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DRUG TRADE AND THE TERROR NETWORK

HEARING

BEFORE THE

SUBCOMMITTEE ON CRIMINAL JUSTICE,

DRUG POLICY AND HUMAN RESOURCES

OF THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED SEVENTH CONGRESS

FIRST SESSION

OCTOBER 3, 2001

Serial No. 107–93

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpo.gov/congress/house

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

DAN BURTON, Indiana, Chairman

BENJAMIN A. GILMAN, New York

CONSTANCE A. MORELLA, Maryland

CHRISTOPHER SHAYS, Connecticut

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

STEPHEN HORN, California

JOHN L. MICA, Florida

THOMAS M. DAVIS, Virginia

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

BOB BARR, Georgia

DAN MILLER, Florida

DOUG OSE, California

RON LEWIS, Kentucky

JO ANN DAVIS, Virginia

TODD RUSSELL PLATTS, Pennsylvania

DAVE WELDON, Florida

CHRIS CANNON, Utah

ADAM H. PUTNAM, Florida

C.L. ‘‘BUTCH’’ OTTER, Idaho

EDWARD L. SCHROCK, Virginia

JOHN J. DUNCAN, JR., Tennessee

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

PATSY T. MINK, Hawaii

CAROLYN B. MALONEY, New York

ELEANOR HOLMES NORTON, Washington,

DC

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

ROD R. BLAGOJEVICH, Illinois

DANNY K. DAVIS, Illinois

JOHN F. TIERNEY, Massachusetts

JIM TURNER, Texas

THOMAS H. ALLEN, Maine

JANICE D. SCHAKOWSKY, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

——— ———

———

BERNARD SANDERS, Vermont

(Independent)

KEVIN BINGER, Staff Director

DANIEL R. MOLL, Deputy Staff Director

JAMES C. WILSON, Chief Counsel

ROBERT A. BRIGGS, Chief Clerk

PHIL SCHILIRO, Minority Staff Director

SUBCOMMITTEE ON CRIMINAL JUSTICE, DRUG POLICY AND HUMAN RESOURCES

MARK E. SOUDER, Indiana, Chairman

BENJAMIN A. GILMAN, New York

ILEANA ROS-LEHTINEN, Florida

JOHN L. MICA, Florida,

BOB BARR, Georgia

DAN MILLER, Florida

DOUG OSE, California

JO ANN DAVIS, Virginia

DAVE WELDON, Florida

ELIJAH E. CUMMINGS, Maryland

ROD R. BLAGOJEVICH, Illinois

BERNARD SANDERS, Vermont

DANNY K. DAVIS, Illinois

JIM TURNER, Texas

THOMAS H. ALLEN, Maine

JANICE D. SCHAKOWSKY, Illinois

EX OFFICIO

DAN BURTON, Indiana HENRY A. WAXMAN, California

CHRISTOPHER DONESA, Staff Director and Chief Counsel

JIM RENDON, Congressional Fellow

CONN CARROLL, Clerk

DENISE WILSON, Minority Professional Staff Member

(III)

C O N T E N T S

Page

Hearing held on October 3, 2001 ............................................................................ 1

Statement of:

Bach, Bill, Director, Office of Asia, Africa, Europe, and NIS Programs,

U.S. Department of State ............................................................................. 101

Hutchinson, Asa, Administrator, Drug Enforcement Administration .......... 12

Letters, statements, etc., submitted for the record by:

Bach, Bill, Director, Office of Asia, Africa, Europe, and NIS Programs,

U.S. Department of State, prepared statement of ..................................... 103

Cummings, Hon. Elijah E., a Representative in Congress from the State

of Maryland, prepared statement of ............................................................ 8

Hutchinson, Asa, Administrator, Drug Enforcement Administration, prepared statement of ........................................................................................ 15

Souder, Hon. Mark E., a Representative in Congress from the State

of Indiana, prepared statement of ............................................................... 3

(1)

DRUG TRADE AND THE TERROR NETWORK

WEDNESDAY, OCTOBER 3, 2001

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON CRIMINAL JUSTICE, DRUG POLICY AND

HUMAN RESOURCES,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The subcommittee met, pursuant to notice, at 10:05 a.m., in room

2154, Rayburn House Office Building, Hon. Mark E. Souder (chairman of the subcommittee) presiding.

Present: Representatives Souder, Gilman, and Cummings.

Staff present: Christopher Donesa, staff director and chief counsel; Roland Foster, professional staff member; Conn Carroll, clerk;

Jim Rendon, congressional fellow; Tony Haywood, minority counsel;

Denise Wilson, minority professional staff member; and Earley

Green, minority assistant clerk.

Mr. SOUDER. This hearing is called to order. Thank you all for

coming.

In the past 3 weeks, our Nation has been forced to simultaneously examine a number of critical issues with new urgency and

vigor. For drug policy, the September 11th attacks on our country

immediately highlighted the dark synergies between narcotics trafficking and international terrorism. Afghanistan has always been

one of the world’s leading producers of opium, but very little of it

has entered the United States, and our national attentions have focused on other sources of supply.

We must now confront the new reality that the Afghan drug

trade, largely without crossing our borders, has harmed our country just as much as the drugs from half a world away that reach

American’s streets. The Afghan drug trade has given direct financial support for the Taliban regime to harbor international terrorists and at least indirectly assist Osama Bin Laden and the alQaeda terrorist network to grievously attack the United States of

America.

The Taliban have controlled as much as 96 percent of the opiumgrowing area in Afghanistan and have consistently collected a 10

percent so-called ‘‘religious tax’’ on the narcotics trade, despite the

fact that drugs are against traditional Islamic law.

Reports also suggest that the Taliban have actively participated

in the drug trade by controlling trafficking groups within Afghanistan. Their total drug revenue could be more than $50 million per

year.

Just as seriously, we have seen every indication, including apparently confirmation from the United Nations, that the Taliban have

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stockpiled drugs for sale on the world market. Their highly publicized ban on new poppy production appears, in reality, to be a

coldly calculated ploy to control the world market price for their

opium and heroin.

Accordingly, we must quickly determine how best to address serious drug policy issues to which we previously had devoted little national attention.

First, what is the true extent of the Taliban and terrorist involvement in the drug trade? As part of this, we must also consider

increasing evidence of links and synergies between the drug cartels

and terrorist organizations, such as the recent arrest of IRA bomb

experts in Colombia and direct threats made by the Colombian

FARC to attack targets in the United States.

Second, what adjustments need to be made to our national narcotics strategy to control the financial support that drug trade gives

to terror groups? Our international programs are designed almost

entirely to break sources of supply coming into the United States.

We must now consider whether additional international narcotics

control and law enforcement programs may be necessary which are

not organized to keep drugs out of our own country, but instead to

stop worldwide trade and cutoff illicit revenue sources.

Third, what are the potential short-term ramifications of the Afghan drug trade in the United States? We have seen rumors alleging that the Taliban may intend to release large quantities of

opium and heroin into the American market, and some anecdotal

evidence of rapidly declining prices for these drugs. We must quickly assess whether there is any substance to the rumors, whether

the Taliban has any ability to quickly move drugs into our country,

and, if so, how to effectively respond through interdiction and law

enforcement.

Today for the first time we welcome the new DEA Administrator,

Asa Hutchinson, back to the subcommittee. He is our recent colleague in the House and on the committee and now is an even closer friend and ally in the fight against drugs.

From the State Department we welcome Bill Bach, who is Director of the Office of Asia, Africa, Europe and NIS programs in the

Bureau of International Narcotics and Law Enforcement Affairs.

I would also like to recognize that Assistant Secretary Randy

Beers wanted to be here today to discuss this important matter,

but was prevented from doing so by unavoidable schedule conflicts

on equally pressing matters.

We look forward to hearing from both of you.

Before we move to testimony and questioning, the Chair will announce that I have informally agreed with the witnesses not to discuss a few specific issues relating to matters which could be under

national security review, mostly whatever immediate, short-term

options may or may not exist to deal with the Afghan drug trade.

In that spirit, I will ask Members to try to limit their questioning

to general background and policy matters.

[The prepared statement of Hon. Mark E. Souder follows:]

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Mr. SOUDER. I now yield to our distinguished ranking member,

Mr. Cummings.

Mr. CUMMINGS. Mr. Chairman, I want to join in welcoming Director Bach from the State Department and our esteemed former

colleague, Asa Hutchinson, for appearing before the subcommittee

today.

This is our first opportunity to hear from our new DEA Administrator, and we certainly congratulate you, as we’ve done before.

And, just as surely as we look forward to hearing his insights, we

also regret that his first appearance before this subcommittee

comes under such irregular and horrible circumstances.

Mr. Chairman, the horrific September 11th attacks on the World

Trade Center towers and the Pentagon sent our Nation and, indeed, the entire civilized world a wake-up call like no other. The

sophistication, coordination, and skill of the attacks left no doubt

that there were many actors and ample financial and other resources behind these attacks.

Accordingly, this massive aggression against the United States

immediately intensified U.S. determination to identify the various

sources of support for international terrorist organizations that are

clearly hell bent on undermining the American way of life by instilling fear among our people.

One of those sources we know to be drug trafficking. Afghanistan

has long been one of the world’s leading source countries for opium.

It is interesting to note that yesterday, in one of his greatest

speeches, Prime Minister Tony Blair said that Afghanistan accounts for 90 percent of the opium flowing through his country.

Under Taliban control, however, opium production sharply increased, and in 1999 the State Department identified Afghanistan

as the world’s No. 1 opium-producing nation.

Because only an estimated 5 percent of illicit opiates consumed

in the United States comes from Afghanistan, American counterdrug resources have been concentrated in Latin America and the

Far East, where the great majority of United States consumed illicit drugs originate.

The events of September 11th, however, dramatically underscore

the ancillary global threat of the Afghan drug trade as a source of

financial support for terrorist activities well beyond the Middle

East—on our own soil, in fact.

We know that the Taliban government has profited greatly from

the sharp increase in Afghan opium production, and there is

mounting evidence, moreover, that narcotics-related income has

been used by the Taliban to provide support for international terrorist activities, including those of Osama Bin Laden and al-Qaeda

terrorist network. It is estimated that the Taliban takes in as much

as $50 million annually in drug-related income.

The United Nation’s Committee of Experts on Afghanistan has

found that funds raised from the production and trading of opium

and heroin are used by the Taliban to buy arms and other war material and to finance the training of terrorists and support the operations of these extremists in neighboring countries and beyond.

For years, the Taliban government was widely criticized in the

international community for its blatant failure to curtail opium

production and trafficking. In July 2000, the Taliban responded by

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issuing a highly publicized and purported religion-based ban on

opium growth, cultivation, and trafficking—the pronouncement on

what has amounted in the eyes of most of the informed observers

to be a very cynical joke.

The Taliban continues to stockpile opium. There has been a rise

in the price of opium on the world market. Trafficking continues

unabated, and the approaching poppy planting season will likely

confirm that the Taliban’s supposed prohibition on poppy growth is,

if not worse, going unenforced.

As President Bush pronounced before a rare joint session of Congress, the United States has been thrust by the events of September 11th into a new war, a new kind of war, a war in which disrupting supply chains is as much about freezing private financial

assets as bombing bridges; a war that is as much about law enforcement as military action.

The role of the drug trade in financing and support the enemy

in this rare war means that there will be an important role for the

Drug Enforcement Administration to play. Increasingly, we are

bound to find that the foreign enemies in the war on drugs and

those in the new war on terrorism are identical, or at least intertwined, accomplices in one another’s crimes.

Underscoring this is the fact that Bin Laden and many of his ideological disciples evidently view drug trafficking not merely as

fundraising and networking tool, but as constituting, in and of

itself, a weapon of mass destruction against western societies.

We talk a lot about the awful prospect of biological and chemical

weapons being unleashed upon an unsuspecting American public,

Mr. Chairman, but a visit to my District will confirm that, whether

or not it was conceived as such, a biochemical weapons attack on

the United States has long since begun, and it has been effective

in destroying untold lives and communities throughout this Nation.

To the extent drug trafficking is now being used by terrorists for

the express purpose of inflicting harm on societies, it seems to me

we are seeing not only a mutually dependent relationship between

distinct types of criminal actors and activities, but, moreover, a

convergence of threats.

What we have begun to see in Colombia reinforces this notion.

In just the past few weeks, we’ve seen two IRA explosives experts

arrested for assisting the FARC and heard the recorded voice of a

FARC leader issuing an explicit threat of attacks on American civilians wherever they may be found, including on American soil.

All of this, Mr. Chairman, speaks clearly to how much the exportation of drugs and terror are becoming intertwined. As you have

indicated, we will not be getting into prospective approaches that

may bear on national security concerns today, but it seems clear

to me that the DEA’s intelligence and expertise in identifying,

tracking, and disrupting drug trafficking cells must be brought to

bear in concert with the many other weapons being employed in

America’s new war.

I look forward to the hearing of our witnesses today and I thank

you, Mr. Chairman, for this timely hearing.

Mr. SOUDER. Thank you very much for your statement.

[The prepared statement of Hon. Elijah E. Cummings follows:]

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Mr. SOUDER. Before proceeding, I’d like to take care of a couple

of standard procedural matters.

I’d first ask unanimous consent that all Members have 5 legislative days to submit written statements and questions for the hearing record, and that any answers to written questions provided by

the witnesses also be included in the record. Without objection, so

ordered.

Second, I ask unanimous consent that all exhibits, documents,

and other materials referred to by Members and the witnesses may

be included in the hearing record and that all Members be permitted to revise and extend their remarks. Without objection, it is

so ordered.

Would the witnesses please stand and raise your right hands and

I’ll administer the oath. As an oversight committee, it is our standard practice to ask all of our witnesses to testify under oath.

[Witnesses sworn.]

Mr. SOUDER. Let the record show that the witnesses have each

answered in the affirmative.

Witnesses will now be recognized for opening statements. It is

my privilege to first recognize the distinguished Administrator of

the Drug Enforcement Administration, my friend, Administrator

Hutchinson.

You are recognized for your opening statement.

STATEMENT OF ASA HUTCHINSON, ADMINISTRATOR, DRUG

ENFORCEMENT ADMINISTRATION

Mr. HUTCHINSON. Thank you, Mr. Chairman, Ranking Member

Cummings. It is a privilege to be back in this committee and back

on Capitol Hill, and the first time as Administrator of the DEA.

All of the DEA deeply appreciates this committee’s leadership on

our fight against international drug trafficking, and I want to say

that both the chairman’s comments and the ranking member’s comments were right on point in reference to the battles that we face.

I have been asked to testify on the connection between international drug trafficking and terrorism, and let me emphasize at

the outset that we would be ill advised to ignore the extent to

which the profits from the drug trade are directed to finance terrorist activities. The issue has to be of paramount concern to our Nation, and it certainly is to the DEA.

The recent attacks on our Nation graphically illustrate the need

to starve the financial base of every terrorist organization capable

of violence to American citizens and property, whether abroad or

at home. In many instances, the terrorist organizations benefit

from the proceeds from the illegal drug trade. In Colombia, the

FARC carries out acts of political violence with a portion of their

funding coming from drug-related activities. Unlike their counterparts in Colombia, where the government is in strong opposition to

both drug trade and rebel violence, the terrorists in Afghanistan

enjoy the benefits of an opium-driven economy in which the ruling

authorities, the Taliban, embrace both drug trafficking and terrorist training.

The cells of terrorists are disbursed beyond the geographic

boundaries of Afghanistan, much in the same manner as other

international narcotics syndicates. Consequently, the DEA’s apVerDate 11-MAY-2000 09:00 Oct 02, 2002 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 C:\DOCS\81496.TXT HGOVREF1 PsN: HGOVREF1
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proach to both the drug trade and our Nation’s response to terrorism must be equally global in scope.

DEA intelligence confirms the presence of a linkage between Afghanistan’s ruling Taliban and international terrorist Osama Bin

Laden. Although the DEA has no corroborated, direct evidence to

confirm that Bin Laden is involved in the drug trade, the relationship between the Taliban and Bin Laden is believed to have flourished, in large part due to the Taliban’s substantial reliance on the

opium trade as a source of organizational revenue. In fact, the very

sanctuary enjoyed by Bin Laden is based on the existence and control of the Taliban, whose modest economy is dependent upon

opium. This connection defines the deadly symbiotic relationship

between the illegal drug trade and international terrorism.

In reference to the Taliban, DEA possesses substantial source information indicating ties between the drug trade and the Taliban.

Acting as the de facto government of Afghanistan, the Taliban

taxes and directly benefits from all aspects of the opium trade.

DEA intelligence reveals that taxation is institutionalized. It is

even institutionalized to the point that the Taliban provides receipts for collected revenues, and it’s on the board and I offer as

my testimony exhibit A, a receipt from the tax collectors, and it has

been translated, that says, ‘‘To the Honorable Road Tax Collectors:

Gentlemen, the bearer of this letter who possess four kilograms of

white good has paid the custom duty at the Shinwar custom. It is

hoped that the bearer will not be bothered further.’’ And it is

signed, of course. And that is a receipt for the taxation that is paid

by the traffickers to the Taliban government.

And so it is institutionalized, but it is not a standardized system

of taxation. While the current tax rate for cultivated opium appears

to be 10 percent, the taxation of processing and transportation of

the product is sporadic and taxed at varying rates.

In 2001, after the much-heralded Taliban prohibition on opium

poppy cultivation, Afghanistan reduced their opium production

from about 4,000 metric tons in 2000 to 74 metric tons in 2001.

And another exhibit that I’ve put on the board shows the increase

in the Afghanistan opium production from 1994 all the way

through 2000, and the dramatic drop in 2001. And so clearly the

Taliban government has an enormous amount of control on what

is produced and what is allowed out of the country.

Despite this significant decrease in 2001 and the Taliban’s claims

of lab destructions, DEA has seen no decrease in availability and

no increase in prices of southwest Asian heroin in the United

States and in Europe. This indicates that significant amounts of

opiates still remain available.

According to the United Nations, Afghan traffickers typically

store up to 60 percent of each year’s opium crop for future sales,

and since the ban by the Taliban the kilogram price of opium has

skyrocketed from $44 U.S. money to over $400 per kilo. This price

increase, which was limited to the immediate region and did not

resonate in the international markets, appeared to be a means for

the Taliban to capitalize on a rise in the prices of a commodity over

which they exercise virtual total control.

DEA intelligence indicates the Taliban’s role was not a passive

one, and that they are engaged in the stockpiling of opium. The net

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effect of this stockpiling is to force the local price substantially upward, which price escalation continued until the recent weeks.

In the wake of the recent mass exodus from Afghanistan, opium wholesalers were reportedly dumping their stocks for as low as $95

per kilo, apparently in anticipation of any intervention in the region.

The beneficial partnership of drug traffickers and terrorists will

challenge the resilience of all law enforcement agencies. It will necessitate a continued commitment to our anti drug leadership overseas, and that is certainly something we’ll have to focus on.

The DEA will continue to aggressively identify and build cases

against these organizations contributing to terrorism. In doing so,

we will limit the ability of the traffickers to use their profits as a

means to support, finance, and benefit their incredibly inhumane

assaults on society and the rule of law.

Thank you for the opportunity to testify. I’ll look forward to any

questions you might have.

Mr. SOUDER. Thank you very much.

[The prepared statement of Mr. Hutchinson follows:]

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Mr. SOUDER. Mr. Bach.

STATEMENT OF BILL BACH, DIRECTOR, OFFICE OF ASIA, AFRICA, EUROPE, AND NIS PROGRAMS, U.S. DEPARTMENT OF

STATE

Mr. BACH. Chairman Souder and Ranking Member Cummings,

thank you very much for this opportunity to present to the subcommittee our views on opium trade, Taliban, and terrorism.

The following statement is an abridged version of a prepared

statement that you have in front of you, I hope.

We have ample evidence that the Taliban has condoned and profited from the drug trade. We also know that the Taliban has provided sanctuary to and received military assistance from terrorist

groups in Afghanistan. Taliban taxes on opium harvests, heroin

production, and drug shipments have helped finance its military

operations against rival factions. These taxes also bestowed legitimacy on Afghan drug traffickers.

Despite the Taliban’s ban on poppy cultivation last year, opiates

smuggled out of Afghanistan continue to de-stabilize the region by

spreading addiction, HIV, AIDS, and crime. This uninterrupted

trafficking suggests that the Taliban’s poppy ban is not a sincere

effort to stop the drug trade.

Before last year’s ban, the Taliban collected from 10 to 20 percent taxes on the yield of poppy fields, as well as taxing the processing, shipment, and sale of opiates. According to United Nations’

estimates for 1999, the value of the Afghan opium crop at the farm

gate was $265 million, which represents at least $40 million in tax

revenue for the Taliban. However, if the Taliban is directly involved in the drug trade, as alleged by some United Nations reporting, its revenue may be far greater.

We know, for example, that an estimated potential street value

of Afghan opium or heroin, rather, in the west in the year 2000

was $35 billion.

The Taliban’s ban on the cultivation of poppy last year effectively

eliminated approximately two-thirds of the world’s annual illicit

opium supply. However, while the price for opium has increased

substantially in the subregion over the past year, the price for heroin has not. The flow of opiates out of Afghanistan has not abated.

Narcotics interdictions by Afghanistan’s neighbors show record seizures of Afghan opiates flowing out and precursor chemicals flowing in. This clearly indicates that Afghan heroin traffickers are

drawing from their stockpiles, presumably with the knowledge and

perhaps the collusion of some in the Taliban.

While we do not have clear evidence directly linking drug traffickers and terrorists in Afghanistan, Taliban responsibility is implicit, given its de facto control over 90 percent of the country.

There is a natural symbiosis between the Taliban and narcotics

traffickers, whose smuggling and money laundering networks

would be of great help in the Taliban’s efforts to circumvent United

Nation’s sanctions. And the Taliban we know has given aid, training, and sanctuary to various Islamic terrorists and separatist

groups in Afghanistan, including Osama Bin Laden’s al-Qaeda

group.

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Al-Qaeda fighters have taken an increasingly prominent role in

the Taliban’s war against the Northern Alliance, reportedly because war-weary indigenous Afghans are reluctant to fight. The

United Nations reports that campaigns against the Northern Alliance are used by foreign terrorist groups in Afghanistan as live fire

exercises for their fighters.

In addition, we are aware that Osama Bin Laden has close relations with top Taliban leaders. Press reports indicate that Bin

Laden encouraged the Taliban to increase its drug trade as part of

his war against the west.

I thank you for this opportunity to raise these important issues

with the subcommittee.

[The prepared statement of Mr. Bach follows:]

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Mr. SOUDER. Thank you both for your testimony.

Let me in the first round of my questions probe a little further

on the connection of the Taliban and possibly the direct involvement in the drug trade.

Do they simply tax the opium producers and traffickers, or is

their participation much deeper? To what extent—to what—do you

place any credence to the reports that they control the trafficking

organizations in Afghanistan, and also that they may be giving

some in-kind contributions in the tax? For example, when we were

just down in South America in Venezuela, one of the things their

company does is they, in their tax on the oil, which is totally legal

and not related to this, but they take it in kind. It’s a standard

method around the world of not just taking a dollar contribution

but an in kind. Is that being done here at all?

Mr. HUTCHINSON. The answer is that, first of all, there’s the historic pattern that you have referred to that any time an authority

or any other group tries to benefit from that trafficking through

taxation or protection money, that many times they will take it in

kind.

Second, there is information that the Taliban, in a number of instances, have taken their taxation revenues in kind, and that obviously puts them in the drug business, itself.

In addition, of course, you have the stockpiling that there’s credible information that they have engaged in the stockpiling, themselves.

Mr. SOUDER. Do you have anything, Mr. Bach?

Mr. BACH. If I could just add that in addition to the tax that’s

taken on the fields, the opium tax on the poppy farmers, there are

taxes taken, as the administrator indicated, on the transportation

and shipment of the poppy that goes to the Taliban, as well as protection that is given to the traffickers. The money from that obviously also goes from the checkpoints to the Taliban.

As far as controlling the drug distributors, the traffickers in Afghanistan, we do have press information—we don’t have verified

information from other sources—that some 35 of the drug trafficking organizations in Afghanistan are controlled by the Taliban, but

we haven’t been able to verify, as I said.

Mr. SOUDER. It is important to make this distinction, because

this isn’t like a benign IRS type of the thing. In other words, if the

United States collected a tax on an activity that many people didn’t

approve of, it doesn’t mean that the U.S. Government is involved

in that because we tax it, but here you’re saying the tax is not like

an IRS collecting a tax; it’s the primary source of revenue for the

Taliban. They know full well what they’re doing. They are, in effect, by stockpiling and protecting the stockpiles, managing the

flow, managing the price, working with the transportation. It’s a

symbiotic relationship, as opposed to a mere tax collection function.

Mr. HUTCHINSON. To illustrate further the level of control, which

to me is quite incredible and impressive, when the Taliban indicated there would not be any more poppy cultivation—and that’s

an easy thing for the government to say or leadership to say. In

Colombia they’ve tried to get rid of the coca cultivation for a long

time. But whenever the Taliban issued that directive, the poppy

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cultivation diminished extraordinarily, almost wiped out. So that illustrates the control that they have.

And so if you think of that level of control and then what else

is happening in terms of the stockpiling, the trafficking routes, obviously I think that level of control translates.

Mr. SOUDER. In other words, this is less like a tax and more like

a mafia-style organization where they’re getting their percent of

the movement that’s moving through as part of allowing it to happen and being a participant? Would that be a fair categorization?

Mr. HUTCHINSON. I’ll leave the characterization to you on that

one.

Mr. SOUDER. OK. Do we have any information suggesting Osama

Bin Laden and the al-Qaeda organization have directly engaged in

or supported the drug trade? If so, what is the extent of that involvement? Has Bin Laden’s group been involved? And what indirect support?

You’ve alluded to this and suggested that we may not have direct

support and implied that. I wondered if you might be able to take

that a little further.

Mr. BACH. We don’t have anything that specifically ties the two

together. We’ve heard reports. In fact, the report by the experts

prepared for the United Nations Committee on—Special Committee

1333, which was talking about sanctions against the Taliban, did

talk about the Taliban providing weapons, as Ranking Member

Cummings suggested, to various terrorist groups inside of Afghanistan, war materials, weapons, etc. That’s the kind of general indication that we have that there’s a connection between the terrorist

organizations and the Taliban and the drug money. I have not seen

anything in any of my sources aside from the open sources that indicate that Osama Bin Laden has in any way directed the cultivation or processing, refining, etc., of opium.

Mr. HUTCHINSON. Let me just add that, from the DEA perspective, there is limited information in regard to Bin Laden’s direct

participation in drug trafficking. The DEA has not been in Afghanistan since the 1980’s. We have conducted our intelligence gathering

from the periphery from Peshawar, Pakistan, from the surrounding

area, but it has been an active gathering of information and monitoring. There is limited information, some of which would have to

be provided to you in a classified setting.

Mr. SOUDER. So, basically to say this another direction, because

there’s—if he gets the revenue from it, there’s no real reason for

him to be involved if he benefits from the revenue. You’re saying,

while he may not be directly—may not be directly raising, dealing,

trafficking in it, that it is a primary source of income for the support groups for him, without whom he could not exist, and that it

may, in fact, be providing him weapons, and, based on other

sources and that—certainly you’ve referred to the fact Afghanistan

has very little economy other than this with which to provide the

infrastructure and the support systems for him, and, furthermore,

it appears that he may have exhausted much of his personal

wealth, meaning he does not have—there’s a lot of impression in

the United States, because he comes from a rich family, that he

has unlimited sources of income other than this, but reports are

suggesting that he has exhausted that income, which has made

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him even more dependent on those who are protecting him, providing revenue sources.

Would you agree with that characterization that he is dependent

on the financial resources right now, or at least appears to be heavily dependent on the protection and the financial resources of the

Taliban?

Mr. HUTCHINSON. Clearly the Taliban has acknowledged that

they have provided protection to Bin Laden. Whenever, again, they

have that level of control over a territory, whenever you see the

terrorist training camps and the poppy fields in the same geographic region, you know that there is a coexistence. And the fact

is that both drug traffickers and violent groups such as terrorists

have to have an area in which the rule of law has been diminished

or the cooperation of the governing authorities. And we don’t know

the financial capability of Bin Laden. I wouldn’t certainly say that

if you dried up all the opium there that his activities would cease,

but clearly whenever both groups deal in violence, both groups

have to depend upon a diminished rule of law, that there is, as you

have stated, that symbiotic relationship between them. But clearly

the Taliban, which derives a substantial source of their revenue

from the drug trade, is providing protection. You don’t know whether weapons or other necessities of a terrorist organization are being

provided or traded, the extent of that, but clearly there is that

inter-relationship between them.

Mr. SOUDER. Any comment on that, Mr. Bach?

Mr. BACH. Mr. Chairman, the primary source of revenue for the

Taliban is probably not drug trade, it is probably smuggling— smuggling more generally. I mean, there are a lot of things that

transit Afghanistan in the direction of the northern Central Asian

Republics. Contraband also heads east toward Pakistan and Iran,

that are smuggled in, from which they derive quite a bit of revenue, apparently.

I’m not that knowledgeable on al-Qaeda’s sources of income, but

I understand that a lot of it comes from charitable sources. They

have financial networks that go worldwide whereby people could

contribute very unknowingly to charities which would provide funding to al-Qaeda. We understand that there has been some state

support. We don’t know from whom, but we know that in the past

there has been support that has been channeled to al-Qaeda. And

I don’t have the impression that he is at the end of his tether in

terms of financing, but I’m not an expert on the subject.

Mr. SOUDER. Thank you.

Mr. Cummings.

Mr. CUMMINGS. I’m just wondering, Administrator, you know,

President Bush has said over and over again in the news reports

also, constantly, that we’ve got 4,000 FBI agents working on this

effort with regard to September 11th, and I was just wondering

how, if at all, has the role of the DEA changed? In other words,

are we shifting priorities? Is it pretty much the same as what

you’ve been doing? And what role have you been asked to take on,

and, just generally, without getting into any classified information,

how has that changed, if at all?

Mr. HUTCHINSON. Thank you for the question, and I’m very

pleased that DEA has offered a great deal of support during the

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ongoing investigation. There has been an impact in the short term.

I think it remains to be seen as to the impact long term. But in

the short term we have tried to provide assistance to the FBI, the

lead agency in this counter-terrorism investigation. We have provided intelligence analysts to the FBI to assist. Each of our field

divisions have been on alert in terms of gathering intelligence and

have offered assistance to the FBI. Through the normal course of

our investigative work, we have actually made arrests and turned

over subjects, questionable people to the FBI to further that investigation.

The sky marshal program is sort of a time of all hands on deck,

and so I was proud of the DEA that whenever they asked for volunteers to get the airlines going again from a security standpoint we

had over 1,000 volunteers. And so we have assisted the Attorney

General as requests have been made.

In the long term, clearly this has put an emphasis upon our work

overseas. Having over 400 agents overseas, offices in 56 countries,

having intelligence sources in Pakistan so close to the area of trouble in Afghanistan, we have—we are an asset that has to be called

upon.

In addition, because of the work of Congress, we have intelligence infrastructure capabilities that has been of assistance, and

I think that will continue in the long term.

When I say that, I’m speaking of the sophisticated side of what

we do and how we are able to aid the law enforcement community.

And I think that, in the long term, we are a single mission agency focusing on drugs, and that is not going to change, but we’re certainly going to keep our eyes and ears out as to what else is happening, information that we can provide that would help our country in dealing with the great threat that comes from abroad, as

well.

Mr. CUMMINGS. You know, as you were just speaking I was just

thinking that when we think about this war and how it has been

described, and that we have—it’s going to be an unconventional

war where we deal with finances and all kinds of data, intelligence,

and whatever, it seems to me that your organization would have

to play a pretty significant role in all of this, and I’m just wondering whether that puts a strain on your resources, because, you

know, we’ve still got all these other problems that we’ve got, and

certainly it’s—and I was just wondering, I mean, how do you see

that, and at what point do you say, ‘‘Mr. President, you know, we

need resources.‘‘ Or do you think you need more resources? If

you’ve got people trying to do this and we’ve got to also address our

domestic problems here that you have been dealing with all of the

time, I was just curious.

Mr. HUTCHINSON. Well, there’s certainly a resource need. Congress has certainly been supportive of our effort at the DEA, and

we are pleased with that. But as the—as you indicated, this is a

new arena that we’re entering that has this very significant law

enforcement component. The President has said that we are either

going to bring these terrorists to justice or we’ll bring justice to the

terrorists, and the first aspect of that is the law enforcement arena,

and so there is that role to play.

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And I think what has been emphasized is that we cannot do our

domestic responsibilities without having the support overseas, as

well, and so the overseas component of the DEA I think will have,

certainly from my view, a new emphasis and will have new needs

because they tie together.

Whenever we have a case in Denver or in Baltimore, with—ultimately, we would get it back to the source, many times we’ll have

an international connection to it, and that is where we can have

the greatest impact. To be able to further the investigation to that

point.

And now we see that the international drug traffickers are a

ready source of supply for other criminal activities and that there

is that inter-relationship.

So I think, again, we have to wait and see as to how roles are

adjusted down the road, but there are going to be some resource

requirements that will have to be addressed.

Mr. CUMMINGS. Without naming names, I’m just wondering—and

when you looked at your—I’m sure you all have a list of suspected

people who may be involved in the drug trade. When you took a

look, when your agency took a look at what the FBI may have come

up with, the CIA, their list of terrorists, did you find any linkages,

I mean, as far as people? I mean, in other words, did you have

some on your list that, you know, you found appeared on their list

with regard to the September 11th events at all?

Mr. HUTCHINSON. I wouldn’t want to comment on the specifics of

it, but we have been tasked with checking our human intelligence

sources, but also from EPIC in El Paso, our intelligence centers, as

well as our other indices in order to see whether these names that

are being checked out pop up, and so we have been supportive in

that and will continue to do so.

Mr. CUMMINGS. Do you, as far as the level of cooperation with

the CIA and the FBI and other agencies involved in this, do you

believe that—most people that—and you were an elected official

and you know that when we go home our constituents are—especially something like this, the one thing they want to know is,

‘‘Well, what are we getting ourselves into and when is it going to

be over and if it is going to be over?’’ I mean, do you share the view

of the President that this is just going to be a long, ongoing event,

this war?

Mr. HUTCHINSON. Well, I think the battle against evil is longstanding. I’m not sure I’m in a perfect position to comment on that,

but yes, I think that, you know, this is going to be a long struggle,

as the President has indicated.

I think that it—the American people have to understand that we

have dangers that we face that are probably unique to this generation, but I think that we can undermine the infrastructure of the

terrorist organizations. Part of that is the drug sources, which is

a subject of this hearing, and I’m of the view that, you know, if we

commit ourselves to it, even if it is a longer struggle than we are

used to, that we can get a victory over this and an absolute victory

over it, and I think that’s what the American people expect and I

think that’s what they will see.

Mr. CUMMINGS. Thank you.

Mr. GILMAN [assuming Chair]. Thank you, Mr. Cummings.

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The chairman had to attend another hearing but will be back

shortly. He asked me to sit in for him.

I want to thank our committee chairman for holding this morning’s hearing to examine this very timely and appropriate topic on

the drug trade and terror network and its impact on the terrorist

network.

The tragic, barbaric events of September 11th have brought numerous similar issues to the fore, and it is gratifying that our committee has been able to take this on and has not been reluctant to

avoid such a difficult subject.

And I want to join in welcoming our new DEA administrator,

Asa Hutchinson, our former colleague, and as well as Bill Bach, our

NIS director of Asia, Africa, Europe, and for the State Department.

As you stated in our roll-out—as our chairman stated in our rollout for the Speaker’s Anti-Drug Task Force, there is a clear and

compelling evidence that the Taliban regime, the Afghan heroin

trade, and the al-Qaeda terrorist network are all interwoven. It is

important to highlight that point because it has become obvious

that the production and shipment of heroin is a key source of income for the Taliban government, as well as for the Osama Bin

Laden there organization.

Afghanistan has traditionally been a major supplier of opium

poppy for the European and Asian heroin markets. However, since

the Taliban seized power in 1996, opium production in Afghanistan

has soared and now represents an estimated 80 percent of the GNP

of their country. Given that more than 70 percent of the world’s

opium for heroin originates in Afghanistan, it is obvious that this

illicit trade is enormous and highly profitable, a significant part of

the Taliban’s power base. Our government believes the Taliban takes in $40 million to $50

million annually from illicit drug revenue. I think it is much more

than that. I think that’s a highly conservative estimate.

Despite repeated pledges to crack down on opiate production and

trafficking, the State Department reports that the Taliban has

made little or no progress in implementing that policy; rather, the

government appears to be a willing participant in both the production and the export of opium and heroin.

For this reason, Afghanistan has been decertified by the State

Department in its annual drug certification process, and I think

that’s highly appropriate. The primary impact of this interwoven

web of drugs and terrorism for our Nation has been the latter, and

the majority of Afghan heroin is exported to Europe and Asia, not

to North America; consequently, the drug issue has enormous policy implications for our European allies.

While we have so far the bulk of the drug problem from Afghan

heroin, the events of September 11th clearly illustrate the capabilities of the terrorists who are funded in part by this illicit drug

trade, so I look forward to comments by our witnesses.

And let me pose a few questions to you. In light of the fact that

the bulk of Afghan heroin is exported to Europe and Asia for consumption, what type of cooperative efforts has the DEA been receiving with our allies in those regions, Mr. Hutchinson?

Mr. HUTCHINSON. Thank you, Mr. Gilman, and it’s good to see

you again. And we’ve received an extraordinary amount of cooperaVerDate 11-MAY-2000 09:00 Oct 02, 2002 Jkt 000000 PO 00000 Frm 00115 Fmt 6633 Sfmt 6633 C:\DOCS\81496.TXT HGOVREF1 PsN: HGOVREF1
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tion from our European counterparts. In Pakistan, particularly, of

course, close to Afghanistan, they have been impacted very personally by the increased opium trade coming out of Afghanistan. Their

consumer base, their addiction population has increased, but they

have, even in Peshawar, Pakistan, where we had to pull our DEA

agents out, they have remained there in terms of their vetted units

that are assisting us. Our office in Islamabad is continuing and

doing extraordinary work, but the Pakistani Government has been

very helpful in regards to addressing the opium problem.

In the one graphic that I had up, it showed the opium production

in Afghanistan and in Pakistan, and you can see how the continued

decline of the production in Pakistan, which is the yellow mark

there, in contrast to red, which is the Afghanistan, so they are

doing great work.

But this is a European problem in the sense that they are most

directly impacted, but it is our problem, as well, because this is

something that we work collaboratively with our European allies.

It affects the whole world, as well as them and us.

Mr. GILMAN. Mr. Bach, do you have any comments about cooperation with our allies?

Mr. BACH. Yes, sir. I, at the beginning of the month, on the 13th

through the 15th was in Islamabad to attend what’s called the ‘‘Six-Plus-Two Talks,’’ which are the front line states around Afghanistan plus Russia and the United States, and there’s a great

deal of interest in pursuing a regional action plan of trying to contain the Afghan opiates at the borders through a lot of cooperative

programs with each other and with Russia and the United States.

China, the Central Asian Republics, Iran, and Pakistan are

members of this group, and we’re hoping to get more cooperation

in the near future from European donor states. There is going to

be a UNDCP meeting later next week which is going to address the

issue of more support for Iran in counternarcotics.

But Iran, for example, is doing a good deal. They’ve lost over

3,000 law enforcement officials over the last 12 years to heavily

armed traffickers in opiates coming across the border from Afghanistan.

We’re getting quite a lot of cooperation from these states.

Mr. GILMAN. When you say they are heavily armed traffickers,

who provides the arms and the protection for the traffickers?

Mr. BACH. Well, as we understand it, the system that the

Taliban has put in place with smuggling of arms circumventing the

United Nations sanctions, etc., that would easily translate into the

availability of arms for traffickers. But, in addition to that, of

course, there were arms that were there from the hostilities with

Russia, which provide a lot of the tanks. There are also still ongoing conflicts between the Northern Alliance and the Taliban militia

forces, which spin off arms, as well, so there’s a lot of capability

to, I think, supply armaments in that country.

Mr. GILMAN. Do any of the neighboring countries, the immediate

neighboring countries, assist in our efforts to stem the flow of narcotics out of that area?

Mr. BACH. Yes, sir. Very much so. As I mentioned, I think the

most seizures that have been accounted for in the past year have

taken place in Iran, but there have been a great many, as well, in

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Pakistan. Both of these countries have huge problems having to do

with the leakage of opiates as they transit their countries bound

for western Europe. There’s a lot that falls off the caravans, of

course, in the sense of being sold locally, so they have terrific crime

problems in those countries, and they are very, very forward-leaning in their attempts to try to interdict.

The borders in both cases are extremely hard to control. They

don’t have sufficient technology or data bases or transfer of intelligence information between them to make it airtight, for sure,

there’s been quite a bit of leakage, as I’ve mentioned, but they are

very much seized with the problem and they have been cooperating.

Mr. GILMAN. What’s the usual route that they take in exporting

their wares?

Mr. BACH. Well, the majority of the opiates, as we understand it,

flow through Iran. A good portion is also going through Tajekistan,

Turkmenistan, the Central Asian Republics, but most of it goes

through Pakistan and Iran, and I think Iran has the highest seizures, and we, therefore, we believe that they have the highest volume, as well.

Mr. GILMAN. What has been the record of the cooperation by

Pakistan with regard to seizing the illicit narcotics?

Mr. BACH. Well, they have been very helpful, but they have an

extremely mountainous border which is almost impossible to surveil from the outposts that they have on that border. We’re looking

at different possibilities to try to enhance their capability for surveillance, but the problem has been that, with this flood coming

back and forth with traditional traffickers and traders, it is extremely difficult to interdict all the flow coming across in the case

of Pakistan.

Mr. GILMAN. Mr. Hutchinson, you mentioned in your testimony

the Taliban has sharply cut opium production in 2001, yet the supply being exported has not declined. Does the DEA have any estimate of the size of the heroin stockpile in Afghanistan, as well as

the locations of that stockpile? We’ve heard a lot of comment that

they have warehoused a lot of their percent.

Mr. HUTCHINSON. The estimates are that each year up to 60 percent of the opium production would be warehoused, and so that

was tightly controlled. That has been the habit and that has been

the means by which they were able to control the prices. And even

though the poppy production almost came to a halt after the ban

in July 2000, the outflow of opium has continued from that country, and the indications are that is because of the warehoused

opium that has been released, and that has had the effect of driving up the price substantially. The price has, once again, adjusted

since—in the last few weeks, where it has once again started climbing again, and I think it reflects sort of an unknown future that

region faces and how that will impact on the opium production in

the future.

If I might, Mr. Chairman, Mr. Gilman, elaborate on the routes

that are coming out, we have an exhibit that we would put up on

the screen which shows some of the routes that are going out, and

in Istanbul, where I traveled to fairly recently, they are impacted

enormously by what is going out of Afghanistan through the route

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through Turkey, and I don’t see that going up on the screen, but

that is—will be available.

Mr. GILMAN. We’ll ask that they make it available.

I see our chairman has returned. I had one more question, Mr.

Chairman.

Let me ask one more question. What do we know of other terrorist organizations around the world who are linked to drug trafficking? I know in Colombia, for example, the FARC are heavily involved. Mr. Hutchinson, do we have any other information of other

terrorist groups involved with drug trafficking?

Mr. HUTCHINSON. Well, as you mentioned, in Colombia you have

the FARC, which is an insurgent or insurgency group that has an

extraordinary violent tendency that receives a significant part of

their funding from drug trafficking, a portion of their funding from

drug trafficking. In addition, you have the Shining Path in the region of Peru. You have in Burma the United Wa State Army

[UWSA], which is another tribal violent group that receives funding from drug trafficking and production, as well.

And so you see that there are a number of areas of the world

that the proceeds from drug trafficking impact on insurgency

groups, as well as terrorist organizations.

Mr. GILMAN. And, of course, in the Bekaa Valley in Lebanon we

have some more drug trafficking. I don’t know who that benefits.

There’s some rumors about it benefiting some of the hierarchy in

Syria. But we would welcome your keeping a close eye on those terrorist groups that do benefit from drug trafficking and advise the

Congress of the names of those groups.

Thank you very much, and thank you, Mr. Chairman.

Mr. SOUDER [resuming Chair]. We’re into a second round of questioning, and I wanted to ask: do you see any other alternative explanation other than stockpiling for the sudden rise of heroin

prices? In other words, in your testimony we talked about the $200,

and then it dropped to $90, as we see some more coming on the

market, and that suggests that, in fact, they were stockpiling. Recent refugees coming across the border appear to be carrying

amounts of heroin for sale, which suggests stockpiling. Is there any

other possible alternative that they have been stockpiling?

Mr. HUTCHINSON. I think that accounts for the—of course, the increase in price after the July 2000, ban was as a result of the decrease in the poppy cultivation, and then they were able to control

it because what they had in stockpile. And as they released that

with a higher price, obviously that produces more revenue.

Since the—in July 2000 it was $44 per kilo. It shot up a year

later to $373 per kilo. Right before the September 11 attack, it actually got up as high as $746 per kilo. Since then, it dropped down

to $95. And these are averages for prices, because there is some

fluctuation.

Mr. SOUDER. Is that a worldwide average or United States?

Mr. HUTCHINSON. No. This is in that region.

Mr. SOUDER. OK. Subregion.

Mr. HUTCHINSON. In that region of the world it has been reduced

again, and that’s because they were dumping it. They were getting

it out of their stockpiles that reduced the price. And then again

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we’ve seen a little bit more stabilization now with prices reported

back up again to $429.

So you can see from this that it is very volatile as far as the pricing goes right now, I think responding to world events and the unpredictability of a future in that region. But it is important that

to this point we have not seen a change in consumer prices, which

indicates there certainly is an adequate supply for opium still

available. We’ll have to wait and see if that is impacted. Certainly

we hope that it will be.

Mr. SOUDER. So you haven’t seen a change in consumer prices in

the United States, or is that true of Europe, also?

Mr. HUTCHINSON. In both instances.

Mr. SOUDER. And have you seen more seizures on the border, or

have the seizures stayed about the same in Iran and Pakistan and

other places? In other words, when they stopped the cultivation,

you mentioned more precursors were going in. You didn’t see a

change in that. Did you see any dramatic change in seizures because if all of a sudden they didn’t have it, supposedly seizures

would have gone down, too.

Mr. BACH. I think I noted that the seizures were at record levels,

actually, in the past year, despite the fact that there was a ban on

production inside of Afghanistan. And, of course, they’ve even gone

up more recently since the 11th as a result, I think, of what the

administrator mentioned, which is the dumping of the stuff.

Mr. SOUDER. So, if I can understand and get into the record a

couple of basic things here, is our heroin in the United States, is

it about 10 percent from that region?

Mr. HUTCHINSON. A little bit less than 10 percent.

Mr. SOUDER. And in Europe, what percent would it be from that

region?

Mr. HUTCHINSON. It would be up around the 80 to 90 percent

level.

Mr. SOUDER. And could it—are prices such that they could, in

fact, or have you seen any sign that they might be targeting an influx into the United States?

Mr. HUTCHINSON. In the United States, we get over 80 percent

of our heroin from Mexico and Colombia and the regions to the

south, so it is a small percent that we get from southwest Asia.

And I’m sorry, Mr. Chairman, I just lost your question.

Mr. SOUDER. Well, that basically addresses it, because we’ve seen

increase in poppy cultivation in Peru and Ecuador, as well as Colombia, and in effect you’re saying that’s the primary market can

continue to be, and since they are increasing their growth of heroin

it’s not likely we’re going to get an influx through Afghanistan.

Could you also, Mr. Bach, talk a little bit about—we’ve historically thought of heroin coming from the Golden Triangle and from

northern Thailand, which a number of years ago was very aggressive in getting rid of it, and from Burma. It looks like it is sliding

to the west, and what impact that’s had on trafficking.

It also suggests to me, by the comments that both of you made

a little earlier regarding Iran and Pakistan being the primary trafficking zone, as opposed to being north, that, in fact, the civil war

may have pushed it south-southeast, which is a different direction

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than the primary markets would be if they’re not coming to the

United States.

Could you talk a little bit about the changing heroin trafficking

patterns in that zone of the world as it relates to Europe and to

their major markets for that heroin, and illustrate also how the

earlier points in when you have a breakdown in law—in effect, the

Golden Triangle had no law. Law came in. They moved to Burma.

You had a breakdown. There was some attempt there. They moved

again.

Could you illustrate kind of the trafficking pattern of how it

wound up in Afghanistan?

Mr. BACH. Yes, I’ll try. Like, Mr. Hutchinson, I’ve just been at

this job for a while, but I did go to Burma and to Thailand, Chiang

Mai, and to Viet Nam to talk to some of the people in the major

producing nations in that part of the world. There has been a shift.

As Mr. Hutchinson indicated, most of our heroin is coming from

Colombia and from Mexico these days, no longer from the Golden

Triangle. That’s mostly goes to Europe. But there has been a terrific cutback in the production, as we understand it, of opium

poppy in the Golden Triangle, and part of that has to do with the

fact that they’ve had serious drought there for 3 years, and the

CNC indicates that the yield has been down quite a lot I have seen

poppy pods that they’ve brought back which are withered and

don’t, I guess, yield very much as a result. So part of it is that.

The cease-fire territories of Burma, the areas that back in 1996

and 1997 had reached cease-fires with the government there, had

been given a certain number of years to eliminate the cultivation

of poppy. Some of those have made progress in that direction, because the Burmese officials have taken some action.

In the case of the Wa, there are a number of UNDCP programs

we’re also supporting through State Department INL, which support alternative development for the Wa peoples, and they’re introducing other crops, of course.

We’re seeing a lot of cooperation these days regionally with the

Thai and the Laotians and the Chinese getting together—the Vietnamese, too, to some degree—and cooperation on intelligence sharing, extradition of drug lords. That happened after the Beijing Conference in August 2001. The Burmese, for the first time, rendered

some ethnic Chinese who were residing in Burma to the Chinese

officials for prosecution.

One of the major developments that officials mentioned in Southeast Asia was that, now that heroin seems to be kind of on the

wane in terms of both production and trafficking, there’s a great

influx of methamphetamines, which has found a thriving market,

particularly in Thailand but also in Viet Nam, where these methamphetamine pills, which are called ‘‘crazy pills,’’ are very available. They have been used to some degree as a substitute, apparently, for heroin by addicts, and they create all kinds of the problems that we’ve associated here in the United States in the past

with amphetamines. It is a killer drug and it has caused a great

deal of crime and addiction, as well as all the other consequences

socially in those countries. It is a major issue with them for which

they’re asking additional assistance from the United States. We’re

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trying to respond to these requests with law enforcement training,

cooperative police networks, databasing, and so forth.

I hope that answers the question.

Mr. SOUDER. And we’re going to continue to track synthetic and

methamphetamines. I know Director Hutchinson has been very involved in that area. Our upcoming next annual transatlantic—now

trans-Atlantic and-Pacific—legislative conference is going to focus

on synthetic drugs, because the Asians were particularly concerned

about that. I know the DEA told me 4 years ago they were concerned that Viet Nam was going to become a major trafficking area

as it opened back up, and many Americans, unfortunately, got addicted to a lot of the narcotics over there. It could easily become

a transit zone. So we’ll be doing followup with that.

I wanted to ask one more question. Another hot topic right now

is the intelligence coordination and cooperation that Chairman

Sensenbrenner is doing in markup this afternoon because of our

concerns on the U.S. border and elsewhere about lack of intelligence cooperation in the United States and ability to share information. This has been a touchy issue internationally, as well, that

has been a subject on some of the national debate programs. For

example, I watched Larry Johnson, who has testified in front of

this committee many times on our anti-terrorism subjects, debate

with former DEA Director Mr. Constantine on this very subject,

and I wondered whether you feel, in the subject of Afghanistan,

Mr. Hutchinson, that there has been adequate cooperation in State

Department, CIA, DEA, whether there’s anything legislatively that

we need to look at that would overcome any limitations in intelligence sharing like we’ve had problems in the domestic side in the

United States.

Mr. HUTCHINSON. I could not point to any problem in that regard, from my experience. Certainly, there’s always arenas that

you want to do better and you need to enhance that cooperation

and sharing.

I think the—it is critically important that, as different intelligence arenas get information that might apply to drug trafficking,

that information be provided, but at the same time, as we have information from our intelligence from the law enforcement side that

might relate to the other agencies, we need to make sure that gets

over there, as well.

The legislation that the administration has proposed will certainly be helpful to make sure there’s not any barriers to that flow

of information back and forth, but my experience is that the cooperation is there and that the sharing—the willingness to share

is there.

Mr. SOUDER. Because we had some concerns about that in Peru,

obviously, as well, where sometimes it seems like our agencies are

not talking to each other as much as they could. I know a lot of

times these decisions are instantaneous and you don’t have that

ability, and I understand that, too.

Mr. Cummings, do you have additional questions?

Mr. CUMMINGS. Just two or three, Mr. Chairman.

You know, it would—when you think about all this—and I assume, Mr. Chairman, one of the reasons why you called this hearing, when we think about the possibility that drugs, the sale of

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drugs, could be financing what we saw on September 11th, I mean,

that is enough—that is very chilling.

And, Mr. Bach, just so that we can, as we wind down now, I just

want to make sure I’m clear on, you know, what your testimony

was. I think you said that you don’t believe that the drug funds— funds coming from the drug sales—are a major—and I’m just—I

just want to make sure I’m clear on where you are—a major part

of the funds used by al-Qaeda and Bin Laden for these terrorist

acts; is that correct? Is that a safe—I mean, is that an accurate

statement?

Mr. BACH. Yes. I think that, although it certainly is a contributor, a major contributor to the Taliban, we don’t have any information that it’s providing a great deal of the wherewithal, financial

resources of al-Qaeda. We think that money laundering and financial networking, legitimate businesses, charitable enterprises, etc.,

are all contributing to it. There’s a very, very complex network that

provides money for al-Qaeda, as we understand it. We are not

aware of to what degree drug money is part of that.

Mr. CUMMINGS. I want to get back to you, Administrator, but I

just want to just take that one step further. I guess this is to both

of you. From what you’re seeing—I mean, September 11th and the

things that—information that may have come to you subsequent to

September 11th, is there—I mean, do you all become more concerned that what you just said, Mr. Bach—in other words, that

there would become possibly a use for drug money? In other words,

are there are things that are happening that would cause you to

say, ‘‘Wait a minute, now, this may not have been—these drug

funds may not have been used to a great extent,’’ but have you

learned things that would cause you to say circumstances may be

changing that would, you know, would raise you to a new level of

concern?

Mr. BACH. Briefly, yes. I think that narco-terrorism has been a

great concern for us for a while, and this, of course, has heightened

it exponentially in terms of the effect of what happened on September 11th. On the other hand, we are looking at a whole range of

possibilities for the financing of al-Qaeda. Drug money certainly is

one of the major stays or resources that was used by the Taliban.

The Taliban had a very intimate relationship with al-Qaeda. So

we’re certainly not discounting the impact of drug money. It’s huge

and it is, I think, pervasive, but it just doesn’t seem, from what

we’ve seen so far, to be the major resource for al-Qaeda.

Mr. CUMMINGS. Well, before you answer that, Mr. Hutchinson,

let me just slip this in. I’m just wondering why do we have a situation where, because of what—of the actions that the President is

taking, might that force—I mean, is there something about drug

trade that, when we are attacking all these other elements, would

make it more attractive to do business with—you understand—to

get money from? Are there things about it that, when you are attacking all the things that the President has talked about, would

cause one to say, ‘‘If I’m trying to get money into the al-Qaeda, say,

OK, guys, we’ve tried all of that. The United States and all these

other nations are putting pressure on us from every angle, so let’s

try to get more money from these drugs?’’ And so do you see that

as a possibility, a probability?

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Mr. HUTCHINSON. I think that is an option that is out there.

Whenever you have a terrorist organization that has to have

sources of money and they are geographically alongside drug organizations that produce money, then there is obviously the potential

for a stronger connection between the two.

And, in answer to your first question, there is, I believe, a new

level of concern that we have, because our primary focus in this

country is to go after the terrorist organizations. One part of that— we don’t know whether it’s small or large in specific instances, but

one part of that would be any benefits that the terrorist organizations get from the drug trafficking organizations and the money

from that.

In some instances, it might not be money, but I think that there

would certainly be some mutually beneficial relationships that

would exist, and I think that you have to be concerned about the

money side of it, but also any other benefits that might be derived

from their coexistence and their friendships.

Mr. CUMMINGS. When you think about a—you know, although we

don’t know the extent of it, but when you think about $25,000 buying a pilot lessons sufficient enough to do the kind of destruction

that was done on September 11th, if that’s all they got that’s a lot.

So I think I understand your concern.

Did you have something else, Mr. Bach?

Mr. BACH. No. I think I would agree with your point, though.

The thrust, I believe, is that there are many things in the drug

trade that would recommend the drug trade and its financial networks and money laundering to terrorists, and I agree that there

is that synergy, and we certainly are going to be looking very carefully to see if this is translated into additional al-Qaeda resources.

Mr. CUMMINGS. Last question, on the synergy, do we have any

evidence—and if you can’t talk about it, let us know—that would

show that the relationship between al-Qaeda and Bin Laden and,

say, drug traffickers is in any way used to recruit folks to be these

terrorists, soldiers, or whatever you want to call them?

Mr. HUTCHINSON. I have no information on that.

Mr. SOUDER. All right. Thank you very much.

Mr. SOUDER. I have a few additional questions I want to make

sure we get for the record.

Both Mr. Cummings and I have referred to the threats that came

from the FARC leader, Jorge Rosino. Do you believe that was a

credible threat? Do you believe that we need to take any actions

regarding that threat? And would you discuss briefly whether you

think the FARC has the ability to carry out those threats?

One of the other dangers that we have of al-Qaeda apparently

being able, through their network, to attack the United States is

it could tempt other terrorist organizations around the world to repeat those type of things. In other words, we’re facing more than

just one type of terrorist.

Could you discuss the FARC and their capability and the credibility you put to their threat?

Mr. HUTCHINSON. Well, in reference to the threat that you mentioned, it was publicly noted. I think we take any threat of that nature or statement of that nature fairly seriously. But, from our experience, the FARC is primarily concentrated as an insurgency

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group in that region, and they are a serious threat to the safety

of our citizens who are in that region, but there has not been any

indication that they’ve tried to move this direction into the United

States to accomplish acts of violence.

I think it is certainly something that you have to bear monitoring, because the trafficking organizations that work out of Colombia, their motivation is money, but certainly they have the capability with the cells internationally and their operatives internationally that if they decided to do harm in a different direction they

would probably have the capability to do that.

Mr. SOUDER. We’d like you to stay very much on top of this, because when Speaker Hastert chaired this subcommittee and we

went over and looked at Khobar Towers, and as we looked at antiterrorism patterns around the world, Bin Laden’s network appeared to be doing the attacks on American citizens abroad, whether we’ve seen USS Cole, the Embassies, the Khobar Towers, and

then moved to domestic attacks. And the danger of the drug terrorists in the south is that they have a whole network of people here

that obviously are able to sell on almost every street corner, and

we need to keep a very close eye on all the terrorist groups. We

see the IRA moving in other zones. We see the Russians in other

zones, their dissident groups, and Ukrainians, and we just need to

be very careful because we need to understand that terrorism is a

different type of battle.

If I could ask you a couple of additional questions yet, another

question is: do you believe that—and this was the other part that

we didn’t get done in my other question—do you believe that, in

fact, the Taliban has the ability or any desire to dump any kind

of heroin or opium in the United States at this point? In other

words, there have been questions of whether they were going to do

that. Do you believe that there are legitimate signs of concern that

they may try to get a share of this market or try to increase the

heroin amount even at the same time the South Americans and

Central Americans are also trying to increase the amount of heroin

coming in?

Mr. HUTCHINSON. I think what they want is a market, and the

market is ready and available and more convenient in Europe. I

think, generally speaking, they see opium production and transportation and heroin use as a weapon against the west, and so I don’t

think they have any problem causing us harm in that fashion.

They see the west generally as whether it’s Europe or whether it’s

the United States.

I think, though, that’s as far as you can, you know, reach to conclusions on that, based upon our information.

Mr. SOUDER. Given that what you’re monitoring in this and the

other things, do you believe that there should be any changes to

the national narcotics control strategy that we currently have

based on the fact that we now have potentially indirect threats as

well as direct threats? Our whole premise of our anti-narcotics control strategy is controlling our borders, the source of where the

drugs are coming into the United States, and all the sudden we

have another potential impact, and that is international drug sales

to other nations could, in fact, finance terrorists who are coming

into the United States.

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Do you believe we should make any changes or look at changes

in our national drug control strategy?

Mr. HUTCHINSON. I certainly think that it should be examined,

and that’s something I assume that John Walters will do once he

is confirmed by the Senate.

From my view, I think that it should be looked at and I think

that we should give some serious consideration to our investment

overseas in terms of our anti-drug efforts.

Mr. SOUDER. And we essentially need the Drug Control Office up

and running with a permanent director, because we have a number

of things on the domestic front on demand reduction, as well as the

international.

I’d like to make a couple of closing comments.

One is, what we can hear on the Taliban is that legalization and

taxing really didn’t work. We often hear of, ‘‘If we just legalize

things and tax it, will it work?’’ Here we’ve seen it become part of

the economic fabric of a nation, because, in fact, it became a primary source of income with other forms of smuggling, because drug

trafficking is, in fact, smuggling; that Taliban clearly is directly involved in the drug trade, both in the taxation and apparently dealing some, themselves. We apparently do not know the extent that

al-Qaeda and Bin Laden are directly involved, but we do know that

they’re deriving at least support from the Taliban, possibly other

means of support, and that’s what you’ll be looking at and keeping

us posted, as well, on what kind of support they’re getting.

It’s also pretty clear that, apparently for the Taliban intermediaries, they’re not going to let religion stand in the way of profit, and they’ve made their decisions based on very practical decisions, in addition to their supposed devotion to Islam. They were

willing to compromise it in order to forward their political goals.

And I think that, last, I want to say that Ranking Member

Cummings made a terrific point earlier, because one of the most

common questions we hear are biochemical warfare. In fact, there

is a biochemical warfare launched on the United States by drug

traffickers in that it has taken a minimum 16,000 lives a year directly, as well as many other lives indirectly in the United States—

huge numbers. And we shouldn’t forget that is a form of terrorism

on our streets every day and in our neighborhoods, and we’re seeing kids die, and I thank him for bringing that point.

With that, our hearing stands adjourned.

[Whereupon, at 11:42 a.m, the subcommittee was adjourned, to

reconvene at the call of the Chair.]

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