U.S. SAYS WAR ON NARCOTICS IS WORKING

The White House Drug Policy Director, Visiting Colombia, Says Efforts
to Disrupt Trafficking Have Cut Cocaine Supplies in the United States.

BOGOTA, COLOMBIA -- Interruptions of the flow of cocaine to the
United States are causing street prices to rise, a sign that the "war
on drugs" is working, the White House anti-drug chief said here Thursday.

John P. Walters, director of the Office of National Drug Control
Policy, told reporters that interdictions in Colombia, in other
countries along cocaine transit routes and on the open seas were
reducing drug supplies, according to data on price and purity
gathered in 37 major U.S. cities.

As a result of reduced supply, street cocaine prices over the first
nine months of the year rose to an average $136.93 per pure gram at
the end of September, a 44% increase from January, he said. Price and
purity data were supported by other measures, including reduced
evidence of cocaine use as found in workplace tests, he said.

Price bumps in U.S. street cocaine prices have occurred before,
touted by U.S. law enforcement officials each time as evidence that
counter-narcotics policies were working. But the increases often
proved temporary and were followed by supply adjustments by drug
dealers and a settling back of cocaine prices.

However, Walters said his office had not seen such an extended rise
in prices since the White House started tracking the data. "Nine
months isn't temporary in my view," he said.

Critics who acknowledge that more cocaine is being seized point out
that data on Colombian coca cultivation do not conclusively show that
production is down.

Others, such as Bill Piper, director of national affairs for the Drug
Policy Alliance, a New York-based organization advocating
alternatives to the administration's drug policy, said higher prices
inevitably cause dealers to boost supply.

"Assuming that high cocaine prices are hurting cartels is like
assuming high gasoline prices are hurting oil companies," Piper said.

Others say the decreased supply may just reflect the fact that more
Colombian cocaine is being shipped to Europe, where it can fetch even
higher prices.

The announcement comes as the House and Senate are hammering out a
fiscal 2008 version of Plan Colombia, the aid program on which U.S.
taxpayers have spent $5 billion to fight drug trafficking and
terrorism. The aid has brought improved security to Colombia but
mixed results in the drug campaign.

Democrats in Congress are pushing for modifications in the program to
offer poor Colombian farmers more economic alternatives to coca
cultivation and processing, and to place less emphasis on spraying
and military aid.

The White House is seeking similar aid for Mexico in a proposal
called the Merida Initiative. President Bush on Thursday asked
Congress to approve $500 million for Mexico as the first installment
of a $1.4-billion package.

According to a State Department statement, the funds will be used for
helicopters and surveillance aircraft, inspection equipment, canine
units for Mexican forces, and security technology and technical advice

Responding to criticism that the plan focuses too much on military
hardware and not enough on state-building and alternative economic
programs, Walters said that security had to be established in Mexico
before aid programs could take root.

Walters' visit comes as the Bush administration continues to push
Congress to approve a bilateral free trade agreement with Colombia.
He said such a bill would provide a greater economic stimulus for
Colombia than any alternative development program.

Chances are slim that Congress will vote on a trade deal this year,
as Democrats are insisting that Colombian President Alavro Uribe
first improve his record on human rights and environmental concerns
and ensure the safety of union organizers.