STATEMENT OF ADMIRAL JAMES M. LOY, USCG, ON THE WESTERN HEMISPHERE DRUG
ELIMINATION ACT

Good morning, Mr. Chairman Grassley, Chairman Coverdell, and distinguished
Committee and Caucus members. It is a pleasure to appear before you today
to comment on Coast Guard drug interdiction and the proposed Western
Hemisphere Drug Elimination Act.

I applaud the Act's goal of strengthening our Nation's counterdrug effort.
This legislation recognizes that the security of our maritime borders is a
critical component of a balanced national strategy to reduce drug use and
its destructive consequences. The National Drug Control Strategy's supply
reduction target looks to reduce drug availability in the United States 25
percent by 2002, and 50 percent by 2007 as compared to a 1996 base year.
The Coast Guard has developed a comprehensive maritime interdiction
strategy, Campaign STEEL WEB, designed to meet the Coast Guard's portion of
these national goals. This Coast Guard strategy is supportedby a 5-year
drug control budget that is submitted to the Office of Drug Control Policy
(ONDCP) annually as required by law. Fully implementing this strategy will
require that adequate resources be provided over the next several years.
This Coast Guard strategy is supported by a 5-year drug control budget that
is submitted to the Office of National Drug Control Policy (ONDCP) annually
as required by law. The Western Hemisphere Drug Elimination Act includes
many policy initiativesand budgetauthorities that could be used to increase
counterdrug performance. In many instances, the Act does address valid
Coast Guard requirements and identifies the types of capabilities required
to implement STEEL WEB. However, I do have serious concerns with the
legislation as currently drafted. While this bill authorizes funding

This bill's authorization levels for increased Coast Guard counterdrug
operations in fiscal years 1999, 2000, and 2001, first2001 are inconsistent
with the President's budget. First and foremost the Coast Guard must be
able to maintain current services for all mission areas in fiscal year 1999
as requested by the President. As a 3-year authorization, this legislation
could result in outyear funding risks. Without adequate outyear funding, I
will not be able to operate additional assets or to sustain the operational
increases for assets now in the Coast Guard inventory. I am also concerned,
from a personnel management perspective, about the potential for a
relatively large increase in work force strength that may only be
authorized for 3 years.

I am also concerned about the executabilitycost effectiveness of some items
specified in the Act. For example, any decision to build new cutters should
be made in the context of the Deepwater Capability Replacement Project,
which is currently in the planning phase. Through the Deepwater process, we
will determine the most cost-effective new construction of cutters would
require long lead-time and significant personnel increases.way to meet
future Coast Guard mission requirements beyond 50 miles from shore. It may
be the case, for example, that converting retired Navy vessels is more
sensible than building new cutters. Additionally, the goal to reduce the
flow of drugs into the United States 80 percent by the end of 2001 is
overly optimistic and is not achievable.

Finally, we face significant source and Transit Zone interdiction
challenges. The Act does not include some key resources proposed in the
President's 1999 Budget that would be necessary to meet these challenges.
For example, the Act does not address increased intelligence collection and
support or the deployable logistics required to support expeditionary pulse
operations, capabilities that are critical to interdiction success and can
reduce the need for expensive, single-mission assets.

The task of maintaining a comprehensive overview of activity and sorting
targets of interest from legitimate air and surface traffic is daunting.
Equally difficult is the logistical challenge of supporting our forces in
such an expansive theater of operations, particularly in the Eastern
Pacific. As previously stated, Campaign STEEL WEB is the Coast Guard's
multiyear plan to position the requisite interdiction forces where they
best counter the ever-evolving drug trafficking threats. The strategic
concept is to deny drug smugglers access to maritime routes by a sequence
of operations in which interdiction forces are concentrated in high-threat
areas of the Caribbean and Eastern Pacific to significantly disrupt drug
traffic. Coast Guard operations in these high threat areas complement and
support Joint Interagency Task Force (JIATF) East and JIATF West
operations. Once a credible law enforcement presence is established,
interdiction forces will be redeployed to other high-threat areas, leaving
an enhanced presence to deter and interdict subsequent smuggling.
Ultimately, successful pulse operations in each high-threat area will
systematically reduce drug flow through the Transit Zone. This concept was
successfully demonstrated during the Coast Guard's Operation FRONTIER SHIELD.

In addition, STEEL WEB is focused on strengthening ties with source and
transit zone nations to increase their capacities to reduce internal
production and trafficking, and supports interagency efforts to combat drug
smuggling. Continued success of Campaign STEEL WEB requires resource
investments and the flexibility to employ resources where they can have the
most impact.

The Coast Guard received a $34.3 million increase in budget authority for
fiscal year 1998, an investment in the long-term campaign to satisfy
obligations under the National Drug Control Strategy. Fiscal year 1998 drug
funding has allowed the Coast Guard to institutionalize FRONTIER SHIELD,
and continue Operations GULF SHIELD and BORDER SHIELD to anchor the flanks
of the Southwest Border.

The fiscal year 1999 budget request includes operating expenses and capital
investments necessary to maintain the current law enforcement presence in
the transit and arrival zones. As long as more than 400 metric tons of
cocaine are moving through the Transit Zone each year, the value of, and
necessity for, agile interdiction forces is undeniable.

The Coast Guard shields America's sea frontiers from a broad spectrum of
threats and challenges, with the scourge of drugs being perhaps the most
visible right now. The need for effective control of America's seaward
borders, territorial sea, and Exclusive Economic Zone extends well beyond
the drug threat and will become even more essential in the first decades of
the 21st century.

Future threats to U.S. security interests will be even more varied than
they are today. The dangers we face are unprecedented in their complexity.
Terrorism, drugs, illegal migrants, organized crime, and proliferation of
weapons of mass destruction are global concerns that transcend national
borders, and environmental damage and rapid population growth undermine
economic prosperity and political stability in many countries.

Since these challenges to America's maritime security are not strictly
military in nature, they underscore the importance, relevance, and vitality
of the Coast Guard's law enforcement role - a core competency developed
during more than 200 years of service to America - and a core competency
that addresses more than drug interdiction.

The multimission Coast Guard has traditionally provided a high rate of
return to the public. In fiscal year 1997, overall interdiction efforts
resulted in a record year for Coast Guard drug seizures. The Coast Guard
seized (or assisted in the seizure of) 103,617 pounds of cocaine and
102,538 pounds of marijuana products. Cocaine seizures easily surpassed the
previous record set in 1991 -- 90,335 pounds.

Through effective interdiction efforts last year, the Coast Guard kept more
than 468 million cocaine "hits" and 100 million marijuana "joints" off our
streets, preventing those drugs from poisoning schools and destroying
homes. The estimated street value of these seizures is more than $4.2
billion -- $1 billion more than the Coast Guard's entire 1997 discretionary
budget.

In order to meet future drug interdiction obligations, the Coast Guard will
need the full support of Congress for its budget requests. As Commandant,
however, I have a responsibility to effectively perform the Coast Guard's
many other mission requirements, such as protection of fisheries stocks and
the marine environment. To do this, the Coast Guard must at least be funded
at current services level through annual appropriations.receive the funding
levels requested by the President for these programs.

As we approach the 21st century, many of our existing assets are nearing
the end of their service lives. Loss of capability and increased
operational costs concern us greatly, as the threats we must counter are
becoming increasingly more sophisticated and capable. In short, our ability
to remain Semper Paratus - Always Ready - to carry out our many missions is
a major Coast Guard concern. We are taking the necessary steps through our
Roles and Missions Review and Deepwater Capability Analysis to address
these concerns. We must be ready to meet tomorrow's challenges.

In closing, I would like to recognize your leadership and commitment to
strengthening the national counterdrug effort. As America moves into the
next century, the Coast Guard stands ready to meet our responsibilities in
this important effort. Thank you for the opportunity to discuss Coast Guard
drug interdiction concerns. I will be happy to answer any questions you may
have.

Checked-by: Richard Lake