By early 1955 the French mobilized the river pirates and some Corsican mercenaries into a wartime battalion. In April the CIA, together with the South Vietnamese Army, fought a pitched battle with the SDECE forces. It was the first-and last time that two Western intelligence -agencies entered open combat. Colonel Lansdale, the CIA chief, directed operations from the presidential palace, while Captain Antoine Savani, the SDECE chief, moved into the river pirates' headquarters. For six days a savage house-to-house battle raged for Saigon.
The. river pirates offered a reward to anyone who brought Colonel Lansdale to their headquarters, where they promised to cut open his stomach and stuff him with dirt. There were no takers. The river pirates had grown soft through a decade of vice and corruption, and the CIA forces pushed them back into the Run Sat swamp. The outnumbered Corsicans withdrew. At the batde's end more than 500 were dead, 2,000 wounded', and 20,000 homeless. Ngo Dinh Diem, the Americans' handpicked choice, was in firm control of Saigon's political machinery and its extensive underworld.<<
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an excerpt from:
Warlords of Crime
Gerald Posner©1988
Penguin Books
ISBN 0140123407
289 pges
In Southeast Asia, not only did the British and French opium monopolies create massive addict populations, but they also inadvertently formed a smuggling network that was crucial to the post-World War 11 heroin epidemic. Although the colonial administrations reaped huge profits, they never became involved in the drug's distribution and sale. That work was left to each colony's licensed opium merchant. Invariably they were Chinese. The British so successfully ingrained opium into China that Chinese merchants were a natural choice to run the monopolies throughout Southeast Asia. The French insisted that Indochina's opium franchise be leased to Chinese merchants. The British forced the Thais to accept Chinese control of all underground vices. In Burma the British allowed only Chinese to direct the opium trade.
Those Chinese merchants developed an unrivaled narcotics expertise. The Chinese families in the opium trade, from Rangoon to Bangkok to Saigon to Shanghai, became acquainted. The early Chinese traffickers, interrelated and tied together by business, virtually monopolized the supply of opium in Southeast Asia.. With criminal elements from Triads in China, they were perfectly poised to take a leading role in the post-World War II heroin boom.
At the war's end, Southeast Asia underwent radical changes. The British returned to Hong Kong and a decimated police force fell behind the expanding Triads. In China the winds of change were represented by Mao. Tse-tung's revolutionary armies. The British gave Burma independence and for the first time in almost one hundred years it prepared for freedom. The French pressed their colonial claim to Indochina but were fighting a growing North Vietnamese rebellion.
French intelligence and the CIA became involved in clandestine activities that would seem farfetched in a spy novel but that played a major role in making the Triads and the Golden Triangle the greatest factors in the narcotics business. French intelligence dealt in narcotics to bankroll their costly war against Ho Chi Minh. The CIA, obsessed with the perceived cold war threat of monolithic communism, assisted criminal empires on the assumption that they would provide a buffer to postwar Communist expansion. The policies of these intelligence agencies transformed the region into the leading heroin-producing and -smuggling center. The French led the way.
When the French government finally banned opium in Indochina, French intelligence (SDECE) took the trade underground. The French military had decided the best way to fight the North Vietnamese was to employ tens of thousands of mercenaries in counterinsurgency warfare. But the problem was a lack of funds. The Indochinese war was tremendously unpopular in France and the government provided little money. Senior French intelligence operatives decided expediency outweighed legality and "Operation X" was born. From 1951 to 1954 the French developed a sophisticated opium distribution network, a feat which won the loyalty of the hill tribes, the population from which the French hoped to recruit their counterinsurgency army,
Each spring SDECE operatives bought opium at competitive prices from the hill tribes. Mountain guerrillas then avoided customs and police controls by flying the illegal drugs to a French military school. From there they were taken by truck to Saigon, where they were turned over to a syndicate of river pirates who worked for the SDECE. The river pirates transformed the raw opium into a smokable version in two large Saigon refineries. Then they distributed some to the city's underground dens and sold the substantial excess to Chinese merchants with Triad connections. The river pirates split the enormous profits with French intelligence.
Operation X initially boosted the military efforts with large in fusions of money. And the hill tribes rallied to the French cause as long as they received high prices for their opium. But when the SDECE utilized non-highland minorities as middlemen, the hill tribes complained they were being cheated. The French ignored the complaints. As the money to the hill tribes dwindled, so did their support for the French. The intelligence service's opium policy unwittingly helped to end France's role in Indo china. The Meo hill tribes, the-backbone of the mercenary army, were so dissatisfied with their opium prices, they allowed the North Vietnamese to infiltrate the surrounding jungles and surprise the French garrison at Dien Bien Phu. Without Meo reinforcements, the French surrendered on May 8, 1954, and signed an armistice two months later.
The entire SDECE, opium experience was not lost on the CIA, which monitored the French. operation and realized that opium was the key to hill tribe loyalty. In half a dozen years, when the CIA sent agents into the Laotian and Vietnamese hills to organize counterinsurgency armies, they offered the French colonel who created Operation X a senior position. Convinced the CIA would never give him real power, he refused.
The SDECE, in financing its Indochina war, made the Southeast Asian narcotics trade international in scope. While some opium was smuggled out of the Golden Triangle before 1950, the sheer bulk restricted the amount exported. But when French intelligence used the air force to move unlimited quantities, they established the foundations for large-scale postwar trafficking, By selling to Chinese merchants with Triad connections, they accelerated a narcotics network that expanded and paralleled the booming Hong Kong Triads.
Although the French signed a 1954 armistice, they merely agreed to withdraw from the northern half of the country and hold a nationwide referendum in 1956. The SDECE maintained its partnership with the Saigon river pirates, ensuring immense profits from the opium dens, gambling casinos, and prostitution houses, including the Hall of Mirrors, the largest whorehouse on the globe. The CIA wanted to cancel the referendum since the Communists were likely to win a popular election. The CIA asked French intelligence to abandon its underworld ventures and turn them over to the Americans. The SDECE refused.
By early 1955 the French mobilized the river pirates and some Corsican mercenaries into a wartime battalion. In April the CIA, together with the South Vietnamese Army, fought a pitched battle with the SDECE forces. It was the first-and last time that two Western intelligence -agencies entered open combat. Colonel Lansdale, the CIA chief, directed operations from the presidential palace, while Captain Antoine Savani, the SDECE chief, moved into the river pirates' headquarters. For six days a savage house-to-house battle raged for Saigon.
The. river pirates offered a reward to anyone who brought Colonel Lansdale to their headquarters, where they promised to cut open his stomach and stuff him with dirt. There were no takers. The river pirates had grown soft through a decade of vice and corruption, and the CIA forces pushed them back into the Run Sat swamp. The outnumbered Corsicans withdrew. At the batde's end more than 500 were dead, 2,000 wounded', and 20,000 homeless. Ngo Dinh Diem, the Americans' handpicked choice, was in firm control of Saigon's political machinery and its extensive underworld.
During the next fifteen years the United States allowed the South Vietnamese to become deeply involved in the narcotics trade. The chief of the air force, later Premier and Vice President, Nguyen Cao Ky, became a principal smuggler, -disguising his trafficking as intelligence and surveillance forays. His brotherin-law ran the Saigon port and oversaw a massive import and export of drugs. South Vietnamese officials worked closely with a Triad based in Saigon's Chinese. suburb, Cholon. The Vietnamese used government planes and trucks to transport Opium from the Golden Triangle into Saigon. The Cholon Triad negotiated the price with the Chinese growers in the Triangle, refined the narcotic in jungle labs and then distributed it to Vietnam's addicts and sold the excess to large Hong Kong syndicates. During this time Bangkok became a key transshipment point, a role it retains to this day.
U.S. military files are replete with the names of South Vietnamese government leaders who spent more time dealing in narcotics than in fighting Communists. Money poured into a system held together by corruption. But the United States not only overlooked its allies' illegal activities, it also assisted them. The CIA followed the path of French intelligence. When operatives went into the Laotian hills to organize counterinsurgency units CIA agents assisted the Meos in planning maximum harvests. It then transported the drugs. Air America, a CIA-owned subsidiary, flew opium loads from Laos to South Vietnam as late as 1973. This was two full years after President Nixon declared heroin "public enemy number one" and promised every possible effort to eradicate it.
But the opium-heroin tool used by U.S. intelligence was the same one that backfired on the French and caused their humil- iating defeat at Dien Bien Phu. Now it came back on the United States like a boomerang. This time the damage was a sudden burst of heroin addiction among GIs. Starting in 1,970 the Cholon Triad imported* the first Hong Kong chemists capable of producing number 4, injectable heroin. Never available before in Vietnam, suddenly number 4 heroin was everywhere. Fourteen- year-old girls sold it at roadside. stands on the main highway; South Vietnamese soldiers offered vials with 99 percent purity for $5.00; prostitutes always had a supply of China White for a special treat; street peddlers stuffed free bottles into GIs' pock- ets as they strolled through Saigon. The aggressive, Triad mar- keting campaign succeeded. By mid-1971 the U.S. Army estimated 15 percent, or 40,000 GIs, were addicted, and the number was growing.
Vietnam was a giant test market for the Triads. Hong Kong sent 14K and Wo Shing Wo gangsters to Vietnam to see the effects.. They were impressed. They saw that a demand for heroin could be created among Westerners similar to the way the British had created an opium demand among nineteenth-century Chinese. Eventually an estimated 100,000 GI addicts consumed as much heroin as two million users would in the United States, more than twenty tons a year. That is why when the GIs withdrew, the market initially collapsed in 1972-73. The Triads' solution was to ship more heroin to other Asian cities and the United States. Combined with a fortuitous ban on opium in Turkey in 1972, Chinese heroin increased from 8 percent of the U.S. market in 1971 to 30 percent by 1974. Although large crop failures later temporarily lowered, that share, Vietnam taught the Triads that America was a receptive market. It whetted the Chinese appetite for selling heroin in the United States.
At the same time these events transpired in Vietnam, CIA activities in neighboring Burma, Thailand, and Laos transformed the Golden Triangle from a minor opium producer to the unrivaled world leader. At the end of World War II the Golden Triangle annually produced 100 tons of opium. Within fifteen years CIA policies were instrumental in increasing production to 700 annual tons, on its way to today's 1,500 tons.
pps 66-71
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