How the CIA Created the Crack Epidemic

Revolutionary Worker #873, September 15, 1996

In the early 1980s, a new drug, crack cocaine, appeared on the streets--at a time when many youth in the inner city were being forced into the underground economy in order to survive. New burdens were being added onto the poor. In a situation of intolerable poverty, unemployment, lousy health care, falling apart schools and crumbling housing, the spread of crack cocaine brought intensified conflicts between street organizations and the painful desperation of people addicted to the pipe. The government launched brutal new invasions by the police--a so-called "war on drugs"-- using the spread of crack as an excuse.

This war on the people has resulted in an epidemic of police brutality and murder, the mass incarceration of Black and Latino youth, and the criminalization of a generation.It was widely believed that the sudden epidemic of crack cocaine into the oppressed communities--like the introduction of heroin in the Vietnam war era--could be traced to the authorities themselves.Now new facts are in, and it is revealed that this is precisely what has been going on.An exposé by reporter Gary Webb of the San Jose Mercury News reveals that agents working with the U.S. Central Intelligence Agency (CIA) sold tons of cocaine in the United States during those years and shipped the profits to the CIA-run army of Nicaraguan Contras. Webb based his work on "recently declassified reports, federal court testimony, undercover tapes, court records here and abroad and hundreds of hours of interviews over the past 12 months." He was assisted by journalists Georg Hodel and Leonore Delgado.Webb's report uncovered the names of the Contra operatives who bought tons of cocaine from the Colombian drug cartels and passed it on to various drug-dealing networks within the U.S. It documents how Contra drug dealers met with a major CIA agent before starting their operation. It reveals how the Salvadoran government air force flew the cocaine into Texas airfields. It details how tons of cheap cocaine flowed like a river into ghetto streets--first in Los Angeles and then beyond. And finally, Webb's report documents the repeated U.S. government efforts to protect these operations.It has been a long struggle to break through the government coverup of this CIA cocaine traffic. During the congressional Iran-Contra hearings in the late 1980s, two people stood up in the audience and shouted "What about the cocaine!?" They were arrested and sentenced to over a year in prison.Long-time readers of our newspaper, the Revolutionary Workerwill remember many articles, especially in 1988 and 1989, exposing the CIA's use of cocaine to finance their secret war in Central America. Our reports were based on the work of many other people--including the Christic Institute, columnist Alexander Cockburn, journalists Martha Honey and Tony Avirgan, filmmaker Barbara Trent (who created the film Coverup: Behind the Iran-Contra-Affair), and Professor Peter Dale Scott (author of The Iran Contra Connection--Secret Teams and Covert Operations in the Reagan Era).

Now an important new piece of the puzzle has fallen into place: Gary Webb documents that the CIA's agents did more than participate in the cocaine trade. He reveals in detail the role they played in creating the crack explosion that has caused so much suffering among the people.Here is a U.S. government that publicly preached "Just Say No!" and sent an army of police to attack the people in the name of a "war on drugs." And meanwhile, this same government had for years been at the nerve center of the operations that brought in the drugs!

Many people have suspected all along that the U.S. government was behind the crack explosion. Now here are the facts.In this article, we will pass on some of the information Gary Webb uncovered. And we will place it in the context of information documented by others about the role of the CIA and the Reagan/Bush White House in the cocaine trade.The full series by Gary Webb, called "Dark Alliance," appeared in the San Jose Mercury News on August 18, 19 and 20. It is available on the Internet at
The Nicaraguan Contras--a Covert, Self-Financing

CIA Operation

In the U.S. in 1980, cocaine was a drug that only the rich could afford. Gary Webb writes, "One study of actual cocaine prices paid by DEA agents put it at $5,200 an ounce." After high-level decisions in the U.S. government, this changed.

On December 1, 1981, President Ronald Reagan signed a secret National Security Directive (NSD) approving the CIA efforts to secretly organize an army to wage war against Nicaragua.

The brutal pro-U.S. Nicaraguan dictator, Anastasio Somoza, had been overthrown in a 1979 revolution and replaced by the leftist Sandinista government. The U.S. ruling class feared that the Sandinistas would weaken U.S. control over Central America and provide the Soviet Union with a "foothold" in a region the U.S. considered its own "backyard."

In August 1981, Col. Enrique Bermúdez--who'd been Somoza's Washington liaison to the U.S. Pentagon--announced the formation of the Fuerza Democrática Nicaraguense (FDN--in English, the "Nicaraguan Democratic Force"). Webb documents that it was the CIA that pulled together the forces who became the FDN--mostly from remnants of Somoza's hated National Guard. Under the leadership of U.S. and Nicaraguan CIA agents, the FDN waged a brutal "low intensity war" of assassination and sabotage to destabilize Nicaragua. Webb reports that Bermúdez was one of those agents who "received regular CIA paychecks for a decade, payments that stopped shortly before his still-unsolved slaying in Managua in 1991."

Webb documents that Ronald Reagan's secret NSD directive permitted the CIA to spend $19.9 million of direct U.S. money on this project--enough to get the Contras started, but not enough to maintain the ongoing military force. It was not necessary to allocate more money: This covert operation was self-financed, so that its crimes could not be easily traced back to the U.S. government. At the moment Reagan signed his NSD, Contra operatives were already buying and selling massive amounts of cocaine.

Gary Webb's exposé focuses heavily on the career of Oscar Danilo Blandón Reyes, the Contra operative directly in charge of selling cocaine in Los Angeles. Blandón testified about these operations in detail in March 1996--when he appeared as a star witness in the San Diego drug trial of his own protege "Freeway Rick" Ross. Webb writes that Blandón "who began working for the FDN's drug operation in late 1981, testified that the drug ring sold almost a ton of cocaine in the United States that year--$54 million worth at prevailing wholesale prices. It was not clear how much of the money found its way back to the CIA's army, but Blandón testified that `whatever we were running in L.A., the profit was going for the Contra revolution.' "

The Planning Meeting That Started the Cocaine Trade

Danilo Blandón, the son of a wealthy Nicaraguan slumlord, was sent to earn a masters degree in U.S.-style "marketing." At the time of the Sandinista revolution, Blandón was living a life of privilege as Nicaragua's director of wholesale markets--heading a $27 million U.S.-financed program for creating "an American-style agricultural system" in Nicaragua.

Webb reports that, when the Somoza dictatorship collapsed, the Blandón family lost their cattle ranches and their property in sprawling urban slums. Blandón left for the United States where, by 1981, he was involved in the formation of the Contras.

Webb writes that Blandón's involvement with cocaine fundraising started when he was asked to pick up another exile, Juan Norwin Meneses Cantarero, at the Los Angeles Airport. Blandón testified in the Ross trial that he and Meneses flew to Honduras and met with the CIA's leading Nicaraguan agent, Col. Bermúdez. Afterward, he said they "started raising money for the Contra revolution." In his testimony, Blandón claimed that Bermúdez didn't know that their fundraising project would be cocaine. Webb writes that "the presence of the mysterious Mr. Meneses strongly suggests otherwise."

Webb reports that Meneses was widely known as a major drug trafficker. Extensive police records in the U.S. documented his activities, and in Nicaraguan newspapers he was called "Rey de la Droga" [the Drug King]. And yet, he was quickly welcomed both into the United States and then into the leading circles of the FDN. In July 1979, Meneses entered the U.S. and was soon granted a visa and work permit as a political refugee. Then in 1981, Meneses himself claims, Bermúdez put him in charge of "intelligence and security" for the newly organized FDN forces in California. Meneses bragged "Nobody would join the Contra forces down there without my knowledge and approval."

With the approval of the U.S. government and the blessing of the CIA agent Bermúdez, Meneses settled in the San Francisco Bay Area. From there, he supervised the importation of thousands of kilos of cocaine into California--while his agent Danilo Blandón worked in Los Angeles marketing that cocaine to networks of drug dealers.

Blandón testified, "There is a saying that the ends justify the means, and that's what Mr. Bermúdez told us in Honduras. OK?"

In June 1984, at the height of their drug operation, Meneses was photographed at a meeting with the political boss of the FDN, Adolfo Calero. Calero is a former Coca-Cola bottler and long-time CIA agent, who served as the public face of the Contras, so that the old cutthroats of Somoza's National Guard could keep to the shadows.

All this evidence suggests that, from its earliest stages, the Contra cocaine operation had CIA approval and support.

Evidence that emerged during the 1980s suggests how high up that approval may have gone. Reagan's specialist in covert operations, Col. Oliver North, denied that anyone in the White House knew that Contra leaders were running drugs. But an August 9, 1985 memo written by North to his agent Robert Owens discusses a DC-6 airplane used to supply the Contras and notes that it "is probably being used for drug runs into the U.S." In another memo, North writes, "$14 M[illion] to finance came from drugs." (RW, January 16, 1989)

Meanwhile, in the Senate's Kerry hearings, an Oregon businessman involved in secret arms and drug shipments named Richard Brenneke said that Donald Gregg, the national security aide to then-Vice President George Bush, was the Washington contact for Brenneke's operation. Brenneke says that he flew a drug shipment to Amarillo, Texas in mid-1985 and discussed it with Gregg who answered, "You do what you were assigned to do. Don't question the decision of your betters."

Blessed with Government-Protected Transportation

In the 1970s, cocaine production was increasing in Latin America and Colombian groups were emerging as major refiners and distributors of the drug. However, cocaine remained extremely expensive in the United States because no one had worked out reliable ways of transporting large amounts of the drug. This was what the Contra operative brought to the drug trade: they hooked up street-level U.S. drug networks directly with the Colombian drug cartels, using transportation networks developed by U.S. intelligence.

In the film Coverup, a long-time CIA specialist in covert war, John Stockwell, says: "You have CIA bases in Costa Rica and Honduras. You have airplanes flying back and forth continuously landing at bases in the United States where they don't have to go through regular customs, with the CIA escorting people in and out."

According to Webb, the Meneses/Blandón wing of the Contra operation also relied on yet another U.S.-sponsored network: the Salvadoran air force planes flying into a U.S. Air Force base in Texas. Webb reports that Meneses had close personal and business ties to a Salvadoran air force commander Marcos Aguada--and Webb adds that Aguada is also known to have been a CIA agent.

During a 1992 court testimony, Enrique Miranda testified that he was an intelligence operative in Somoza's government and that, after the Sandinista revolution, he worked as Meneses' emissary to the cocaine cartel of Bogotá, Colombia. "He [Norwin Meneses] and his brother Luis Enrique had financed the Contra revolution with the benefits of the cocaine they sold," Miranda testified. "This operation, as Norwin told me, was executed with the collaboration of high-ranking Salvadoran military personnel. They met with officials of the Salvadoran air force, who flew [planes] to Colombia and then left for the U.S., bound for an Air Force base in Texas, as he told me." During the 1980s, the Salvadoran military was engaged in counterinsurgency against guerrilla forces and was closely supervised by CIA and U.S. military advisors. Webb writes, "U.S. General Accounting Office records confirm that El Salvador's air force was supplying the CIA's Nicaraguan guerrillas with aircraft and flight support services throughout the mid-1980s."

Bottom Line Arithmetic of the Crack Explosion

Blandón testified that after the 1981 meeting with Bermúdez, Meneses took him back to San Francisco for two days of schooling in the cocaine trade. Then, Blandón said, Meneses gave him two kilograms of cocaine, the names of two customers, and a one-way ticket to Los Angeles.

Meneses funneled the cocaine to California from its various entry points. Webb writes, "It arrived in all kinds of containers: false-bottomed shoes, Colombian freighters, cars with hidden compartments, luggage from Miami. Once here, it disappeared into a series of houses and nondescript storefront businesses scattered from Hayward to San Jose, Pacifica to Burlingame, Daly City to Oakland."

"Danilo Blandón is in charge of a sophisticated cocaine smuggling and distribution organization operating in Southern California," L.A. County Sheriff's Sgt. Tom Gordon said in a 1986 affidavit. "The monies gained from the sales of cocaine are transported to Florida and laundered through Orlando Murillo, who is a high-ranking officer of a chain of banks in Florida named Government Securities Corporation. From this bank the monies are filtered to the Contra rebels to buy arms in the war in Nicaragua."

Webb reveals that Blandón deliberately targeted the Black communities of L.A.with his massive drug import operation--selling "the world's most expensive street drug in some of California's poorest neighborhoods."

According to Webb, Blandón recruited a small-time South-Central drug dealer named Ricky Donnell Ross. Ross sold the cocaine for Blandón in South Central L.A.and Compton, using contacts in various Crips street organizations and later among the Bloods. Ross swore he had no idea where Blandón got the drugs, and only knew that Blandón was "plugged" into powerful forces.

Quickly, within a year, Blandón and Ross had taken over much of drug traffic of Los Angeles. The reason for their success was simple: price. With cheap transportation and government protection--the Contras were able to deliver huge quantities of extremely cheap cocaine. When they started, a kilo of cocaine reportedly cost L.A. drug dealers about $30,000 or $50,000. But the Contra operatives were able to sell at $12,000 and still gather millions in profits for the

CIA's covert war.

Webb says Blandón and Ross helped decide which drug organizations grew strong: Drug dealers either bought cocaine from "Freeway Rick" Ross, the frontman for the Contras, or else they went out of business. Ross said, "It was unreal. We were just wiping out everybody." Webb quotes Blandón, from a 1990 DEA tape, saying that he had sold between two and four tons of cocaine in Los Angeles during the 1980s.

A Blizzard Hits the Ghetto

Not only was this Contra cocaine cheap enough to become a street drug for the first time, it was also cheap enough for the mass production of its recently invented, crystallized, smokeable form--crack. Crack delivers an explosive high--10 times more powerful than snorted powder cocaine.

Webb describes Blandón as "the Johnny Appleseed of crack." By late 1983, his cocaine operation became a massive crack operation. Rick Ross estimates his networks were sometimes distributing $2 million or $3 million worth of crack in one day. In their crack-manufacturing cookhouses, huge vats of bubbling cocaine had to be stirred with canoe paddles.

As everyone knows, the effect of the crack explosion--in oppressed communities, in the schools, and in the projects--has been devastating. Crack is extremely addictive. And thanks to the CIA's protection, it was also extremely cheap.

The legacy of this CIA operation is thousands of crack addicts, often homeless, living and dying in abandoned buildings, driven to desperate acts to feed their pipes. The violent capitalist competition of the drug trade, unleashed by U.S. government agents, has intensified deadly conflicts among the people.

And then, in the ultimate hypocrisy, this same government called for a war on drugs starting in the late 1980s--and sent its armed enforcers into oppressed communities, creating a new level of harassment and brutality. The authorities set legal penalties for possessing and selling crack cocaine many times higher than penalties for comparable amounts of powder cocaine--which has been more popular among the more affluent. As a result of this discrimination, tens of thousands of Black youth are serving hard time for possessing or selling small amounts of crack cocaine. A 1993 study showed that 88.3 percent of those convicted on federal crack offenses were Black. They have seized thousands of young men for imprisonment--for the crime of selling rocks that were introduced into oppressed communities by the CIA itself!
Protection and

Continuing Coverup

Webb reports that U.S. drug agencies investigated Meneses throughout the 1980s: "Agents from four organizations--the DEA, U.S. Customs, the Los Angeles County Sheriff's Department and the California Bureau of Narcotic Enforcement--have complained that investigations were hampered by the CIA or unnamed `national security' interests."

Webb documents one police attempt to raid Blandón's operation in October 1986--after the Contras had snowed cocaine for five years without interference. Agents of the FBI, IRS, LAPD and sheriffs fanned out to a dozen locations. Blandón and several of his agents were arrested. But nothing incriminating was found and no one was ever prosecuted. Webb writes, "Ron Spear, a spokesman for Los Angeles County Sheriff Sherman Block, said Blandón somehow knew that he was under police surveillance. Others thought so, too. `The cops always believed that investigation had been compromised by the CIA,' Los Angeles federal public defender Barbara O'Connor said in a recent interview."

Webb documents that since then it also came out that the L.A. County Sheriff's elite narcotics squad, including the secret task force assigned to capture Ross, had been involved in massive corruption, beating suspects, stealing drug money and planting evidence.

After the Contra-Sandinista war ended, the Meneses/Blandón ring went into operations for themselves, and in 1989 the U.S. government started efforts to dismantle their operations--in a way they hoped would avoid producing exposure or political waves. Ross, who knew nothing of the Contra-CIA connection, was busted and sent to jail. When he was released he was busted (in a DEA sting run by Blandón) and faces more prison.

Meanwhile, Meneses moved from San Francisco to a ranch in Costa Rica before Federal prosecutors finally charged him with conspiracy to distribute one kilo of cocaine. Webb reports that after Nicaraguan police arrested Meneses on drug charges in 1991, his judge expressed astonishment that this infamous drug dealer had never been busted in the U.S. During a pretrial hearing Judge Martha Quezada asked: "How do you explain the fact that Norwin Meneses, implicated since 1974 in the trafficking of drugs...has not been detained in the United States, a country in which he has lived, entered and departed many times since 1974?"

"Well, that question needs to be asked to the authorities of the United States," replied Roger Mayorga, then chief of Nicaragua's anti-drug agency.

Meanwhile, the U.S. government worked systematically to suppress any evidence of CIA involvement in the crack explosion. "The Justice Department flipped out to prevent us from getting access to people, records--finding anything out about it," recalled Jack Blum, former chief counsel to the Senate subcommittee that investigated allegations of Contra cocaine trafficking. "It was one of the most frustrating exercises that I can ever recall."

Webb writes that this year, shortly before Blandón took the stand in San Diego as a witness against Ross, "federal prosecutors obtained a court order preventing defense lawyers from delving into his ties to the CIA." Assistant U.S. Attorney L.J. O'Neale argued that Blandón "will admit that he was a large-scale dealer in cocaine, and there is no additional benefit to any defendant to inquire as to the Central Intelligence Agency."

To provide for Blandón's cooperation, he was sprung from prison by the U.S. Department of Justice in 1994 and hired as a "full-time informant" for the Drug Enforcement Administration.

Webb writes, "According to his Miami lawyer, Blandón spends most of his time shuttling between San Diego and Managua, trying to recover Nicaraguan properties he left behind in 1979..." With the return to power of a pro-U.S. government in Nicaragua, Blandón stands a good chance of returning to his family's traditional slumlord business--profiting from the desperation of Nicaragua's poor. Several people have alleged that Blandón continues to organize international cocaine smuggling.

Webb writes: "A Freedom of Information Act request filed with the CIA was denied on national security grounds. FOIA requests filed with the DEA were denied on privacy grounds. Requests filed months ago with the FBI, the State Department and the Immigration and Naturalization Service have produced nothing so far. None of the DEA officials known to have worked with the two men would talk to a reporter. Questions submitted to the DEA's public affairs office in Washington were never answered, despite repeated requests."

When Webb's exposé appeared in the Mercury News, Assistant U.S. Attorney L.J. O'Neale even demanded to know how the press had gotten its picture of Danilo Blandón's face--claiming that the publication of that picture violated a court order.

The fact that this government continues to suppress all kinds of information connected with the CIA-Contra crack operations is itself a confession of guilt.

It seems clear that the information that has now come out--devastating though it already is for the CIA--is still only the tip of the iceberg.

Many questions remain unanswered: Who approved this massive flood of cocaine to the U.S.? And who decided that it would start by specifically targeting the Black communities of Los Angeles? How deeply was the White House itself--Ronald Reagan and his vice president George Bush--involved in these decisions? Who ordered the coverup? And who continues to insist on the coverup today?

"Everybody's talking about crime; tell me who are the criminals."

Peter Tosh

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