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Tuesday, March 4, 2014

Red Cocaine by Joseph Douglass part 16

In preparation for discussions with the visiting delegation, a joint Ministry of Defence and Interior report on political relations among the Communist Parties of Japan, China and the Soviet Union was prepared for the Czechoslovak Defence Council. The drug business was one of the items covered in this report.
The report described Soviet measures (in which Czechoslovak intelligence partici- pated) to recruit Chinese spies. The targets of this recruitment operation were Chinese scientists, students, engineers and technicians whom the Soviets believed might go into some aspect of the drug business. Recruitment took place in China and in the Soviet Union and Eastern Europe, where numerous Chinese were temporarily stationed. The
cadre of intelligence agents so recruited provided the Soviets with extensive data on
China's drug operations, notwithstanding Chinese security practices associated with the drug business.
While China tried to hide its activities from the Soviets, by the late 1950s Soviet intelligence had identified almost 100 Chinese factories manufacturing heroin and drugs for use against the bourgeoisie. They also knew about new laboratories in Shanghai, Katong and Tibet where synthetic drugs were prepared and tested. The Chinese also controlled factories in different countries which participated in the Chinese drug strategy. The Soviet recruitment program had produced a particularly valuable source in one such company located in Saigon. Through this source, information was obtained on Chinese drug-trafficking in Vietnam. The company also provided narcotics to various Middle East and  African countries. This was in fact the source omuch of the original Soviet
intelligence on drug-related corruption in Africa and the Middle East.
Through their agents, the Soviets were also alerted to the Chinese decision in 1957 to expand their drug offensive. By 1958, the Soviets had grown concerned about the expansion of Chinese trafficking because of its possible adverse effects on Soviet plans. Accordingly, in late 1958 or early 1959, the Chinese Minister of Defence, Marshal P'eng Te-huai, who was also a member of the Politburo, was invited to tour the Soviet Union and Eastern Europe. During his visit, deficiencies in Chinese industry and collective farms were pointed out to him to make him appreciate the potential value of Soviet assistance, and, of course, of Soviet 'good faith' and interest.
Then, midway through his visit, the subject of drugs and narcotics was raised. The Soviets suggested that the two countries and Parties should coordinate their foreign policies. In particular, the Soviets suggested dividing up the drug market, with the Chi-
nese getting Asia and Africa, and the Soviets taking the Americas and Europe. When the
Defence Minister returned to China, he sent a personal letter to Mao, criticising some of Mao's policies and recommending certain improvements, based on his visit to the Soviet Union and Eastern Europe. The letter was classified Top Secret because it discussed cooperation in foreign policy, military policy and drugs. Not only did the suggestion fall on deaf ears, but Mao Tse-tung liquidated the Defence Minister, not for criticising him, but rather, for even acknowledging to the Soviets that China was in the drug business7.
While the Chinese were first to recognise the potential for the use of drugs in Viet- nam, the Soviets were not far behind. In 1963, the Soviets had arranged for Czechoslovak



intelligence to assist the North Vietnamese in setting up a training centre for drug-traf- fickers. Then, in 1964 when the school was in operation, the Soviets prevailed upon the Czechoslovaks to negotiate an agreement with North Vietnam to produce narcotics and drugs in that country and to ship the material via the Viet Cong and through Thailand to US forces throughout Southeast Asia. The North Vietnamese were pleased with the arrangements finalised in 1965 because, among other considerations, Sejna recalls, it put them in competition with the Chinese. The agreement within which the narcotics agree- ment was concealed dealt with the production of natural rubber. It was signed by Premier Pham Van Dong and Prime Minister Josef Lenart. The details were worked out by the chiefs of North Vietnamese and Czechoslovak military intelligence.
Through its intelligence sources in China, who were reporting back through a Czechoslovak Zs agent stationed at their embassy in Peking, the Czechoslovaks learned that the Chinese had also expanded their narcotics trafficking operation in 1964. Specifi- cally, an agreement had been signed between the Communist Party of Japan and China in which the Japanese would assist China in supplying drugs to US soldiers in Japan and Okinawa. Under the terms of the agreement, China's counter-intelligence would perform
background security checks on all Japanese who were scheduled to be recruited for this
operation. In return for their assistance, the Communist Party of Japan was to receive twenty five percent of the profits.
In 1965, the Soviets expanded their Vietnam narcotics trafficking operations to ensure that drugs were available in nearby locations which US servicemen and officers would visit during vacations to 'rest and recuperate'. One leg of this trafficking operation in which the Czechoslovak intelligence service assisted was located in Australia. The Czechoslovaks were called upon to assist because they were able to operate in Australia more flexibly than the Soviets and were not watched as closely as the Soviets.
The Czechoslovaks had also established better relations with the Australians, particularly with the Labour Party, and had several commercial operations in Australia which helped to provide cover. Finally, the Czechoslovaks had additional resources, namely Australian soldiers whom the Czechoslovak intelligence services had recruited. The supply of drugs for this operation came from North Vietnam - which was another reason for Czechoslovak assistance, insofar as they were already involved in the North Vietnam drug production operation.
1965 was also the year when the Czechoslovak Chief of the General Staff and Chief of the Main Political Administration learned that the Czechoslovak operation had been criticised in a Soviet Defence Council report. The Soviet complaint was directed against the Czechoslovak intelligence service, and accused it of placing more attention on profits than on the real objective of the drug business, which was the liquidation of capitalism. The two Czechoslovak officials were in Moscow attending a meeting when they were informed about this concern by the Soviet Defence Council and were told to change their priorities. The first priority was to promote drug usage, not to make money. The specific subject addressed was the use of drugs against the US military in Southeast Asia.
The primary targets within the US military in Vietnam, the Soviet officials emphasised, were US military command staff officers, personnel associated with communications, personnel responsible for producing situation analyses, and intelligence officers. General Vaclav Prchlik subsequently reported to Sejna that Soviet General Yepishev, who headed the Main Political Administration, had told him that if the US military were inclined to take drugs, they should if necessary be given them free of charge. The money



was far less important than influencing the military with drugs.
Western intelligence officers as well as political analysts have identified 1966 as the year when the trafficking of narcotics into Vietnam underwent a marked increase8. This would also be the year when the Soviet-Czechoslovak-North Vietnamese operation became fully operational. By 1967, narcotics had become a serious problem among the US military in Vietnam. One Soviet KGB intelligence study reported that 90 percent of US ser- vicemen were using some form of drug, most commonly marijuana. However, the US military authorities refused to acknowledge the seriousness of the problem until it became so open and blatant that it could no longer be denied.
The drug challenge was brought out of the closet in 1970, immediately following the
'secref bombing of Viet Cong sanctuaries in Cambodia in April-May that year. China responded with a stern warning which Henry Kissinger analysed in person. He then advised the President as follows: 'The Chinese have issued a statement, in effect saying that they wouldn't do anything'9.
But, with effect from June 1970, heroin of almost pure quality suddenly appeared for sale at below wholesale prices outside the gates of every US installation in Southeast Asia.
As General Lewis Walt has explained:
'In June of 1970, immediately after our Cambodian incursion, South Vietnam was flooded with heroin of remarkable purity - 94 to 97 percent - which sold at the ridicu- lously low price of first $1 and then $2 a vial. If profit-motivated criminals were in charge of the operation, the price made no sense at all - because no GI who wanted to get high on heroin would have batted an eyelash at paying $5, or even $10. The same amount of heroin in New York would have cost $250'.
'The only explanation that makes sense is that the epidemic was political rather than economic in inspiration - that whoever was behind the epidemic wanted to hook as many GI's as possible, as fast as possible, and as hard as possible'10.
General Walt also made it clear that the trafficking operation appeared to be highly coordinated and centralised and that some group must have established virtually simul-
taneous contact with scores of ethnic Chinese entrepreneurs and other criminal elements
throughout South Vietnam. He also examined reports of interrogations of Viet Cong defectors who claimed to have knowledge of large-scale opium production in North Vietnam and, in one case, of Viet Cong involvement in the heroin epidemic. Another defector described the North Vietnamese distribution of drugs as a direct means of undermining the morale and efficiency of US forces. The Vietnamese officers with whom Walt discussed the problem were all convinced that the heroin epidemic was political rather than criminal in origin".
The result was a mammoth rise in US military drug abuse. While previously there had been two deaths per month due to a drug overdose, suddenly the statistic rose to sixty per month. In 1970-1971, the US Air Force lost more people to drugs than to combat. The impact on morale, readiness, and support for the war at home was devastating12. During investigations of the new epidemic, Chinese trafficking, North Vietnamese pro- duction and Viet Cong trafficking were all identified by US intelligence13.
And, based on simple free market economics, one is led to two conclusions: First, that the increase was the result of combined, albeit not necessarily coordinated, operations; secondly, that the trafficking was unquestionably a sign of political warfare and not greed- or profit-motivated.
The increase in US military consumption was driven by supply, not demand.


62                                            RED COCAINE

But, notwithstanding the overwhelming evidence concerning the role of China, the White House, as will be explained in Chapter 9, issued instructions in 1972 to US Gov- ernment officials telling them that the rumours about Chinese drug-trafficking were without substance and should be disregarded.

References to Chapter 6:
1. Chinese trafficking during the Vietnam War is reported in Hamburger, The Peking Bomb, op. cit, pages 117-
148 and Candlin, Psycho-Chemical Warfare: The Chinese Communist Drug Offensive Against the West, op. cit., pages 240-266. The role of China was also confirmed by US intelligence and fact-finding missions. Sejna cor- roborated these reports. His knowledge was based on detailed Soviet and Czechoslovak intelligence reports.
2. Interview with Molloy Vaughan, May 1989. General Sejna further reports that the successful use of narcotics by the Chinese and Vietnamese Communists in the Indochina War was also studied by the French Communist Party, based on reports from Communists in the French Army in Vietnam. This French study was reviewed in Czechoslovakia during a Czechoslovak study undertaken to intensify drug-trafficking in the mid-1960s. The French study also blamed the use of drugs on 'bourgeois officers', some of whom were involved in the trafficking.
3. Reported by Mikhail Suslov at the February 1964, Moscow meeting of high-level East European leaderships which Sejna attended. The effects of the decision were also reflected in Candlin, Psycho-Chemical Warfare: The Chinese Communist Drug Offensive Against the West, op. cit, page 114.
4. T'ang Ming-chieh, Specialist, Bureau of Investigation, Ministry of Justice, Republic of China, The Maoist
Production of Narcotics and Their Intrigue to Poison the World', Issues and Studies, June 1973, page 35.
5. Also, in 1959 a delegation of the armed forces of North Vietnam, led by the Chief of the General Staff, visited the Soviet Union and other Warsaw Pact countries. Sejna was the host for the visiting delegation in Czechoslovakia. The main purpose of the visit was to obtain military equipment for the North Vietnamese army. At that time, the North Vietnamese expected the United States to increase its commitment to South Vietnam and wanted to prepare for the coming war. As part of their preparation, they were planning to reorganise their whole country for general war.
6. The Maoist Production of Narcotics and Their Intrigue to Poison the World', op. cit., page 36, citing an article in the French magazine Histoire Pour Tous, January 1973. The episode is also described in the more widely read reference book by Mohammed Hassanein Heikal, Nasser: The Cairo Documents (New York: Doubleday, 1971), pages 278-279. See also Hamburger, The Peking Bomb, op. cit, pages 143-148 and Candlin, Psycho-Chemical Warfare: The Chinese Communist Drug Offensive Against the West, op. cit, pages 21-24.
7. Sejna was responsible for the Chinese Minister's schedule in Czechoslovakia and for assisting in the Soviet attempt to recruit the Minister. In preparation for his visit, Novotny was instructed by officials from the Soviet Inter- national Department. Other Czechoslovak officials were instructed by their Soviet adviser. In February 1964, Suslov presented a major speech on China at a meeting of the Soviet Central Committee. This was the formal time at which the Soviets stated that they had concluded that China was 'not about to march in step' and that the rift between China and the Soviets was irreversible. Suslov discussed many aspects of Chinese foreign policy, including China's drug operation. It was during this discussion that Suslov explained the reasons behind the Chinese Defence Minister's liquidation. The information had been obtained by Soviet intelligence. The secret element of this speech contained details on Soviet operations against China. In 1965, China was added to the Soviet 'main enemies' list.
Editor's Note: Anatoliy Golitsyn's analysis reveals that, notwithstanding these facts, the Sino-Soviet split was indeed a dialectical ploy, based upon classical Leninist strategic deception theory.
8. See, for example, Stefan T Possony, 'Maoist China and Heroin', Issues and Studies, November 1971. The increase is undoubtedly the product of the combined competing trafficking of the Chinese and North Vietnamese- Czech Soviet operations.
9. Henry Kissinger, White House Years (Boston: Little Brown and Company, 1979), page 509.
10. US Congress, Senate, World drug-traffic and its impact on US. Security, Hearings Before the Subcommittee to Investigate the Administration of the Internal Security Act and other Internal Security Laws of the Committee on the Judiciary, August 14,1972, Part 1, Southeast Asia, and September 14,1972, Part 4, The Global Context; Report of General Walt (Washington, D.C.: Government Printing Office, 1972), Part 4, pages 157-158.
11. Ibid., pages 54-58.
12. In 1971, Representative Robert Steel (R-CT) reported that the high rate of heroin addiction had prompted the Nixon Administration to step up its rate of troop withdrawals. 'Drugs Reported Tied to Vietnam Pullouf, New York Times, June 7,1971, page A6.

13. World drug-traffic, op. cit, Part 1, pages 54-58, and Part 4, page 160.

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