Reed CollegeDouglass Cassel, Jr., DePaul UniversityBarbara Cimaglio, State of Illinois Department of

Alcoholism & Substance AbuseJohn Cooper, University of WisconsinMarcia DamMathea Falco, Drug StrategiesAugustin S. Hart, Jr., retired Vice-Chairman,

The Quaker Oats CompanyS. Rebecca Holland, Treatment Alternatives for

Safer Communities, Inc.Karin KizerRebecca Morales, University of Illinois at ChicagoPrexy Nesbitt, Francis Parker SchoolRichard Newman, Lake Forest Capital

Management CompanyAllan Noonan, U.S. Public Health ServiceJewell Oates, Women’s Treatment Center

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The annual certification of other countries for theirnarcotics control cooperation has not been helpful,according to several members, because the processreinforces the image of the United States as “police-man of the world” without producing measurableresults. The group concurred that U.S. drug policy hasrelied too much on bilateral approaches that attempt topressure other governments to take action that mightnot be in their own interests: one participant noted thatthe United States treats its Latin neighbors as secondclass countries. The group concluded that the UnitedStates should engage other governments as partners,through multilateral and regional coalitions, and worktogether to reduce drug addiction and the power of thedrug traffickers. One example of this kind of approachis the new Panama coalition, led by Panama’s FirstLady, modeled after the Miami Coalition which bringstogether business, political and civic leaders to devel-op community anti-drug strategies.

MIAMI MEETING PARTICIPANTSMae Bryant, Metro-Dade Department of

Human ServicesMarilyn Wagner Culp, The Miami Coalition For A

Safe and Drug-Free CommunityChristopher Deverell, BM&A Ltd.Dennis Fagan, U.S. Customs Office, MiamiMathea Falco, Drug StrategiesEdward T. Foote II, University of MiamiEduardo Gamarra, Florida International UniversityPedro José Greer, University of MiamiJames Hall, Up Front Information Services, Inc.Major Doug Hughes, High Intensity Drug Trafficking

Area Task Force

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marijuana grown in Humboldt County, California issold to wealthy youth in Mexico City. From the Miamiperspective, drug traffickers again threaten the securi-ty of the Caribbean, but now involve more sophisticat-ed transnational narco-criminal networks than in earli-er decades. Specifically, drugs move from Colombiathrough the Caribbean, Puerto Rico, Cuba and theDominican Republic, which has become a key distrib-ution point for cocaine in the eastern United States.Italian crime organizations are trafficking Boliviancocaine out of Argentina, while Russian banks arelaundering money in Aruba. Participants observed thatsmall nations can literally be purchased, particularlywhen solid economic alternatives are not available.Poverty in Latin America and the Caribbean hasincreased substantially in recent years, making thesecountries more vulnerable to drug production and traf-ficking. One member reminded the group that Asiaalso has rapidly escalating drug problems. In China,where heroin addiction has increased 80 percent, thehead of public security in Yunnan Province is seekingto develop effective treatment programs because herecognizes that reducing the demand for drugs is thekey to success.

Money laundering, which has become a major prob-lem in many countries, is particularly apparent inMiami. One expert noted that approximately one-fifth ofLatin American drug profits go back to the producingcountries while the rest remains in U.S. banks: for exam-ple, cash purchases of cars in Miami exceeded $200 mil-lion last year, although a city of this size would normal-ly produce cash car sales of only $2 million. (These carsare then smuggled into Latin America for resale.)

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world. When one source is disrupted, another soontakes its place. For example, the Cali cocaine cartelquickly took over the business of the Medellín cartelafter its leaders were arrested and imprisoned.Although cocaine prices rose somewhat after thearrests, they dropped again to their former levels with-in six months. Another member noted that illicit U.S.production of marijuana has more than compensatedfor marijuana seized in transit from Latin America.

Participants in the Atlanta meeting voiced concernabout the economics of the illicit drug trade, whichgenerates enormous untaxed profits that might other-wise be invested in legitimate jobs and industry. Drugmoney, which circulates through a vast electronicbanking system that supports total daily transfers inexcess of $1 trillion, is often hard to detect. The drugtraffic depends on “an audience held captive by addic-tion,” according to one member, who noted that “richor poor, black or white, all consumers are in the mostbasic sense a source of money.”

From the Atlanta perspective, the lack of invest-ment in prevention is a major problem. Grassrootsorganizations lack the money, technology, and exper-tise to impact public policy. As a result, less than one-third of high school students have any drug preventionprograms; minority students in inner-city schools donot have access to the most effective teaching. Severalmembers observed that politicians find it expedient toblame inner cities and foreign countries for drug traf-ficking while also being critical of social and educa-tional programs that will alleviate the inner city drugproblem. Instead they build more prisons, where struc-tural racism and inequality ensure that incarcerated

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Judge Herbert Klein, Wetherington, Klein & HubbartClyde B. McCoy, Comprehensive Drug

Research CenterAmbler Moss, University of MiamiCharles B. Reed, State University System of FloridaDon Shoemaker, Council on Foreign RelationsSusie Shoemaker, Council on Foreign RelationsDavid S. Weinstein, Florida State Attorney’s OfficeCharles Zwick, retired Chairman,

Southeast Banking Corporation

AT L A N TA , G E O R G I AN O V E M B E R 18, 1996

Host: Harry G. Barnes, Jr., The Carter Center


Robert Pastor, The Carter Center

The group concurred that U.S. anti-drug policy had notbeen successful in reducing drug purity or in increas-ing drug prices—the key goals of international supplyreduction initiatives. Yet the strategy has remainedessentially the same, emphasizing interdiction andsource-country eradication and enforcement. Somemembers noted that even greater resources and betterimplementation would not effectively reduce foreignsupplies of drugs coming into the United States. Drugscan be produced very cheaply almost anywhere in the

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Herschelle Challenor, Clark Atlanta UniversityArchie Crain, Boy Scouts of AmericaKenneth A. Cutshaw, Smith, Gambrell & RussellMathea Falco, Drug StrategiesGordon Giffin, Long, Aldridge & NormanLynn Walker Huntley, Southern Education

FoundationWalter R. Huntley, Jr., Atlanta Economic

Development CorporationSandra MacKey, authorWilmer (Buddy) Parker, Assistant U.S. AttorneyMargaret M. Pastor, consultantRobert Pastor, The Carter CenterGordon L. Streeb, The Carter CenterAdam Taylor, The Carter CenterDavid Worley, attorney

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populations are disproportionately racial minorities.“Race and class fragment the political climate andserve to counter the capacity of society to intervene,”according to one civic leader. Yet, prevention canwork, as demonstrated by the success of anti-smokingefforts, built on a close collaboration between govern-ment and civil society.

Stricter penalties for offenders and traffickers havenot dissuaded use or deterred trafficking. T h eSingapore model, which imposes capital punishmentfor drug dealing, would not be acceptable in this coun-try. The group agreed that drugs must be addressed asboth a national and a community problem with adverseeffects on society, including corruption, violence, andsocial disruption. The problem must also be “desegre-gated” along class and racial lines to concentrateinstead on the corporate structure of the drug business.

The Atlanta group reached a general consensus thatinternational strategies should be re-evaluated and thatmuch higher priority should be accorded to domesticprevention and education efforts. In addition, themedia should be used as an instrument for shapingsocial values in relation to drug use and drug dealingand for discouraging the demand for drugs.

ATLANTA MEETING PARTICIPANTSHarry G. Barnes, Jr., The Carter CenterAl Bartell, The Carter CenterKris Bosworth, U.S. Centers for Disease Control

and PreventionRussell Broda, Robinson-Humphrey Company, Inc.Christopher Burdett, The Carter CenterDavid Carroll, The Carter Center

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—————, Bolivia: Human Rights Violations and the War on Drugs.Vol. 7, No. 8. New York: Human Rights Watch, 1995.

—————, Bolivia Under Pressure: Human Rights Violations andCoca Eradication.Vol. 8, No. 4. New York: Human Rights Watch, 1996.

Human Rights Watch/Americas and Human Rights Watch Arms Project,Colombia’s Killer Networks: The Military-Paramilitary Partnership andthe United States. New York, Human Rights Watch, 1997.

Inter-American Commission on Drug Policy, Seizing Opportunities:Report of the Inter-American Commission on Drug Policy. La Jolla, CA:Institute of the Americas and The Center for Iberian and Latin AmericanStudies, June 1991.

International Narcotics Control Board, Report of the InternationalNarcotics Control Board for 1995. Vienna: United Nations, 1996.

Jeffrey Laurenti, Breaking the Drug Chain: Options for InternationalPolicy on Narcotic Drugs. New York: United Nations Association of theUSA, 1990.

Rensselaer W. Lee III, The White Labyrinth: Cocaine and PoliticalPower. New Brunswick, NJ: Transaction Publishers, 1989.

Mark H. Moore, “Supply Reduction and Drug Law Enforcement,”Michael Tonry and James Q. Wilson, eds., Drugs and Crime. Chicago:University of Chicago Press, 1990, pp. 109-157.

David F. Musto, The American Disease: Origins of Narcotic Control.New York: Oxford University Press, 1987.

Douglas W. Payne, “Drugs into Money into Power,” Freedom Review.Vol. 27, No. 4. July-August 1996, pp. 9-104.

Peter Reuter, The Limits and Consequences of U.S. Foreign DrugControl Efforts. Santa Monica, CA: RAND, 1992.

Peter Reuter, Gordon Crawford, and Jonathan Cave, Sealing theB o rders: The Effects of Increased Military Participation in Dru gInterdiction. Santa Monica, CA: RAND, 1988.

K. Jack Riley, Snow Job? The War Against International CocaineTrafficking. New Brunswick, NJ: Transaction Publishers, 1996.

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R E S O U R C E S

Elena H. Alvarez, “Economic Development, Restructuring and the IllicitDrug Sector in Bolivia and Peru: Current Policies,” Journal ofInteramerican Studies and World Affairs . Vol. 37, No. 3. Fall 1995, pp.125- 146.

Andean Information Network, Human Rights Violations Stemming fromthe “War on Drugs” in Bolivia. La Paz, Bolivia: Andean InformationNetwork, 1993.

Peter Andreas, Eva Bertram, Morris Blachman, and Kenneth Sharpe,“Dead End Drug Wars,” Foreign Policy, No. 85. 1991-1992, pp. 106-128.

—————, Drug War Politics: The Price of Denial. Berkeley, CA:University of California Press, 1996.

Patrick L. Clawson and Rensselaer Lee III, The Andean CocaineIndustry. New York: St. Martin’s Press, 1996.

Mathea Falco, “Passing Grades,” Foreign Affairs. Vol. 74, No. 5.September /October 1995, pp. 15-20.

—————, “U.S. Drug Policy: Addicted to Failure,” Foreign Policy.No. 102. Spring 1996, pp. 120-133.

—————, The Making of A Drug Free America: Programs ThatWork. New York: Times Books, 1994.

Stephen Flynn, “Worldwide Drug Scourge,” The Brookings Review. Vol.11, No. 1. Winter 1993, pp. 6- 11.

William C. Gilmore, Dirty Money: The Evolution of Money LaunderingCounter-Measures. Strasbourg: Council of Europe Press, 1995.

Foreign Service Journal, “America’s Losing Drug Strategy.” Vol. 73,No. 10. October 1996.

Eduardo A. Gamarra, The System of Justice in Bolivia: An InstitutionalAnalysis. San José, Costa Rica: Center for the Administration of Justice,1991.

Human Rights Watch/Americas, State of War: Political Violence andCounterinsurgency in Colombia. New York: Human Rights Watch, 1993.

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General Accounting Office, The Drug War: Colombia Is UndertakingAntidrug Programs, but Impact Is Uncertain. GAO/NSIAD-93-158.Washington, D.C.: GAO, August 1993.

—————, Drug Control: Interdiction Efforts in Central AmericaHave Had Little Impact on the Flow of Drugs. GAO/NSIAD-94-233.Washington, D.C.: GAO, August 1994.

—————, Drug War: Observations on U.S. International DrugControl Efforts. Congressional testimony of Joseph E. Kelly, GAODirector of International A ffairs Issues. GAO/T- N S I A D - 9 5 - 1 9 4 .Washington, D.C.: GAO, August 1995.

—————, D rug Control: Counternarcotics Efforts in Mexico .GAO/NSIAD-96-163. Washington, D.C.: GAO, June 1996.

Office of National Drug Control Policy, Crop Substitution in the Andes.Washington, D.C.: ONDCP, December 1993.

—————, What America’s Users Spend on Illegal Drugs, 1988-1993.Washington, D.C.: U.S. Government Printing Office, Spring 1995.

—————, The National Drug Control Strategy: 1996. Washington,D.C.: U.S. Government Printing Office, 1996.

O ffice of Technology Assessment, Alternative Coca ReductionStrategies in the Andean Region. Washington, D.C.: U.S. GovernmentPrinting Office, July 1993.

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C. Peter Rydell and Susan S. Everingham, Controlling Cocaine: SupplyVersus Demand Programs. Santa Monica, CA: RAND, 1994.

Eric Schlosser, “Reefer Madness,” The Atlantic Monthly. August 1994,pp. 45-63.

Peter H. Smith, ed., Drug Policy in the Americas. Boulder, CO:Westview Press, 1992.

Paul B. Stares, Global Habit: The Drug Problem in a Borderless World.Washington, D.C.: The Brookings Institution, 1996.

Francisco E. Thoumi, Political Economy and Illegal Drugs in Colombia.Boulder, CO: Lynne Rienner Publishers Inc., 1995

Washington Office on Latin America, Clear and Present Dangers: TheU.S. Military and the War on Drugs in the Andes. Washington, D.C.:Washington Office on Latin America, 1991.

—————, The Colombian National Police, Human Rights and U.S.Drug Policy . Washington, D.C.: Washington Office on Latin America,1993.

Phil Williams and Ernesto U. Savona, eds., The United Nations andTransnational Organized Crime. London: Frank Cass, 1996.

Coletta Youngers, The Andean Quagmire: Rethinking U.S. Drug ControlEfforts in the Andes. Washington, D.C.: Washington Office on LatinAmerica, 1996.

U.S . G o v e r n m e n t P u b l i c a t i o n s

Bureau for International Narcotics and Law Enforcement A ff a i r s(Department of State), International Narcotics Control Strategy Report,1996. Washington, D.C.: Department of State, March 1996.

Bureau of Intelligence and Research (Department of State) and CentralIntelligence Agency, Conference Report: Economics of the NarcoticsIndustry. Washington, D.C.: Department of State, 1994.

Department of Health and Human Services, National Survey Results onD rug Abuse from the Monitoring the Future Study (1975-1995) .Rockville, MD: National Institute on Drug Abuse, 1996.

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R et h i n k i n g I n t e r n a t i o n a l D r u g C on trolSERGIO GALVIS: Mr. Galvis is Partner...

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