Hearing on U.S. Policy in the Andean Region

September 17, 2002

Testimony
Testimony by CFR fellows and experts before Congress.

U.S. Senate Caucus on International Narcotics Control

Washington, D.C.

September 17, 2002

This transcript has not been edited.

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WITNESSES:

RICHARD L. ARMITAGE, Deputy Secretary of State

ASA HUTCHINSON, DIRECTOR, United States Drug Enforcement Administration

BRIGADIER GENERAL GALEN B. JACKMAN, Director of Operations for the United States Southern, Command, United States Army

MEMBERS OF THE CAUCUS:

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U.S. SENATOR JOSEPH R. BIDEN, JR. (D-DE)

CHAIRMAN

U.S. SENATOR BOB GRAHAM (D-FL)

U.S. SENATOR DIANNE FEINSTEIN (D-CA)

U.S. SENATOR TOM HARKIN (D-IA)

U.S. SENATOR CHARLES E. GRASSLEY (R-IA)

CO-CHAIRMAN

U.S. SENATOR JEFF SESSIONS (R-AL)

U.S. SENATOR MIKE DEWINE (R-OH)

GRAHAM: Call the hearing to order. Senator Biden has been unexpectedly delayed on the train, will be arriving in approximately 30 minutes. We will also be joined by other members of the committee. But in difference to the schedules of our witnesses, I would like to commence. I have an opening statement which I will summarize and then insert in the record. I am very appreciative that we have such distinguished Americans with a wealth of background on the subject who will be giving us the benefit of their insights on a very important issue, which is the blending of drug traffickers and their nefarious activities, and the actions of terrorist group in the Andean Region, particularly in Colombia. This blending of drug and guerrilla empires has a significant adverse effect on the countries in which it has occurred, and also has the potential of effecting neighboring nations including the United States.

One effect that it will have on the United States is to cause us to re-look at our policy. Historically, we have recognized a division between narcotics producers and traffickers, and guerrilla and insurgency groups. Both of those have operated in Colombia, but each has had a different set of objectives. For the past decade the United States aid in Colombia has focused almost exclusively on counter- narcotics. And for the good reason that Colombia's the primary source of cocaine and heroine to the United States, has been an increasing source of supply, and that has fed Americans habit, which last year resulted in the consumption of over $64 billion of illegal drugs.

While our response to counter-narcotics has been vigorous, we have at the same time taken essentially a hands-off policy relative to the guerrilla insurgences in these countries. However, over time these groups have come together. The drug organizations benefit by the terrorist military skills, weapons, counterfeit documents and relationship with other suspect organizations. The terrorist organizations gain revenue, access to boats and aircraft, and money laundering experience. In many instances, the two, narco-traffickers and guerrillas have become one.

This poses a significant to the United States as to how it will continue to pursue its policies against narcotics when the same person in the same uniform is also a terrorist guerrilla. The administration has recommended some alterations to our previous policies, which will allow for a recognition of this blending of the two. And we look forward, particularly, to getting your insights and recommendations as to what future policies would be.

Right now, the acts of terror have been contained largely within Colombia, yet they are beginning to threaten regional stability and U.S. interest through the transaction -- national arms sales, drug trafficking, kidnapping and extortion. Some recent examples, Colombia statistically is the world's most terrorist afflicted nation. Together, the three groups, the FARC, the ELN and the United Self Defense Group of Colombia, the AUC, are responsible for more than 90 percent of terrorist incidents in the Western hemisphere.

The State Department reported that these three groups regularly engage in attacks on key infrastructure include pipelines, dams, electric equipments, roads and bridges. As an example, the Cano Limon pipeline in Northern Colombia was bombed 170 times in 2001 alone. It has been bombed 918 times since 1986, spilling almost three million barrels of oil, 11 times the amount of the Exxon Valdez oil tanker disaster.

The narcotics terrorists sabotage of oil pipelines have cost the government of Colombia lost revenue in the order of $500 million per year. Colombia is facing an outright assault by these illegal armed terrorists on its own government, society and people. In 2001, over 3,000 Colombians were killed and 2,856 kidnapped. In 2001, 55 percent of all terrorist attacks on U.S. interest in the world occurred in Colombia. Colombia has suffered more terrorist abductions than were reported in the rest of the world's countries combined. These abductions included five American citizens and more than 70 Americans over the past decade.

Since 1992 the FARC and ELN have kidnapped 51 U.S. citizens and murdered 13 with three remaining unaccounted for. The events of the past year and the past decade should leave no doubt that these groups do not care about the political process, democracy, Colombian citizens or even the nation of Colombia itself. In light of these facts, the United States has recognized that cocaine and terror have merged in Colombia and are merging in the Andean Region. The Andean counter- drug initiative, combined with new legal authorities, will aid Colombia in confronting the barrage of narco-terrorism.

We have three distinguished Americans to share with us their views on this subject. And I would like to introduce them at this time, and they will be called upon to give their comments in the order of introduction.

The first we have Deputy Secretary of State, Richard Armitage. His experience with government and foreign policy is extensive. A veteran of three combat tours in Vietnam, he has held many positions across the United States government including Assistant Secretary of Defense, Administrative Assistant here in the Senate, and now the number two position at the Department of State.

Our second witness has also has extensive experience. Asa Hutchinson is the Administrator of the Drug Enforcement Administration. Over the past year he has become a regular and familiar face here at the drug caucus. Of course, Administrator Hutchinson previously was a member of the United States House of Representatives and in that position was also an active figure in terms of counter-drug policy.

Our third witness is General Galen Jackman, a Brigadier General in the United States Army, the Director of Operations for the United States Southern Command. He has served in the army for nearly 30 years, and we welcome General Jackman join us today.

We have two members of the committee who have joined us.

Senator Grassley, do you have an opening statement?

GRASSLEY: A very short one.

I would first of all like to thank Chairman Biden for calling this hearing, and Senator Graham, who I worked with on the work of this committee for a long period of time, for his starting the meeting and chairing it today.

And also I think it speaks well of the administration by sending at high level, like each of our witness are today, of the seriousness of this problem, and how our government takes it to heart, both from the standpoint of the international relations and the international problem as well as a domestic problem by having three people like you come. So I thank the administration and you for participating.

Senator Graham and I have talked several times about the devastation that our narcotics has done to the youth of our country, and simultaneously to the peace and stability of our allies in Latin America. The challenges that we face from narcotics and Latin America are not new challenges, although they wear new faces from time to time.

The drug threat has not gone away, nor has it lessened since the tragic events of a year ago. The last year has seen elections, Bolivia, Colombia, a resurgence of rebels, Peru, violence over Coca eradication programs in Bolivia, Colombia, what seems to be the epicenter of Coca production. And regional violence has a seen a peace process fail. The fighting strength of the FARC and the paramilitary terrorists groups rise while its economy has continued to stagnate. Newspapers have printed stories of arms for drugs, plane flights between Venezuela, Southern Colombia. Parts of Ecuador and Panama have become resting areas for the FARC, the ELN and the AUC terrorist organizations.

Eradication is the corner stone of our counter-narcotics strategy. This strategy has been based on the assumption that if by spraying Coca we can make in unprofitable for farmers to raise it that the farmer will change to legitimate crops. Our alternative development strategy is built off this assumption, focusing on providing farmers profitable alternatives to Coca. The military equipment and training that we have been providing is based on this assumption, under the argument that Coca fields must be secured on the ground so that they're safe to spray from the air.

Now I have supported this strategy because if Coca farmer is a decision-maker as to whether or not Coca is grown, then the logic stands up. It is a strategy that will take some time to work, particularly when we are working in a hostile environment against well-funded opposition in cooperation with governments who are too often out-manned, out-gunned, out-funded.

But despite a consecrated effort in Colombia, Coca production has increased from an estimated 50,900 acres in '95 to 136,000, 2001. This production expansion has offset any gains that we have made in Bolivia or Peru, we believe. We have not seen a significant change in the aperitif price, availability levels of cocaine during the time. We have watched Coca production move from one area of Colombia to another and seen an expansion to opium as well.

Most recently the president proposed, and in the supplemental appropriation bill, Congress has so likewise consented to expand the authority for counter-narcotics materials provided to Colombia.

In addition, we have seen some retrenchment in the process against Coca production that has been made in Bolivia and Peru. We are in effect expanding the mission of a fix set of resources in Colombia while facing an increased threat elsewhere.

With illegal drugs produced in the countries killing Americans everyday, of course it's in our interest to promote political stability, rule of law and economic success in the region. Addressing narcotics trafficking, which is funding many of the conflicts in the Andes, is a logical place to be.

But I don't think the region of the world has become any safer or any more stable since we significantly increased our levels of assistance three years ago. While I do think our assistance has been beneficial, the fact is the supply of drugs from the Andes has not decreased. Each of us can agree that we want to do something to make a difference, and I look forward to this discussion today to see if we can be more successful in the future.

Thank you.

GRASSLEY: Thank you, Senator.

Senator DeWine?

DEWINE: Chairman, thank you very much. Let me first thank our panelist for being here. This is...

GRASSLEY: Senator.

DEWINE: This is, as my colleagues have pointed out, a very distinguished panel and we look forward to hearing your testimony.

I have believed, as I think we all do, that we really need a balanced strategy. I think I've talked to each one of our witnesses at one time or another about the need for that balanced strategy, and I think we constantly strive to do that.

The first step in a balanced strategy is, of course, achieved by eradicating drugs at their source. We have to go to the source. In doing this, we can take an important step towards reducing domestic supply and demand.

Right here in our own hemisphere, the Revolutionary Armed Forces of Colombia, the FARC, is estimated to receive --and we don't know for sure the figures, but it's estimated to receive $300 million a year from drug sales alone. Colombia's right-wing paramilitaries get 40 to 70 percent of their income from the illegal drug trade. These groups use drug profits to carry out murder, kidnappings and extortion on a routine, if not daily, basis.

Since 1990, 73 Americans alone have been taken hostage in Colombia. And since 1995, 12 have been murdered. On August 7, during the new president's inauguration, the FARC launched attacks on the presidential palace killing 21 people. Four children and one pregnant woman were among the dead. Within weeks of the inauguration, reports emerged that the FARC has issued a direct order to its forces to carry out attacks on American citizens in Colombia. The media also has reported that a bomb had been sent to Colombia's Attorney General, and fortunately, it was intercepted before anyone was harmed or killed.

In addition to shedding to light on the increasing chaotic situation in Colombia, these recent events highlight the fact that we're not simply dealing with a drug problem in the Andean Region. We're dealing with a problem of regional security, a problem the United States simply cannot ignore.

Guerrillas and paramilitary forces battle to control rural areas causing massive internal displacement. The drug trade funds outlaw groups are directly responsible for violence, for internal conflict, and gross human rights violations. The conflict in Colombia and its spillover effects have created political instability, deterred foreign investment, and increased capital flight from the nations of the entire region.

While nations such as Bolivia and Peru have made progress and have seen decreased cocaine production, their leaders remain under tremendous significant political pressure and civil unrest is on the rise.

Mr. Chairman, we must do everything possible to prevent illegal drug income from being used to finance regional instability or international terrorism. This is true whether we're talking about the Taliban in Afghanistan or the FARC in Colombia. If we fail to sever the ties between the drug money and terrorism, then we risk losing fragile democracies around the world. And not just around the world, right here in our own back yard in countries such Colombia and Haiti.

The success of the Andean Regional Initiative is critical to defeating this threat. The ARI supports programs to protect human rights workers in Colombia, strengthens democratic institutions in Peru, supports judicial reform in Bolivia, and helps the government of Ecuador to fight corruption and promote public accountability. It helps promote economic alternatives to Coca production by including access to markets and fostering environmentally sustainable production. The ARI provides a balance between law enforcement and security programs, and social and economic development.

While in some cases difficult to implement, the alternative development, judicial reform and economic growth projects are important components of this package. Safeguarding peace, security and democracy in the Andean Region presents some of the most important challenges facing our hemisphere.

So I look forward to hearing from our witnesses this morning, and to working to with each one of them, and with the chairman, members of this committee in the future.

Thank you.

GRASSLEY: Thank you, Senator DeWine.

Our first witness is Deputy Secretary of State Richard Armitage.

ARMITAGE: Thank you, Mr. Chairman.

Good morning. Good morning, Mr. Grassley, Mr. DeWine. I remember very well the discussion you and Senator DeWine and I had, sir, when you talked about having this very hearing. We're very grateful that the Senate drug caucus cares so deeply about these issues, and we've been very heartened by the support you've given us.

Now I realize having been up here a time or two that the patience of the committee is in inverse proportion to the length of my opening statement, so I'm just going to submit if for the record and I'll try to stand by and answer as factually as I can any questions that you may have, Mr. Chairman.

GRASSLEY: Thank you, Mr. Secretary.

Administrator Hutchinson?

HUTCHINSON: Thank you, Senator Graham, Senator Grassley, Senator DeWine. It's a pleasure to be before this caucus again.

And joining with Mr. Armitage, I want to join in our thanks to this committee for its continued support and I'm pleased to be on this panel as well with General Jackman, and to offer our testimony with regard to the Andean Regional Initiative. And I would like to make brief comments. I'll certainly try to keep them brief, aware of the need for question and answer session.

But I want cover three areas in my oral testimony; first of all, DEA initiative under the Andea Regional Program, secondly, the results of these efforts, and thirdly what's ahead.

First of all the DEA, the Drug Enforcement Administration, focuses its efforts on targeting trafficking organizations that have the greatest impact on the United States. This is DEA's priority targeting system, and there are currently 22 listed priority target investigations in South America. South American offices are focused on these targets.

The second part of our program, that the Senators are very well aware of, would be the sensitive investigative units that have been developed in Colombia and the adjoining countries. This group of specifically trained and vetted police officers carry out highly sensitive investigations that directly impact the United States.

There are currently four distinct SIUs operating in Colombia. They are divided based upon their investigative responsibilities. They have offices located in the major cities of Colombia and are completed funded by the DEA.

It has been a very highly successful program and it has enhanced our ability to go after the organizational structures. We, in addition, have SIU programs in other Andean countries include Peru, Bolivia, Ecuador and Brazil. Since FY 2000, the DEA has trained 579 foreign law enforcement officers in this program, and we conduct other training initiatives as well.

Thirdly, I want to mention extradition. Extradition has been one of the most effective tools that we have in our arsenal to go after the traffickers in South America. Since the Colombian constitution was amended to allow extradition in 1997, we have extradited 26 Colombian nationals in the United States to stand justice.

Next initiative would be the regional intelligence sharing program that we have. In late November of 2001, 25 unified Caribbean online regional network systems were purchased and distributed to host nation law enforcement. These are called the Unicorm (ph) System and they are in nine South American countries. It improves the communication through encryption software with our host nation counterparts and allows us, in a timely fashion, to share sensitive law enforcement information to allow us to proceed with our investigations. Those are a sample of the initiatives that the DEA has undertaken in the region.

What are the results of those initiatives? First of all, we have had significant enforcement successes. In March of this year, the Department of Justice indicted three members of the 16th front of the Revolutionary Armed Forces of Colombia, or the FARC, specifically their commander Tomas Molina, and a member, Carlos Bolas, on charge of conspiracy to bring cocaine into the United States. It was the first time members of a known terrorist organization have been indicted for drug trafficking.

In June of 2002, I was very pleased that because of some good DEA investigative work and cooperation of host nation law enforcement, we were able to arrest one of the indicted members in Suriname, Carlos Bolas. He was subsequently transported to the United States to face trial. He is in custody here in the Washington D.C. area.

HUTCHINSON: Combining this with the fact in March of 2002, this year, the Colombian national police, in coordination with the DEA, went into the recently reclaimed Dispay (ph) area, which was set aside for peaceful negotiation with the terrorist organization.

And we found something totally different. We found seven tons of cocaine hydrochloride and cocaine base in two cocaine processing laboratories that were operated by the FARC in this particular area. So clearly, we found from that raid the terrorist organization (inaudible) involved in drug trafficking activity.

In the last 20 months, vessels intercepted from Colombia, based upon intelligence, have led the interdiction of approximately 71 tons of cocaine destined for the United States. I could recite similar operations in Ecuador and other countries in the area.

I wanted to address some of the results of this, though, to the United States. And I know there's been discussions about what impact has it had on cocaine purity in the United States, as well as the cocaine supply. And we've been careful about these numbers, but I did want to share with the committee that the purity levels of cocaine in the United States have been declining. I offer this chart to the committee, which shows that since 1998 wholesale cocaine purities have dropped by nearly 10 percent in the United States. The reasons for the decline can be speculated upon, but I would like to attribute some of that success to the enforcement operations in the South American region of the world, the SIU programs, the targeting programs, and the interdiction programs as well.

It's clear that while the price might not be impacted, they adjust in others ways by reducing the purity level of the cocaine. Secondly, there's been an impact on the flow of cocaine. In addition to the decline of cocaine purity levels, the importation of cocaine to the United States has decreased substantially. From 1996 to 1999 the cocaine flow to the United States declined by nearly 200 metric tons. Since then in '99 to 2001, it began to rise again, to great concern of us all, but still the overall estimated cocaine flow to the United States in 2001 was still down by nearly 100 metric tons compared to the 1996 level.

What's ahead, I'm very pleased to announce today, that we are able to establish the heroine task force in Bogota (ph) to address the growing concern of heroine production in Colombia. This will be a task force comprised of 45 officers of the host country as well as the DEA. Last Friday the House and Senate appropriations committee approved the DEA's proposal to reallocate 13 foreign positions in support of this Boga (ph) heroine task force. And this is critical to our efforts to address the growing heroine problem in the region of the world.

There certainly has been spillover effect reflected by the increased seizures of heroine in countries such as Ecuador, Venezuela and Panama. Extraordinary numbers -- heroine seizures have increased by 785 percent in Venezuela, 285 percent in Ecuador and 226 percent in Panama. This reflects the importance of a regional approach to our drug trafficking problems and, I think, some success of our coordination efforts in targeting the organizations.

As Senator Graham mentioned prior to the hearing, the extraordinary concern of the narco-terrorist activity, and the combination of those two elements, are substantial and are of great concern. We continue to develop overwhelming evidence about the connection between the FARC and other terrorist groups and the drug trade.

In 1980 -- or since 1980, the FARC has murdered 13 United States citizens, and kidnapped over 100 more. Recently a high ranking FARC member reportedly gave orders to specifically target United States personnel in Colombia. In August of this year, the Colombian press reported that -- confirmed that Jorge Suarez, also know as known Mono Jojoy, announced a decision by the FARC leadership to attack United States citizens residing in Colombia. And so what we've seen is that a terrorist organization engaged in attacks on United States citizen, is also engaged on attacking the United States through drug trafficking as well.

I would leave the committee with this one point that DEA targeting of trafficking organizations is an essential part of our continued effort, and I believe has provided substantial success in four areas. We have created risk to the traffickers. We've reduced the flow of cocaine. Thirdly, we've provided intelligence for inbound seizures of narcotics. And fourthly, we have encouraged and built regional stability by developing a rule of law in law enforcement coordination.

I thank this committee for receiving this testimony. I look forward to the question and answers.

GRASSLEY: Thank you, Mr. Hutchinson.

General Jackman?

JACKMAN: Well, Senator Graham and Senator DeWine, appreciate the opportunity to appear before you to discuss the United States Southern Command's role in the Andean Ridge Initiative.

Twenty months ago, Southern Command began to execute the Defense Department's support to play in Colombia, given the resources provided by Congress in the fiscal year 2000 supplemental. Our mission has been to provide assistance to the Colombian forces to improve their counter-drug capabilities. We have provided that assistance to human rights, vetted, Colombian forces, and within the 400 military person cap established by Congress. We have spent 100 percent of $300.5 million provided to the Department of Defense from the $1.3 billion planned Colombia supplemental. This mission continues to support the national drug control strategy and the Defense Department's role of interdiction support.

During these past 20 months, we have provided operational-level counter-drug related intelligence to the Colombian military and national police. We have also collected intelligence to protect U.S. personnel in Colombia and to facilitate operations by our joint interagency task force east in the drug transit zone.

Until April 20, 2001, we provided support for the Air Bridge Denial Program with our long-range, over the horizon, and ground-based radar architecture, airborne early warning systems and tracker aircraft. That program and the Defense Department's support to it was suspended following the Peruvian shoot-down of a civilian aircraft.

On the ground we train and equip the Colombian first counter- narcotics brigade, currently operating under the command and control of Colombia's military's joint task force south headquarters and the Putumayo and Caqueta departments of Southern Colombia. We've continued to provide periodic sustainment training for that brigade. Additionally, we continue to provide intelligence support and planning assistance to joint task force south.

In a major effort to improve the Colombian military's counter- drug mobility and operational reach. The Department of Defense is providing training to Colombian army aviation personnel who will fly and maintain the 14 UH-60 Black Hawk and 25 Huey II Plan Colombia helicopters.

The final class of eight UH-60 pilots completed the provided training on 10 September '02. Overall, 45 Colombia army pilots successfully completed this training. Additionally, the requirement for Colombian army UH-60 crew chiefs was met in April 2002 with a total of 21 crew chiefs graduating from the DOD-provided CONUS training.

Completion of these UH-60 training programs were significant milestones, as the Colombian army now has the UH-60 pilots and crew chiefs and the numbers required to operate Plan Colombia Black Hawk aircraft.

DOD resource training programs for Colombia army Huey II pilots and maintenance personnel for the Black Hawk and Huey II aircraft are proceeding as scheduled. The training program Colombian army maintenance personnel is scheduled to be complete in February 2003, followed by the training for Huey II pilots, which is scheduled to end in late September 2003. We've also provided maintenance assistance and training to improve the operational readiness of their HC-130 lift aircraft.

On the water, we have helped to train and equip 33 of a planned 58 Colombian marine brigade riverine combat elements. These efforts have improved our capability to enter drugs and precursor chemicals on the rivers, and extended their operational reach into the vast countryside. We're in the process of helping them to establish their own mobile riverine training teams to sustain the training and readiness of these riverine combat elements.

Additionally, joint interagency task force east has coordinated and operated with the Colombian navy on the important scene between the drug source and transit zones. When we began support of Plan Colombia, Colombia's military-related infrastructure and base force protection were inadequate for counter-drug operations. We've helped them to construct airfields and aircraft support facilities, barracks, riverine infrastructure, forward operating bases and radar support infrastructure.

In addition, the Colombian military has developed a curriculum to be taught at the new judge advocate general core school that emphasizes the rule of law in human rights. This curriculum will reach all military personnel in the Colombian judge advocate general core.

Outside of Colombia our main effort has been to employ joint interagency task force east to support interdiction in the drug transit zone, specifically in the Eastern Pacific where the main cocaine trafficking vector exists. For our operations in the source and transit zones we have improved our own theater forward operating locations or FOLs in Manta, Ecuador, Como Opa (ph), El Salvador and Curasol, Netherlands Antilles to enhance our aircraft capacity, aircraft maintenance, support facilities and crew force protection. We have also provided counter-drug training and support on a lesser scale to Ecuador, Peru, Bolivia and Venezuela.

Our assessment of the units we have trained and equipped in Colombia is that their tactical capabilities have improved as indicated in the results of their operations. Since its inception in January 2001, joint task force south has destroyed 22 HCL labs and 1,063 base labs. It has seized 3,400 kilograms of Coca-base, 240 pounds of Coca leaf, 132,500 gallons of gas and diesel, and 1,103 weapons. It has detained 125 people suspected of participating in or supporting Coca production or trafficking, and it has killed 318 FARC and paramilitary personnel.

There are indicators that the FARC and AUC are moving their drug operations further away from joint task force south operational area. Seizure statistics of the Colombia marine riverine brigade from August 1999 to May 2002 show 6.3 metric tons of cocaine, 246 tons of solid chemical precursors, 42,906 gallons of liquid precursors, 395,400 gallons of gasoline, 297 tons of Coca leaf being processed, and 14.2 tons of Coca-base.

An example of a recent successful joint counter-drug operation occurred August 24 through 26, 2002 where Colombian navy, marine infantry, marine counter-drill, and marine riverine units coordinated and executed operation Tomaco Mia Alto (ph) two in the Mera (ph) river sector, Nerino (ph) department, against eight cartel-owned AUC and 29th front FARC-guarded HCL labs.

Colombian military units seized one metric ton of cocaine, over 45,700 gallons of precursor chemicals, 13 microwaves, six electric generators and five hydraulic machines. According to the U.S. country team narcotic affairs section, this operation destroyed a combined monthly 20 metric tons cocaine production capacity. That these HCL labs were located in the Nereno (ph) department, well west of the Putumayo and Caqueta region is the strongest evidence yet that the successes of the first counter-narcotics brigade and JTF south have forced the drug producing groups to move their operation out of JTF south's area of responsibility.

Although these tactical statistics sound impressive along with the fact that overall strategic cocaine seizures increased in 2001, the inner-agency assessment of cocaine movement suggests that traffickers have maintained ample supplies of cocaine to meet world demand.

Our analysis in SOUTHCOM concludes that while drug production and trafficking pose a serious threat to Colombia and the United States, the nature of the conflict in Colombia is a crisis of governance, which, if not solved, will effect the region to a greater extent than it has today.

The government of Colombia is unable to control much of its territory, enforce the rule of law and provides its citizen a safe and secure environment. It is unable to do so because of the complex security threat posed by the FARC, ELN and AUC, all designated as terrorist organizations by the U.S. inter-agency intelligence committee on terrorism, and by the narco-terror traffickers. And because it currently does not the necessary strategy, correlation of forces, and military and police capabilities to establish a safe and secure environment in which their other government components can be successful.

Clearly this is Colombia's conflict to win, and they must mobilize all their elements of national power to be decisive. We cannot do it for them. However, from a military perspective, we can do some things to better help them. First, if Congress grants expanded authorities in the future similar to those in the FY '02 supplemental, and the president approves the new draft national security presidential directive, we could flexibly apply counter-drug resources and assets to optimize our military assistance to Colombia to support their fight against this complex threat.

JACKMAN: For example, we could provide the Colombians intelligence that is not limited by counter-drug nexus. We could employ joint interagency task force east and other SOUTHCOM forces to support the interdiction of arms bound for Colombia. This arms trafficking often takes place in the same pipelines as drug trafficking and cocaine is often the barter in exchange for weapons and ammunition.

The Colombians could use the U.S. counter-drug trained units and U.S. provided counter-drug equipment with greater flexibility and latitude against the terrorist. For example, the Colombian military could employ the U.S.-provided helicopters against critical FARC, AUC and ELN as well as narco-trafficker targets and in operations to free kidnapping victims.

Second, we could help the Colombians build military capabilities they deem the most critical in their fight against the threat. This could include helping them fashion their military strategy in campaign plans, providing strategic operational and tactical level intelligence collection and planning assistance, and training and equipping additional units which could enable them to seize the initiative and protect their critical infrastructure.

We can assist them in identifying these requirements, but they must take the lead and mobilize their own resources to build these capabilities. Again, I think it's important to underscore that this is Colombia's conflict to win, an important lesson we learned from our experiences in Vietnam.

Your continued support will help strengthen democracy in Colombia in the Andean Region and safeguard U.S. national interest there. Thank you for providing me this opportunity to discuss these issues with you today. And I'm pleased to respond to any questions you may have at this time.

GRASSLEY: Thank you very much, General, for three very helpful commentaries.

As I indicated in my opening statement, one of the principal policy issues that led to the calling of this hearing of the drug caucus was on the linkage between counter-narcotics and counter- terrorism. General Jackman has just outlined some of the ways in which he believes that if the United States modifies, in a permanent way, some of its previous policies which have built a wall between those two activities, that we would increase our effectiveness. There are some of our colleagues that who are not yet convinced that in fact this marriage of terrorism and narcotics has occurred.

What are some of the elements of evidence that you would offer as to the merger of the activities of terrorists and narcotic traffickers in the Andean Region and the consequences, particularly the consequences in terms of increased capability that has resulted from this marriage?

Mr. Secretary?

ARMITAGE: Mr. Chairman, I think we could start just looking at the August 7 inauguration of President Uribe and work backwards to get the evidence. Clearly the FARC attempted to do massive damage, from their point of view, unfortunately only killed 21 peasants, rather than the president, the visiting delegation from many foreign countries as well as a lot more citizens. It was only because of inaccurate mortars and some failed mortars that they didn't do more damage.

You yourself, Senator Grassley, Senator DeWine, have laid out the kidnappings, the murders, the abductions, the violence that has been perpetrated. I don't think that there are many, even, up here that you suggest who don't now see that there's a nexus between drugs and terrorism.

Finally, well before that, let me say that if there was a pretension to political ambitions by the FARC, and the ELN, and the AUC -- if there was some pretension to really be putting forth justice for all as the reason for their activities, I think it's been done away with. And it's certainly been done away with in the last year- and-a-half by the unprecedented level of violence that they're exhibiting.

And I think the new case to look at is an old case. It's the Sendero Luminoso in Peru where following that dictates if Hernando Desoto and others, the government of Peru got a good leg up on the shining path. And recently they've come back using the proceeds for drugs to fuel their ambitions, most recently demonstrated in the March 9 attack in Lima, right prior to the visit of our president, an indiscriminant attack which, but for the grace of God, didn't kill Americans.

So I think it from our point of view, sir, it's pretty clear evidence.

GRASSLEY: Mr. Hutchinson?

HUTCHINSON: I would concur, certainly, with Secretary Armitage in regards to his statement, but I would tie even further the drug trafficking aspect of the FARC. What we traditionally thought was that the FARC did light the shining path in Peru by taxed the Coca fields. And they derive revenue from taxation.

It was much more involved in that, as we learned after we went into the demilitarized zone in March of this year and we discovered that they were engaged not just the taxation, but in the production, in the conversion laboratories, in the trafficking side of it, so really at every level. As we went into see the two conversion laboratories, we actually saw receipts issued by the FARC for the Coca that they received that was converted in their laboratories.

And so the evidence is really indisputable that their revenue source is substantially cocaine trafficking, production and trafficking. The violence is well documented.

The consequences of that is that we cannot have artificial boundaries in going after an organization that is engaged in both. Intelligence that is counter-narcotics related needs to be used for counter-terrorism and vice versa, because the target is one and the same.

GRASSLEY: General Jackman?

JACKMAN: Senator, it's interesting to me that we used to talk about all of the groups separately. We talked about the traffickers. We talked about the insurgents. We talked about illegal arms groups, terrorists, et cetera, but I think it's important to remember that after we helped Colombia dismantle the large cartels in Colombia, that these groups filled that vacuum and essentially took over the production, the cultivation, the production of drugs in Colombia. And so now we see all of these groups clearly the same. We sometime coin them as narco-terrorists, but they are all the same. They're all involved in these activities.

I think that it's also important to understand that this goes well beyond Colombia. Although they use drugs to fuel the means, they use the drugs to buy weapons, or the proceeds from drugs to buy weapons. And these weapons come from Central America, such as Nicaragua, Guatemala, Honduras, weapons that existed there after the wars in those areas. Sadly, those weapons and ammunition also come from the United States. They come from Central Europe and they transit, not only directly into Colombia, but through places like Suriname, Brazil, through the tri-border area.

And in that whole line of communication of arms for drugs, there are other terrorist organizations in Latin America that are involved in these transactions. So this is -- this goes well beyond Colombia.

GRASSLEY: Thank you.

Senator DeWine?

DEWINE: Thank you, Mr. Chairman.

The original plan, Colombia envisioned assistance from some of our European friends. I notice, Secretary, you mentioned page two of your written statement, you see some consensus and I quote, "We see some consensus in principal European nations, European commission, Canada, Japan, the United Nations who pledged up to $600 million to the Andean counter-narcotics efforts. Unfortunately, their disbursements are not matching their generous intent."

You want to...

ARMITAGE: Yes, we're very disappointed...

DEWINE: ... explain that a little further.

ARMITAGE: Yes, Senator DeWine.

We're very disappointed in pledges of $550 to $600 million, and come up with about $245 million of the pledges that were actually committed. I'm pleased to say that Japan, which pledged $175 million, has actually committed $175 million. Spain which committed $100 million pledged $100 million and committed $18 million and are well on their way in a pipeline to committing the rest. But beyond that, Germany and France and others, Norway, have not stepped up yet. They've not committed this money. And this is a problem for us as the Department of State, and we've got to go out and jawbone and push and pressure and try to -- the final analysis maybe even embarrass people to doing what they pledged.

DEWINE: Let me direct this question to all of you, but it's really a follow-up for that question.

We talk about a balanced approach to Colombia and the Andean Region. How much of our approach was the military side and how much was the non-military? How much was more developmental? And then, how does that fit in? What's kind of the big picture with our other allies? What were they doing? What was envisioned that they were going to do that we were going to do, because I think that's important to get the overall picture to see that we do and make sure that this is in fact a balanced program.

ARMITAGE: Senator DeWine, there is not actual balance in the program. If you're referring to that monies which is put against eradication and the prosecution advice the alternative development. It's about two to one for the eradication, not quite in Colombia. In Peru it's more closely balanced. And the reasons are the security situations. We can't have alternative development, for instance, in Colombia until we've gotten a much better security system.

Our allies are not on the sharp edge or the heavy edge of this program. They're all in, what we'd call, alternative development. They're all in the softer issues. We didn't ask them to step up in the counter-insurgents...

DEWINE: So we're doing more of the sharp. They're doing more of the soft if...

ARMITAGE: We are doing much more of the sharp, particularly in Colombia. But as I say, there's not a balance dollar for dollar in this program at all, except in Peru it's pretty close.

DEWINE: I wonder if you could talk a little bit about this alternative development. I'll direct this to any one of the three members of the panel who would like to answer it.

There was a GAO report that did in fact talk about that. And so did one -- as I recall, and this is a summarization, but one of the problems was that we were not making the progress that we thought we were going to make and we wanted to make. And you want to talk a little bit about that?

ARMITAGE: I usually dug into it. I don't pretend to be an expert in this matter, Senator DeWine, I asked that very question. And the short answer is it didn't work. And it didn't work for two reasons.

Initially, particularly in the Southern part of Colombia when we tried alternative development, it was crop substitution. And as I understand it, that was not on. And the soil wasn't right. It wasn't working. We didn't have the right partnerships in our NGOs, and some who were partnered with us.

The alternative development plan we've gone to now is one I would call local participation, where you approach the village and you talk to them about what do they need. Is it a school? Is it a road? Is it a well? What is it? And what are they going to do to get it?

Now, the government of Colombia, for instance, will eradicate, will spray where they want to spray. It's much better if the village signs up and voluntarily agrees to aerial eradication in return for some alternative development, which now, as they say, is the social end of things, schools and clinics and roads. And at least I'm briefed that we seem to be making some progress in that regard.

And that President Uribe and yesterday Vice President Santos, who was in to visit me from Colombia, had some pretty kind things about vice about a year-and-a-half ago.

DEWINE: Senator Hutchinson?

HUTCHINSON: Senator DeWine, just going back to the balance part of your question. Clearly, the Andean Ridge Initiative originally Plan Colombia was focused on the eradication efforts substantially, the assistance that we provide. Congress has supplemented that with some assistance for the organizational targeting and I believe that is a major -- should be a very significant part of the effort in Colombia and in that region.

In reference to the allies, there is certainly a growing awareness. I hope that this will be followed by a greater commitment of funding, but as the cocaine flow has increased to the European countries, as we see -- they are starting to invest more, at least in terms of personnel, looking at Colombia as a source country for them and their routes that head these drugs to Europe.

And so I hope that they will increase their effort in terms of personnel and investment.

DEWINE: Good.

Thank you, Mr. Chairman.

GRASSLEY: Thank you, Senator.

We have been joined by our Chair, Senator Biden.

Senator Biden, we have had opening statements, statements by the witnesses and one round of questioning. I'm turning the chair over to you.

BIDEN: I will -- you keep the Chair, but I -- turn the mike on. Here you go. The mike's on now. Thank you.

I apologize to my colleagues and to the witnesses for being late. We just have to fund Amtrak better. But we'll talk about that at another hearing.

Mr. Chairman, I don't want to ruin the reputation of our three witnesses, but they are among my three favorite administration officials because they are the most effective in any administration. And I want to publicly commend Asa for one heck of a job he's been doing. He's kept every commitment he said he would to this committee and not just in this area, but across the board with DEA.

You're doing a great job, Asa, and I want to publicly acknowledge that.

And I always -- I have an inordinately high regard for Secretary Armitage. If you ever want a straight answer, he's the guy to go to. And I appreciate it -- always been straight.

And General, welcome to you.

I'm going to give my very brief opening statement here and then continue -- let you all continue with rounds of questioning. And then I will have some questions.

Over the past few years, the members of this drug caucus have worked closely with both the Clinton and Bush administrations on long- term strategy to control the trade of illicit narcotics. And the drug trade is not only, to state the obvious, destabilizing the politically, but it's also economically destabilizing and particularly in the Andean Region. But it has had a devastating impact on the street corners and the schoolyards here, in the United States of America.

Two years ago we renewed our commitment to the Andean Region, providing funding for Plan Colombia, which was somewhat controversial. And it remains somewhat controversial now. But I think it was the right decision to make, as well as for alternative development and law enforcement efforts in Bolivia, Peru, Ecuador, Venezuela and Brazil.

In my view, we have a duty to help this effort because it's America's seemingly insatiable demand for narcotics that has helped fuel this drug trade. And it's also in our naked self-interest.

Over the past few years, there has been some progress. We have seen the decrease in coca production in Bolivia and Peru, but a great deal of work has to be done. And implementation of Plan Colombia continues, but we have yet to see significant impact on coca or opium production.

There is no question that the training and performance of the Colombian military, General, I think is consequence of our training those units has shown a marked improvement. But the United States continues to have, as you know, strong concerns about the link between military and illegal paramilitaries.

And let's be honest, we have some work to do here, at home, as well. After several years of stable level drug use in the United States, this year we're up 11 percent among 12- to 17-year-olds and 18 percent -- 18- to 25-year-olds.

Because nearly 70 percent of the world's cocaine and nearly all of the incredibly pure heroine sold on the East Coast -- and I remember I got here a long time ago and we were talking about heroine out of Mexico in the Nixon administration. And we were talking about purity -- there was 6 -- 7 -- 8 -- 10 percent. Now we're talking, as you have forgotten more about this than most will know, purity on the streets in my state and the East Coast here -- up in the area of 90 percent.

I mean, it comes from Colombia and Colombia has been the primary focus of our attention.

But we have to continue to bolster Colombia's neighbors to protect against the so-called balloon effect where coca production goes down in one area only to increase in another. And over the past few years, the United States government has been a strong ally of President Pastrana. And I hope and trust that we'll be able to develop that same sort of relationship with Uribe, who will visit this country next week. It is my firm belief that the United States must stay engaged in Colombia. If we walk away, we can be sure of one thing, the human rights situation will further deteriorate and drug production will continue to flourish.

The newly elected president has been in office for just over a month and already his tenure has been rocked by terrorism that has become far too commonplace in Colombia.

With a three-front war against the drug traffic -- its guerrillas and right-wing paramilitaries -- Colombia has a level of violence that Americans cannot comprehend. In response to the violent attack at his inauguration, the president has declared a state of internal emergency, allowing him to issue a number of temporary security measures to try to establish control in the country.

For better or for worse, until recently the United States has stayed out of Colombia's insurgency war. But with the new authority given to Colombia to use equipment provided by the United States for counter-insurgency purposes, we have entered new territory here. The new power has not yet been used, but I look forward to hearing -- and I will catch up with my staff -- what the witnesses have already said about how they anticipate it will work in practice and to the degree to which it will affect our ongoing counter-narcotics program.

The United States has to continue to press Colombia for improvements in human rights. Last week, the secretary of state certified that Colombia's military is taking steps to suspend soldiers committing human rights violations and is cooperating with civilian prosecutors to prosecute those who have been alleged to have committed those acts. And is taking steps to severe links with the paramilitaries. But the military has long way to go, in my opinion. The military continues to turn a blind eye to paramilitary violence. I believe support for the Andean Counter Drug Initiative and will inevitably erode in this body and in this country.

So I look forward to catching up on what you've already said and asking a few questions when the time is appropriate.

But, again, I thank you all. Quite frankly, I think we have no choice but to engage in this. It's slippery territory. It's not easy, but I know of no alternative.

As I say to people when I am criticized for supporting the plan, which is not infrequent -- I say, "Can you imagine a South America, with the oldest democracy in their region, at the top of that continent being a narco-state? What does that bode for the rest of the continent?" And I think we have no choice.

So I'm anxious to hear what the witnesses have said and what they are about to say and to hear your questions, Mr. Chairman. And I thank you for allowing me this interruption and apologize for it being out of order.

GRASSLEY: Thank you, Senator Biden.

I'd like to go back to the question of the consequences of linkages between terrorists and narco-traffickers. One of the distinguishing factors of those two groups, historically, in Colombia is that while the narco-traffickers, because of the nature of their enterprise, were very global -- that is, they had contacts with and distribution systems throughout the world, particularly in North America.

The guerrillas were quite insular two or three years ago when Scandinavian countries invited some of the leaders of the FARC to visit their countries. It was the first time that most of those people had ever been outside of Colombia. It has been suggested that now that the two are married that one consequence is that the guerrillas -- the terrorists -- are, themselves, becoming more global, including linkages with other international terrorist groups. There was much discussion a year ago about a group from the Irish Republican Army who had come to Colombia allegedly to train FARC in urban warfare and to collect some of the drug money that the FARC had available to pay for that training.

What is your assessment of the current state of Colombian terrorists establishing relationships with terrorist groups outside of Colombia?

ARMITAGE: My assessment, sir, is that the three groups, to include the paramilitaries in Colombia, are primarily still internal in terms of the violence they foment. It is the case that we saw some -- at least some intelligence that the FARC was intent on actually harming some Americans in Venezuela not so long ago when we warned people from going to a certain area.

However, as some of the members of the Senate Drug Caucus have mentioned already, the reach of the drugs is global. The reach of the gray (ph) arms market. The proceeds go for not legitimate ends, but for rather nefarious ends. And my own view is that that's where the global reach of these characters is. But I stand to be modified corrected or ...

HUTCHINSON: No, I would not correct. I would elaborate that our indication is that the FARC and the other terrorist organizations in Colombia engaged in drug trafficking are utilizing transporters, whether it be Brazil traffickers to move their goods out. But they have not set up a network substantially outside of that region.

I think that is something we have to watch very carefully if they move in to taking over transportation routes or trafficking organizations to a larger extent.

At this point, there is not that indication. They are regional in nature and they are utilizing other traffickers and other organizations to move their goods.

GRASSLEY: General?

JACKMAN: Senator, I would say that certainly the tentacles of the FARC extend well beyond the boundaries of Colombia. There is evidence -- there is intelligence that they have worked with the Sendero Luminoso in Peru with illegal arm groups in Bolivia and have some presence in the tribora (ph) area in Paraguay.

And it's clear based on the intelligence that we have that they are involved with other organized crime elements and other terrorist organizations in Latin America to facilitate those things that they need -- primarily arms, ammunition, medical supplies -- those types of things. So there are plenty of organized criminal elements and other organizations out there that would be happy to make money and make the deals to provide the means for the FARC -- for what they are doing inside of Colombia.

GRASSLEY: Senator DeWine?

DEWINE: Thank you, Mr. Chairman.

I want to get back to the alternative development a little bit. And we touched on it a minute ago. But the issue about the security involved and how the terrorism and the war, itself, impacts the ability of the Colombian government and the U.S. government -- USAID -- to carry out any kind of alternative development -- any kind of assistance.

Would any one of you like to discuss that and where we are and how the two are linked, if they are?

HUTCHINSON: I wanted to make one comment, then I'll turn it over to the secretary.

But I think the critical part of alternative development -- crop substitution programs -- eradication programs -- is that you have success where the government is in control of the countryside -- they are in control of the geography and the rule of law can be enforced.

You look at Bolivia and Peru -- you had strong governments that were able to assure the success of the eradication program -- enforce the rule of law. Even though there were glitches, they had successes there.

in Colombia and Afghanistan, we have trouble with these programs because the government is not -- civil authority is not in control in the regions you're trying to carry these out. And so we have to establish rule of law. We have to be able to diminish the influence of the narco-terrorists in order to carry out a successful program.

ARMITAGE: I...

DEWINE: Mr. Secretary?

ARMITAGE: We got a very strong signal, I think, of what's going on in Colombia by the election of President Uribe. The fact that he was elected on the first ballot, which I am told is unprecedented in Colombia -- and he stood on a very strong national security rule of law platform.

So first of all, it indicated to me that the people of Colombia have had enough. This is one of the reasons why I think the FARC reacted so virulently to his inaugural day because they realized that unless they take care of the Uribe government, they are not going to be able to disrupt his plans to extend the rule of law.

Senator, if you were to ask an administration witness, "What are you trying to accomplish with the ACI?" Counter-narcotics -- alternative development -- judicial reform, which is another way of saying respect for human rights and the spread of the judicial system to all areas. Right now we are, as the administrator indicates, we are forbidden to -- and the government of Colombia is forbidden to extent that rule of law to some areas because of the insecurity and instability which just feed the narco-traffickers.

DEWINE: General?

JACKMAN: Senator, I think it's, as Mr. Hutchinson points out, it's very difficult, I think, to have meaningful alternative development if you do not have a safe and secure environment in which that can flourish.

In February, after President Pastrana ordered the military into the former despeje, the FARC began to move against the urban centers. And it continued and stepped up its attacks against the infrastructure in Colombia. And, as we talked about earlier, the critical pipeline in the northern part of that country -- they lose about $1.5 million a day in revenue because of attacks on that pipeline.

JACKMAN: But what this did is it forced the military, then, to change its operations in order to protect those urban centers and seek out the FARC in those areas -- and AUC in those areas and to protect its infrastructure.

So in areas that were targeted for our alternative development, you just did not have the presence of security forces from the Colombian government there to assist then.

DEWINE: Mr. Hutchinson, let me change the subject just a little bit, if I could.

Since September 11, the FBI has had to change its focus. How has that impacted what you are doing? And just to take it -- even in a country like Colombia -- your big picture and then take it down to how many agents you might have in an individual country -- what you might be doing in one country. And maybe Colombia is not a good example.

HUCHINSON: Well, first of all in regards to the FBI's decision to move 400 agents from counter-narcotics to counter-terrorism, Director Mueller has communicated with me regularly about where these are coming from and how we can work together in that transition for the DEA to take on that additional responsibility.

And more has fallen on our shoulders. Primarily it is a domestic issue. I think that would impact us overseas because -- I mean, it gives us less flexibility. It's a zero sum game. Unless you have new resources to move or to put places, you just have to shuffle the existing deck.

But we are responding, I think, somewhat effectively by -- we have -- Congress has approved the moving of agents to the southwest border to pick up a gap there. we're still working in that process. But there's going to be a continued review of this.

In some areas of the country where the FBI is in a rural area and they reassigned their agents from counter-narcotics to counter- terrorism, we may not have an agent there. We might have to open up a post of duty. So we are having to do some adjustments. And we are working with the Department of Justice to make sure that federal responsibility is met -- primarily the impacts is here, domestically.

We have gone through a reallocation of our foreign offices that the Senate Appropriations Committee has signed off on. And we really hadn't effectively done that since, you know -- in Bolivia where we have principally got our cocaine and -- it's moved to Colombia. We have not really adjusted effectively since then. And we have gone through that allocation to meet the ecstasy threat from the Netherlands -- to meet the increased heroin threat from Colombia, as well as the new issues in Mexico, where we can be helpful in our counter-terrorism fight, as well.

So we have done a readjustment in response to the threat, but also in response to the FBI's moving agents out of counter-narcotics.

DEWINE: Well, my time is up. I just think that this is something that we, in Congress, working with you, have to be cognizant of and we have to constantly monitor. Because this is a major shift in what the FBI is doing, obviously. And i