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5. South Vietnam: Narcotics in the Nation's Service PDF Print E-mail
Written by Alfred Mccoy   
Tuesday, 05 January 2010 00:00

5. South Vietnam: Narcotics in the Nation's Service

THE BLOODY Saigon street fighting of April-May 1955 marked the end of French colonial rule and the beginning of direct American intervention in Vietnam. When the First Indochina War-came to an end, the French government had planned to withdraw its forces gradually over a two- or three-year period in order to protect its substantial political and economic interests in southern Vietnam. The armistice concluded at Geneva, Switzerland, in July 1954 called for the French Expeditionary Corps to withdraw into the southern half of Vietnam for two years, until an all-Vietnam referendum determined the nation's political future. Convinced that Ho Chi Minh and the Communist Viet Minh were going to score an overwhelming electoral victory, the French began negotiating a diplomatic understanding with the government in Hanoi.(1) But America's moralistic cold warriors were not quite so flexible. Speaking before the American Legion Convention several weeks after the signing of the Geneva Accords, New York's influential Catholic prelate, Cardinal Spellman, warned that, "If Geneva and what was agreed upon there means anything at all, it means . . . taps for the buried hopes of freedom in Southeast Asia! Taps for the newly betrayed millions of Indochinese who must now learn the awful facts of slavery from their eager Communist masters!" (2)

Rather than surrendering southern Vietnam to the "Red rulers' godless goons," the Eisenhower administration decided to create a new nation where none had existed before. Looking back on America's postGeneva policies from the vantage point of the mid 1960s, the Pentagon Papers concluded that South Vietnam "was essentially the creation of the United States":

"Without U.S. support Diem almost certainly could not have consolidated his hold on the South during 1955 and 1956.

Without the threat of U.S. intervention, South Vietnam could not have refused to even discuss the elections called for in 1956 under the Geneva settlement without being immediately overrun by Viet Minh armies.

Without U.S. aid in the years following, the Diem regime certainly, and independent South Vietnam almost as certainly, could not have survived."(3)

The French had little enthusiasm for this emerging nation and its premier, and so the French had to go. Pressured by American military aid cutbacks and prodded by the Diem regime, the French stepped up their troop withdrawals. By April 1956 the once mighty French Expeditionary Corps had been reduced to less than 5,000 men, and American officers had taken over their jobs as advisers to the Vietnamese army.(4) The Americans criticized the french as hopelessly "colonialist" in their attitudes, and French officials retorted that the Americans were naive During this difficult transition period one French official denounced "the meddling Americans who, in their incorrigible guilelessness, believed that once the French Army leaves, Vietnamese independence will burst forth for all to see."(5)

Although this French official was doubtlessly biased, he was also correct. There was a certain naiveness, a certain innocent freshness, surrounding many of the American officials who poured into Saigon in the mid 1950s. The patron saint of America's antiCommunist crusade in South Vietnam was a young navy doctor named Thomas A. Dooley. After spending a year in Vietnam helping refugees in 1954-1955, Dr. Tom Dooley returned to the United States for a whirlwind tour to build support for Premier Diem and his new nation. Dooley declared that France "had a political and economic stake in keeping the native masses backward, submissive and ignorant," and praised Diem as "a man who never bowed to the French." (6) But Dr. Dooley was not just delivering South Vietnam from the "organized godlessness" of the "new Red imperialism," he was offering them the American way. Every time he dispensed medicine to a refugee, he told the Vietnamese "This is American aid." (7) And when the Cosmevo Ambulator Company of Paterson, New Jersey, sent an artificial limb for a young refugee girl, he told her it was "an American leg."(8)

Although Dr. Dooley's national chauvinism seems somewhat childish today, it was fairly widely shared by Americans serving in South Vietnam. Even the CIA's tactician, General Lansdale, seems to have been a strong ideologue. Writing of his experiences in Saigon during this period, General Lansdale later said:

"I went far beyond the usual bounds given a military man after I discovered just what the people on these battlegrounds needed to guard against and what to keep strong.... I took my American beliefs with me into these Asian struggles, as Tom Paine would have done."(9)

The attitude of these crusaders was so strong that it pervaded the press at the time. President Diem's repressive dictatorship became a "one man democracy." Life magazine hailed him as "the Tough Miracle Man of Vietnam," and a 1956 Saturday Evening Post article began: "Two years ago at Geneva, South Vietnam was virtually sold down the river to the Communists. Today the spunky little Asian country is back on its own feet, thanks to a mandarin in a sharkskin suit who's upsetting the Red timetable! (10)

But America's fall from innocence was not long in coming. Only seven years after these journalistic accolades were published, the U.S. Embassy and the CIA-in fact, some of the same CIA agents who had fought for him in 1955-engineered a coup that toppled Diem and left him murdered in the back of an armored personnel carrier. (11) And by 1965 the United States found itself fighting a war that was almost a carbon copy of France's colonial war. The U.S. Embassy was trying to manipulate the same clique of corrupt Saigon politicos that had confounded the French in their day. The U.S. army looked just like the French Expeditionary Corps to most Vietnamese. Instead of Senegalese and Moroccan colonial levies, the U.S. army was assisted by Thai and South Korean troops. The U.S. special forces (the "Green Berets") were assigned to train exactly the same hill tribe mercenaries that the French MACG (the "Red Berets") had recruited ten years earlier.

Given the striking similarities between the French and American war machines, it is hardly surprising that the broad outlines of "Operation X" reemerged after U.S. intervention. As the CIA became involved in Laos in the early 1960s it became aware of the truth of Colonel Trinquier's axiom, "To have the Meo, one must buy their opium." (12) At a time when there was no ground or air transport to and from the mountains of Laos except CIA aircraft, opium continued to flow out of the villages of Laos to transit points such as Long Tieng. There, government air forces, this time Vietnamese and Lao instead of French, transported narcotics to Saigon, where parties associated with Vietnamese political leaders were involved in the domestic distribution and arranged for export to Europe through Corsican syndicates. And just as the French high commissioner had found it politically expedient to overlook the Binh Xuyen's involvement in Saigon's opium trade, the U.S. Embassy, as part of its unqualified support of the Thieu-Ky regime, looked the other way when presented with evidence that members of the regime are involved in the GI heroin traffic. While American complicity is certainly much less conscious and overt than that of the French a decade earlier, this time it was not just opium -but morphine and heroin as well-and the consequences were far more serious. After a decade of American military intervention, Southeast Asia has become the source of 70 percent of the world's illicit opium and the major supplier of raw-materials for America's booming heroin market.

The Politics of Heroin in South Vietnam

Geography and politics have dictated the fundamental "laws" that have governed South Vietnam's narcotics traffic for the last twenty years. Since opium is not grown inside South Vietnam, all of her drugs have to be importedfrom the Golden Triangle region to the north. Stretching across 150,000 square miles of northeastern Burma, northern Thailand, and northern Laos, the mountainous Golden Triangle is the source of all the opium and heroin sold in South Vietnam. Although it is the world's most important source of illicit opium, morphine, and heroin, the Golden Triangle is landlocked, cut off from local and international markets by long distances and rugged terrain. Thus, once processed and packaged in the region's refineries, the Golden Triangle's narcotics follow one of two "corridors" to reach the world's markets. The first and most important route is the overland corridor that begins as a maze of mule trails in the Shan hills of northeastern Burma and ends as a four-lane highway in downtown Bangkok. Most of Burma's and Thailand's opium follows the overland route to Bangkok and from there finds its way into international markets, the most important of which is Hong Kong. The second route is the air corridor that begins among the scattered dirt airstrips of northern Laos and ends at Saigon's international airport. The opium reaching Saigon from Burma or Thailand is usually packed into northwestern Laos on muleback before being flown into South Vietnam. While very little opium, morphine, or heroin travels from Saigon to Hong Kong, the South Vietnamese capital appears to be the major transshipment point for Golden Triangle narcotics heading for Europe and the United States.

Since Vietnam's major source of opium lies on the other side of the rugged Annamite Mountains, every Vietnamese civilian or military group that wants to finance its political activities by selling narcotics has to have (1) a connection in Laos and (2) access to air transport. When the Binh Xuyen controlled Saigon's opium dens during the First Indochina War, the French MACG provided these services through its officers fighting with Laotian guerrillas and its air transport links between Saigon and the mountain maquis. Later Vietnamese politicomilitary groups have used family connections, intelligence agents serving abroad, and Indochina's Corsican underworld as their Laotian connection. While almost any high-ranking Vietnamese can establish such contacts without too much difficulty, the problem of securing reliable air transport between Laos and the Saigon area has always limited narcotics smuggling to only the most powerful of the Vietnamese elite.

When Ngo Dinh Nhu, brother and chief adviser of South Vietnam's late president, Ngo Dinh Diem, decided to revive the opium traffic to finance his repression of mounting armed insurgency and political dissent, he used Vietnamese intelligence agents operating in Laos and Indochina's Corsican underworld as his contacts. From 1958 to 1960 Nhu relied mainly on small Corsican charter airlines for transport, but in 1961-1962 he also used the First Transport Group (which was then flying intelligence missions into Laos for the CIA and was under the control of Nguyen Cao Ky) to ship raw opium to Saigon. During this period and the following years, 1965-1967, when Ky was premier, most of the opium seems to have been finding its way to South Vietnam through the Vietnamese air force. By mid 1970 there was evidence that high-ranking officials in the Vietnamese navy, customs, army, port authority, National Police, and National Assembly's lower house were competing with the air force for the dominant position in the traffic. To a casual observer, it must have appeared that the strong central control exercised during the Ky and the Diem administrations had given way to a laissez-faire free-for-all under the Thieu government.

What seems like chaotic competition among poorly organized smuggling rings actually appears to be, on closer examination, a fairly disciplined power struggle between the leaders of Saigon's three most powerful political factions: the air force, which remains under VicePresident Ky's control; the army, navy, and lower house, which are loyal to President Thieu; and the customs, port authority, and National Police, where the factions loyal to Premier Khiem have considerable influence. However, to see through the confusion to the lines of authority that bound each of these groups to a higher power requires some appreciation of the structure of Vietnamese political factions and the traditions of corruption.

Tradition and Corruption in Southeast Asia

As in the rest of Southeast Asia, the outward forms of Western bureaucratic efficiency have been grafted onto a traditional power elite, and the patient is showing all the signs of possible postoperative tissue rejection. While Southeast Asian governments are carbon copies of European bureaucracies in their formal trappings, the elite values of the past govern the behind-the-scenes machinations over graft, patronage, and power. In the area of Southeast Asia we have been discussing, three traditions continue to influence contemporary political behavior: Thailand's legacy of despotic, Hinduized god-kings; Vietnam's tradition of Chinese-style mandarin bureaucrats; and Laos's and the Shan States' heritage of fragmented, feudal kingdoms.

The Hindu world view spread eastward from India into Thailand carrying its sensuous vision of a despotic god-king who squandered vast amounts of the national wealth on palaces, harems, and personal monuments. All authority radiated from his divine, sexually potent being, and his oppressively conspicuous consumption was but further proof of his divine right to power.

After a thousand years of Chinese military occupation, Vietnam bad absorbed its northern neighbor's Confucian ideal of meritocratic government: welleducated, carefully selected mandarins were given a high degree of independent administrative authority but were expected to adhere to rigid standards of ethical behavior. While the imperial court frequently violated Confucian ethics by selling offices to unqualified candidates, the Emperor himself remained piously unaware while such men exploited the people in order to make a return on their investment.

Although Chinese and Indian influence spread across the lowland plains of Vietnam and Thailand, the remote mountain regions of Laos and the Burmese Shan States remained less susceptible to these radically innovative concepts of opulent kingdoms and centralized political power. Laos and the Shan States remained a scattering of minor principalities whose despotic princes and sawbwas usually controlled little more than a single highland valley. Centralized power went no further than loosely organized, feudal federations or individualy powerful fiefdoms that annexed a few neighboring valleys.

The tenacious survival of these antiquated political structures is largely due to Western intervention in Southeast Asia during the last 150 years. In the midnineteenth century, European gunboats and diplomats broke down the isolationist world view of these traditional states and annexed them into their farflung empires. The European presence brought radical innovations-modern technology, revolutionary political ideas, and unprecedented economic oppression-which released dynamic forces of social change, While the European presence served initially as a catalyst for these changes, their colonial governments were profoundly conservative, and allied themselves with the traditional native elite to suppress these new social forces-labor unions, tenants' unions, and nationalist intellectuals. And when the traditional elite proved unequal to the task, the colonial powers groomed a new commercial or military class to serve their interests. In the process of serving the Europeans, both the traditional elite and the new class acquired a set of values that combined the worst of two worlds. Rejecting both their own traditions of public responsibility and the Western concepts of humanism, these native leaders fused the crass materialism of the West with their own traditions of aristocratic decadence. The result was the systematic corruption that continues to plague Southeast Asia.

The British found the preservation of the Shan State sawbwas an administrative convenience and reversed the trend of gradual integration with greater Burma. Under British rule, the Shan States became autonomous regions and the authority of the reactionary sawbwas was reinforced.

In Laos, after denying the local princes an effective voice in the government of their own country for almost fifty years, the French returned these feudalistic incompetents to power overnight when the First Indochina War made it politically expedient for them to Laotianize.

And as the gathering storm of the Vietnamese revolution forced the French to Vietnamize in the early 1950s, they created a government and an army from the only groups at all sympathetic to the French presence -the French-educated, land-owning families and the Catholic minority. When the Americans replaced the French in Indochina in 1955, they confused progressive reform with communism and proceeded to spend the next seventeen years shoring up these corrupted oligarchies and keeping reform governments out of power.

In Thailand a hundred years of British imperial councilors and twenty-five years of American advisers have given the royal government a certain veneer of technical sophistication, but have prevented the growth of any internal revolutions that might have broken with the traditional patterns of corrupted autocratic government.

At the bottom of Thailand's contemporary pyramids of corruption, armies of functionaries systematically plunder the nation and pass money up the chain of command to the top, where authoritarian leaders enjoy an ostentatious life style vaguely reminiscent of the old god-kings. Marshal Sarit, for example, had over a hundred mistresses, arbitrarily executed criminals at public spectacles, and died with an estate of over $150 million. (13) Such potentates, able to control every corrupt functionary in the most remote province, are rarely betrayed during struggles with other factions. As a result, a single political faction has usually been able to centralize and monopolize all Thailand's narcotics traffic. In contrast, the opium trade in Laos and the Shan States reflects their feudal political tradition: each regional warlord controls the traffic in his territory.

Vietnam's political factions are based in national political institutions and compete for control over a centralized narcotics traffic. But even the most powerful Vietnamese faction resembles a house of cards with one mini-clique stacked gracefully, but shakily, on top of another. Pirouetting on top of this latticework is a high-ranking government official, usually the premier or president, who, like the old pious emperors, ultimately sanctions corruption and graft but tries to remain out of the fray and preserve something of an honest, statesmanlike image. But behind every perennially smiling politician is a power broker, a heavy, who is responsible for building up the card house and preventing its collapse. Using patronage and discretionary funds, the broker builds a power base by recruiting dozens of small family cliques, important officeholders, and powerful military leaders. Since these ad hoc coalitions are notoriously unstable (betrayal precedes every Saigon coup), the broker also has to build up an intelligence network to keep an eye on his chief's loyal supporters. Money plays a key role in these affairs, and in the weeks before every coup political loyalties are sold to the highest bidder. Just before President Diem's overthrow in 1963, for example, U.S. Ambassador Lodge, who was promoting the coup, offered to give the plotters "funds at the last moment with which to buy off potential opposition. (14)

Since money is so crucial for maintaining power, one of the Vietnamese broker's major responsibilities is organizing graft and corruption to finance political dealing and intelligence work. He tries to work through the leaders of existing or newly established mini-factions to generate a reliable source of income through officially sanctioned graft and corruption. As the mini-faction sells offices lower on the bureaucratic scale, corruption seeps downward from the national level to the province, district, and village.

From the point of view of collecting money for political activities, the Vietnamese system is not nearly as efficient as the Thai pyramidal structure. Since each layer of the Vietnamese bureaucracy skims off a hefty percentage of the take (most observers feel that officials at each level keep an average of 40 percent for themselves) before passing it up to the next level, not that much steady income from ordinary graft reaches the top. For this reason, large-scale corruption that can be managed by fewer men-such, as collecting "contributions" from wealthy Chinese businessmen, selling major offices, and smuggling-are particularly important sources of political funding. It is not coincidence that every South Vietnamese government that has remained in power for more than a few months since the departure of the French has been implicated in the nation's narcotics traffic.

Diem's Dynasty and the Nhu Bandits

Shortly after the Binh Xuyen gangsters were driven out of Saigon in May 1955, President Diem, a rigidly pious Catholic, kicked off a determined antiopium campaign by burning opium-smoking paraphernalia in a dramatic public ceremony. Opium dens were shut down, addicts found it difficult to buy opium, and Saigon was no longer even a minor transit point in international narcotics traffic. (15) However, only three years later the government suddenly abandoned its moralistic crusade and took steps to revive the illicit opium traffic, The beginnings of armed insurgency in the countryside and political dissent in the cities had shown Ngo Dinh Nhu, President Diem's brother and head of the secret police, that he needed more money to expand the scope of his intelligence work and political repression. Although the CIA and the foreign aid division of the State Department had provided generous funding for those activities over the previous three years, personnel problems and internal difficulties forced the U.S. Embassy to deny his request for increased aid.(16)

But Nhu was determined to go ahead, and decided to revive the opium traffic to provide the necessary funding. Although most of Saigon's opium dens had been shut for three years, the city's thousands of Chinese and Vietnamese addicts were only too willing to resume or expand their habits. Nhu used his contacts with powerful Cholon Chinese syndicate leaders to reopen the dens and set up a distribution network for smuggled opium. (17) Within a matter of months hundreds of opium dens had been reopened, and five years later one Time-Life correspondent estimated that there were twenty-five hundred dens operating openly in Saigon's sister city Cholon. (18)

To keep these outlets supplied, Nhu established two pipelines from the Laotian poppy fields to South Vietnam. The major pipeline was a small charter airline, Air Laos Commerciale, managed by Indochina's most flamboyant Corsican gangster, Bonaventure "Rock" Francisci. Although there were at least four small Corsican airlines smuggling between Laos and South Vietnam, only Francisci's dealt directly with Nhu. According to Lt. Col. Lucien Conein, a former high-ranking CIA officer in Saigon, their relationship began in 1958 when Francisci made a deal with Ngo Dinh Nhu to smuggle Laotian opium into South Vietnam. After Nhu guaranteed his opium shipment safe conduct, Francisci's fleet of twin-engine Beechcrafts began making clandestine airdrops inside South Vietnam on a daily basis. (19)

Nhu supplemented these shipments by dispatching intelligence agents to Laos with orders to send back raw opium on the Vietnamese air force transports that shuttled back and forth carrying agents and supplies. (20)

While Nhu seems to have dealt with the Corsicans personally, the intelligence missions to Laos were managed by the head of his secret police apparatus, Dr. Tran Kim Tuyen. Although most accounts have portrayed Nhu as the Diem regime's Machiavelli, many insiders feel that it was the diminutive ex-seminary student, Dr. Tuyen, who had the real lust and capacity for intrigue. As head of the secret police, euphemistically titled Office of Social and Political Study, Dr. Tuyen commanded a vast intelligence network that included the CIA-financed special forces, the Military Security Service, and most importantly, the clandestine Can Lao party.(21) Through the Can Lao party, Tuyen recruited spies and political cadres in every branch of the military and civil bureaucracy. Promotions were strictly controlled by the central government, and those who cooperated with Dr. Tuyen were rewarded with rapid advancement. (22) With profits from the opium trade and other officially sanctioned corruption, the Office of Social and Political Study was able to hire thousands of cyclo-drivers, dance hall girls ("taxi dancers"), and street vendors as part-time spies for an intelligence network that soon covered every block of Saigon-Cholon. Instead of maintaining surveillance on a suspect by having him followed, Tuyen simply passed the word to his "door-to-door" intelligence net and got back precise, detailed reports on the subject's movements, meetings, and conversations. Some observers think that Tuyen may have had as many as a hundred thousand full- and part-time agents operating in South Vietnam. (23)(24) Through this remarkable system Tuyen kept detailed dossiers on every important figure in the country, including particularly complete files on Diem, Madame Nhu, and Nhu himself which he sent out of the country as a form of personal "life insurance.

Since Tuyen was responsible for much of the Diem regime's foreign intelligence work, he was able to disguise his narcotics dealings in Laos under the cover of ordinary intelligence work. Vietnamese undercover operations in Laos were primarily directed at North Vietnam and were related to a CIA program started in 1954. Under the direction of Col. Edward Lansdale and his team of CIA men, two small groups of North Vietnamese had been recruited as agents, smuggled out of Haiphong, trained in Saigon, and then sent back to North Vietnam in 1954-1955. During this same period Civil Air Transport (now Air America) smuggled over eight tons of arms and equipment into Haiphong in the regular refugee shipments authorized by the Geneva Accords for the eventual use of these teams.(25)

As the refugee exchanges came to an end in May 1955 and the North Vietnamese tightened up their coastal defenses, CIA and Vietnamese intelligence turned to Laos as an alternate infiltration route and listening post. According to Bernard Yoh, then an intelligence adviser to President Diem, Tuyen sent ten to twelve agents into Laos in 1958 after they had completed an extensive training course under the supervision of Col. Le Quang Tung's Special Forces. When Yoh sent one of his own intelligence teams into Laos to work with Tuyen's agents during the Laotian crisis of 1961, he was amazed at their incompetence. Yoh could not understand why agents without radio training or knowledge of even the most basic undercover procedures would have been kept in the field for so long, until he discovered that their major responsibility was smuggling gold and opium into South Vietnam. (26) After purchasing opium and gold, Tuyen's agents had it delivered to airports in southern Laos near Savannakhet or Pakse. There it was picked up and flown to Saigon by Vietnamese air force transports which were then under the command of Nguyen Cao Ky, whose official assignment was shuttling Tuyen's espionage agents back and forth from Laos. (27) Dr. Tuyen also used diplomatic personnel to smuggle Laotian opium into South Vietnam. In 1958 the director of Vietnam's psychological warfare department transferred one of his undercover agents to the Foreign Ministry and sent him to Pakse, Laos, as a consular official to direct clandestine operations against North Vietnam. Within three months Tuyen, using a little psychological warfare himself, had recruited the agent for his smuggling apparatus and had him sending regular opium shipments to Saigon in his diplomatic pouch. (28)

Despite the considerable efforts Dr. Tuyen had devoted to organizing these "intelligence activities" they remained a rather meager supplement to the Corsican opium shipments until May 1961 when newly elected President John F. Kennedy authorized the implementation of an interdepartmental task force report which suggested:

In North Vietnam, using the foundation established by intelligence operations, form networks of resistance, covert bases and teams for sabotage and light harassment. A capability should be created by MAAG in the South Vietnamese Army to conduct Ranger raids and similar military actions in North Vietnam as might prove necessary or appropriate. Such actions should try to avoid the outbreak of extensive resistance or insurrection which could not be supported to the extent necessary to stave off repression.

Conduct overflights for dropping of leaflets to harass the Communists and to maintain the morale of North Vietnamese population . . . .(29)

The CIA was assigned to carry out this mission and incorporated a fictitious parent company in Washington, D.C., Aviation Investors, to provide a cover for its operational company, Vietnam Air Transport. The agency dubbed the project "Operation Haylift." Vietnam Air Transport, or VIAT, hired Col. Nguyen Cao Ky and selected members of his First Transport Group to fly CIA commandos into North Vietnam via Laos or the Gulf of Tonkin. (30)

However, Colonel Ky was dismissed from Operation Haylift less than two years after it began, One of VIAT's technical employees, Mr. S. M. Mustard, reported to a U.S. Senate subcommittee in 1968 that "Col. Ky took advantage of this situation to fly opium from Laos to Saigon. (31) Since some of the commandos hired by the CIA were Dr. Tuyen's intelligence agents, it was certainly credible that Ky was involved with the opium and gold traffic. Mustard implied that the CIA had fired Ky for his direct involvement in this traffic; Col. Do Khac Mai, then deputy commander of the air force, says that Ky was fired for another reason. Some time after one of its two-engine C-47s crashed off the North Vietnamese coast, VIAT brought in four-engine C-54 aircraft from Taiwan. Since Colonel Ky had only been trained in two-engine aircraft he had to make a number of training flights to upgrade his skills; on one of these occasions he took some Cholon dance hall girls for a spin over the city. This romantic hayride was in violation of Operation Haylift's strict security, and the CIA speedily replaced Ky and his transport pilots with Nationalist Chinese ground crews and pilots. (32) This change probably reduced the effectiveness of Dr. Tuyen's Laotian "intelligence activities," and forced Nhu to rely more heavily on the Corsican charter airlines for regular opium shipments.

Even though the opium traffic and other forms of corruption generated enormous amounts of money for Nhu's police state, nothing could keep the regime in power once the Americans had turned against it. For several years they had been frustrated with Diem's failure to fight corruption, In March 1961 a national intelligence estimate done for President Kennedy complained of President Diem:

"Many feel that he is unable to rally the people in the fight against the Communists because of his reliance on one-man rule, his toleration of corruption even to his immediate entourage, and his refusal to relax a rigid system of controls."(33)

The outgoing ambassador, Elbridge Durbrow, had made many of the same complaints, and in a cable to the secretary of state, he urged tha Dr. Tuyen and Nhu be sent out of the country and their secret police be disbanded. He also suggested that Diem make a public announcement of disbandment of Can Lao party or at least its surfacing, with names and positions of all members made known publicly. Purpose of this step would be to eliminate atmosphere of fear and suspicion and reduce public belief in favoritism and corruption, all of which the party's semi-covert status has given rise to.(34)

In essence, Nhu had reverted to the Binh Xuyen's formula for combating urban guerrilla warfare by using systematic corruption to finance intelligence and counterinsurgency operations. However, the Americans could not understand what Nhu was trying to do and kept urging him to initiate "reforms." When Nhu flatly refused, the Americans tried to persuade President Diem to send his brother out of the country. And when Diem agreed, but then backed away from his promise, the U.S. Embassy decided to overthrow Diem.

On November 1, 1963, with the full support of the U.S. Embassy, a group of Vietnamese generals launched a coup, and within a matter of hours captured the capital and executed Diem and Nhu. But the coup not only toppled the Diem regime, it destroyed Nhu's police state apparatus and its supporting system of corruption, which, if it had failed to stop the National Liberation Front (NLF) in the countryside, at least guaranteed a high degree of "security" in Saigon and the surrounding area.

Shortly after the coup the chairman of the NLF, Nguyen Huu Tho, told an Australian journalist that the dismantling of the police state had been "gifts from heaven" for the revolutionary movement:

"... the police apparatus set up over the years with great care by Diem is utterly shattered, especially at the base. The principal chiefs of security and the secret police on which mainly depended the protection of the regime and the repression of the revolutionary Communist Viet Cong movement, have been eliminated, purged."(35)

Within three months after the anti-Diem coup, General Nguyen Khanh emerged as Saigon's new "strong man" and dominated South Vietnam's political life from January 1964 until he, too, fell from grace, and went into exile twelve months later. Although a skillful coup plotter, General Khanh was incapable of using power once he got into office. Under his leadership, Saigon politics became an endless quadrille of coups, countercoups, and demicoups, Khanh failed to build up any sort of intelligence structure to replace Nhu's secret police, and during this critical period none of Saigon's rival factions managed to centralize the opium traffic or other forms of corruption. The political chaos was so severe that serious pacification work ground to a halt in the countryside, and Saigon became an open city.(36) By mid 1964 NLF-controlled territory encircled the city, and NLF cadres entered Saigon almost at will.

To combat growing security problems in the capital district, American pacification experts dreamed up the Hop Tac ("cooperation") program. As originally conceived, South Vietnamese troops would sweep the areas surrounding Saigon and build a "giant oil spot" of pacified territory that would spread outward from the capital region to cover the Mekong Delta and eventually all of South Vietnam. The program was launched with a good deal of fanfare on September 12, 1964, as South Vietnamese infantry plunged into some NLF controlled pineapple fields southwest of Saigon. Everything ran like clockwork for two days until infantry units suddenly broke off contact with the NLF and charged into Saigon to take part in one of the many unsuccessful coups that took place with distressing frequency during General Khanh's twelve-month interregnum.(37)

Although presidential adviser McGeorge Bundy claimed that Hop Tac "has certainly prevented any strangling siege of Saigon, (38) the program was an unqualified failure. On Christmas Eve, 1964, the NLF blew up the U.S. officers' club in Saigon, killing two Americans and wounding fifty-eight more.(39) On March 29, 1965, NLF sappers blew up the U.S. Embassy.(40) In late 1965, one U S. correspondent, Robert Shaplen of The New Yorker, reported that Saigon's security was rapidly deteriorating:

These grave economic and social conditions [the influx of refugees, etc.] have furnished the Vietcong with an opportunity to cause trouble, and squads of Communist propagandists, saboteurs, and terrorists are infiltrating the city in growing numbers; it is even said that the equivalent of a Vietcong battalion of Saigon youth has been taken out, trained, and then sent back here to lie low, with hidden arms, awaiting orders. . . . The National Liberation Front radio is still calling for acts of terror ("One American killed for every city block"), citing the continued use by the Americans of tear gas and cropdestroying chemical sprays, together with the bombing of civilians, as justification for reprisals . . . . (41)

Soon after Henry Cabot Lodge took office as ambassador to South Vietnam for the second time in August 1965, an Embassy briefer told him that the Hop Tac program was a total failure. Massive sweeps around the capital's perimeter did little to improve Saigon's internal security because

The threat-which is substantial-comes from the enemy within, and the solution does not lie within the responsibility of the Bop Tac Council: it is a problem for the Saigon police and intelligence communities. (42)

In other words, modern counterinsurgency planning with its computers and game theories had failed to do the job, and it was time to go back to the tried-and-true methods of Ngo Dinh Nhu and the Binh Xuyen bandits. When the French government faced Viet Minh terrorist assaults and bombings in 1947, they allied themselves with the bullnecked Bay Vien, giving this notorious river pirate a free hand to organize the city's corruption on an unprecedented scale. Confronted with similar problems in 1965-1966 and realizing the nature of their mistake with Diem and Nhu, Ambassador Lodge and the U.S. mission decided to give their full support to Premier Nguyen Cao Ky and his power broker, Gen. Nguyen Ngoc Loan. The fuzzy-cheeked Ky had a dubious reputation in some circles, and President Diem referred to him as "that cowboy," a term Vietnamese then reserved -,for only the most flamboyant of Cholon gangsters. (43)


The New Opium Monopoly

Premier Ky's air force career began when he returned from instrument flying school in France with his certification as a transport pilot and a French wife. As the Americans began to push the French out of air force advisory positions in 1955, the French attempted to bolster their wavering influence by promoting officers with strong proFrench loyalties to key positions. Since Lieut. Tran Van Ho was a French citizen, he was promoted to colonel "almost overnight" and became the first ethnic Vietnamese to command the Vietnamese air force. Lieutenant Ky's French wife was adequate proof of his loyalty, and despite his relative youth and inexperience, he was appointed commander of the First Transport Squadron. In 1956 Ky was also appointed commander of Saigon's Tan Son Nhut Air Base, and his squadron, which was based there, was doubled to a total of thirty-two C-47s and renamed the First Transport Group. (44) While shuttling back and forth across the countryside in the lumbering C-47s may have lacked the dash and romance of fighter flying, it did have its advantages. Ky's responsibility for transporting government officials and generals provided him with useful political contacts, and with thirty-two planes at his command, Ky had the largest commercial air fleet in South Vietnam. Ky lost command of the Tan Son Nhut Air Base, allegedly, because of the criticism about the management (or mismanagement) of the base mess hall by his sister, Madame Nguyen Thi Ly. But he remained in control of the First Transport Group until the anti-Diem coup of November 1963. Then Ky engaged in some dextrous political intrigue and, despite his lack of credentials as a coup plotter, emerged as commander of the entire Vietnamese air force only six weeks after Diem's overthrow. (45)

As air force commander, Air Vice-Marshal Ky became one of the most active of the "young Turks" who made Saigon political life so chaotic under General Khanh's brief and erratic leadership. While the air force did not have the power to initiate a coup singlehandedly, as an armored or infantry division did, its ability to strafe the roads leading into Saigon and block the movement of everybody else's coup divisions gave Ky a virtual veto power. After the air force crushed the abortive September 13, 1964, coup against General Khanh, Ky's political star began to rise. On June 19, 1965, the ten-man National Leadership Committee headed by Gen. Nguyen Van Thieu appointed Ky to the office of premier, the highest political office in South Vietnam. (46)

Although he was enormously popular with the air force, Ky had neither an independent political base nor any claim to leadership of a genuine mass movement when he took office. A relative newcomer to politics, Ky was hardly known outside elite circles. Also, Ky seemed to lack the money, the connections, and the capacity for intrigue necessary to build up an effective ruling faction and restore Saigon's security. But he solved these problems in the traditional Vietnamese manner by choosing a power broker, a "heavy" as Machiavellian and corrupt as Bay Vien or Ngo Dinh Nhu-Gen. Nguyen Ngoc Loan.

Loan was easily the brightest of the young air force officers. His career was marked by rapid advancement and assignment to such technically demanding jobs as commander of the Light Observation Group and assistant commander of the Tactical Operations Center. (47) Loan also had served as deputy commander to Ky, an old classmate and friend, in the aftermath of the anti-Diem coup. Shortly after Ky took office he appointed Loan director of the Military Security Service (MSS). Since MSS was responsible for anticorruption investigations inside the military, Loan was in an excellent position to protect members of Ky's faction. Several months later Loan's power increased significantly when he was also appointed director of the Central Intelligence Organization (CIO), South Vietnam's CIA, without being asked to resign from the MSS. Finally, in April 1966, Premier Ky announced that General Loan had been appointed to an additional post--directorgeneral of the National Police. (48) Only after Loan had consolidated his position and handpicked his successors did he "step down" as director of the MSS and CIO. Not even under Diem had one man controlled so many police and intelligence agencies.

In the appointment of Loan to all three posts, the interests of Ky and the Americans coincided. While Premier Ky was using Loan to build up a political machine, the U.S. mission was happy to see a strong man take command of "Saigon's police and intelligence communities" to drive the NLF out of the capital. Lt. Col. Lucien Conein says that Loan was given whole-hearted U.S. support because

We wanted effective security in Saigon above all else, and Loan could provide that security. Loan's activities were placed beyond reproach and the whole three-tiered US advisory structure at the district, province and national level was placed at his disposal. (49) The liberal naivete that had marked the Kennedy diplomats in the last few months of Diem's regime was decidedly absent. Gone were the qualms about "police state" tactics and daydreams that Saigon could be secure and politics "stabilized" without using funds available from the control of Saigon's lucrative rackets.

With the encouragement of Ky and the tacit support of the U.S. mission, Loan (whom the Americans called "Laughing Larry" because he frequently burst into a high-pitched giggle) revived the Binh Xuyen formula for using systematic corruption to combat urban guerrilla warfare. Rather than purging the police and intelligence bureaus, Loan forged an alliance with the specialists who had been running these agencies for the last ten to fifteen years. According to Lieutenant Colonel Conein, "the same professionals who organized corruption for Diem and Nhu were still in charge of police and intelligence. Loan simply passed the word among these guys and put the old system back together again. (50)

Under Loan's direction, Saigon's security improved markedly. With the "door-todoor" surveillance network perfected by Dr. Tuyen back in action, police were soon swamped with information. (51) A U.S. Embassy official, Charles Sweet, who was then engaged in urban pacification work, recalls that in 1965 the NLF was actually holding daytime rallies in the sixth, seventh, and eighth districts of Cholon and terrorist incidents were running over forty a month in district 8 alone. (See Map 4, page 111.) Loan's methods were so effective, however, that from October 1966 until January 1968 there was not a single terrorist incident in district 8. (52) In January 1968, correspondent Robert Shaplen reported that Loan "has done what is generally regarded as a good job of tracking down Communist terrorists in Saigon .... (53)

Putting "the old system back together again," of course, meant reviving largescale corruption to finance the cash rewards paid to these part-time agents whenever they delivered information. Loan and the police intelligence professionals systematized the corruption, regulating how much each particular agency would collect, how much each officer would skim off for his personal use, and what percentage would be turned over to Ky's political machine. Excessive individual corruption was rooted out, and Saigon-Cholon's vice rackets, protection rackets, and payoffs were strictly controlled. After several years of watching Loan's system in action, Charles Sweet feels that there were four major sources of graft in South Vietnam: (1) sale of government jobs by generals or their wives, (2) administrative corruption (graft, kickbacks, bribes, etc.), (3) military corruption (theft of goods and payroll frauds), and (4) the opium traffic. And out of the four, Sweet has concluded that the opium traffic was undeniably the most important source of illicit revenue. (54)

As Premier Ky's power broker, Loan merely supervised all of the various forms of corruption at a general administrative level; he usually left the mundane problems of organization and management of individual rackets to the trusted assistants.

In early 1966 General Loan appointed a rather mysterious Saigon politician named Nguyen Thanh Tung (known as "Mai Den" or "Black Mai") director of the Foreign Intelligence Bureau of the Central Intelligence Organization. Mai Den is one of those perennial Vietnamese plotters who have changed sides so many times in the last twenty-five years that nobody really knows too much about them. It is generally believed that Mai Den began his checkered career as a Viet Minh intelligence agent in the late 1940s, became a French agent in Hanoi in the 1950s, and joined Dr. Tuyen's secret police after the French withdrawal. When the Diem government collapsed, he became a close political adviser to the powerful I Corps commander, Gen. Nguyen Chanh Thi. However, when General Thi clashed with Premier Ky during the Buddhist crisis of 1966, Mai Den began supplying General Loan with information on Thi's movements and plans. After General Thi's downfall in April 1966, Loan rewarded Mai Den by appointing him to the Foreign Intelligence Bureau. Although nominally responsible for foreign espionage operations, allegedly Mai Den's real job was to reorganize opium and gold smuggling between Saigon and Laos.(55)

Through his control over foreign intelligence and consular appointments, Mai Den would have had no difficulty in placing a sufficient number of contact men in Laos. However, the Vietnamese military attache in Vientiane, Lt. Col. Khu Duc Nung, (56) and Premier Ky's sister in Pakse, Mrs. Nguyen Thi Ly (who managed the Sedone Palace Hotel), were Mai Den's probable contacts.

Once opium had been purchased, repacked for shipment, and delivered to a pickup point in Laos (usually Savannakhet or Pakse), a number of methods were used to smuggle it into South Vietnam. Although no longer as important as in the past, airdrops in the Central Highlands continued. In August 1966, for example, U.S. Green Berets on operations in the hills north of Pleiku were startled when their hill tribe allies presented them with a bundle of raw opium dropped by a passing aircraft whose pilot evidently mistook the tribal guerrillas for his contact men.(57) Ky's man in the Central Highlands was 11 Corps commander Gen. Vinh Loc.58 He was posted there in 1965 and inherited all the benefits of such a post. His predecessor, a notoriously corrupt general, bragged to colleagues of making five thousand dollars for every ton of opium dropped into the Central Highlands.

While Central Highland airdrops declined in importance and overland narcotics smuggling from Cambodia had not yet developed, large quantities of raw opium were smuggled into Saigon on regular commercial air flights from Laos. The customs service at Tan Son Nhut was rampantly corrupt, and Customs Director Nguyen Van Loc was an important cog in the Loan fund-raising machinery. In a November 1967 report, George Roberts, then chief of the U.S. customs advisory team in Saigon, described the extent of corruption and smuggling in South Vietnam:

"Despite four years of observation of a typically corruption ridden agency of the GVN [Government of Vietnam], the Customs Service, I still could take very few persons into a regular court of law with the solid evidence I possess and stand much of a chance of convicting them on that evidence. The institution of corruption is so much a built in part of the government processes that it is shielded by its very pervasiveness. It is so much a part of things that one can't separate "honest" actions from "dishonest" ones. Just what is corruption in Vietnam? From my personal observations, it is the following:

The very high officials who condone, and engage in smuggling, not only of dutiable merchandise, but undercut the nation's economy by smuggling gold and worst of all, that unmitigated evil--opium and other narcotics;

The police officials whose "check points" are synonymous with "shakedown points";

The high government official who advises his lower echelons of employees of the monthly "kick in" that he requires from each of them; . . .

The customs official who sells to the highest bidder the privilege of holding down for a specific time the position where the graft and loot possibilities are the greatest."(58)

It appeared that Customs Director Loc devoted much of his energies to organizing the gold and opium traffic between Vientiane, Laos, and Saigon. When 114 kilos of gold were intercepted at Tan Son Nhut Airport coming from Vientiane, George Roberts reported to U.S. customs in Washington that "There are unfortunate political overtones and implications of culpability on the part of highly placed personages. (59), (60) Director Loc also used his political connections to have his attractive niece hired as a stewardess on Royal Air Lao, which flew several times a week between Vientiane and Saigon, and used her as a courier for gold and opium shipments. When U.S. customs advisers at Tan Son Nhut ordered a search of her luggage in December 1967 as she stepped off a Royal Air Lao flight from Vientiane they discovered two hundred kilos of raw opium.(61) In his monthly report to Washington, George Roberts concluded that Director Loc was "promoting the day-to-day system of payoffs in certain areas of Customs' activities."(62)

After Roberts filed a number of hard-hitting reports with the U.S. mission, Ambassador Ellsworth Bunker called him and members of the customs advisory team to the Embassy to discuss Vietnamese "involvement in gold and narcotics smuggling." (63) The Public Administration Ad Hoc Committee on Corruption in Vietnam was formed to deal with the problem. Although Roberts admonished the committee, saying "we must stop burying our heads in the sand like ostriches" when faced with corruption and smuggling, and begged, "Above all, don't make this a classified subject and thereby bury it," the U.S. Embassy decided to do just that. Embassy officials whom Roberts described as advocates of "the noble kid glove concept of hearts and minds" had decided not to interfere with smuggling or large-scale corruption because of "pressures which are too well known to require enumeration."(64)

Frustrated at the Embassy's failure to take action, an unknown member of U.S. customs leaked some of Roberts' reports on corruption to a Senate subcommittee chaired by Sen. Albert Gruening of Alaska. When Senator Gruening declared in February 1968 that the Saigon government was "so corrupt and graft-ridden that it cannot begin to command the loyalty and respect of its citizens," (65) U.S. officials in Saigon defended the Thieu-Ky regime by saying that "it had not been proved that South Vietnam's leaders are guilty of receiving 'rake-offs." (66) A month later Senator Gruening released evidence of Ky's 1961-1962 opium trafficking, but the U.S. Embassy protected Ky from further investigations by issuing a flat denial of the senator's charges. (67)

While these sensational exposes of smuggling at Tan Son Nhut's civilian terminal grabbed the headlines, only a few hundred yards down the runway VNAF C-47 military transports loaded with Laotian opium were landing unnoticed. Ky did not relinquish command of the air force until November 1967, and even then he continued to make all of the important promotions and assignments through a network of loyal officers who still regarded him as the real commander. Both as premier and vice-president, Air Vice-Marshal Ky refused the various official residences offered him and instead used $200,000 of government money to build a modern, air-conditioned mansion right in the middle of Tan Son Nhut Air Base. The "vice-presidential palace," a pastelcolored monstrosity resembling a Los Angeles condominium, is only a few steps away from Tan Son Nhut's runway, where helicopters sit on twentyfourhour alert, and a minute down the road from the headquarters of his old unit, the First Transport Group. As might be expected, Ky's staunchest supporters were the men of the First Transport Group. Its commander, Col. Luu Kim Cuong, was considered by many informed observers to be the unofficial "acting commander" of the entire air force and a principal in the opium traffic. Since command of the First Transport Group and Tan Son Nhut Air Base were consolidated in 1964, Colonel Cuong not only had aircraft to fly from southern Laos and the Central Highlands (the major opium routes), but also controlled the air base security guards and thus could prevent any search of the C-47s.(68)

Once it reaches Saigon safely, opium is sold to Chinese syndicates who take care of such details as refining and distribution. Loan's police used their efficient organization to "license" and shake down the thousands of illicit opium dens concentrated in the fifth, sixth, and seventh wards of Cholon and scattered evenly throughout the rest of the capital district.

Although morphine base exports to Europe had been relatively small during the Diem administration, they increased during Ky's administration as Turkey began to phase out production in 1967-1968. And according to Lt. Col. Lucien Conein, Loan profited from this change:

"Loan organized the opium exports once more as a part of the system of corruption. He contacted the Corsicans and Chinese, telling them they could begin to export Laos's opium from Saigon if they paid a fixed price to Ky's political organization." (69)

Most of the narcotics exported from South Vietnam-whether morphine base to Europe or raw opium to other parts of Southeast Asia-were shipped from Saigon Port on oceangoing freighters. (Also, Saigon was probably a port of entry for drugs smuggled into South Vietnam from Thailand.) The director of the Saigon port authority during this period was Premier Ky's brother-in-law and close political adviser, Lt. Col. Pho Quoc Chu (Ky had divorced his French wife and married a Vietnamese).(70) Under Lieutenant Colonel Chu's supervision all of the trained port officers were systematically purged, and in October 1967 the chief U.S. customs adviser reported that the port authority "is now a solid coterie of GVN [Government of Vietnam military officers. (71) However, compared to the fortunes that could Se made from the theft of military equipment, commodities, and manufactured goods, opium was probably not that important.

Loan and Ky were no doubt concerned about the critical security situation in Saigon when they took office, but their real goal in building up the police state apparatus was political power. Often they seemed to forget who their "enemy" was supposed to be, and utilized much of their police-intelligence network to attack rival political and military factions. Aside from his summary execution of an NLF suspect in front of U.S. television cameras during the 1968 Tet offensive, General Loan is probably best known to the world for his unique method of breaking up legislative logjams during the 1967 election campaign. A member of the Constituent Assembly who proposed a law that would have excluded Ky from the upcoming elections was murdered. (72) widow publicly accused General Loan of having ordered the assassination. When the assembly balked at approving the ThieuKy slate unless they complied with the election law, General Loan marched into the balcony of the assembly chamber with two armed guards, and the opposition evaporated . (73) When the assembly hesitated at validating the fraudulent tactics the Thieu-Ky slate had used to gain their victory in the September elections, General Loan and his gunmen stormed into the balcony, and once again the representatives saw the error of their ways. (74)

Under General Loan's supervision, the Ky machine systematically reorganized the network of kickbacks on the opium traffic and built up an organization many observers feel was even more comprehensive than Nhu's candestine apparatus. Nhu had depended on the Corsican syndicates to manage most of the opium smuggling between Laos and Saigon, but their charter airlines were evicted from Laos in early 1965. This forced the Ky apparatus to become much more directly involved in actual smuggling than Nhu's secret police had ever been. Through personal contacts in Laos, bulk quantities of refined and raw opium were shipped to airports in southern Laos, where they were picked up and smuggled into South Vietnam by the air force transport wing. The Vietnamese Customs Service was also controlled by the Ky machine, and substantial quantities of opium were flown directly into Saigon on regular commercial air flights from Laos , , Once the opium reached the capital it was distributed to smoking dens throughout the city that were protected by General Loan's police force. Finally, through its control over the Saigon port authority, the Ky apparatus was able to derive considerable revenues by taxing Corsican morphine exports to Europe and Chinese opium and morphine shipments to Hong Kong. Despite the growing importance of morphine exports, Ky's machine was still largely concerned with its own domestic opium market. The GI heroin epidemic was still five years in the future.

The Thieu-Ky Rivalry

Politics built Premier Ky's powerful syndicate, and politics weakened it. His meteoric political rise had enabled his power broker, General Loan, to take control of the police-intelligence bureaucracy and use its burgeoning resources to increase their revenue from the lucrative rackets -which in Saigon always includes the flourishing narcotics trade. However, in 1967 simmering animosity between Premier Ky and Gen. Nguyen Van Thieu, then head of Saigon's military junta, broke into open political warfare. Outmaneuvered by this calculating rival at every turn in this heated conflict, Ky's apparatus emerged from two years of bitter internecine warfare shorn of much of its political power and its monopoly over kickbacks from the opium trade. The Thieu-Ky rivalry was a clash between ambitious men, competing political factions, and conflicting personalities. In both his behind-the-scenes machinations and his public appearances, Air ViceMarshal Ky displayed all the bravado and flair of a cocky fighter pilot. Arrayed in his midnight black jumpsuit, Ky liked to barnstorm about the countryside berating his opponents for their corruption and issuing a call for reforms. While his flamboyant behavior earned him the affection of air force officers, it often caused him serious political embarrassment, such as the time he declared his profound admiration for Adolf Hitler. In contrast, Thieu was a cunning, almost Machiavellian political operator, and demonstrated all the calculating sobriety of a master strategist. Although Thieu's tepid, usually dull, public appearances won him little popular support, years of patient politicking inside the armed forces built him a solid political base among the army and navy officer corps.

Although Thieu and Ky managed to present a united front during the 1967 elections, their underlying enmity erupted into bitter factional warfare once their electoral victory removed the threat of civilian government. Thieu and Ky had only agreed to bury their differences temporarily and run on the same ticket after forty-eight Vietnamese generals argued behind closed doors for three full days in June 1967. On the second day of hysterical political infighting, Thieu won the presidential slot after making a scathing denunciation of police corruption in Saigon, a none-too-subtle way of attacking Loan and Ky, which reduced the air vice-marshal to tears and caused him to accept the number-two position on the ticket. (75) But the two leaders campaigned separately, and once the election was over hostilities quickly revived.

Since the constitution gave the president enormous powers and the vicepresident very little appointive or administrative authority, Ky should not have been in a position to challenge Thieu. However, Loan's gargantuan policeintelligence machine remained intact, and his loyalty to Ky made the vicepresident a worthy rival. In a report to Ambassador Bunker in May 1968, Gen. Edward Lansdale explained the dynamics of the Thieu-Ky rivalry:

"This relationship may be summed Lip as follows: ( I ) The power to formulate and execute policies and programs which should be Thieu's as the top executive leader remains divided between Thieu and Ky, athough Thieu has more power than Ky. (2) Thieu's influence as the elected political leader of the country, in terms of achieving the support of the National Assembly and the political elite, is considerably limited by Ky's influence . . . (Suppose, for example, a U.S. President in the midst of a major war had as Vice President a leader who had been the previous President, who controlled the FBI, CIA, and DIA [Defense Intelligence Agency], who had more influence with the JCS [Joint Chiefs of Staff] than did the President, who had as much influence in Congress as the President, who had his own base of political support outside Congress, and who neither trusted nor respected the President.)" (76)

Lansdale went on to say that "Loan has access to substantial funds through extra legal money-collecting systems of the police /intelligence apparatus," (77) which, in large part, formed the basis of Ky's political strength. But, Lansdale added, "Thieu acts as though his source of money is limited and has not used confidential funds with the flair of Ky. (78)

Since money is the key to victory in interfactional contests of this kind, the Thieu-Ky rivalry became an underground battle for lucrative administrative positions and key police-intelligence posts. Ky had used two years of executive authority as premier to appoint loyal followers to high office and corner most of the lucrative posts, thereby building up a powerful financial apparatus. Now that President Thieu had a monopoly on appointive authority, he tried to gain financial strength gradually by forcing Ky's men out of office one by one and replacing them with his own followers.

Thieu's first attack was on the customs service, where Director Loc's notorious reputation made the Ky apparatus particularly vulnerable. The first tactic, as it has often been in these interfactional battles, was to use the Americans to get rid of an opponent. Only three months after the elections, customs adviser George Roberts reported that his American assistants were getting inside information on Director Loc's activities because "this was also a period of intense inter-organizational, political infighting. Loc was vulnerable, and many of his lieutenants considered the time right for confidential disclosure to their counterparts in this unit." (79) Although the disclosures contained no real evidence, they forced Director Loc to counterattack, and "he reacted with something resembling bravado." (80) He requested U.S. customs advisers to come forward with information on corruption, invited them to augment their staff at Tan Son Nhut, where opium and gold smuggling had first aroused the controversy, and launched a series of investigations into customs corruption. When President Thieu's new minister of finance had taken office, he had passed the word that Director Loc was on the way out. But Loc met with the minister, pointed out all of his excellent anticorruption work, and insisted on staying in office. But then, as Roberts reported to Washington, Thieu's faction delivered the final blow:

"Now, to absolutely assure Loc's destruction, his enemies have turned to the local press, giving them the same information they had earlier given to this unit. The press, making liberal use of innuendo and implication, had presented a series of front page articles on corruption in Customs. They are a strong indictment of Director Loc."(81)

Several weeks later Loc was fired from his job (82) and the way was open for the Thieu faction to take control over the traffic at Tan Son Nhut Airport.

The Thieu and Ky factions were digging in for all-out war, and it seemed that these scandals would continue for months, or even years. However, on January 31, 1968, the NLF and the North Vietnamese army launched the Tet offensive and 67,000 troops attacked 102 towns and cities across South Vietnam, including Saigon itself. The intense fighting, which continued inside the cities for several months, disrupted politics asusual while the government dropped everything to drive the NLF back into the rice paddies. But not only did the Tet fighting reduce much of Saigon-Cholon to rubble, it decimated the ranks of Vice-President Ky's trusted financial cadres and crippled his political machine. In less than one month of fighting during the "second wave" of the Tet offensive, no less than nine of his key fund raisers were killed or wounded.

General Loan himself was seriously wounded on May 5 while charging down a blind alley after a surrounded NLF soldier. An AK-47 bullet severed the main artery in his right leg and he was forced to resign from command of the police to undergo surgery and months of hospitalization. (83) The next day Col. Luu Kim Cuong, commander of the air force transport wing and an important figure in Ky's network, was shot and killed while on operations on the outskirts of Saigon. (84)

While these two incidents would have been enough to seriously weaken Ky's apparatus, the mysterious incident that followed a month later dealt a crippling blow. On the afternoon of June 2, 1968, a coterie of Ky's prominent followers were meeting, for reasons never satisfactorily explained, in a command post in Cholon. At about 6:00 P.M. a U.S. helicopter, prowling the skies above the ravaged Chinese quarter on the lookout for NLF units, attacked the building, rocketing and strafing it. Among the dead were: Lt. Col. Pho Quoc Chu; director of the Saigon port authority and Ky's brother-in-law. Lt. Col. Dao Ba Phuoc, commander of the 5th Rangers, which were assigned to the Capital Military District. Lt. Col. Nguyen Van Luan, director of the Saigon Municipal Police. Major Le Ngoc Tru, General Loan's right-hand man and police commissioner of the fifth district. Major Nguyen Bao Thuy, special assistant to the mayor of Saigon. Moreover, General Loan's brother-in-law, Lt. Col. Van Van Cua, the mayor of Saigon, suffered a shattered arm and resigned to undergo four months of hospitalization. (85)

These represented the financial foundation of Ky's political machine, and once they were gone his apparatus began to crumble. As vicepresident, Ky had no authority to appoint anyone to office, and all of the nine posts vacated by these casualties, with the exception of the air force transport command, were given to Thieu's men. On June 6 a loyal Thieu follower, Col, Tran Van Hai, was appointed director-general of the National Police and immediately began a rigorous purge of all of Loan's men in the lower echelons. (86) The Saigon press reported that 150 secret police had been fired and a number of these had also been arrested. (87)On June 15 Colonel Hai delivered a decisive blow to Ky's control over the police by dismissing eight out of Saigon's eleven district police commissioners. (88)

As Ky's apparatus weakened, his political fortunes went into a tailspin: loss of minor district and municipal police posts meant he could not collect protection money from ordinary businesses or from the rackets; as the "extra legal money-collecting systems of the police/intelligence apparatus" began to run dry, he could no longer counter President Thieu's legal appointive power with gifts; and once the opposition weakened, President Thieu began to fire many high-ranking pro-Ky police-intelligence officials. (89)

While the quiet desertion of the ant-army bureaucracy to the Thieu machine was almost imperceptible to outside observers, the desertion of Ky's supporters in the National Assembly's cash-and-carry lower house was scandalously obvious. Shortly after the October 1967 parliamentary elections were over and the National Assembly convened for the first time since the downfall of Diem, the Thieu and Ky machines had begun competing for support in the lower house. (90) Using money provided by General Loan, Ky had purchased a large bloc of forty-two deputies, the Democratic Bloc, which included Buddhists, southern intellectuals, and even a few hill tribesmen. Since Thieu lacked Ky's "confidential funds," he had allied himself with a small twenty-one-man bloc, the Independence Bloc, comprised mainly of right-wing Catholics from northern and central Vietnam. (91) Both men were paying each of their deputies illegal supplemental salaries of $4,000 to $6,000 a year, in addition to bribes ranging up to $1,800 on every important ballot. (92) At a minimum it must have been costing Ky $15,000 to $20,000 a month just to keep his deputies on the payroll, not to mention outlays of over $100,000 for the particularly critical showdown votes that came along once or twice a year. In May 1968 General Lansdale reported to Ambassador Bunker that "Thieu's efforts . . . to create a base of support in both Houses have been made difficult by Ky's influence among some important senators . . . and Ky's influence over the Democratic Bloc in the Lower House." (93) However, throughout the summer of 1968 Ky's financial difficulties forced him to cut back the payroll, and representatives began drifting away from his bloc.

As Thieu's financial position strengthened throughout the summer, his assistant in charge of relations with the National Assembly approached a number of deputies and reportedly offered them from $1,260 to $2,540 to join a new proThieu faction called the People's Progress Bloc. One deputy explained that "in the last few months, the activities of the lower house have become less and less productive because a large number of deputies have formed a bloc for personal interests instead of political credits." In September The Washington Post reported:

"The "Democratic Bloc," loyal to Vice President Ky, now retains 25 out of its 42 members. Thieu and Ky have been privately at odds since 1966. Thieu's ascendancy over his only potential rival has grown substantively in recent months.

The severe blow dealt to the Ky bloc in the House has not been mentioned extensively in the local press except in the daily Xay Dung (To Construct), which is a Catholic, pro-Ky paper." (94)

These realignments in the balance of political power had an impact on the opium traffic. Despite his precipitous political decline, Air ViceMarshal Ky retained control over the air force, particularly the transport wing. Recently, the air force's transport wing has been identified as one of the most active participants in South Vietnam's heroin smuggling (see pages 187-188). Gen. Tran Thien Khiem, minister of the interior (who was to emerge as a major faction leader himself when he became prime minister in September 1969) and a nominal Thieu supporter, inherited control of Saigon's police apparatus, Tan Son Nhut customs, and the Saigon port authority. However, these noteworthy internal adjustments were soon dwarfed in importance by two dramatic developments in South Vietnam's narcotics trafficthe increase in heroin and morphine base exports destined for the American market and the heroin epidemic among American GIs serving in South Vietnam.

The GI Heroin Epidemic

The sudden burst of heroin addiction among GIs in 1970 was the most important development in Southeast Asia's narcotics traffic since the region attained self-sufficiency in opium production in the late 1950s. By 1968-1969 the Golden Triangle region was harvesting close to one thousand tons of raw opium annually, exporting morphine base to European heroin laboratories, and shipping substantial quantities of narcotics to Hong Kong both for local consumption and reexport to the United States. Although large amounts of chunky, low-grade no. 3 heroin were being produced in Bangkok and, the Golden Triangle for the local market, there were no laboratories anywhere in Southeast Asia capable of producing the fine-grained, 80 to 99 percent pure, no. 4 heroin. However, in late 1969 and early 1970, Golden Triangle laboratories added the final, dangerous ether precipitation process and converted to production of no. 4 heroin. Many of the master chemists who supervised the conversion were Chinese brought in specially from Hong Kong. In a June 1971 report, the CIA said that conversion from no. 3 to no. 4 heroin production in the Golden Triangle "appears to be due to the sudden increase in demand by a large and relatively affluent market in South Vietnam." By mid April 1971 demand for no. 4 heroin both in Vietnam and the United States had increased so quickly that the wholesale price for a kilo jumped to $1,780 from $1,240 the previous September. (95)


Once large quantities of heroin became available to American GIs in Vietnam, heroin addiction spread like a plague. Previously nonexistent in South Vietnam, suddenly no. 4 heroin was everywhere: fourteen-year old girls were selling heroin at roadside stands on the main highway from Saigon to the U.S. army base at Long Binh; Saigon street peddlers stuffed plastic vials of 95 percent pure heroin into the pockets of GIs as they strolled through downtown Saigon; and "mama-sans," or Vietnamese barracks' maids, started carrying a few vials to work for sale to on-duty GIs. With this kind of aggressive sales campaign the results were predictable: in September 1970 army medical officers questioned 3,103 soldiers of the Americal Division and discovered that 11.9 percent had tried heroin since they came to Vietnam and 6.6 percent were still using it on a regular basis. (96) In November a U.S. engineering battalion in the Mekong Delta reported that 14 percent of its troops were on heroin. (97) By mid 1971 U.S. army medical officers were estimating that about 10 to 15 percent, or 25,000 to 37,000 of the lower-ranking enlisted men serving in Vietnam were heroin users. (98)

As base after base was overrun by these ant-armies of heroin pushers with their identical plastic vials, GIs and officers alike started asking themselves why this was happening. Who was behind this heroin plague? The North Vietnamese were frequently blamed, and wild rumors started floating around U.S. installations about huge heroin factories in Hanoi, truck convoys rumbling down the Ho Chi Minh Trail loaded with cases of plastic vials, and heroin-crazed North Vietnamese regulars making suicide charges up the slopes of Khe Sanh with syringes stuck in their arms. However, the U.S. army provost marshal laid such rumors to rest in a 1971 report, which said in part:

"The opium-growing areas of North Vietnam are concentrated in mountainous northern provinces bordering China. Cultivation is closely controlled by the government and none of the crop is believed to be channeled illicitly into international markets. Much of it is probably converted into morphine and used for medical purposes." (99)

Instead, the provost marshal accused high-ranking members of South Vietnam's government of being the top "zone" in a four-tiered heroinpushing pyramid:

"Zone 1, located at the top or apex of the pyramid, contains the financiers, or backers of the illicit drug traffic in all its forms. The people comprising this group may be high level, influential political figures, government leaders, or moneyed ethnic Chinese members of the criminal syndicates now flourishing in the Cholon sector of the City of Saigon. The members comprising this group are the powers behind the scenes who can manipulate, foster, protect, and promote the illicit traffic in drugs." (100)

But why are these powerful South Vietnamese officials-the very people who would lose the most if the heroin plague forced the U.S. army to pull out of South Vietnam completely-promoting and protecting the heroin traffic? The answer is $88 million. Conservatively estimated, each one of the twenty thousand or so GI addicts in Vietnam spends an average of twelve dollars a day on four vials of heroin. Added up over a year this comes out to $88 million, an irresistible amount of money in an impoverished, war-torn country.

In probing the root causes of the heroin plague, the mass media have generally found fault with the U.S. army: the senior NCOs and junior officers came down too hard on strong-smelling marijuana and drove the GIs to heroin, which is odorless, compact, and much harder to detect; the GIs were being forced to fight a war they did not believe in and turned to heroin to blot out intense boredom; and finally, the army itself was an antiquated institution from which the GIs wanted to "escape." Much of this is no doubt true, but the emphasis is misplaced. Officers and NCOs had been cracking down on marijuana for several years without the GIs turning to heroin. (101) By 1968 the emotional malaise of the Vietnam GI was already well developed; the race riot in Long Binh stockade and the My Lai massacre were only the most obvious signs of the problem. But there was no serious heroin use until the spring of 1970, when large quantities were being sold everywhere in Vietnam. And the simple fact is that there would have been no epidemic without this well-organized, comprehensive sales campaign. The real root of the problem does not lie with the GI victim or the army's marijuana crackdown, but with those Vietnamese officials who organized and protected the heroin traffic.

The experience of Maj. Gen. John Cushman in IV Corps, the Mekong Delta, demonstrates the extent of official involvement on the part of the Vietnamese army and utter futility of the U.S. army's " cleanup," "crackdown" approach to dealing with the GI heroin epidemic. When Major General Cushman took command of U.S. forces in the Delta in mid 1971 he was shocked by the seriousness of the heroin problem. U.S. army medical doctors estimated that 15 to 20 percent of the GIs in his command were regular heroin users. (102) Cushman made a desperate bid to stem the rising rate of addiction. Prepared with all the precision and secrecy of a top priority offensive, a massive crackdown on drug use began on June 22 at 5:30 A.M.: all troops were confined to base twenty-four hours a day, guard patrols were stiffened, everyone entering base was searched, and emergency medical clinics were opened. The price of a three-dollar vial of heroin shot up to forty dollars on base and three hundred addicts turned themselves in for treatment. However, within six days the MPs' enthusiasm for searches began to wane, and heroin once more became available. On July 4 confinement was terminated and passes for town were reissued. Within a week the price of heroin was down to four dollars, and over half of those who had turned themselves in were back on drugs. (103)

By late July General Cushman realized that he could never solve the problem until the Vietnamese police and army stopped protecting the pushers. Although he wrote the Vietnamese IV Corps commander, General Truong, threatening to withdraw his "personal support" from the war effort unless Vietnamese officers stopped pushing heroin, he realized it was a futile gesture. The problem was not General Truong. Cushman explained, "Truong has a spotless reputation. I haven't heard the slightest whisper of talk that he is anything other than a man of the highest integrity. I personally admire him and I feel the same about his generals." But he could not say the same for the Vietnamese colonels and majors. While Truong himself is not involved, he "is not a free agent" and lacks the authority to stop his third-level commanders from dealing in drugs.(104) Some Vietnamese sources have identified these colonels as men who are loyal to President Thieu's chief military adviser, General Dang Van Quang. (105)

The Cambodian invasion may have been another important factor in promoting the GI heroin epidemic. While this hypothesis can probably never be proven because of the clandestine, fragmented nature of the heroin traffic, it is an interesting coincidence that the invasion occurred in May 1970 and most journalistic accounts and official reports give "spring 1970" or "early 1970" (106) as the starting date for widespread heroin addiction. (Late 1969 is the date usually given for the beginning of small-scale heroin use among GIs.' (107)) The difficulties involved in smuggling between southern Laos and the Vietnamese Central Highlands limited the amount of narcotics that could be brought into Vietnam; the lack of roads and rivers made air transport an absolute necessity, but the rugged mountain terrain and the relative infrequency of flights between these two unpopulated areas required excessively intricate planning.

Since the mid 1950s the Cambodian neutralist ruler, Prince Sihanouk, had remained hostile to the various pro-American South Vietnamese regimes. Vietnamese military transports, naval vessels, or military convoys never entered Cambodia, and most of the gold and narcotics smuggling from Laos avoided this neutralist kingdom. However, less than three months after Sihanouk's ouster in March 1970, the Vietnamese army crashed across the border and VNAF's Fifth Air Division began daily flights to Phnom Penh, Cambodia. Once Cambodia opened up, unlimited quantities of narcotics could be flown from southern Laos to the Cambodian capital, Phnom Penh, on any one of the hundreds of commercial, military, or clandestine flights that crowded the airways every day. From there narcotics could easily be forwarded to Saigon by boat, truck, or aircraft. Since the spread of GI heroin addiction seems to have been limited only by the availability of drugs, the improved smuggling conditions that resulted from the Cambodian invasion must have played some role in promoting the GI heroin epidemic.

South Vietnam: Heroin Achieves Full Market Potential

The quantum leap in the size and profitability of South Vietnam's narcotics trade, due both to the new and burgeoning GI market as well as the increased demand on the part of the international narcotics syndicates, resulted in a number of new mini-cliques coming into the traffic. (108)

But by 1970 the traffic appeared to be divided among three major factions: (1) elements in the South Vietnamese air force, particularly the air transport wing; (2) the civil bureaucracy (i.e. police, customs and port authority), increasingly under the control of Prime Minister Khiem's family; and (3) the army, navy and National Assembly's lower house, who answer to President Thieu. In spite, or perhaps because, of the enormous amounts of money involved, there was considerable animosity among these three major factions.

"Involvement" in the nation's narcotics traffic took a number of different forms. Usually it meant that influential Vietnamese political and military leaders worked as consultants and protectors for chiu chau Chinese syndicates, which actually managed wholesale distribution, packaging, refining, and some of the smuggling. (Chiu chau are Chinese from the Swatow region of southern China, and chiu chau syndicates have controlled much of Asia's illicit drug traffic since the mid 1800s and have played a role in China's organized crime rather similar to the Sicilian Mafia in Italy and the Corsican syndicates in France. See Chapter 6 for more details.) The importance of this protection, however, should not be underestimated, for without it the heroin traffic could not continue. Also, powerful Vietnamese military and civil officials are directly involved in much of the actual smuggling of narcotics into South Vietnam. The Vietnamese military has access to aircraft, trucks, and ships that the Chinese do not, and most of the Vietnamese elite have a much easier time bringing narcotics through customs and border checkpoints than their Chinese clients.

The Opium Airlift Command

Of South Vietnam's three major narcotics rings, the air transport wing loyal to Air Vice-Marshal Ky must still be considered the most professional. Although Ky's apparatus lost control over the internal distribution network following his post-Tet political decline in 1968, his faction continues to manage much of the narcotics smuggling between Vietnam and Laos through the air force and its relations with Laotian traffickers. With over ten years of experience, it has connections with the Lao elite that the other two factions cannot even hope to equal. Rather than buying heroin through a maze of middlemen, Ky's apparatus deals directly with a heroin laboratory operating somewhere in the Vientiane region. According to a U.S. police adviser stationed in Vientiane, this laboratory is supposed to be one of the most active in Laos, and is managed by a Chinese entrepreneur named Huu Tim Heng. Heng is the link between one of Laos's major opium merchants, Gen. Ouane Rattikone (former commander in chief of the Laotian army), and the air transport wing heroin ring. (109) From the viewpoint of the narcotics traffic, Huu Tim Heng's most important legitimate commercial venture is the Pepsi-Cola bottling factory on the outskirts of Vientiane. With Prime Minister Souvanna Phourna's son, Panya, as the official president, Heng and two other Chinese financiers began construction in 1965-1966. Although the presence of the prime minister's son at the head of the company qualified the venture for generous financial support from USAID (U.S. Agency for International Development), the plant has still not bottled a single Pepsi after five years of stop-start construction. (110) The completed factory building has a forlorn, abandoned look about it. While Pepsi's competitors are mystified at the company's lac adaisical attitude, the U.S. Bureau of Narcotics has an answer to the riddle. Bureau sources report that Heng has been using his Pepsi operation as a cover for purchases of chemicals vital to the processing of heroin, such as ether and acetic anhydride, and for large financial transactions. (111)

Once the heroin is processed and packaged in large, plastic envelopes, other experienced members of the Ky apparatus take charge of arranging shipment to South Vietnam. Mrs. Nguyen Thi Ly, Ky's elder sister, had directed much of the traffic from the Sedone Palace Hotel in Pakse when her brother was premier, but in 1967 she gave up her position as manager and moved back to Saigon. However, sources in Vientiane's Vietnamese community report that she and her husband have traveled between Saigon, Pakse, and Vientiane at least once a month since they returned to Vietnam. Mrs, Ly purchases heroin produced in Huu Tim Heng's clandestine laboratory and has it shipped to Pakse or Phnom Penh where it is picked up by Vietnamese air force transports. (112)

In addition, the U.S. Bureau of Narcotics believes that General Loan's old assistant, Mai Den, may also be involved in this operation. After General Loan was wounded in May 1968, Mai Den was forced out of his position as director of the CIO's Foreign Intelligence Bureau, and he exiled himself to Bangkok. (113) For two years this wily chameleon had used his CIO agents to weave a net of drug contacts across the Golden Triangle, and the Bureau of Narcotics has reason to believe he may still he using them.

Normally, those air force officers responsible for directing the flow of narcotics to South Vietnam purchase the drugs and have them delivered, often by the Laotian air force, to points in Laos, particularly Pakse, or else across the border in Pleiku Province, South Vietnam, or in Phnom Penh, Cambodia. Most observers feel that the Cambodian capital has prempted Pleiku's importance as a drop point since the Vietnamese air force began daily sorties to Phnom Penh during the 1970 Cambodia invasion. In August 1971 The New York Times reported that the director of Vietnam customs "said he believed that planes of the South Vietnamese Air Force were the principal carriers" of heroin coming into South Vietnam."(114) While the director is a Thieu appointee and his remark may be politically motivated, U.S. customs advisers, more objective observers, have stated that the air force regularly unloads large quantities of smuggled narcotics at Tan Son Nhut Air Base." (115) Here Air Vice-Marshal Ky reigns like a feudal baron in his airconditioned palace, surrounded by only his most loyal officers. As one U.S. air force adviser put it, "In order to get a job within shooting distance of the Vice Presidential palace a VNAF officer has to be intensely loyal to Ky. (116)

The current commander of Tan Son Nhut and the air force's transport wing (renamed the Fifth Air Division in January 1971) is Col. Phan Phung Tien. Brother-in-law of one of Ky's close political advisers who died in the 1968 "accidents," Col. Tien served under Ky as a squadron commander in the First Transport Group from 1956 to 1960. He has remained one of Ky's most loyal followers, and one U.S. air force adviser recently described him as Ky's "revolutionary plotter" inside the air force.(117)

Ever since the Cambodia invasion of May 1970, Fifth Air Division C-47, C-119, and C123 transports have been shuttling back and fo th between Phnom Penh and Tan Son Nhut with equipment and supplies for the Cambodian army, while two AC-47 gunships have flown nightly missions to Phnom Penh to provide perimeter defense for the Cambodian capital. (118) All of these flights are supposed to return empty, but the director-general of Vietnam customs believes they are often filled with dutiable goods, gold, and narcotics. The director-general has singled out Colonel Tien for criticism in an interview with The New York Times in August 1971, labeling him "the least cooperative in his efforts to narrow the channels through which heroin reached Vietnam. (119) Moreover, Vietnamese police officials report that Colonel Tien is extremely close to some of the powerful Corsican underworld figures who manage hotels and restaurants in Saigon.(120) The accumulation of this kind of evidence has led many informed Vietnamese observers to conclude that Colonel Tien has become a central figure in Vietnam's narcotics traffic.

Thieu Takes Command

In the wake of Air Vice-Marshal Ky's precipitous political decline, ranking military officers responsible to President Thieu appear to have emerged as the dominant narcotics traffickers in South Vietnam. Like his predecessors, President Diem and Premier Ky, President Thieu has studiously avoided involving himself personally in political corruption. However, his power broker, presidential intelligence adviser Gen. Dang Van Quang, is heavily involved in these unsavory activities. Working through highranking army and navy officers personally loyal to himself or President Thieu, General Quang has built up a formidable power base.

Although General Quang's international network appears to be weaker than Ky's, General Ouang does control the Vietnamese navy, which houses an elaborate smuggling organization that imports large quantities of narcotics either by protecting Chinese maritime smugglers or by actually using Vietnamese naval vessels. Ky's influence among high ranking army officers has weakened considerably, and control over the army has now shifted to General Quang. The army now manages most of the distribution and sale of heroin to American GIs. In addition, a bloc of pro-Thieu deputies in the lower house of the National Assembly have been publicly exposed as being actively engaged in heroin smuggling, but they appear to operate somewhat more independently of General Quang than the army and navy.

On the July 15, 1971, edition of the NBC Nightly News, the network's Saigon correspondent, Phil Brady, told a nationwide viewing audience that both President Thieu and Vice-President Ky were financing their election campaigns from the narcotics traffic. Brady quoted "extremely reliable sources" (121) as saying that President Thieu's chief intelligence adviser, Gen. Dang Van Quang, was "the biggest pusher" in South Vietnam. (122) Although Thieu's press secretary issued a flat denial and accused Brady of "spreading falsehoods and slanders against leaders in the government, thereby providing help and comfort to the Communist enemy, (123) he did not try to defend General Quang, renowned as one of the most dishonest generals in South Vietnam when he was commander of IV Corps in the Mekong Delta.

In July 1969 Time magazine's Saigon correspondent cabled the New York office this report on Gen. Quang's activities in IV Corps:

While there he reportedly made millions by selling offices and taking a rake off on rice production. There was the famous incident, described in past corruption files, when Col. Nguyen Van Minh was being invested as a 21st Division commander. He had been Quang's deputy corps commander. At the ceremony the wife of the outgoing commander stood up and shouted to the assembled that Minh had paid Quang 2 million piasters [$7,300] for the position.... Quang was finally removed from Four Corps at the insistence of the Americans.(124)

'General Quang was transferred to Saigon in early 1967 and became minister of planning and development, a face-saving sinecure. (125) Soon after President Thieu's election in September 1967, he was appointed special assistant for military and security affairs. (126) General Quang quickly emerged as President Thieu's power broker, and now does thesame kind of illicit fund raising for Thieu's political machine that the heavy-handed General Loan did for Ky's. (127)

President Thieu, however, is much less sure of Quang than Premier Ky had been of General Loan. Loan had enjoyed Ky's absolute confidence and was entrusted with almost unlimited personal power. Thieu, on the other hand, took care to build up competing centers of power inside his political machine to keep General Quang from gaining too much power. As a result, Quang has never had the same control over the various pro-Thieu mini-factions as Loan had over Ky's apparatus. As the Ky apparatus's control over Saigon's rackets weakened after June 1968, various pro-Thieu factions moved in. In the political shift, General Quang gained control of the special forces, the navy and the army, but one of the pro-Thieu cliques, that headed by Gen. Tran Thien Khiem, gained enough power so that it gradually emerged as an independent faction itself. (128) However, at the very beginning most of the power and influence gained from Ky's downfall seemed to be securely lodged in the Thieu camp under General Quang's supervision.

There is evidence that one of the first new groups which began smuggling opium into South Vietnam was the Vietnamese special forces contingents operating in southern Laos. In August 1971 The New York Times reported that many of the aircraft flying narcotics into South Vietnam "are connected with secret South Vietnamese special forces operating along the Ho Chi Minh Trail network in Laos. (129) Based in Konturn Province, north of Pleiku, the special forces "assault task force" has a small fleet of helicopters, transports, and light aircraft that fly into southern Laos on regular sabotage and long-range reconnaissance forays. Some special forces officers claim that the commander of this unit was transferred to another post in mid 1971 because his extensive involvement in the narcotics traffic risked exposure. (130)

But clandestine forays were a relatively inefficient method of smuggling, and it appears that General Quang's apparatus did not become heavily involved in the narcotics trade until the Cambodian invasion of May 1970. For the first time in years the Vietnamese army operated inside Cambodia; Vietnamese troops guarded key Cambodian communication routes, the army assigned liaison officers to Phnom Penh, and intelligence officers were allowed to work inside the former neutralist kingdom. More importantly, the Vietnamese navy began permanent patrols along the Cambodian stretches of the Mekong and set up bases in Phnom Penh.

The Vietnamese Navy: Up the Creek

The Vietnamese navy utilized the Cambodian invasion to expand its role in the narcotics traffic, opening up a new pipeline that had previously been inaccessible. On May 9 an armada of 110 Vietnamese and 30 American river craft headed by the naval fleet commander, Capt. Nguyen Thanh Chau, crossed the border into Cambodia, speeding up the Mekong in a dramatic V-shaped formation. (131) The next day the commander of Riverine Task Force 211, Capt. Nguyen Van Thong, landed several hundred Vietnamese twenty miles upriver at Neak Luong, a vital ferry crossing on Route I linking Phnom Penh with Saigon. (132) Leaving their American advisers behind here, the Vietnamese arrived at Phnom Penh on May 11, and on May 12 reached Kompong Chain, seventy miles north of the Cambodian capital, thus totally clearing the waterway for their USe. (133) Hailed as a tactical coup and a great "military humanitarian fleet" by navy publicists, the armada also had, according to sources inside the Vietnamese navy, the dubious distinction of smuggling vast quantities of opium and heroin into South Vietnam.

An associate of General Quang's, former navy commander Rear Admiral Chung Tan Cang, rose to prominence during the Cambodian invasion. Admiral Cang had been a good friend of President Thieu's since their student days together at Saigon's Merchant Marine Academy (class of '47). (134) When Admiral Cang was removed from command of the navy in 1965, after being charged with selling badly needed flood relief supplies on the black market instead of delivering them to the starving refugees, (135) Thieu had intervened to prevent him from being prosecuted and had him appointed to a face-saving sinecure. (136)

Sources inside the Vietnamese navy say that a smuggling network which shipped heroin and opium from Cambodia back to South Vietnam was set up among high-ranking naval officers shortly after the Vietnamese navy docked at Phnom Penh. The shipments were passed from protector to protector until they reached Saigon: the first relay was from Phnom Penh to Neak Luong; the next, from Neak Luong to Tan Chau, just inside South Vietnam; the next, from Tan Chan to Binh Thuy. From there the narcotics were shipped to Saigon on a variety of naval and civilian vessels.(137)

As the Cambodian military operation drew to a close in the middle of 1970, the navy's smuggling organization (which had been bringing limited quantities of gold, opium, and dutiable goods into Vietnam since 1968) expanded.

Commo. Lam Nguon Thanh was appointed vice-chief of naval operations in August of 1970. Also a member of Thieu's class at the Merchant Marine Academy (class of '47) Commodore Thanh had been abruptly removed from his post as navy chief of staff in 1966.(138) Sources inside the navy allege that highranking naval officials used three of the Mekong Delta naval bases under Commodore Thanh's command-Rach Soi, Long Xuyen, and Tan Chau-as drop points for narcotics smuggled into Vietnam on Thai fishing boats or Cambodian river sampans. From these three bases, the narcotics were smuggled to Saigon on naval vessels or on "swift boats" (officially known as PCFs, or Patrol Craft Fast). When, as often happened, the narcotics were shipped to Saigon on ordinary civilian sampans or fishing junks, their movements were protected by these naval units. (139)

Some of these smuggling operations within the Vietnamese navy were exposed in the summer of 1971. Shortly before this happened, the U.S. government had finally begun pressuring the South Vietnamese to crack down on the drug smuggling. According to sources inside the navy, the American demands were a cause of some concern for General Quang and Admiral Cang. General Quang thoughtfully had Admiral Cang appointed as chairman of the National AntiNarcotics Committee and his associate, Commodore Thanh, installed as chairman of the Navy Anti-Narcotics Committee.(140)

Although these precautions should have proved adequate, events and decisions beyond General Quang's control nearly resulted in a humiliating public expose. On July 25, 1971, Vietnamese narcotics police, assisted by Thai and American agents, broke up a major chiu chau Chinese syndicate based in Cholon, arrested 60 drug traffickers, and made one of the largest narcotics seizures in Vietnam's recent history -51 kilos of heroin and 334 kilos of opium. Hailed in the press as a great victory for the Thieu government's war on drugs, these raids were actually something of a major embarrassment, since they partially exposed the navy smuggling ring. (141)

This Cholon chiu chau syndicate was organized in mid 1970 when "Mr. Big" in Bangkok, a chiu chau Chinese reputed to be one of the largest drug financiers in Southeast Asia, decided to start dealing in South Vietnam. He contacted a respectable chiu chau plastics manufacturer in Cholon, Mr. Tran Minh, and the two soon came to an agree ment. The Vietnamese navy, of course, was to provide protection (see Map 5, page 155). Sometime in mid 1970 a Thai fishing vessel arrived off the coast of Puolo Dama, a tiny Vietnamese island in the Gulf of Siam, with the first shipment. Waiting for the boat was a Vietnamese fishing boat under the command of a chiu chau captain named Tang Hai. Hired by Mr. Tran Minh, Tang Hai was the link between the Bangkok and Cholon syndicates. After two hundred kilos of opium had been transferred in mid-ocean, the Vietnamese boat chugged off toward its home port, Rach Gia, about fifty-five miles to the northeast. In Rach Gia, the bundles of opium were loaded onto a river sampan for the voyage to Saigon. Concealed under a layer of coconut shells, the opium appeared to be just another commercial cargo as it wound its way through the maze of canals that led to the docks of Cholon. Once the sampan docked at a wharf in Cholon's seventh district, the cargo was transferred to a microbus, driven to Tran Minh's warehouse in Cholon's sixth district, and eventually dispensed to the opium dens of Saigon-Cholon. All the traffic on these waterways was policed and protected by the Vietnamese navy. Tran Minh's business prospered and the smuggling continued.

By the third shipment Mr. Tran Minh had decided to expand into the GI market, and ordered ten kilos of Double U-0 Globe brand heroin as well as the usual two hundred kilos of opium. For the fourth shipment, Tran Minh was afraid the deliveries might start attracting notice and changed the transfer point to Hon Panjang, an island 115 miles southwest of Rach Gia. By mid 1971 business was going so well that the Cholon syndicate boss ordered a double shipmentfour hundred kilos of opium and sixty kilos of heroin. The heroin alone was worth more than $720,000 retail, and for the fishing captain Tang Hai and his military protectors at the Rach Soi Naval Base it turned out to be an irresistible temptation.

In early July 1971 Tang Hai kept his appointment with the Thai fishing boat and picked up the cargo near Hon Panjang Island. But instead of returning to Rach Gia, he then proceeded to sail sixty miles north to Phu Quoc Island, where he buried the opium and hid the heroin in some underbrush. Then he returned to Rach Gia and told Mr. Tran Minh's contact man that the shipment had been stolen by the Vietnamese navy. Apparently this was a convincing explanation, and the contact man relayed the news to Cholon. When Mr. Tran Minh agreed to buy back half of the shipment from the navy for $25,000, Tang Hai returned to Phu Quoc Island, dug up most of the cache, and delivered half of the original shipment to the contact man in Rach Gia after burying the difference near his home. The contact man hired the usual sampan owner to smuggle the drugs to Cholon, but he was robbed, this time for real, by three ARVN corporals only ten miles up the canal from Rach Gia.

The boatman returned to Rach Gia and reported his bad luck to the beleaguered contact man, who dutifully passed the word along to ChoIon. Now $25,000 poorer, Mr. Tran Minh informed Bangkok that he had been robbed twice and could not pay for the shipment. The Bangkok financier, however, immediately assumed that he was being cheated and decided to wipe out the entire Vietnamese syndicate. The Thai fishing captain was selected as the informer, and he approached Col. Pramual Vangibandhu of the Thai Central Narcotics Bureau with a proposition: in exchange for a guarantee of complete immunity and anonymity for the Bangkok syndicate, he would name the two key men in the Saigon operation (which were, in fact, the only names the Bangkok syndicate knew).

Colonel Pramual accepted the offer and contacted U.S. narcotics agent William Wanzeck, asking him to arrange a meeting with the Vietnamese. The two men flew to Saigon, where they met with the head of the Vietnamese Narcotics Police, Redactor Ly Ky Hoang, and U.S. narcotics agent Fred Dick. It was agreed that there should be two simultaneous raids; the Vietnamese National Police would bust the Saigon syndicate while Redactor Hoang, Colonel Pramual, and Fred Dick flew to Rach Gia to arrest Tang Hai and his cohorts.

The two raids were planned for 9:30 A.M. on July 25, less than three weeks after the drugs first arrived off Hon Panjang Island. The Saigon raid came off perfectly, but at Rach Gia, Redactor Hoang found that Tang Hai was not at home. Hoang, who was not in uniform, explained to Tang Hai's sister that the boss, Mr. Tran Minh, had sent him to negotiate for the missing drugs. After fifty minutes of skillful explanations, the sister finally agreed to take Redactor Hoang to a restaurant where her brother was "at a party drinking with some friends." The two of them clambered aboard a sputtering Lambretta taxi and disembarked about thirty minutes later in front of a restaurant in Rach Soi, a small fishing port four miles south of Rach Gia. Inside, Tang Hai was the guest of honor at a boisterous drinking party hosted by the commander of nearby Rach Soi Naval Base, Captain Hai, and attended by twenty well-armed navy officers and sailors.

Explaining that Mr. Tran Minh himself was waiting at Rach Gia, Redactor Hoang suggested that he and Tang Hai go there to discuss buying back the drugs. When the chiu chau smuggler replied that he would rather stay at the party, Redactor Hoang elaborated on his story, explaining that the boss was willing to pay $25,000 for the remaining half of the shipment. At this the navy commander insisted that Hoang use his personal jeep and driver to bring Mr. Tran Minh to the party for negotiations.

An hour later Redactor Hoang returned in a police car, accompanied by Colonel Pramual and Fred Dick. While the others waited outside, Redactor Hoang entered the restaurant alone. After suggesting that they step outside for a private word with the boss, he arrested Tang Hai, threw him into the waiting police car, and raced off for Rach Gia. Minutes later the navy officers realized their guest had been arrested, grabbed their guns, and sped off in hot pursuit.

Even though they suspected that the navy posse was not far behind, the multinational police squad stopped enroute to Rach Gia at a house belonging to Tang Hai's cousin to search for a suspected drugs cache. While Dick and Colonel Pramual took Tang Hai inside and proceeded to ransack the house, Redactor Hoang remained in the car a hundred yards down the street, radioing desperately for police assistance. Before he finally realized that the radio was out of order navy jeeps screeched to a halt in front of the house and the officers began spreading out along the opposite side of the street with their guns drawn and aimed at the house.

Hoang was pinned down in the police car, cut off from his friends and feeling rather frightened. Suddenly he spotted a Lambretta minibus coming down the road. He cocked his gun and waited. When the minibus was just abreast of his car, Hoang jumped out, raced alongside the minibus until it was parallel with the house, and then dove through the front door. When he told the others what was happening, Fred Dick started to break out a window with his pistol butt for a shoot-out, but Hoang, who had not seen as many cowboy movies, stopped him.

Fortunately for our heroes, a plainclothes policeman just happened to enter the adjoining iron shop. After Hoang explained the situation, the policeman jumped on his Honda motor bike and puttered off for help. When a well-armed squad of local police arrived ten minutes later, the naval officers, realizing they were outgunned, reluctantly climbed back in their jeeps and retreated to Rach Soi.

When search of the house turned up nothing, Hoang and the others drove Tang Hai to the Rach Gia police station for interrogation. At first the smuggler refused to talk, but after Hoang, who has considerable ability in these arcane arts, finished with a few minutes of skillful interrogation, he confessed everything-including the location of the drug cache on Phu Quoc Island. While Colonel Pramual and Fred Dick flew Tang Hai out to the island to dig up the cache ( 112.0 kilos of opium and 3.9 kilos of heroin), Hoang himself arrested the three ARVN corporals who had actually stolen half the shipment and turned them over to the Military Security Service (MSS) for questioning. Sensing that MSS would learn nothing, Hoang ordered the Rach Gia police commander to send a car around to his hotel when the MSS gave up. The military finished six hours of fruitless questioning at 2:00 A.M.; Hoang arrived at police headquarters an hour later and had his answers in only fifteen minutes. The next morning a police squad unearthed 32.7 kilos of heroin and 35.0 kilos of opium near a canal about two hours from Rach Gia. A search of Tang Hai's yard later that day uncovered an additional 7.0 kilos of Double U-0 Globe brand heroin and 88.0 kilos of opium. Meanwhile, back in Bangkok the Thai police held a press conference on July 29, only four days after the first spectacular raids. Nervous over rumors of their involvement in the international traffic, the Thai police were eager to grab credit and add a little luster to their otherwise tawdry reputation. Gen. Nitya Bhanumas, secretary general of the Thai Narcotics Board, reportedly claimed that the information tha led to the seizures came from "informants he developed in an investigation he directed last month.(142)

When the Vietnamese police picked up their newspapers the next morning, they were outraged. (143) Not only had the Thais claimed credi for what they felt was their work, but the investigation was still continuing and the Vietnamese police feared that the headlines might drive many of the syndicate's members into hiding. The Thai police had only given their Vietnamese counterparts the two names known to Bangkok's "Mr. Big"-Tang Hai and Mr. Tran Minh. Working from the top of the syndicate down, the Vietnamese were just beginning a roundup that eventually netted over sixty middle- and upper-level distributors and scores of street pushers.

According to sources inside the Vietnamese navy, these raids created a near panic in the navy smuggling ring as its leaders scrambled frantically to salvage the situation. Two of the officers involved in the Cambodia invasion command structure were speedily removed about the time that the smuggling ring was exposed. Capt. Nguyen Van Thong was removed from his command of Riverine Task Force 211 and reassigned to a command training course only a few days before the police raids took place. The commander of the coastal patrol force, Capt. Nguyen Huu Chi, was transferred to a staff college for advanced training a scarce two weeks later. (144) Although MSS has arrested the navy officers at Rach Soi directly implicated in the affair, (145) there are reports that highranking military officers are doing their best to protect them, and have managed to make sure that their arrest received almost no mention in the press. (146)

The Vietnamese Army: Marketing the Product

While the Vietnamese navy is involved in drug importing, pro-Thieu elements of the Vietnamese army (ARVN) manage much of the distribution and sale of heroin to GIs inside South Vietnam. But rather than risking exposure by having their own officers handle the more vulnerable aspects of the operation, highranking ARVN commanders generally prefer to work with Cholon's Chinese syndicates. Thus, once bulk heroin shipments are smuggled into the countryeither by the military itself or by Chinese protected by the military-they are usually turned over to Cholon syndicates for packaging and shipment. From Cholon, Chinese and Vietnamese couriers fan out across the country, delivering multikilo lots of heroin to military commanders from the Delta to the DMZ. In three of the four military zones, the local distribution is supervised and protected by high-ranking army officers. (147) In the Mekong Delta (IV Corps) local sales are controlled by colonels loyal to General Quang; in the south central part of the country (II Corps) heroin distribution has become a subject of controversy between two feuding generals loyal to President Thieu, the former II Corps commander Gen. Lu Lan and the present commander Gen. Ngo Dzu;(148) and in northernmost I Corps the traffic is directed by deputies of the corps commander. (149) In June 1971 the chief U.S. police adviser filed a memorandum on Gen. Ngo Dzu's involvement in the heroin trade that describes the relationship between Cholon's Chinese racketeers and Vietnamese generals: (150)



MEMORANDUM FOR RECORD SUBJECT: Alleged Trafficking in Heroin (U)

1. A confidential source has advised this Directorate that the father of General Dzu, MR 2 Commanding General, is trafficking in heroin with Mr. Chanh, an ethnic Chinese from Cholon. (Other identification not available.)

2. General Dzu's father lives in Qui Nhon. Mr. Chanh makes regular trips to Qui Nhon from Saigon usually via Air Vietnam, but sometimes by General Dzu's private aircraft. Mr. Chanh either travels to Qui Nhon alone, or with other ethnic Chinese. Upon his arrival at the Qui Nhon Airport he is met by an escort normally composed of MSS and/or QC's [military police]; Mr. Chanh is then allegedly escorted to General Dzu's father, where he turns over kilogram quantities of heroin for U.S. currency. Mr. Chanh usually spends several days in Qui Nhon, and stays at the Hoa Binh Hotel, Gia Long Street, Qui Nhon. When Chanh returns to Saigon he is allegedly also given an escort from TSN Airport.

3. The National Police in Qui Nhon especially those police assigned to the airport, are reportedly aware of *the activity between General Dzu's father and Mr. Chanh, but are afraid to either report or investigate these alleged violations fearing that they will only be made the scapegoat should they act.

4. Mr. Chanh (AKA: Red Nose) is an ethnic Chinese from Cholon about 40 years of age,

[signed] Michael G. McCann, Director Public Safety Directorate CORDS

After bulk shipments of heroin have been delivered to cities or ARVN bases near U.S. installations it is sold to GIs through a network of civilian pushers (barracks' maids, street vendors, pimps, and street urchins) or by low-ranking ARVN officers. In Saigon and surrounding 11 Corps most of the heroin marketing is managed by ordinary civilian networks, but as GI addicts move away from the capital to the isolated firebases along the Laotian border and the DMZ, the ARVN pushers become more and more predominant. "How do we get the stuff?" said one GI stationed at a desolate firebase near the DMZ, "just go over to the fence and rap with an ARVN. If he's got it you can make a purchase .

Even at Long Binh, the massive U.S. army installation on the outskirts of Saigon, Vietnamese officers work as pushers. As one GI addict based at Long Binh put it, "You can always get some from an ARVN; not a Pfc., but the officers. I've gotten it from as high as Captain." (152)

The Lower House: Heroin Junkets

Another avenue of the narcotics traffic that has proved embarrassing to President Thieu is the smuggling operations indulged in by pro-Thieu members of the National Assembly's lower house. The buffoonlike ineptness of many of these politicians has turned out to be more of a liability than an asset. At one point in Thieu's rivalry with the increasingly important Prime Minister Khiem, the ease with which these politician smugglers could be exposed created a good many political problems for the Thieu apparatus. While only the slightest hint of the pro-Thieu faction's massive smuggling operation has leaked out of the securityconscious military, the opera bouffe antics of bumbling lower house representatives have rated incredulous headlines around the world. Between September 1970 and March 1971 no less than seven representatives returning from foreign study tours were caught trying to smuggle everything from gold and heroin to Playboy calendars and brassieres into South Vietnam.(153) Foreign observers were genuinely dismayed by the smuggling arrests, but the Vietnamese public simply regarded them as a new low in the lower house's four-year history of bribery, corruption, and scandal. (154)

The outrageous behavior of its representatives on the floor of the house, where insults of every order are freely and openly traded, has cost the lower house any semblance of popular respect among the essentially honest, puritanical South Vietnamese peasants. It is widely regarded as the longest-running comedy show in Saigon. Votes on crucial issues are sold to the highest bidder, and the Saigon press cheerfully keeps a running tally of the going price. In addition to regular monthly stipends and special New Year's bonuses of $350,(155) pro-Thieu representatives have earned up to $1,800 apiece for voting the right way on crucial government measures. (156) In fact, even staunch opposition members vote the right way to pick up a little extra cash when defeat for their side looks inevitable.(157)

In the lower house, President Thieu relies on members of the Independence Bloc to do the bargaining and make the payments, rather than negotiating personally or working through his military advisers. Consisting almost entirely of North Vietnamese Catholic refugees, this bloc has maintained a militantly anti-Communist position since it was formed in 1967. Although the bloc is nominally independent, its leader, Rep. Nguyen Quang Luyen, met with President Thieu soon after it was formed and "verbally agreed" to support the president in exchange for unspecified favors. (158) The bloc has influence far beyond its numerical strength, and all its members occupy key positions as committee chairmen, fund raisers, or whips; with only nineteen members, the Independence Bloc controls six out of the lower house's sixteen committee chairmanships. (159) During the debates over the 1971 election law, for example, it was an Independence Bloc member, Rep. Pliam Huu Giao, who floor managed the passage of article 10. This controversial clause required a minimum of forty Congressional signatures on every nominating petition for the upcoming presidential election and made it possible for President Thieu to eliminate Ky from the running. Early in the debates, Rep. Pham Huu Giao reportedly tied down a few hill tribe votes for as little as $350 apiece and most of the Cambodian minority's ballots for a mere $700 each.(160) However, in the three days of intense bargaining preceding the final balloting, the price jumped from $1,000 to $1,800 for the final handful that completed the proposal's winning tally of seventy-five votes.(161)

Loyalty to Thieu seems to have its benefits. No opposition members have even been implicated in a serious smuggling case. All lower house representatives implicated in the heroin and gold traffic are either present or past members of the Independence Bloc. The reason for this is simple; opposition deputies often lack the necessary capital to finance such trips, and are not guaranteed "courtesy of the port" when they return. However, pro-government deputies who are bankrolled by an official travel grant or savings from months of voting the right way are able to take advantage of their four exit visas per year, a privilege guaranteed I deputies for foreign travel during the legislative holidays. The result has been an orgy of foreign junketeering on the part of pro-government deputies. In 1969-1970 junketeering representatives purchased $821,000 worth of foreign currency for their travels. One prominent progovernment representative was abroad for 119 days in 1969, 98 days in 1970 , and 75 days during the first three months of 1971. (162)

Although most pro-government deputies had usually returned with some form of contraband or undeclared dutiable item, they passed through customs without being checked. (163) Even if a representative was caught, customs officers merely imposed a "fine" and allowed the illegal items to pass through. For example, in August and December 1970 Vietnamese customs officers at Tan Son Nhut Airport discovered gold and dutiable goods in the luggage of Rep. Pham Huu Giao, one of the Thieu regime's most important lower house whips. The representative paid a rather nominal fine, and the whole matter was hushed up until it was revealed during the height of the smuggling controversy several months later. (164)

The tempo of parliamentary smuggling seems to have been intensified by the eruption of the GI heroin epidemic and the liberalization of the assembly's travel laws. In December 1970 a group of pro-Thieu deputies who control the lower house administrative office decided to allow representatives four foreign trips each year instead of two. (165) When the annual January-March legislative holiday started a few weeks later, one Saigon daily reported that a record 140 out of the National Assembly's 190 members would soon be going abroad.(166)

The smuggling bonanza that followed resulted in three sensational customs seizures within ten days of each other in March as the legislators returned one by one to prepare for the upcoming session of the National Assembly.

The first deputy implicated was Rep. Vo Van Mau, a Catholic refugee from North Vietnam and a member of the pro-Thieu Independence Bloc. During Air Vietnam's regular Vientiane-Saigon flight on March 10, a Chinese smuggler transferred a suitcase to one of the stewardesses, Mrs. Nguyen Ngoc Qui. (167) But instead of being waved through customs at Tan Son Nhut, as Air Vietnam stewardesses usually were, Mrs. Qui was subjected to a thorough search, which turned up 9.6 kilos of Laos's most popular export-Double U-0 Globe brand heroin-and a letter addressed to Rep. Vo Van Mau. Showing unusual insensitivity to Representative Mau's high official status, officers of customs' Fraud Repression Division followed up the lead. A search of Representative Mau's offices turned up the Chinese smuggler's identity card. (168) Although a spokesman for Prime Minister Khiem's office later announced that this seizure was being thoroughly investigated "because it appears to implicate directly" a deputy, (169) Representative Mau was never officially charged and quietly faded from view when he failed to stand for reelection several months later.

On March 17 another pro-Thieu representative, Pham Chi Thien, landed at Tan Son Nhut Airport on the 4:30 P.m. flight from Bangkok. Much to Representative Thien's surprise, a customs officer insisted on giving his luggage a thorough search and opened a gift-wrapped box he found in the legislator's suitcase, which turned out to contain four kilos of Double U-0 Globe brand heroin. (170) Announcing his resignation from the lower house a week later, Representative Thien denied that he was "actually" a smuggler and claimed that he had simply agreed to carry a package to Saigon as a favor to "a soft-spoken lady I met in Vientiane." (171) He admitted to accepting money for carrying the package, but denied any knowledge of its contents.(172)

While the charges against Vo Van Mau and Pham Chi Thien, both rather unimportant legislators, caused a certain amount of dismay, the arrest of a third pro-Thieu legislator, Rep. Nguyen Ouang Luyen, for gold smuggling was a major scandal. Representative Luyen was second deputy chairman of the lower house, chairman of the Asian Parliamentary Union, and had been chairman of the pro-Thieu Independence Bloc from 1967 to 1970 (he, too, was a North Vietnamese refugee). As he was boarding a flight for Saigon at the Bangkok Airport on March 18, Thai customs searched his luggage and discovered fifteen kilos of pure gold, worth about $26,000 on Saigon's black market. (173) However, the Vietnamese Embassy intervened and secured his immediate release after another legislator traveling with Representative Luyen raced into downtown Bangkok to plead for assistance.(174)

Four days later one Saigon newspaper reported that Thai customs had suspected Representative Luyen of being part of an international smuggling ring for several years but had been maintaining a discreet surveillance because of the sensitive nature of ThaiVietnamese relations. The fifteen kilos seized in Rep. Luyen's luggage were reportedly part of a larger shipment of ninety kilos of gold (worth $158,000 on the Saigon black market) being smuggled piecemeal into Saigon by this ring.(175) Reliable sources inside the lower house report that other members of the Independence Bloc had helped finance this shipment.

By all accounts, lower house representatives had been smuggling narcotics, gold, and dutiable goods into South Vietnam for over three years without such sensational exposes. Arrests were rare, and when they occurred the legislator almost always settled the matter quietly by just paying a "fine." Why had Vietnamese customs officials suddenly become so aggressive, or more pointedly, why was the Thieu faction suddenly subjected to the humiliating indignity of having three of its staunchest legislative supporters implicated in contraband smuggling within ten days of one another? The answer, as usual in South Vietnam, was political. Ironically, President Thieu's gadfly was his own handpicked prime minister, Tran Thien Khiem.

The Khiem Apparatus: All in the Family

While the Independence Bloc enjoys President Thieu's political protection, unfortunately for these three smugglers the customs service was controlled by Prime Minister Khiem's apparatus. After four years of political exile in Taiwan and the United States, Khiem had returned to Vietnam in May 1968 and was appointed minister of the interior in President Thieu's administration. Khiem, probably the most fickle of Vietnam's military leaders, proceeded to build up a power base of his own, becoming prime minister in 1969. Although Khiem has a history of betraying his allies when it suits his Purposes, President Thieu had been locked in a desperate underground war with Vice-President Ky, and probably appointed Khiem because he needed his unparalleled talents as a political infighter. (176) But first as minister of the interior and later as concurrent prime minister, Khiem appointed his relatives to lucrative offices in the civil administration and began building an increasingly independent political organization. In June 1968 he appointed his brother-in-law mayor of Saigon. He used his growing political influence to have his younger brother, Tran Thien Khoi, appointed chief of customs' Fraud Repression Division (the enforcement arm), another brother made director of Saigon Port and his cousin appointed deputy governor-general of Saigon. Following his promotion to prime minister in 1969, Khicm was able to appoint one of his wife's relatives to the position of director-general of the National Police.

One of the most important men in Khiem's apparatus was his brother, Tran Thien Khoi, chief of customs' Fraud Repression Division. Soon after U.S. customs advisers began working at Tan Son Nhut Airport in 1968, they filed detailed reports on the abysmal conditions and urged their South Vietnamese counterparts to crack down. However, as one U.S. official put it, "They were just beginning to clean it up when Khiem's brother arrived, and then it all went right out the window. (177) Fraud Repression Chief Tran Thien Khoi relegated much of the dirty work to his deputy chief, and together the two men brought any effective enforcement work to a halt.(178) Chief Khoi's partner was vividly described in a 1971 U.S. provost marshal's report:

He has an opium habit that costs approximately 10,000 piasters a day [$35] and visits a local opium den on a predictable schedule. He was charged with serious irregularities approximately two years ago but by payoffs and political influence, managed to have the charges dropped. When he took up his present position he was known to be nearly destitute, but is now wealthy and supporting two or three wives.(179)

The report described Chief Khoi himself as "a principal in the opium traffic" who had sabotaged efforts to set up a narcotics squad within the Fraud Repression Division.(180)". . . after three years of these meetings and countless directives being issued at all levels, the Customs operation at the airport has . . . reached a point to where the Customs personnel of Vietnam are little more than lackeys to the smugglers . . ." (181) The report went on to describe the partnership between customs officials and a group of professional smugglers who seem to run the airport: Under Chief Khoi's inspired leadership, gold and opium smuggling at Tan Son Nhut became so blatant that in February 1971 a U.S. customs adviser reported that

Actually, the Customs Officers seem extremely anxious to please these smugglers and not only escort them past the examination counters but even accompany them out to the waiting taxis. This lends an air of legitimacy to the transaction so that there could be no interference on the part of an over zealous Customs Officer or Policeman who might be new on the job and not yet know what is expected of him.(182)

The most important smuggler at Tan Son Nhut Airport was a woman with impressive political connections:

"One of the biggest problems at the airport since the Advisors first arrived there and the subject of one of the first reports is Mrs. Chin, or Ba Chin or Chin Map which in Vietnamese is literally translated as "Fat Nine." This description fits her well as she is stout enough to be easily identified in any group.... This person heads a ring of 10 or 12 women who are present at every arrival of every aircraft from Laos and Singapore and these women are the recipients of most of the cargo that arrives on these flights as unaccompanied baggage. . . . When Mrs. Chin leaves the Customs area, she is like a mother duck with her brood as she leads the procession and is obediently followed by 8 to 10 porters who are carrying her goods to be loaded into the waiting taxis....

I recall an occasion . . . in July 1968 when an aircraft arrived from Laos.... I expressed an interest in the same type of Chinese medicine that this woman had received and already left with. One of the newer Customs officers opened up one of the packages and it was found to contain not medicine but thin strips of gold.... This incident was brought to the attention of the Director General but the Chief of Zone 2. . . . said that I was only guessing and that I could not accuse Mrs. Chin of any wrong doing. I bring this out to show that this woman is protected by every level in the GVN Customs Service." (183)

Although almost every functionary in the customs service receives payoffs from the smugglers, U.S. customs advisers believe that Chief Khoi's job is the most financially rewarding. While most division chiefs only receive payoffs from their immediate underlings, his enforcement powers enable him to receive kickbacks from every division of the customs service. Since even so minor an official as the chief collections officer at Tan Son Nhut cargo warehouse kicked back $22,000 a month to his superiors, Chief Khoi's income must have been enormous. (184)

In early 1971 U.S. customs advisers mounted a "strenuous effort" to have the deputy chief transferred, but Chief Khoi was extremely adept at protecting his associate. In March American officials in Vientiane learned that Rep. Pham Chi Thien would be boarding a flight for Saigon carrying four kilos of heroin and relayed the information to Saigon. When U.S. customs advisers asked the Fraud Repression Division to make the arrest (U.S. customs officials have no right to make arrests), Chief Khoi entrusted the seizure to his opium-smoking assistant. The "hero" was later decorated for this "accomplishment," and U.S. customs advisers, who were still trying to get him fired, or at least transferred, had to grit their teeth and attend a banquet in his honor.(185)

Frustrated by months of inaction by the U.S. mission and outright duplicity from the Vietnamese, members of the U.S. customs advisory team evidently decided to take their case to the American public. Copies of the unflattering customs advisory reports quoted above were leaked to the press and became the basis of an article that appeared on the front page of The New York Times on April 22, 1971, under the headline, "Saigon Airport a Smuggler's Paradise." (186)

The American response was immediate. Washington dispatched more customs advisers for duty at Tan Son Nhut, and the U.S. Embassy finally demanded action from the Thieu regime. Initially, however, the Saigon government was cool to the Embassy's demands for a cleanup of the customs' Fraud Repression Division. It was not until the smuggling issue became a political football between the Khiem and Thieu factions that the Vietnamese showed any interest in dealing with the problem.

Tempest in a Teapot: The Thieu-Khiem Squabble

When the enormous political dividends of the Fraud Repression Division were added to Khiem's other sources of power, such as the police and the Saigon port authority, the result was all the strength necessary to form an independent political faction. Prime Minister Khiem's reemergence as something of a political power in his own right seems to have created tensions inside the Thieu organization and produced some heated political infighting.

As relations between the Thieu and Khiem factions soured, the smuggling issue became just another club to use against the competition. As one frank U.S. Embassy official in Saigon put it, "Our role essentially ends up allowing one faction to use U.S. pressure to force the other faction out of business. And," he added rather glumly, "the way these guys jump on each other so gleefully makes it look like they are really eager to cut themselves in on . . . an enormously lucrative traffic."(187)

When the Air Vietnam stewardess was arrested with 9.6 kilos of heroin, it was Prime Minister Khiem's office that issued an official statement confirming rumors that a pro-Thieu representative was involved. (188) Furthermore, reliable lower house sources claim that the aggressiveness shown by Chief Khoi's Fraud Repression Division in investigating the case was politically motivated. President Thieu later retaliated. According to one Saigon press report, members of Prime Minister Khiem's cabinet "protested . . . President Thieu's remark that the smuggling involved many high ranking officials who smuggled through the Tan Son Nhut Airport where one of the Prime Minister's brothers was in control." (189) Despite the cabinet's protest, the director-general of customs was dismissed, and in late June Tran Thien Khoi left for a short vacation in Paris. On his return several weeks later, he was transferred to a less lucrative post in the Cholon Customs House. (190) His opium-smoking assistant was likewise transferred, and wound up in the Customs Library, a traditional dumping ground for those in disgrace. (191)

Three months later, the director-general of the National Police, one of Mrs. Khiem's relatives, resigned under pressure. The Saigon press reported that the director-general had been involved in the heroin traffic and was being dismissed as a part of the antinarcotics campaign. Prophetically, one Saigon daily had earlier reported that President Thieu was "taking advantage of the antinarcotics smuggling drive" to force officials out of office and to replace them with his own supporters. (192)Interestingly enough, the new police director-general is Col. Nguyen Khac Binh, a nephew of Mrs. Thieu. (193)

Despite all this political agitation over the narcotics traffic, heroin smuggling continues unabated. U.S. customs advisers have pointed out that commercial air flights have been only one of several routes used to bring narcotics into South Vietnam. Now that airport security has tightened up, smugglers have simply diverted narcotics shipment to other routes, particularly military air bases and coastal and river shipping. (194) Throughout 1971 unlimited quantities of heroin were readily available near every U.S. installation in Vietnam, and there was no appreciable rise in price.

The Mafia Comes to Asia

The flourishing heroin traffic among Vietnam-based GIs was undoubtedly the most important new market for Indochina's drug traffickers, but it was not the only one. As we have already seen, increasingly insurmountable problems in the Mediterranean Basin had forced the American Mafia and the Corsican syndicates of Marseille to look to Southeast Asia for new sources of heroin and morphine base. Faced with the alternative of finding a new source of morphine base or going out of business, the Corsican syndicates of Marseille turned to their associates in Southeast Asia for help. "There are people who think that once the problem in Turkey is cleaned up, that's the end of the traffic," explains John Warner, chief intelligence analyst for the U.S. Bureau of Narcotics. "But the Corsicans aren't stupid. They saw the handwriting on the wall and began to shift their morphine base sources to Southeast Asia."(195)

The Corsican narcotics syndicates based in Saigon and Vientiane had been supplying European drug factories with Southeast Asian morphine base for several years, and links with Marseille were already well established. During the First Indochina War (1946-1954) Corsican gangsters in Marseille and Saigon cooperated closely in smuggling gold, currency, and narcotics between the two ports. In 1962 Corsican gangsters in Saigon reported that Paul Louis Levet, a Bangkokbased syndicate leader, was supplying European heroin laboratories with morphine base from northern Thailand. (196) Furthermore, at least four Corsican charter airlines had played a key role in Southeast Asia's regional opium traffic from 1955 to 1965. Although they were forced out of business when the Laotian generals decided to cut themselves in for a bigger share of the profits in 1965, most of the Corsicans had remained in Southeast Asia. They had opened up businesses or taken jobs in Vientiane and Saigon to tide themselves over until something new opened up.(197)

When Gen. Edward G. Lansdale of the CIA returned to Saigon as a special assistant to Ambassador Henry Cabot Lodge in 1965, he quickly learned that his old enemies, the Corsicans, were still in town. During the fighting between the French 2eme Bureau and the CIA back in 1955, the Corsican gangsters had been involved in several attempts on his life. "So I wouldn't have to look behind my back every time I walked down the street," Lansdale explained in a June 1971 interview, "I decided to have a meeting with the Corsican leaders. I told them I wasn't interested in doing any criminal investigations; I wasn't in Vietnam for that. And they agreed to leave me alone. We had some kind of a truce." General Lansdale can no longer recall much of what transpired at that meeting. He remembers that a large-busted French-Vietnarnese named Helene took an active role in the proceedings, that the affair was amicable enough, but not much else. Lansdale later learned that the Corsicans were still heavily involved in the narcotics traffic, but since this was not his responsibility, he took no action. (198)

Most of what Lansdale knew about the Corsicans came from his old friend Lt. Col. Lucien Conein, the CIA agent who had helped engineer President Diem's overthrow in 1963. As a former OSS liaison officer with the French Resistance during World War 11, Conein had some experiences in common with many of Saigon's Corsican gangsters. During his long tours of duty in Saigon, Conein spent much of his time in fashionable Corsican-owned bars and restaurants and was on intimate terms with many of Saigon's most important underworld figures. When Conein left Vietnam several years later, the Corsicans presented him with a heavy gold medallion embossed with the Napoleonic Eagle and the Corsican crest. Engraved on the back of it is Per Tu Amicu Conein ("For your friendship, Conein"). Conein proudly explains that this medallion is worn by powerful Corsican syndicate leaders around the world and serves as an identification badge for secret meetings, narcotics drops, and the like. (199)

Through his friendship with the Corsicans, Conein has gained a healthy respect for them. "The Corsicans are smarter, tougher, and better organized that the Sicilians," says Conein. "They are absolutely ruthless and are the equal of anything we know about the Sicilians, but they hide their internal fighting better." Conein also learned that many Saigon syndicate leaders had relatives in the Marseille underworld. These family relations play an important role in the international drug traffic, Conein feels, because much of the morphine base used in Marseille's heroin laboratories comes from Saigon. Corsican smugglers in Saigon purchase morphine base through Corsican contacts in Vientiane and ship it on French merchant vessels to relatives and friends in Ma seille, where it is processed into heroin. (200) "From what I know of them," says Conein, "it will be absolutely impossible to cut off the dope traffic. You can cut it down, but you can never stop it, unless you can get to the growers in the hills." (201)

This pessimism may explain why Conein and Lansdale did not pass on this information to the U.S. Bureau of Narcotics. It is particularly unfortunate that General Lansdale decided to arrange "some kind of a truce" with the Corsicans during the very period when Marseille's heroin laboratories were probably beginning the changeover from Turkish to Southeast Asian morphine base. In a mid-1971 interview, Lieutenant Colonel Conein said that power brokers in Premier Ky's apparatus contacted the leaders of Saigon's- Corsican underworld in 1965-1966 and agreed to let them start making large drug shipments to Europe in exchange for a fixed percentage of the profits. By October 1969 these shipments had become so important to Marseille's heroin laboratories that, according to Conein, there was a summit meeting of Corsican syndicate bosses from around the world at Saigon's Continental Palace Hotel. Syndicate leaders from Marseille, Bangkok, Vientiane, and Phnom Penh flew in for the meeting, which discussed a wide range of international rackets but probably focused on reorganizing the narcotics traffic. (202) According to one well-informed U.S. diplomat in Saigon, the U.S. Embassy has a reliable Corsican informant who claims that similar meetings were also held in 1968 and 1970 at the Continental Palace. Most significantly, American Mafia boss Santo Trafficante, Jr., visited Saigon in 1968 and is believed to have contacted Corsican syndicate leaders there. Vietnamese police officials report that the current owner of the Continental Palace is Philippe Franchini, the heir of Mathieu Franchini, the reputed organizer of currency- and opium-smuggling rackets between Saigon and Marseille during the First Indochina War.

Police officials also point out that one of Ky's strongest supporters in the Air Force, Transport Division Commander Col. Phan Phung Tien, is close to many Corsican gangsters and has been implicated in the smuggling of drugs between Laos and Vietnam.

From 1965 to 1967 Gen. Lansdale's Senior Liaison Office worked closely with Premier Ky's administration, and the general himself was identified as one of the young premier's stronger supporters among U.S. mission personnel. (203) One can only wonder whether Conein's and Lansdale's willingness to grant the Corsicans a "truce" and overlook their growing involvement in the American heroin traffic might not have been motivated by political considerations, i.e., their fear of embarrassing Premier Ky.

Just as most of the Corsican gangsters now still active in Saigon and Vientiane came to Indochina for the first time as camp followers of the French Expeditionary Corps in the late 1940s and early 1950s, the American Mafia followed the U.S. army to Vietnam in 1965. Like any group of intelligent investors, the Mafia is always looking for new financial "frontiers," and when the Vietnam war began to heat up, many of its more entrepreneurial young members were bankrolled by the organization and left for Saigon. Attracted to Vietnam by lucrative construction and service contracts, the mafiosi concentrated on ordinary graft and kickbacks at first, but later branched out into narcotics smuggling as they built up their contacts in Hong Kong and Indochina.

Probably the most important of these pioneers was Frank Carmen Furci, a young mafioso from Tampa, Florida. Although any ordinary businessman would try to hide this kind of family background from his staid corporate associates, Frank Furci found that it impressed the corrupt sergeants, shady profiteers, and Corsican gangsters who were his friends and associates in Saigon. He told them all proudly, "My father is the Mafia boss of Tampa, Florida." (204) (Actually, Frank's father, Dominick Furci, is only a middle-ranking lieutenant in the powerful Florida-based family. Santo Trafficante, Jr., is, of course, the Mafia boss of Tampa. (205)) Furci arrived in Vietnam in 1965 with good financial backing and soon became a key figure in the systematic graft and corruption that began to plague U.S. military clubs in Vietnam as hundreds of thousands of GIs poured into the war zone. (206) A lengthy U.S. Senate investigation later exposed the network of graft, bribes, and kickbacks that Furci and his fellow profiteers employed to cheat military clubs and their GI customers out of millions of dollars. At the bottom of the system were 500,000 bored and homesick GIs who found Vietnamese rice too sticky and the strong fish sauce repugnant.

The clubs were managed by senior NCOs, usually sergeant majors, who had made the army their career and were considered dedicated, trustworthy men. While the officers were preoccupied with giving orders and running a war, the sergeants were left with responsibility for all of the minor details involved in managing one of the largest restauran and night club chains in the world-ordering refrigerators, hiring bands, selecting liquor brands, and negotiating purchasing orders for everything from slot machines to peanuts. Accounting systems were shoddy, and the entire system was pathetically vulnerable to well-organized graft. Seven sergeants who had served together in the Twenty-fourth Infantry Division at Augsburg, Germany, during the early 1960s had discovered this weakness and exploited it fully, stealing up to $40,000 a month from NCO clubs.(207)

In 1965 these seven sergeants started showing up in Vietnam as mess custodians and club managers at the First Infantry Division, the Americal Division, and U.S. army headquarters at Long Binh. (208) Most important of all, the group's ringleader, Sgt William 0. Wooldridge, was appointed sergeant major of the army in July 1966. As the army's highest-ranking enlisted man, he served directly under the army chief of staff at the Pentagon, where he was in an ideal position to manipulate personnel transfers and cover up the group's activities. (209)

At the top of the system were the civilian entrepreneurs-Frank Furci and his competitor, William J. Crum-who worked as agents for a host of American companies and paid the sergeants lavish kickbacks on huge Army purchase orders for kitchen equipment, snacks, liquo , etc.

Furci was also heavily involved in the currency black market. A U.S. Senate investigation of illegal currency manipulations in Vietnam later showed that he had exchanged $99,200 through a single unauthorized money changer at the black market rate of 300 or 400 piasters to the dollar, considerably more than the official rate of 118 piasters. (210)

Unfortunately for Furci, his competitor, William J. Crum, was also aware of these illegal transactions, and he decided to use this knowledge to force Furci out of business. Frank Furci was simply outclassed by the crippled, half-blind William Crum, an old China hand who has made a profit on almost every war in Asia since 1941. Attracted by the economic potential of the growing Southeast Asia conflict, Crum came out of his milliondollar retirement in Hong Kong and moved to Saigon in 1962. (211)

While the massive U.S. military buildup in 1965 had attracted other commercial agents as well, Crum seemed particularly resentful of Furci, whose competing line of liquor brands, slot machines, and kitchen equipment had "stolen" $2.5 million worth of his business. (212) Crum passed on information about Furci's illegal currency transactions to the Fraud Repression Division of the Vietnamese customs service through a U.S. army general whom Crum was paying $1,000 a month for protection. (213) Vietnamese customs raided Furci's offices in July 1967, found evidence to support the accusations, and later fined him $45,000. (214) Unable to pay such a large fine, Furci left Saigon. Crum later bragged that he had "paid for" the raid that had eliminated his competitor. (215)

Furci moved to Hong Kong and in August opened a restaurant named the San Francisco Steak House with nominal capital of $100,000. (216) More importantly, Furci was instrumental in the formation of Maradern Ltd., a company that the Augsburg sergeants who managed NCO clubs in Vietnam used to increase illegal profits from the military clubs. Although Furci's name does not appear on any of the incorporation papers, it seems that he was the "silent partner" in the classic Mafia sense of the term. (217)

Maradem Ltd, was not a wholesale supplier or retail outlet, but a broker that used its control over NCO clubs and base mess halls to force legitimate wholesalers to pay a fixed percentage of their profits in order to do business. (218) Maradem's competitors were gradually "squeezed out" of business, and in its first year of operation the company did $1,210,000 worth of business with NCO clubs in Vietnam. (219)

By 1968 Frank Furci had gained three years of valuable experience in the shadow world of Hong Kong and Indochina; he was friendly with powerful Corsican syndicate leaders in Saigon and had the opportunity to form similar relationships with chiu chau bosses in Hong Kong. (220) Thus, perhaps it is not too surprising that the boss himself, Santo Trafficante, Jr., did Furci the honor of visiting him in Hong Kong in 1968. Accompanied by Frank's father, Dominick Furci, Trafficante was questioned by Hong Kong authorities regarding the purpose of his visit, and according to a U.S. Senate investigation, he explained that "They were traveling around the world together at the time. They stopped to visit Furci, Frank Furci in Hong Kong and to visit his restaurant .... (221)

After a leisurely stopover, Trafficante proceeded to Saigon, (222) where, according to U.S. Embassy sources, he met with some prominent Corsican gangsters.(223) Trafficante was not the first of Lansky's chief lieutenants to visit Hong Kong. In April 1965 John Pullman, Lansky's courier and financial expert, paid an extended visit to Hong Kong, where he reportedly investigated the narcotics and gambling rackets.(224)

Although the few Mafia watchers who are aware of Trafficante's journey to Asia have always been mystified by it, there is good reason to believe that it was a response to the crisis in the Mediterranean drug traffic and an attempt to secure new sources of heroin for Mafia distributors inside the United States. With almost 70 Percent of the world's illicit opium supply in the Golden Triangle, skilled heroin chemists in Hong Kong, and entrenched Corsican syndicates in Indochina, Southeast Asia was a logical choice.

Soon after Trafficante's visit to Hong Kong, a Filipino courier ring started delivering Hong Kong heroin to Mafia distributors in the United States. In 1970 U.S. narcotics agents arrested many of these couriers. Subsequent interrogation revealed that the ring had successfully smuggled one thousand kilos of pure heroin into the United States-the equivalent of 10 to 20 percent of America's annual consumption.

Current U.S. Bureau of Narcotics intelligence reports indicate that another courier ring is bringing Hong Kong heroin into the United States through the Caribbean, Trafficante's territory. From Hong Kong heroin is usually flown to Chile on regular flights and then smuggled across the border into Paraguay in light, private aircraft.(225) In the la e 1960s Paraguay became the major transit point for heroin entering the United States from Latin America; both Hong Kong and Southeast Asian heroin smuggled across the Pacific into Chile and European heroin smuggled across the Atlantic into Argentina are shipped to Paraguay before being forwarded to the United States. Argentina and Paraguay are popular refuges for Marseille gangsters wanted in France for serious crimes. The most prominent of these is Auguste Joseph Ricord, a Marseille-born gangster who worked with the Gestapo during World War 11. Using a variety of means ranging from private aircraft to stuffed artifacts, Ricord is believed to have smuggled some 2.5 billion dollars' worth of heroin into the United States from Argentina and Paraguay in the last five years. (226) Although law enforcement officials have always assumed that Ricord and his associates were being supplied from Marseille, current reports of shipments from Hong Kong and Southeast

Asia to Paraguay have raised the possibility that their sources may have shifted to Asia in recent years. (227) (For heroin routes to the United States through Latin America, see Map 1, page 10.)

The Consequences of Complicity: A Generation of Junkies

In the face of the twin horrors of the Vietnam drug problem-the heroin epidemic among GIs and the growing exports to the United Stateswhat has been the response from American diplomatic and military officials in Vietnam? On the whole, their reaction has been a combination of embarrassment and apathy. Embarrassment, because they are all aware to some degree, even though they will not admit it, that elements of the Vietnamese government they have been praising and defending all these years are pushing heroin to American GIs Apathy because most of them feel that anybody who uses heroin deserves what he gets. Almost all U.S. officials knit their brows, cluck their tongues, and try to look very, very concerned whenever the heroin problem is mentioned, but most simply could not care less. They are in Vietnam to beat the VC, smash the Communists, and defend Democracy; the fact that some of Democracy's proteges are pushing heroin is something they would rather not think about.

In the early years of the Diem administration, American pronouncements about its goals in Vietnam had an almost naively innocent quality about them. President Diem was seen as a middle path of virtuous democracy between the Viet Minh's brutal "Communist dictatorship" on the left and the corrupt, dopedealing Binh Xuyen pirates on the right. When Diem refused to fire his corrupt brother, who had revived the endemic corruption so characteristic of the Binh Xuyen, the U.S. mission helped engineer Diem's downfall in the hope that an honest, efficient government would emerge from the confusion. But as Vietnam's politics proceeded to plunge into chaos and Saigon's security reached the critical level, the U.S. mission saw the light and prayed for the return of another "strong man."

The answer to the American prayer was the Thieu-Ky administration. Although Thieu and Ky devoted too much of their time to fighting each other, the Americans have generally been pleased with their ability to govern with a firm, if despotic, hand. Having learned that this type of heavy-handed government is the only kind compatible with American interests, U.S. officials were hardly going to protest when the close associates of both leaders were involved in systematic corruption, including the narcotics traffic. As long as the narcotics traffic was directed exclusively at Chinese and Vietnamese opium smokers, U.S. congressional complaints about corruption were muted. When in 1968 Senator Albert Gruening accused Air Vice-Marshal Ky of smuggling opium, the U.S. Embassy in Saigon issued a firm, if inaccurate, denial, and the matter was forgotten. (228)But when South Vietnam's narcotics syndicates started cultivating the GI heroin market, the problem was not dismissed so cavalierly. After NBC's Saigon correspondent accused President Thieu's chief adviser, General Quang, of being "the biggest pusher" of heroin to GIs in Vietnam (229) the U.S. Embassy "filed a top level report to Washington saying it can find no evidence to support recent charges that President Nguyen Van Thieu and Vice-President Nguyen Cao Ky were involved in or profiting from the drug trade." Simultaneously, U.S. officials defended Thieu and Ky publicly by leaking the Embassy report to members of the Saigon press corps in an offthe-record background briefing. (230)

According to a U.S. Embassy official assigned to the drug problem, the U.S. mission "can find no evidence" because it studiously avoids looking for any. It is an unwritten rule among Embassy officials that nobody can mention the names of high-ranking Vietnamese during discussions of the heroin traffic. The CIA avoids gathering information on high-level involvement, and even in its closed-door sessions with high Embassy officials discusses only minor pushers and addicts.

The U.S. mission's handling of the accusations concerning Gen. Ngo Dzu's involvement in the heroin trade is another case in point. Beginning in January 1971, the U.S. army's Criminal Investigation Division (CID) began gathering detailed information on Gen. Ngo Dzu's involvement in GI heroin traffic. Although these reports were sent to the U.S. Embassy through the proper channels, the U.S. mission did absolutely nothing. (231) When U.S. Congressman Robert H. Steele told a congressional subcommittee in July 1971 that "U.S. military authorities have provided Ambassador Bunker with hard intelligence that one of the chief traffickers is Gen. Ngo Dzu, the commander of 11 Corps, (232) the U.S. mission did its best to discredit the Congressman. Rather than criticizing Gen. Ngo Dzu for pushing heroin, the senior U.S. adviser for 11 Corps declared publicly, "There is no information available to me that in any shape, manner or fashion would substantiate the charges Congressman Steele has made." (233) In light of the CID report quoted earlier, the U.S. mission has apparently decided to use any means possible to protect the Thieu regime from investigation of its involvement in the heroin trade.

While the U.S. Embassy has done its best to shield the Thieu regime from criticism, the Nixon administration and the U.S. military command have tried to defuse public concern over the GI heroin epidemic by minimizing the extent of the problem. The military offers two main arguments to justify its official optimism: (1) the definitive urinalysis test administered to every Vietnam GI just before he returns to the United States has shown that no more than 5.5 percent of all army personnel in Vietnam are heroin users; (2) since only 8.0 percent of the GI addicts in Vietnam inject, or "mainline," the great majority who smoke or snort heroin are not seriously addicted and will have no problern kicking the habit once they return home. (234)

Unfortunately, the army's first supposition is not true. On June 22, 1971, the U.S. military command ordered every GI leaving Vietnam to submit to a sophisticated test that can detect significant amounts of morphine in the body. Any GI who tested positively was confined to a special detoxification center and could not be allowed to return home until he had "dried out" and could pass the test. From the very first, GIs started devising ingenious ways of belting the system. Supervision of the testing centers has been notoriously lax, and many serious addicts pass by bringing a buddy's "clean" urine to the test and substituting it for their own. (235) Since the urinalysis can only detect morphine in the body if the addict has used heroin within the last four or five days, many addicts dry themselves out voluntarily before taking the test. (236) Army nurses have seen addicts who are in the midst of an agonizing withdrawal pass the test.(237) Contrary to popular myth, addicts can control their intake to some extent, and often alternate "sprees" with brief periods of abstinence lasting up to a week, especially the last few days before payday.(238)

Almost every American soldier in Vietnam knows the exact date of his scheduled return to the "world," and most keep a running countdown, which often includes hours and minutes as the time gets shorter. Every GI's DEROS (Date of Expected Return from Overseas) has an historic, even religious quality about it, and the thought of having to stay an extra week, or even a few days more is absolutely intolerable. Most GI addicts accept the pain of voluntary withdrawal in order to pass the test and get on their scheduled flight. Those who are too weak to make it on their own volunteer for the base "amnesty" program.

Many army physicians report a disproportionately high percentage of patients with only a few weeks left in their tours. (239) When one GI was asked why he and his buddies had temporarily given up heroin, he replied, "The magic word, the absolute magic word, is DEROS." (240) The short, painful detoxification simply flushes the morphine out of the system but in no way ends the deep psychological craving for heroin. When these men return home they are still "addicts" in every sense of the word.

The army's suggestion that addicts who smoke heroin in Vietnam are somehow less addicted than those who "mainline" back in the United States is patently absurd. While it is true that injection is more potent than smoking, Vietnamese heroin is so pure (90 to 98 percent pure compared to 2 to 10 percent pure in the United States) that smoking one vial of Vietnamese heroin is equivalent to five or six injections of the cut heroin available in the United States. (241) (Almost no Hong Kong addicts "mainline," but that city has the most serious heroin addiction problem in the world.) Most GI addicts in Vietnam have habits that would cost them over two hundred dollars a day back in the United States.

The army makes its absurd claim because it is not willing to admit the catastrophic impact of GI addiction in Vietnam on the worsening heroin crisis back in the United States. Despite President Nixon's promise that "all our servicemen must be accorded the right to rehabilitation," the U.S. military command in Vietnam is discharging between one thousand and two thousand GI addicts a month. These are men who are declar d of negligible value to the United States Army" after failing the urinalysis test twice. Although every GI in Vietnam has been guaranteed the right to declare himself an addict and volunteer for treatment, the army's generosity does not often extend to two-time losers. Once a commanding officer decides that a two-time loser is a hopeless case, the GI addict is flown back to the United States and discharged almost immediately Y. (242)

Virtually none of these addicts are given any follow-up treatme t. In August 1971 the chairman of the House Subcommittee on Public Health, Rep. Paul Rogers, declared that "Veterans Administration hospitals have handled only three referrals out of 12,000 servicemen on heroin . . . in Vietnam. " (243) Left to fend for themselves, many of these men are returning to their home towns as confirmed addicts and potential pushers. A large percentage of the returning veterans are middle Americans from communities that have always been completely free from heroin addiction and regarded it as a problem unique to the black ghetto. Organized crime had never established a foothold in white middle-class communities, and most law enforcement experts considered them immune to heroin. When GI addicts started coming home to middle America, however, drug experts were frightened that they might be carriers of the heroin plague. In June 1971 one specialist said, "Each addict makes at least four more. He cannot bear his habit alone and is sure to seek recruits even if he is not himself the pusher. This is the emergency we now face. (244)

In Vietnam heroin use is so commonplace among GIs that the traditional middle-class American taboo toward the drug has been broken. A U.S. army survey administered to 1,000 army returnees in March 1971 showed that while only I I percent had used heroin regularly in Vietnam, 22 percent had tried it at least once. (245) For these men heroin is just another narcotic like marijuana, pep pills, or alcohol. In Vietnam soldiers handle heroin so frequently-buying it for themselves, picking up some for a buddy on duty, or selling it for profit-that the idea of pushing heroin once they get home seems natural. "I heard from a few guys who got off it," said one twenty-two-year-old middle American at the Long Binh treatment center. "They said they were still off 'cause it was too expensive, and anyway, they were scared to use the needle. But they said they wanted me to send 'em some scag [heroin] so they could sell it and make some money. You know a jug [vial] over here only costs two dollars, but you can get a hundred dollars for it back in the world." (246) Traveling through Asia on an investigative tour, U.S. Congressman John M. Murphy found "numerous examples of the slick GI who gets discharged, goes home, then comes back to set himself up in the drug traffic." (247)

According to U.S. narcotics agents, one of the more important heroin exporters in Thailand was an ex-serviceman, William Henry Jackson, who managed the Five Star Bar in Bangkok, a hangout for black GIs. Working with other ex-servicemen, Jackson recruited activeduty soldiers going home as couriers and used local GIs "to ship heroin to the United States through the army and air force postal system. (248)One U.S. agent who has arrested several of these ex-GI drug dealers says that, "Most of these guys say to themselves, 'Just as soon as I get $100,000 for a gas station, home, boat, and car in California I'm going to quit.' Most of them are just regular guys." On April 5, 1971, U.S. customs officials in Fort Monmouth, New Jersey, seized 7.7 kilos of Double U-0 Globe brand heroin in a package mailed from Bangkok, Thailand, through the U.S. military postal system. (249) It had a retail value estimated at $1.75 million. During March and April 1971 U.S. customs seized 248 pieces of mail containing narcotics in the army and air force postal systems. (250)

As the number of American troops in Vietnam rapidly dwindles, there will be a natural tendency to forget the whole nightmarish experience of the Vietnam heroin epidemic. In time the Nixon administration may even claim the end of the GI heroin problem as one of the more solid accomplishments of its Vietnamization program. Despite these fervent hopes, it will probably be a long time before the memory of the Vietnam heroin epidemic can take its richly deserved place in the garbage can of history. For returning GI addicts have come home as carriers of the disease and are afflicting hundreds of communities with the heroin virus. The Golden Triangle heroin laboratories, which had been supplying American soldiers in Vietnam since late 1969, are not going out of business. When the number of GIs in Vietnam declined drastically in 1971, Corsican and Chinese syndicates started shipping Laotian heroin directly to the United States. In April 1971 the Laotian Ambassador to France was apprehended in Paris with sixty kilos of Double U-0 Globe brand heroin destined for the United States. (251) On November 11, 1971, a Filipino diplomat and a Bangkok Chinese merchant were arrested at the Lexington Hotel in New York City with 15.5 kilos of Double U-0 Globe brand shortly after they arrived from Vientiane. (252) Heroin is following the GIs home.

World War I produced a "lost generation" of writers, poets, and artists. World War II gave us a generation of collegians and suburbanites. The Vietnam War seems to be fathering a generation of junkies.

5 South Vietnam: Narcotics in the Nation's Service

1. The Pentagon Papers, Senator Gravel Edition (Boston: Beacon Press, 1971), vol. 1, pp. 221-222.

2. Robert Scheer, "Hang Down Your Head Tom Dooley," in A Muckraker's Guide (San Francisco: Ramparts Magazine, 1969), p. 18.

3. The Pentagon Papers, Senator Gravel Edition, vol. 11, p. 22.

4. Ibid., vol. 1, p. 240.

5. Philippe Devillers and Jean Lacouture, End of a War (New York: Frederick A. Praeger, 1969), p. 377.

6. Thomas A. Dooley, M.D., Deliver Us from Evil (New York: Farrar, Straus and Cudahy, 1956), pp. 41, 60.

7. Ibid., p. 71.

8. Ibid., p. 159; for a description of American moralism in this period see Chester L. Cooper, The Lost Crusade (T~ew York: Dodd, Mead & Company, 1970), pp. 1214.

9. Edward G. Lansdale, In the Midst of Wars (New York: Harper & Row, 1972), p. ix.

10. David Halberstam, The Making of a Quagmire (New York: Random House, 1964), p. 42.

11. Lt. Col. Lucien Conein was one of Lansdale's chief assistants during the 1955 battles which put Diem in power, and he was the CIA liaison man with the coup plotters who overthrew Diem in November 1963. Interestingly, Diem's two key supporters in the 1955 fighting-Gen. Mai 14uu Xuan and Gen. Duong Van Minh-were two of the leaders of the 1963 coup group.

12. Interview with Col. Roger Trinquier, Paris, France, March 25, 1971.

13. Fred. W. Riggs, Thailand: The Modernization of a Bureaucratic Polity (Honolulu: East-West Center Press, 1966), p. 245.

14. The New York Times, The Pentagon Papers (New York: Quadrangle Books, 1971), p. 235.

15. Interview with Bernard Yoh, Washington, D.C., June 15, 1971. (Bernard Yoh was an adviser to President Ngo Dinh Diem during the 1950s.)

16. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

17. Gen. Mai Huu Xuan claims that most of Nhu's dealings with the Chinese syndicates and business community were conducted through a Chinese businessman named Ma Tuyen (interview with Gen. Mai Huu Xuan, Saigon, Vietnam, July 19, 1971). Following the November 1963 coup, Diem and Nhu hid in Ma Tuyen's house in Cholon just prior to their murder (The New York Times, November 4, 1971, p. 8).

18. Stanley Karnow, Time-Life Editorial Reference Files (unpublished manuscript, April 1963).

19. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

20. Ibid.

21. The Can Lao was a clandestine organization formed by Ngo Dinh Nhu shortly after President Diem took office. Party members were recruited from every branch of the military and civil bureaucracy, but were usually conservative Catholics. The party functioned as a government within the government, and through it Nhu was able to exercise direct control over every aspect of the government. Its membership list as kept secret to enable party cadres to spy more effectively on their coworkers.

22. Interview with an exiled Vietnamese army colonel, Paris, France, March 25, 1971.

23. Interview with an exiled Can Lao party official, Paris, France, April 1 1971.

24. Denis Warner, The Last Confucian (London: Angus & Robertson, 1964), p. 224; for one U.S. official's opinion of Dr. Tuyen see Chester L. Cooper, The Lost Crusade, p. 205.

25. The New York Times, The Pentagon Papers, p. 19.

26. Interview with Bernard Yoh, Washington, D.C., June 15, 1971.

27. Interview with an exiled Can Lao party official, Paris, France, April 1, 1971.

28. Ibid.; interview with Tran Van Dinh, Washington, D.C., April 30, 1971.

29. Interdepartmental Task Force, "A Program of Action for South Vietnam," in The New York Times, The Pentagon Papers, p. 129.

30. A number of sources have confirmed the fact that Col. Ky was hired to fly these missions: interview with Col. Phan Phung Tien, Tan Son Nhut Air Base, South Vietnam, July 29, 1971 (Colonel Tien is commander of the Fifth Air Division, the air transport division); interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971; interview with Bernard Yoh, Washington, D.C., June 15, 1971.

31. S. M. Mustard, letter to Senator Ernest Greuning (March 9, 1968); The New York Times, April 19, 1968, p. 11.

32. Interview with Col. Do Khac Mai, Paris, France, March 29, 1971. (Col. Do Khac Mai was commander of the Vietnamese air force in 1963.)

33. The New York Times, The Pentagon Papers, p. 9t.

34. Cablegram from Elbridge Durbrow, United States Ambassador to Sou

Vietnam, to Secretary of State Christian A. Herter, September 16, 1960, in ibid., p. 122.

35. Marguerite Higgins, Our Vietnam Nightmare (New York: Harper ∧ Row, 1965), p. 241.

36. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971; Chester L. Cooper, The Lost Crusade, p. 247.

37. The Pentagon Papers, Senator Gravel Edition, vol. 11, pp. 522-523.

38. Ibid., p. 524.

39. The New York Times, The Pentagon Papers, p. 347.

40. Ibid., p. 410.

41. Robert Shaplen, The Road from War (New York: Harper & Row, 1970), pp. 22-23.

42. The Pentagon Papers, Senator Gravel Edition, vol. 11, pp. 525-526.

43. Interview with an exiled Can Lao party official, Paris, France, April 1, 1971.

44. Interview with Nguyen Xuan Vinh, Ann Arbor, Michigan, June 22, 197 1. (Nguyen Xuan Vinh was commander of the Vietnamese air force from 1958 until 1962.)

45. Interview with Col. Do Khac Mai, Paris, France, March 29, 1971. (According to Colonel Mai, Mrs. Ly had raised prices and was grafting from the base food budget. Air force officers complained to the high command, and Ky was removed from command of Tan Son Nhut after an investigation by a ranking army general.)

46. George McTurnan Kahin and John W. Lewis, The United States in Vietnam (New York: The Dial Press, 1967), p. 241.

47. Interview with Nguyen Xuan Vinh, Ann Arbor, Michigan, June 22, 1971.

48. The New York Times, April 22, 1966, p. 22.

49. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

50. Ibid.

51. Ibid.

52. Interview with Charles Sweet, Washington, D.C., May 1971. (Charles Sweet was an adviser to Air Vice-Marshal Ky when he was minister of sports and youth in 1965. Mr. Sweet later served as an assistant to Gen. Edward G. Lansdale in the senior liaison office attached to the U.S. Embassy in Saigon.)

53. Shaplen, The Road from War, p. 185.

54. Interview with Charles Sweet, Washington, D.C., May 1971.

55. Interview with a Vietnamese intelligence official, Saigon, Vietnam, July, 1971.

56. Interview with Tran Van Dinh, Washington, D.C., February 16, 1971. (Tran Van Dinh is former South Vietnamese ambassador to the United States.)

57. Vietnam Guardian (Saigon), August 18, 1966.

58. Interview with a Vietnamese intelligence official, Saigon, Vietnam, July 1971; Shaplen, The Road from War, pp. 36-37, 53.

59. George Roberts, Report to Robert R. Johnson, Public Administration Ad Hoc Committee on Corruption in Vietnam (November 29, 1967).

60. George Roberts, Report, October 5, 1967.

61. Los Angeles Times, February 29, 1968.

62. George Roberts, Report, December 6, 1967.

63. Ibid.

64. George Roberts, Report to Robert R. Johnson (November 29, 1967).

65. U.S. Congress, Senate, Congressional Record 114, no. 16 (February 5, 1968).

66. The Christian Science Monitor, March 9, 1968.

67. The New York Times, April 19, 1968, p. 11.

68. Interview with a Vietnamese intelligence official, Saigon, Vietnam, July 1971.

69. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

70. "Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, U.S. Embassy, Saigon, Vietnam (May 1967), p. 11. (Those who prepared this report were Edward G. Lansdale, David E. Hudson, Calvin E. Mehlert, and Charles F. Sweet.)

71. George Roberts, Report, October 5, 1967.

72. Kahin and Lewis, The United States in Vietnam, pp. 347-348.

73. Keesing's Research Report, South Vietnam: A Political History, 1954-1970 (New York: Charles Scribner's Sons, 1970), pp. 124-125.

74. Kahin and Lewis, The United States in Vietnam, p. 358.

75. Shaplen, The Road from War, pp. 156-157.

76. "Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, P. 9.

77. Ibid., pp. 11, 15.

78. Ibid., p. 10.

79. George Roberts, Report, December 6, 1967.

80. Ibid.

81. Ibid.

82. George Roberts, Report, January 19, 1968.

83. Interview with Col. Tran Vam Phan, Saigon, Vietnam, July 23, 1971. (Colonel Phan is information officer for the National Police.)

84. Interview with Col. Phan Phung Tien, Tan Son Nhut Air Base, Vietnam, July 29, 1971.

85. Interview with Col. Tran Van Phan, Saigon, Vietnam, July 23, 1971. (Colonel Phan was then assistant to the director-general of the National Police for personnel training. He suffered a serious leg wound in the accident and was hospitalized for three months.)

86. Keesing's Research Report, South Vietnam: A Political History, 1954-1970, p. 138.

87. Richard Critchfield, The Long Charade (New York: Harcourt, Br ce and World, 1968), p. 387.

88. Keesing's Research Report, South Vietnam: A Political History, 1954-1970, p. 138.

89. Interview with a senior MACCORDS official, Saigon, Vietnam, July, 1971.

90. Most of the visible corruption in the National Assembly seems to be the work of lower house members. As in many European parliaments, the Senate has less nominal authority and its members are generally more reserved, more austere.

91. "Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, pp. 1920.

92. Interview with a lower house representative, Saigon, Vietnam, July, 1971.

93. "Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, P. 18.

94. The Washington Post, September 8, 1968.

95. The New York Times, June 6, 1971, p. 2.

96. Capt. Gary C. Lulenski (MC), Capt. Larry E. Alessi (MC) and Sp4c Charles E. Burdick, "Drug Abuse in the 23rd Infantry Division (Americal)" (September 1970), p. 9.

97. Major Richard H. Anderson (MC) and Sp4c Wade Hawley, "Subject: Analysis of 482 Questionnaires on Illicit Drug Use in an Engineering Battalion in Vietnam" (November 11, 1970), p. 6.

98. The New York Times, May 16, 1971, p. 1.

99. "The Drug Abuse Problem in Vietnam," Report of the Office of the Provost Marshal, U.S. Military Assistance Command Vietnam (Saigon, 1971 ), p. 4. (Emphasis added.)

100. Ibid., p. 6.

101. For an analysis of the impact of the army's marijuana suppression campaign, see Norman E. Zinberg, "GIs and OJs in Vietnam," The New York Times Magazine (December 5, 1971), p. 120. Dr. Zinberg says the crackdown on marijuana began in 1968. Since large numbers of GIs did not start using heroin until spring 1970, it is obvious that the crackdown on marijuana is only a contributing factor in the switch to heroin.

102. Interview with Captain Higginbotham, Can Tho, Vietnam, July 23, 1971. (Captain Higginbotham is a medical doctor working in the IV Corps amnesty program.)

103. The Washington Post, July 13, 1971.

104. Interview with Maj. Gen. John H. Cushman, Can Tho, Vietnam, July 23, 1971.

105. The New York Times, May 18, 197 1, p. ~10.

106. "The Drug Abuse Problem in Vietnam," Report of the Office of the Provost Marshal, p. 3.

107. Interview with U.S. Rep. Robert H. Steele, Washington, D.C., June 16, 1971.

108. Milford Citizen (Milford, Connecticut), June 29, 1971. (The paper carried a UPI dispatch from Phnom Penh that said, "Since its inclusion in the Indochina War 15 months ago Cambodia has become a small but growing 'way station' for hard drugs bound for American Servicemen in Vietnam.")

109. Interview with an agent, Washington, D.C., October 21, 1971. (Huu Tim Heng's involvement in the heroin traffic has been confirmed by the U.S. Bureau of Narcotics and Dangerous Drugs, October 21, 1971.)

110. Telephone interview with Richard J. Hynes, USAID/Laos, Vientiane, Laos, September 7, 1971.

111. Interview with an agent, U.S. Bureau of Narcotics and Dangerous Drugs, Washington, D.C., October 21, 197 1.

112. Interview with Vietnamese residents of Vientiane, Laos, August 1971; interview with a Vietnamese intelligence official, Saigon, Vietnam, September 1971; interview with Estelle Holt, London, England, March 1971 (Estelle Holt is a former foreign correspondent in Laos); inter

view with an agent, U.S. Bureau of Narcotics and Dangerous Drugs, New Haven, Connecticut, May 3, 1972.

113. Interview with an agent, U.S. Bureau of Narcotics and Dangerous Drugs, Saigon, Vietnam, July 27, 1971.

114. The New York Times, August 30, 1971, p. 1.

115. Interview with a U.S. customs adviser, Saigon, Vietnam, July 16, 1971.

116. Interview with the U.S. air force adviser to the Fifth Air Division, Tan Son Nhut Air Base, Vietnam, July 1971.

117. Ibid.

118. On June 29, 1971, United Press International reported, "Vietnamese air force C 119 flying boxcars or C 123 providers, which fly military cargo to Cambodia, return to Saigon empty, except for the drug shipments, sources claim" (Milford Citizen [Milford, Connecticut], June 29, 1971).

119. The New York Times, August 30, 1971, p. 1.

120. Interview with the U.S. air force adviser to the Fifth Air Division, Tan Son Nhut Air Base, Vietnam, July 1971; interview with a Vietnamese intelligence official, Saigon, Vietnam, July 1971.

121. The Washington Post, July 21, 1971.

122. Ibid., July 17, 1971.

123. Ibid., July 18, 1971.

124. "Corruption in Vietnam," memo from Bill Marmon, Saigon, to Time World, New York (July 23, 1969).

125. Shaplen, The Road from War, pp. 88, 125.

126. "National Politics in Viet-Nam," Report of Senior Liaison Office, p. 12.

127. Interview with a senior MACCORDS official, Saigon, Vietnam, July 1971.

128. Ibid.

129. The New York Times, August 8, 1971, p. 1.

130. Interview with a Vietnamese intelligence official, Saigon, Vietnam, July 1971.

131. The New York Times, May 11, 1970, p. 1.

132. The Washington Post, May 11, 1970.

133. The New York Times, May 12, 1970, p. 1; The Washington Post, May 13, 1970.

134. Interview with Vietnamese naval officers, Saigon, Vietnam, July 1971.

135. The floods were some of the worst in central Vietnam's recent history. The typhoon rains killed five thousand people and left thousands homeless (Don Luce and John Sommer, Vietnam: The Unheard Voices [Ithaca, N.Y.: Cornell University Press, 19691, pp. 243-244). Admiral Cang's grafting outraged the residents of central Vietnam, and the I Corps commander, Gen. Nguyen Chanh Thi, initiated an official investigation of the affair. It was largely due to General Thi's persistent demands for punishment that Rear Admiral Cang was removed from command (interview with Gen. Nguyen Chanh Thi, Washington, D.C., October 21, 1971.)

136. Vietnamese navy records show that Rear Adm. Chung Tan Cang has held the following positions since he was removed from command in 1965:

(1) 1966, special assistant to the joint generals staff.

(2) December 1, 1966-August 14, 1969, commander of the Military Academy.

(3) August 14, 1969-July 1, 1970, detached to the Ministry of Defense.

(4) July 1, 1 970-July 1, 197 1, detached as a research assistant.

137. Interview with Vietnamese naval officers, Saigon, Vietnam, July 1971.

138. Vietnamese naval records show that Commo. Lam Nguon Thanh reached the position of deputy commander in chief of the navy before being sent to the U.S. Naval War College in Newport, Rhode Island, in 1966. From 1966 until August 1970 he served successively as assistant to the chief, Political Warfare Directorate and Commandant, Political Warfare College in Dalat.

139. Interview with Vietnamese naval officers, Saigon, Vietnam, July 1971.

140. Ibid.

141. All of the following information is based on extensive interviews with Redactor Ly Ky Hoang, chief of the Narcotics Bureau of the National Police (interviews with Redactor Ly Ky Hoang, Saigon, Vietnam, August 5 and 12, and September 11, 1971). Agents of the U.S. Bureau of Narcotics and Dangerous Drugs who participated in the raids were unwilling or unable to be interviewed. The Thai official involved, Col. Pramual Vanigbandhu, was out of the country when we were in Bangkok.

142. Pacific Stars and Stripes, July 30, 1971. (Emphasis added.)

143. Competition between the Vietnamese and Thai police created complications in the investigation and arrests. Redactor Hoang is openly resentful of the Thai police for the haughty, commanding attitude they displayed at the various planning meetings. Redactor Hoang told the authors "the whole story" because,~"the Thais are claiming all the credit" (interview with Redactor ~y Ky Hoang, Saigon, Vietnam, August 12, 1971).

144. Vietnamese navy records show that Capt. Nguyen Huu Chi was transferred from command of Task Force 213/DP to an unspecified post on August 9, 1971.

145. Interview with Redactor Ly Ky Hoang, Saigon, Vietnam, September 11, 1971.

146. Interview with a senior MACCORDS official, Saigon, South Vietnam, August 1971.

147. Corps commanders have been a key feature of the Vietnamese corruption system since the early 1960s. In a report prepared for Ambassador Ellsworth Bunker in May 1968, Gen. Edward G. Lansdale of the CIA described how the corps commanders have tended to become corrupt warlords:

". . . the civil apparatus and Armed Forces in most of the country have operated more on the basis of a system of the patronage revolving around each corps commander under which . . . each has appointed and replaced virtually all province and district chiefs and to a considerable degree division and regimental commanders in the Corps Tactical Zone. As a result, these officers are more responsive to the corps commander than to the central government . . . and not infrequently the corps commander's policies differ from those of Saigon. Certain facets of this system have also led to considerable corruption within the government" ("Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, p. 6).

148. The competition between General Dzu and Gen. Lu Lan sparked a major controversy in South Vietnam during the summer of 1971. In a widely publicized speech in early 1971, General Dzu claimed that he could not clean up the 11 Corps drug traffic because he had inherited the problem from his predecessor, Gen. Lu Lan. After U.S. Congressman Robert Steele (R., Conn.) accused Ngo Dzu of being one of the chief drug traffickers in South Vietnam, Gen. Lu Lan, who had since been promoted to inspector general of ARVN, announced gleefully that he was undertaking a full investigation of the charges. General Dzu counterattacked, accusing Lu Lan of being the man responsible Congressman Steele's allegations (Auchincloss, Johnson and Lynch, Newsweek dispatch [Saigon Bureau], July 9, 1971; The New York Times, July 8, 1971, p. 1; July 10, 1971, p. 2). In his report to Ambassador Bunker cited above, General Lansdale reported that "General Lu Lan is personally loyal to Thieu" and implied that Gen. Lu Lan was fast becoming another corrupt warlord. ("Nationalist Politics in Viet-Nam," Report of the Senior Liaison Office, p. 6.)

149. Interview with a high-ranking police-intelligence official, Saigon, Vietnam, July 1971.

150. The U.S. army's Criminal Investigation Division (CID) also filed three reports on Gen. Ngo Dzu's involvement in the drug traffic.

1. Dated January 6, 1971. SQurce reported to CID that General Dzu and his father were involved in narcotics trafficking. This source said that General Dzu was cooperating with a number of other individuals, including the ARVN provost marshal in Qui Nhon, certain South Vietnamese navy officers, and an officer in a South Korean division.

2. Dated May 12, 1971. Source reported that Gen. Ngo Dzu's father, Ngo Khoung, was trafficking in heroin with an ethnic Chinese. According to this source General Dzu's father is working with a former special assistant to President Thieu.

3. Dated July 10, 1971. Source alleged that General Dzu co trolled a sizable heroin ring through a number of associates, including his mistress, Mrs. Tran Thi Khanh.

151. Dispatch News Service International (weekly Asian release), August 16, 1971.

152. Interview with U.S. army enlisted men, Operation Crossroads Rehabilitation Center, Long Binh, Vietnam, July 1971.

153. Dien Tin (Saigon), March 23, 1971.

154. D. Gareth Porter, "Saigon National Assembly Racked by Corruption and Smuggling," Dispatch News Service International, April 19, 1971.

155. Dien Tin, May 1-2, 1971.

156. Cong Luan (Saigon), May 19, 1971.

157. Porter, "Saigon National Assembly Racked by Corruption and Smuggling."

158. Hoa Binh (Saigon), March 29, 1971.

159. The bloc committee chairman and their committees, as of June 12, 1971, are as follows:

1. Rep. Tran Quy Phong, Communications and Public Works
2. Rep. Nguyen Dinh Ly, Economics
3. Rep. Pham Hun Giao, Foreign Affairs
4. Rep. Hoang Thong, Interior
5. Rep. Le Van Dien, Information and Open Arms
6. Rep. Truong Dinh Tu, Public Health.

Also, a former Independence Bloc member, Rep. Tran Kim Thoa, was chairman of the Labor, Social Welfare, and Veterans Committee.

160. Interview with a lower house representative, Saigon, Vietnam, July 1971; Tin Sang (Saigon), May 19, 1971.

161. Cong Luan, May 19, 1971; Chinh Luan (Saigon), May 19, 1971.

162. Tin Sang (Saigon), April 18, 1971.

163. Porter, "Saigon National Assembly Racked by Corruption and Smuggling."

164. Cong Luan, May 17, 1970.

165. Porter, "Saigon National Assembly Racked by Corruption and Smuggling."

166. Dien Tin, January 31, 1971.

167. "The Drug Abuse Problem in Vietnam," Report of the Office of the Provost Marshal, p. 13.

168. Interview with a Vietnamese customs official, Saigon, Vietnam, July 22, 1971.

169. Announcement from the residence of the prime minister, Republic of Vietnam, March 19, 1971.

170. "The Drug Abuse Problem in Vietnam," Report of the Office of the Provost Marshal, p. 13.

171. Saigon Post, March 25, 1971.

172. Vietnam Guardian (Saigon), March 25, 1971.

173. Ibid., March 24, 1971.

174. Bao Den (Saigon), March 24, 1971.

175. Dien Tin (Saigon), March 22, 1971.

176. General Khiem has an interesting political history: During the November 11, 1960 coup against President Diem, he advanced on Saigon from the delta telling both sides that he was coming to help them. When it was apparent that the coup group was weakening, he ordered his troops to attack the rebels, delivered the decisive blow, and took credit for saving the Diem regime. Three years later he allied with General Duong Van Minh to topple President Diem, but only three months after that he played a key role in the coup which overthrew General Minh's government. Although he occupied a number of important positions in succeeding governments, he was one of the architects of a coup against the new regime in February 1965. This last coup is nerhaps General Khiem's most remarkable achievement; be organized it from the Vietnamese Embassy in Washington, D.C., nine thousand miles from Saigon (Kahin and Lewis, The United States in Vietnam, p. 173).

177. The New York Times, May 18, 1971, p. 10.

178. Interview with a U.S. customs adviser, Saigon, Vietnam, July 16, 1971.

179. "The Drug Abuse Problem in Vietnam," Report of the Office of the Provost Marshal, p. 10.

180. Ibid., p. 10.

181. "Excerpts from Report of Customs Advisor Joseph R. Kvoriak; Date: February 8, 197 1," United States Government Memorandum, to James E. Townsend, chief of party/customs, from Joseph R. Kvoriak, customs adviser, on the subject "Lack of Controls and Enforcement, Tan Son Nhut," (Februarv 25, 1971 ), p. 1.

182. Ibid., p. 2.

183. Ibid., pp. 4-5. (Emphasis added.)

184. "The Drug Abuse Problem in Vietnam", Report of the Provost Marshal, p. 7.

185. The New York Times, August 30, 1971, p. 1.

186. The New York Times, April 22, 1971, p. 1.

187. Interview with a U.S. Embassy official, Saigon, Vietnam, July 1971.

188. Announcement, from the residence of the prime minister, Republic of Vietnam, March 19, 1971.

189. Lap Truong (Saigon), May 29, 1971.

190. Interview with a Vietnamese customs official, Saigon, Vietnam, July 1971.

191. The New York Times, August 8, 1971, p. 1.

192. Lap Truong, May 31, 1971.

193. Interview with a Vietnamese intelligence officer, Saigon, Vietnam, July 1971. (Some other sources report that Colonel Binh was a member of Khiem's army faction during the early 1960s. These sources feel that Colonel Binh may still be a member of the Khiem faction today, even though he is Mrs. Thicu's nephew.)

194. The New York Times, August 8, 197 1, p. 1; interview with a U.S. customs adviser, Saigon, Vietnam, July 1971.

195. Interview with John Warner*, Washington, D.C., October 14, 1971; other U.S. officials including Representative James H. Scheuer, the Comptroller General of the United States, and the Assistant Secretary of State for East Asia and Pacific Affairs have observed this shift to Southeast Asia. (U.S. Congress, House Committee on Foreign Affairs, International Aspects of the Narcotics Problem, 92nd Cong., Ist sess., 1971, pp. 61, 119, 149.)

196. Interview with Police Col. Smith Boonlikit, Bangkok, Thailand, September 17, 1971.

197. Cabled dispatch from Shaw, Vientiane (Hong Kong Bureau). to Time Inc., received September 16-17, 1965.

198. Interview with Gen. Edward G. Lansdale, Alexandria, Virginia, June 17, 1971.

199. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

200. French commercial shipping companies still maintain regular schedules between Saigon and France. In August 1971, for example, there were four scheduled departures from Saigon:
Leave Arrive Arrive Company Ship Saigon
Le Havre Marseille Messageries Maritimes Godavery --- August 9 October 8
Chargeurs Réunis Tobago --- August 6 September 24
Nausicaa --- August 22 October 9
Toscana --- August 26 October 26

201. Interview with Lt. Col. Lucien Conein, McLean, Virginia, June 18, 1971.

202. Ibid.

203. In September 1965 General Lansdale's Senior Liaison Office began advising the Vietnamese Central Rural Construction Council, headed by Premier Ky, on pacification and social reform. (Kahin and Lewis, The United States in Vietnam, p. 242.)

204. Interview with Norma Sullivan, Singapore, September 24, 1971. (Norma Sullivan is a special assistant to William Crum, and has worked in Saigon business circles since the early 1960s.)

205. Ed Reid, The Grim Reapers (Chicago: Henry Regnery Company, 1969), appendix 111, chart 8.

206. U.S. Congress, Senate Permanent Subcommittee on Investigations, Committee on Government Operations, Fraud and Corruption in Management of Military Club Systems-Illeqal Currency Manipulations A flecting South Vietnam, 91 st Cong., 2nd sess., 92nd Cong., I st sess., 1971, pt. 4, p. 1017.

207. Ibid., Report, pp. 28, 34.

208. Ibid., Report, p. 68.

209. Ibid., Report, p. 43.

210. Ibid., pt. 3, p. 637.

211. Ibid., Report, pp. 12-13.

212. Ibid., Report, p. 73.

213. Ibid., pt. 5, p. 1045.

214. Ibid., pt. 2, pp. 478-479.

215. Ibid., pt. 5, pp. 1046-1047.

216. Fine Foreign Foods Ltd., described as the "restaurant proprietor" of the San Francisco Steak House (Ground floor, 67 Peking Road, Kowloon), registered with the Inland Revenue Department, Hong Kong, on August 1, 1967.

217. Senate Permanent Subcommittee on Investigations, Committee on Government Operations, Fraud and Corruption in Management of Military Club Systems-Illegal Currency Manipulations Aflecting South Vietnam, 91st Cong., 2nd sess., 92nd Cong., Ist sess., Report, pp. 75-77.

218. Ibid., p. 85.

219. Ibid., p. 86.

220. According to corporate records filed with the Hong Kong government, Frank Carmen Furci resigned from his position as director of Fine Foreign Foods Ltd. on March 18, 1970. He transferred 1,667 shares to James Edward Galagan, his partner for the last few years, and 1,666 shares to Setsui Morten on March 25, 1970. Since the corporate report filed in 1969 showed that Frank Carmen Furci owned 3,333 shares, it is presumed that these events marked the end of his connection with the company and its restaurant.

221. Senate Permanent Subcommittee on Investigations, Committee on Government Operations, Fraud and Corruption in Management of Military Club Systems-Illegal Currency Manipulations Aftectinq South Vietnam, 91st Cong., 2nd sess., 92nd Cong., Ist sess., pt. 2, p. 279. This testimony before the committee was given by Senate investigator Carmine Bellino, "conceded to be the best investigative accountant in

the country" (Victor S. Navasky, Kennedy Justice [New York: Atheneum, 1971, p. 53.)

222. Reid, The Grim Reapers, p. 296.

223. Interview with a U.S. Embassy official, Saigon, Vietnam, July 1971.

224. Hank Messick, Lansky (New York: G. P. Putnam's Sons, 1971), p. 241.

225. Interview with an agent, U.S. Bureau of Narcotics and Dange ous Drugs, Washington, D.C., November 18, 1971.

226. The New York Times, January 9, 1972, p. 25.

227. The Evening Star (Washington, D.C.), January 6, 1972~ U.S. Coneress, Senate Committee on Appropriations, Foreign Assistance and Related Programs Appropriations for Fiscal Year 1972, 92nd Cong., Ist sess., 1971, p. 614. This and other evidence contradict Secretary of State William Rogers' assertion that the narcotics problem in Southeast Asia is being dealt with effectively. (Sec. of State William Rogers, Testimony Before the Foreign Operations Subcommittee of the Senate Appropriations Subcommittee, Uncorrected Transcript, May 15 1972.)

228. The New York Times, April 19, 1968, p. 11.

229. The Washington Post, July 17, 1971.

230. The Saigon Post, July 25, 1971. (Emphasis added.)

231. The army CID filed reports detailing Gen. Ngo Dzu's involvement in the heroin traffic on January 6, May 12, and July 10, 1971. These reports and other information gathered by the U.S. Bureau of Narcotics and Dangerous Drugs convinced several of its ranking agents that General Dzu was clearly involved.

232. The New York Times, July 8, 1971, p. 1.

233. Ibid., July 10, 1971, p. 2; whether by design or by accident the U.S. Embassy failed to forward these reports on General Ngo Dzu's involvement in the heroin traffic to the State Department in Washington. Testifying in July 1971, the Assistant Secretary of State for East Asia and Pacific Affairs, Marshall Green, said that he had "no information" on Gen. Ngo Dzu's involvement in the traffic. (U.S. Congress, House Committee on Foreign Affairs, International Aspects of the Narcotics Problem, p. 157.)

234. The New York Times, December 19, 1971, p. 1.

235. The Washington Post, August 3, 1971.

236. Pacific Stars and Stripes, August 7, 1971.

237. The New York Times, June 24, 1971, p. 4.

238. Interview with Maj. Richard A. Ratner, Long Binh Rehabilitation Center, Vietnam, July 22, 1971.

239. Interview with Sp4c. James Baltz, Long Binh Rehabilitation Center, Vietnam, July 22, 1971.

240. Pacific Stars and Stripes, July 19, 1971.

241. The New York Times, May 19, 1971, p. 6.

242. Ibid., December 19, 1971, p. 1.

243. The Washington Post, August 3, 1971.

244. The New York Times, June 16, 1971, p. 21.

245. The Washington Post, August 20, 1971.

246. Interview with a U.S. serviceman, Long Binh Rehabilitation Center, South Vietnam, July 22, 1971.

247. The Washington Post, August 19, 1971.

248. Morgan F. Murphy and Robert H. Steele, The World Heroin Problem, 92nd Cong., Ist sess. (Washington, D.C.: U.S. Government Printing Office, 1971), p. 20.

249. Telephone interview with Jerome Hollander, Los Angeles, California, June 25, 1971. (Jerome Hollander is the public information officer, U.S. Customs Regional Commission.)

250. Murphy and Steele, The World Heroin Problem, p. 20,

251. The New York Times, August 11, 1971, p. 1.

252. Ibid., November 12, 1971, p. 93.



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