THE LOST WAR

We've Spent 36 Years and Billions of Dollars Fighting It, but the
Drug Trade Keeps Growing

Poppies were the first thing that British army Capt. Leo Docherty
noticed when he arrived in Afghanistan's turbulent Helmand province
in April 2006. "They were growing right outside the gate of our
Forward Operating Base," he told me. Within two weeks of his
deployment to the remote town of Sangin, he realized that "poppy is
the economic mainstay and everyone is involved right up to the higher
echelons of the local government."

Poppy, of course, is the plant from which opium -- and heroin -- are derived.

Docherty was quick to realize that the military push into northern
Helmand province was going to run into serious trouble. The rumor was
"that we were there to eradicate the poppy," he said. "The Taliban
aren't stupid and so they said, 'These guys are here to destroy your
livelihood, so let's take up arms against them.' And it's been a
downward spiral since then."

Despite the presence of 35,000 NATO troops in Afghanistan, the drug
trade there is going gangbusters. According to the U.N. Office on
Drugs and Crime (UNODC), Afghan opium production in 2006 rose a
staggering 57 percent over the previous year. Next month, the United
Nations is expected to release a report showing an additional 15
percent jump in opium production this year while highlighting the
sobering fact that Afghanistan now accounts for 95 percent of the
world's poppy crop. But the success of the illegal narcotics industry
isn't confined to Afghanistan. Business is booming in South America,
the Middle East, Africa and across the United States.

Thirty-six years and hundreds of billions of dollars after President
Richard M. Nixon launched the war on drugs, consumers worldwide are
taking more narcotics and criminals are making fatter profits than
ever before. The syndicates that control narcotics production and
distribution reap the profits from an annual turnover of $400 billion
to $500 billion. And terrorist organizations such as the Taliban are
using this money to expand their operations and buy ever more
sophisticated weapons, threatening Western security.

In the past two years, the drug war has become the Taliban's most
effective recruiter in Afghanistan. Afghanistan's Muslim extremists
have reinvigorated themselves by supporting and taxing the countless
peasants who are dependent one way or another on the opium trade,
their only reliable source of income. The Taliban is becoming richer
and stronger by the day, especially in the east and south of the
country. The "War on Drugs" is defeating the "war on terror."

For the past three years, I have been traveling the world researching
a book on the jaw-dropping rise of transnational organized crime
since the collapse of communism and the advent of globalization. I
have witnessed how a ferocious drug gang mounted an assault on Sao
Paolo, closing the city for three days as citizens cowered at home. I
have watched Bedouins shift hundreds of kilos of cocaine across the
Egyptian-Israeli border on the backs of camels, and observed how
South Africa and West Africa have become an international narcotics
distribution hub.

The trade in illegal narcotics begets violence, poverty and tragedy.
And wherever I went around the world, gangsters, cops, victims,
academics and politicians delivered the same message: The war on
drugs is the underlying cause of the misery. Everywhere, that is,
except Washington, where a powerful bipartisan consensus has turned
the issue into a political third rail.

The problem starts with prohibition, the basis of the war on drugs.
The theory is that if you hurt the producers and consumers of drugs
badly enough, they'll stop doing what they're doing. But instead, the
trade goes underground, which means that the state's only contact
with it is through law enforcement, i.e. busting those involved,
whether producers, distributors or users. So vast is the demand for
drugs in the United States, the European Union and the Far East that
nobody has anything approaching the ability to police the trade.

Prohibition gives narcotics huge added value as a commodity. Once
traffickers get around the business risks -- getting busted or being
shot by competitors -- they stand to make vast profits. A
confidential strategy report prepared in 2005 for British Prime
Minister Tony Blair's cabinet and later leaked to the media offered
one of the most damning indictments of the efficacy of the drug war.
Law enforcement agencies seize less than 20 percent of the 700 tons
of cocaine and 550 tons of heroin produced annually. According to the
report, they would have to seize 60 to 80 percent to make the
industry unprofitable for the traffickers.

Supply is so plentiful that the price of a gram of heroin is
plummeting in Europe, especially in the United Kingdom. According to
the UNODC, the street price of a gram of cocaine in the United States
is now less than $70, compared with $184 in 1990. Adjusted for
inflation, that's a threefold drop.

A surfeit of bananas drove 47-year-old Colombian Susan Castillo to do
business with terrorists. "It was about 10 to 15 years ago," she told
me. "We had built our farm and raised our seven children on corn and
bananas. But suddenly nobody wanted to buy our bananas anymore. We
did what everybody did then -- we switched from bananas and corn to
coca. Actually, we did not grow the coca ourselves but we rented out
our land to a cocalero and he grew the crop." Both the Castillo
family and the grower paid tax to the FARC -- the Revolutionary Armed
Forces of Colombia, a 17,000-strong peasant-based army, by far the
largest terrorist organization in the Southern Hemisphere.

I spoke to Castillo in the bare office of a local U.N. counseling
center in Ciudad Bolivar, a sprawling refugee camp that extends south
from Bogota and houses about 1 million people. A few weeks earlier,
she had been forced to leave her home after a pitched battle between
the Colombian military and the FARC near La Macarena National Park.

Next to the U.N. office stands a spanking new library, courtesy of
Plan Colombia, the $4.7 billion worth of drug-fighting assistance
that the United States gave to Colombia over the first half-decade of
this new century. Ninety-eight percent of that money was devoted to
beefing up the Colombian armed forces' assault on coca plantations
and left-wing guerrillas. I was rather pleased to uncover one of its
few civilian outlets. All the library needs now is to open (it was
padlocked), a few books (there were none) and some people who can
read (a rare species in Ciudad Bolivar).

According to the Government Accountability Office, 70 percent of the
money allotted to Plan Colombia never leaves the United States. It is
used to buy U.S.-built helicopters and other weapons for the
military, and a large chunk is paid to the security firm DynCorp.
Britain and other E.U. countries have so far resisted spraying Afghan
poppy fields with chemicals. But for several years, DynCorp has been
spraying the herbicide glyphosate on thousands of acres of coca in Colombia.

The impact of the eradication program has been negligible at best.
The FARC not only continues to control a swath of territory the size
of Switzerland in south-central Colombia, but it has established
itself in the north as well. The United Nations has identified coca
plantations in 24 of the country's 32 provinces, whereas it was grown
in only six when spraying began. But most embarrassing of all, before
his trip to Washington in May, President Alvaro Uribe was forced to
announce that production of coca was up 8 percent in 2006. Coca
production has been so ample that the wholesale price of Colombia's
best-known export has continued to slide throughout the course of
Plan Colombia.

And now the U.S. government wants to repeat this "success" in Mexico.
There's talk in Washington about a $1 billion aid package for the
government of President Felipe Calderon to back his own war against
drugs. And in Mexico, it's definitely a war: Calderon has mobilized
the army to fight traffickers. In the first half of this year, more
than 1,000 people were gunned down by rival drug cartels. Among the
dead were newspaper reporters, narcotics police investigators, judges
and politicians.

The collapse of communism and the rise of globalization in the late
1980s and early 1990s gave transnational criminality a tremendous
boost. The expansion of world trade and financial markets has
provided criminals ample opportunity to broaden their activities. But
there has been no comparable increase in the ability of the Western
world to police global crime.

International mobsters, unlike terrorists, don't seek to bring down
the West; they just want to make a buck. But these two distinct
species breed in the same swamps. In areas notorious for crime, such
as the tri-border region connecting Paraguay, Brazil and Argentina,
or in the blood-diamond conflict zones such as Sierra Leone and
Liberia, gangsters and terrorists habitually cooperate and work
alongside one another.

Those swamps are steadily seeping toward the United States. British
Columbia is now home to the greatest number of organized-crime
syndicates anywhere in the world (if we accept the U.N. definition of
a syndicate as more than two people involved in a planned crime).
According to B.C. government statistics, the production, distribution
and export of B.C. Bud, highly potent marijuana grown in hothouses
along the province's border with the United States, accounts for 6
percent of the region's gross domestic product. It now employs more
Canadians than British Columbia's traditional industries of mining
and logging combined.

The majority of the province's criminals remain passive hippie types
for whom the drug is a lifestyle choice. But as Brian Brennan, the
chief investigator for the drug squad of the Royal Canadian Mounted
Police, told me, the marijuana trade is threatening to turn nasty as
British Columbia's Hells Angels, one of the best-organized criminal
syndicates in the world, moves in on the action. The drug trade is so
lucrative, he said, that when police seize growing operations in
houses worth $500,000, suspects simply abandon the properties. "They
are making so much money that they don't care about losing that
investment," he said.

An avalanche of B.C. Bud rolls southward into the United States every
day, dodging U.S. customs in myriad imaginative ways. But as the
Hells Angels and other syndicates get stronger and their control over
the port of Vancouver tightens, the ability of U.S. and Canadian
authorities to monitor the border becomes ever weaker.

Could anything replace the war on drugs? There's no easy answer. In
May, the Senlis Council, a group that works on the opium issue in
Afghanistan, argued that "current counter-narcotics policies . . .
have focused on poppy eradication, without providing farmers with
viable alternatives." Instead of eradication, the council, which is
made up of senior politicians and law enforcement officials from
Canada and Europe, concludes that Afghan farmers should be permitted
to grow opium that can then be refined and distributed for medical
purposes. (That's not going to happen, as the United States has
recently reiterated its commitment to poppy eradication.)

Others argue that the only way to minimize the criminality and social
distress that drugs cause is to legalize narcotics so that the state
may exert proper control over the industry. It needs to be taxed and
controlled, they insist.

In Washington, the war on drugs has been a third-rail issue since its
inauguration. It's obvious why -- telling people that their kids can
do drugs is the kiss of death at the ballot box. But that was before
9/11. Now the drug war is undermining Western security throughout the
world. In one particularly revealing conversation, a senior official
at the British Foreign Office told me, "I often think we will look
back at the War on Drugs in a hundred years' time and tell the tale
of 'The Emperor's New Clothes.' This is so stupid."

How right he is.