NICARAGUAN TOWN RIDES HIGH ON CAST-OFF COCAINE

BLUEFIELDS, Nicaragua - At first glance, this coastal town looks like
any other rum-soaked, Rastafarian-packed, hammock-infested Caribbean
city. But Bluefields has a secret: Most people here don't have to
work because every week - sometimes, every day - sacks of floating
cocaine between 75 and 100 pounds each drift in from the sea.

The economy of this town of 50,000 is addicted to cocaine. While
local authorities have no official figures, former Mayor Moises Arana
says when the drugs float in, "everyone is happy, the stores are
happy, the bars are happy, everyone has money. I remember one month
when (Bluefields) bought 28,000 cases of beer."

Located halfway between the drug labs of Colombia and millions of
users in the United States, Bluefields is ground zero for cocaine
transportation. Nicaraguan waters flow near Colombian territorial
limits, making the area extremely popular with smugglers in vessels
with 800-horsepower motors that the U.S. military calls "go-fast
boats." In contrast, a Porsche 911 Turbo has a 485-horsepower engine.

While fast, these boats are visible to radar systems on roaming U.S.
spy planes, Coast Guard cutters and helicopters that regularly
monitor the region. "With night-vision equipment, I have seen a lit
cigarette from 2 miles," said a U.S. Coast Guard pilot, who asked
not to be identified because of the sensitivity of his work.

When authorities close in, traffickers typically toss most cocaine
sacks overboard to eliminate evidence and lighten the load so they
can escape, U.S. Coast Guard officials say.

"I have been on four interdictions, and we have confiscated about
6,000 pounds of cocaine and I'd say equal that much was dumped into
the ocean," said Coast Guard Cmdr. Jason Church.

Sea currents typically bring the discarded cocaine bales to the chain
of islands, beaches and cays that make up huge lagoons that surround
Bluefields.

"There are no jobs here - unemployment is 85 percent," said Arana,
who served as mayor between 2001 and 2005. "It is sad to say, but the
drugs have made contributions. Look at the beautiful houses. Those
mansions come from drugs. We had a woman come into the local
electronics store with a milk bucket stuffed full of cash - she was
this little Miskito (indigenous) woman, and she had $80,000."

White lobster

Hujo Sugo, a local historian, says floating cocaine has created a new
pastime - beachcombing.

"People here now go beachcombing for miles, they walk until they find
packets," said Sugo. "Even lobster fishermen now go out with the
pretense of fishing, but really they are looking for 'white lobster.'
"

Bluefields residents then sell it to traveling buyers who cruise the
coast often disguised as used clothes vendors, says Judge Yorlene
Orozco.

"We are talking about people without a profession, no home, no job.
One day later they have a new car, go to the (local) casino and are
building a home that costs I don't know how many thousands of
dollars," said Orozco.

The Nicaraguan police and navy have few resources to stop the cocaine
traffic, and most locals consider them corrupt, incompetent or both.
Bluefields is effectively a town without a government. On the
streets, it is not unusual to see men walking with a bag of white
powder the size of a golf ball, dipping their fingers inside and
snacking as if they were eating popcorn or potato chips.

"I just had a Swiss tourist tell me that when she went to the
supermarket, they tried to sell her cocaine," said Orozco.

At $3,500 per kilo, or 2.2 pounds, the typical 77-pound sack nets
$122,500, which by most accounts is spent immediately.

"Last time bags and bags washed up, everyone (felt like) a
millionaire, but that money does not last," said a woman named Ruth,
who runs a university research institute and asked that her last name
not be used. Asked how the locals unload their cash, she said -
"Beer, beer, beer. You should see the amount they drink here. Go to
the pier and see how much alcohol goes out to the (surrounding) islands."

'Unique historical situation'

With literally tons of cocaine buried in the hills, stashed in yards
and piled up around town, why don't the Colombian cartels storm these
remote communities and repossess their drugs?

"The Miskito are guerrillas. They have been through war. They have
AK-47s and up," said a local businessman named Peter, in reference to
the protracted war between Miskito Indians and the Sandinista
National Liberation Front in the 1980s. Peter, who carried a fat
pistol under his Houston Rockets NBA shirt, also asked not to be
fully identified.

In a recent report to Congress, the U.S. Drug Enforcement Agency
noted that "a unique historical situation and civil conflicts have
left Nicaragua with a tradition of armed rural groups - and
institutionalized violence - that greatly complicates counter-drug
enforcement."

For hundreds of years, the Miskito Indians have fished this stretch
of the Caribbean, enduring hurricanes and storms. Many of their
estimated 4,000 small fishing boats are fragile wooden canoes with
hand-sewn sails of colored plastic. But some Miskitos have switched
to a V-6 Yamaha 200-horsepower engine to better patrol the coast to
find cocaine.

Because they often live in isolated communities, the Miskitos
maintain their own rules and traditions - including the belief that
whatever treasures arrive by water are gifts from god. When a
fisherman finds "white lobster," the entire village shares the
treasure - with percentages shared by the community, church and crew
that found the drugs.

Little Miami

The cocaine business is reshaping the face of these Indian
communities, says Peter, the local businessman. Tasbapauni Beach,
located just north of Bluefields, is now nicknamed "Little Miami" due
to the construction of luxurious oceanfront condos protected by
security guards. Funds from cocaine have also built schools and
replaced church roofs.

"It is like a municipal tax," said Sergio Leon, an investigative
reporter for the Managua daily, La Prensa, who has covered the local
drug scene for years. "The schools and churches are not built by the
government - that money comes from the fishermen and their finds."

At the Midnight Dream reggae bar, dozens of young black men wearing
baseball hats, NBA sleeveless shirts and Nike Air sneakers, are
bedecked in gold chains and partying with women who openly snort
cocaine. The recent discovery of bales of cocaine along a nearby
beach financed the celebration.

"Those guys over at that table, they are Miskito, they found seven
bags," noted the bartender, who asked not to be named. "They will buy
a couple of ranches, two boats and have someone else fish for them.
The stuff washes up all the time."

The cocaine capital

Bluefields, a town of some 50,000 residents on Nicaragua's Atlantic
coast, was named after the Dutch pirate Abraham Blauvelt, who hid in
nearby waters in the early 17th century. It is Nicaragua's chief
Caribbean port.

Despite its apparent drug wealth, electricity is sporadic, and there
are few roads and cars. In fact, there is no road access from the
west coast of Nicaragua. Visitors must take a boat down the Rio
Escondido from the town of Rama or fly from the capital, Managua, in
a 25-year-old twin-engine airplane whose fuselage carries
instructions on how to react after a crash: "Cut Here for Easy Entry."

Bluefields is the capital of the South Atlantic Autonomous Region,
meaning the government largely ignores the area's mixed population of
mostly blacks, Mestizos and Miskito Indians. Residents complain they
only see politicians when there is an election or a hurricane.

While cocaine is the town's economic lifeblood, shrimp and lobster
are the principal means of legitimate work. Most shops sell rum,
bananas, sneakers and baseball hats. The largest store sells nothing
more sophisticated than a washing machine or a TV set.

At the local casino, payoffs are much lower when bets are placed in
the Nicaraguan currency, the cordoba.

"We don't even use the Nicaraguan currency here. To the south (of the
Autonomous Region) we use the (Costa Rican) colon, in the north, we
use the (Honduran) lempira, and everywhere else it is the dollar,"
said a local fisherman named Eugenio, who asked that his last name
not be used.