Homeland Security


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27–661CC

1997

DRUG INTERDICTION AND OTHER MATTERS RELATED TO THE NATIONAL DRUG CONTROL POLICY

PLEASE NOTE: The following transcript is a portion of the official hearing record of the Committee on Transportation and Infrastructure. Additional material pertinent to this transcript may be found on the web site of the Committee at [http://www.house.gov/transportation]. Complete hearing records are available for review at the Committee offices and also may be purchased at the U.S. Government Printing Office.

(104–69)

HEARING

BEFORE THE

SUBCOMMITTEE ON

COAST GUARD AND MARITIME TRANSPORTATION

OF THE

COMMITTEE ON
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TRANSPORTATION AND INFRASTRUCTURE

HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTH CONGRESS

SECOND SESSION

SEPTEMBER 12, 1996
[JOINT HEARING WITH SENATE CAUCUS ON INTERNATIONAL NARCOTICS CONTROL]

Printed for the use of the

Committee on Transportation and Infrastructure

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

BUD SHUSTER, Pennsylvania, Chairman

DON YOUNG, Alaska
WILLIAM F. CLINGER, Jr., Pennsylvania
THOMAS E. PETRI, Wisconsin
SHERWOOD L. BOEHLERT, New York
HERBERT H. BATEMAN, Virginia
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HOWARD COBLE, North Carolina
JOHN J. DUNCAN, Jr., Tennessee
SUSAN MOLINARI, New York
WILLIAM H. ZELIFF, Jr., New Hampshire
THOMAS W. EWING, Illinois
WAYNE T. GILCHREST, Maryland
Y. TIM HUTCHINSON, Arkansas
BILL BAKER, California
JAY KIM, California
STEPHEN HORN, California
BOB FRANKS, New Jersey
PETER I. BLUTE, Massachusetts
JOHN L. MICA, Florida
JACK QUINN, New York
TILLIE K. FOWLER, Florida
VERNON J. EHLERS, Michigan
SPENCER T. BACHUS, Alabama
JERRY WELLER, Illinois
ZACH WAMP, Tennessee
TOM LATHAM, Iowa
STEVEN C. LaTOURETTE, Ohio
ANDREA SEASTRAND, California
RANDY TATE, Washington
SUE KELLY, New York
RAY LaHOOD, Illinois
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BILL MARTINI, New Jersey
DAN FRISA, New York
TODD TIAHRT, Kansas
RICHARD H. BAKER, Louisiana

JAMES L. OBERSTAR, Minnesota
NICK J. RAHALL II, West Virginia
ROBERT A. BORSKI, Pennsylvania
WILLIAM O. LIPINSKI, Illinois
ROBERT E. WISE, Jr., West Virginia
JAMES A. TRAFICANT, Jr., Ohio
PETER A. DeFAZIO, Oregon
BOB CLEMENT, Tennessee
JERRY F. COSTELLO, Illinois
PETE GEREN, Texas
GLENN POSHARD, Illinois
BUD CRAMER, Alabama
BARBARA-ROSE COLLINS, Michigan
ELEANOR HOLMES NORTON, District of Columbia
JERROLD NADLER, New York
PAT DANNER, Missouri
ROBERT MENENDEZ, New Jersey
JAMES E. CLYBURN, South Carolina
CORRINE BROWN, Florida
JAMES A. BARCIA, Michigan
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BOB FILNER, California
EDDIE BERNICE JOHNSON, Texas
BILL K. BREWSTER, Oklahoma
KAREN McCARTHY, Missouri
FRANK MASCARA, Pennsylvania
THOMAS C. SAWYER, Ohio
GENE TAYLOR, Mississippi
JUANITA MILLENDER-McDONALD, California
ELIJAH E. CUMMINGS, Maryland

Coast Guard and Maritime Transportation

HOWARD COBLE, North Carolina, Chairman

TILLIE K. FOWLER, Florida 
DON YOUNG, Alaska 
SUSAN MOLINARI, New York 
BILL BAKER, California 
VERNON J. EHLERS, Michigan 
BUD SHUSTER, Pennsylvania
(Ex Officio)

BOB CLEMENT, Tennessee
 ROBERT A. BORSKI, Pennsylvania
ELIJAH E. CUMMINGS, Maryland
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GENE TAYLOR, Mississippi
JAMES L. OBERSTAR, Minnesota
(Ex Officio)

Senate Caucus on International Narcotics Control

CHARLES E. GRASSLEY, Iowa, Chairman

ALPHONSE M. D'AMATO, New York
FRANK H. MURKOWSKI, Alaska
JOSEPH R. BIDEN, Jr., Delaware, Co-Chairman
BOB GRAHAM, Florida

CONTENTS

TESTIMONY

    Bozin, Captain William G., Assistant Deputy Director, Office of Supply Reduction, Office of National Drug Control Policy

    Ford, Jess T., Associate Director, International Relations and Trade, National Security and International Affairs Division, U.S. General Accounting Office

    Gelbard, Ambassador Robert S., Assistant Secretary for International Narcotics and Law Enforcement Affairs, U.S. Department of State
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    Pierluisi, Pedro R., Attorney General, Commonwealth of Puerto Rico

    Pothier, Harvey G., Director, Air Interdiction Division, Office of Invegtigations, U.S. Customs Service

    Reuter, Dr. Peter, School of Public Affairs and Department of Criminology, University of Maryland, College Park

    Saunders, Rear Admiral Norman T., Chief, Operations, U.S. Coast Guard

    Sheridan, Brian E., Deputy Assistant Secretary of Defense for Drug Enforcement Policy and Support, U.S. Department of Defense

    Walters, John P., President, New Citizenship Project and Former Deputy Director for Supply Reduction, Office of National Drug Control Policy

    Warren, Mary Lee, Deputy Assistant Attorney General, Criminal Division, U.S. Department of Justice

PREPARED STATEMENTS SUBMITTED BY WITNESSES

    Bozin, Captain William G

    Ford, Jess T
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    Gelbard, Ambassador Robert S

    Pierluisi, Pedro R

    Pothier, Harvey G

    Reuter, Dr. Peter

    Saunders, Rear Admiral Norman T

    Sheridan, Brian E

    Walters, John P

    Warren, Mary Lee

SUBMISSIONS FOR THE RECORD

Bozin, Captain William G., Assistant Deputy Director, Office of Supply Reduction, Office of National Drug Control Policy:

Chart, Cocaine Seizures versus Production

Responses to questions from Rep. Coble
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Chart, Cocaine Availability and Usage Rates: 1982–1996

Chart, Office of National Drug Control Policy FY 1997 National Drug Budget

Ford, Jess T., Associate Director, International Relations and Trade, National Security and International Affairs Division, U.S. General Accounting Office:

Responses to post hearing questions

Report, Drug Control: Counternarcotics Efforts in Mexico, June 1996

Report, Drug Control: U.S. Interdiction Efforts in the Carribbean Decline, April 1996

    Gelbard, Ambassador Robert S., Assistant Secretary for International Narcotics and Law Enforcement Affairs, U.S. Department of State, responses to post hearing questions

    Pierluisi, Pedro R., Attorney General, Commonwealth of Puerto Rico, responses to post hearing questions

    Pothier, Harvey G., Director, Air Interdiction Division, Office of Invegtigations, U.S. Customs Service, responses to post hearing questions

    Saunders, Rear Admiral Norman T., Chief, Operations, U.S. Coast Guard, responses to post hearing questions
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    Sheridan, Brian E., Deputy Assistant Secretary of Defense for Drug Enforcement Policy and Support, U.S. Department of Defense, responses to post hearing questions

    Walters, John P., President, New Citizenship Project and Former Deputy Director for Supply Reduction, Office of National Drug Control Policy, responses to post hearing questions

Warren, Mary Lee, Deputy Assistant Attorney General, Criminal Division, U.S. Department of Justice:

Responses to post hearing questions from Sen. Grassley, November 12, 1996

Responses to questions from Rep. Gilchrest, March 26, 1997

ADDITIONS TO THE RECORD

     D'Amato, Sen. Alfonse M., statement
Constantine, Thomas A., Administrator, Drug Enforcement Administration, statement:

Responses to questions from Sen. Grassley, November 6, 1996
Responses to questions from Rep. Coble, November 7, 1996

DRUG INTERDICTION AND OTHER MATTERS RELATED TO THE NATIONAL DRUG CONTROL POLICY

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THURSDAY, SEPTEMBER 12, 1996

U.S. House of Representatives,

Subcommittee on Coast Guard and Maritime Transportation
and the Senate Caucus On International Narcotics Control,

Committee on Transportation and Infrastructure,
Washington, DC.

    The subcommittee met, pursuant to notice, at 10:07 a.m. in room 2167, Rayburn House Office Building, Hon. Howard Coble (chairman of the subcommittee) presiding.

    Mr. COBLE. The Subcommittee on Coast Guard and Maritime Transportation and the Senate Caucus on International Narcotics Control will come to order.

    We're meeting today to hear testimony on drug interdiction and other matters relating to the President's national drug control policy.

    I want to initially welcome Senator Grassley, and I presume there will be other members of the Senate caucus at this hearing.

    The Chair now recognizes the chairman of the Senate Caucus on International Narcotics Control, Senator Grassley, for any opening statement he may have.

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    Mr. GRASSLEY. Mr. Chairman, I thank you very much for your leadership in this effort. The jurisdiction of your subcommittee, the important responsibilities you have, and taking time out for this very serious national problem we're dealing with—I thank you very much.

    Today's hearing is on our national strategy and our international efforts to deal with the problem of drug production, trafficking, and use, and this hearing comes at a disturbing time. Just this week the Center on Addiction and Substance Abuse issued another report that confirms what we already know: that teenage drug abuse is on the rise, and I'm sorry to say dramatically so.

    I understand that the national PRIDE survey due out later this month will bear witness to this same trend.

    What is even more distressing about these numbers is that they come after years of decline; in other words, years of a succeeding war against drugs. Not only was teenage drug use declining, but teen attitudes about drug use were also turning increasingly against drugs right through 1992. This is no longer the case. More teens are now using more drugs and seeing use as less dangerous than just a few years ago.

    All our major surveys confirm this shocking reality. The CASA study, however, is disturbing in yet another way. We know from surveys of attitudes of teenagers that they see fewer dangers in using drugs than their peers did just a few years ago. What the CASA study suggests, however, is that a significant percentage of the parents of these kids see drug use among their own kids as inevitable. These same parents do not want their kids to try or use drugs; they believe, however, that nothing can make a difference. They just want to throw their hands up.
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    Since many of these parents are baby boomers who experimented with drugs, they are uncertain about what to do. They are uncertain how to talk to their children. It is unfortunate that they are getting little help from this Administration in learning any better.

    Today's hearing is an excellent example of this. Although we have a fine list of knowledgeable witnesses from the Administration, the individuals here are not policy-makers. With the exception of Ambassador Gelbard and Mr. Constantine, all the present witnesses are stand-ins for the responsible policy-making officials.

    This is a major joint hearing on our national strategy and international narcotics control policy. It comes at a time of major increases in domestic use. It comes after years of declining efforts in our international drug control efforts. I think that the American public deserves to hear from policy-makers for drug policy. After all, the Administration has repeatedly asserted that it takes the issue seriously and takes it seriously at the highest levels of Government. Unfortunately, these highest levels are not represented here today.

    Although we gave the Administration ample notice of this hearing, the Administration's chief drug spokesman chose to give a speech on Asian organized crime in Hawaii. He also is speaking on marijuana initiatives in California. As important as those meetings are, we gave the Administration ample time to reschedule. The representation here today is disappointing, especially at this time.

    I am of the opinion that we develop policies and strategies for a purpose. We intend these means to effect outcomes. We expect the programs that we develop, the priorities that we set, and the actions that we take to achieve some purpose.
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    In the present case our national drug strategy is not just meant to be a funding device. It is not supposed to be a warehouse for housing various Government department pet projects. It's not meant to be a grab bag of disconnected activities. This is true for our international efforts. They are meant to be a part of a larger effort. They are not meant to be disconnected programs.

    Further, when our policies and strategies are not achieving their stated purpose, then we need to ask some tough questions about what is going on.

    What do we find, however, when we look at this Nation's drug war today? I submit that what we find is very far from what we intend. I submit that the main objective of our policies and strategies is to protect our young people from the harm that drugs do—the harm to them directly from use and the harm that results from drug-related violence.

    At one time we were making progress in this area; today, unfortunately, by every reporting system we have, the signs are clear: our efforts are not working.

    In the last several years, after decades of decline, teenage drug abuse is on the rise. As chart one over here indicates, past-month use among teenagers has risen more than 50 percent over 1992 levels; past-month use of marijuana among kids age 12 to 17 is now almost at the 1986 rate, as chart two will illustrate here in just a minute.

    I invite everyone to look at the trend shown here and to tell me that we're doing okay in the war on drugs.
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    In the meantime, as chart three shows, emergency room admissions are going up, and I might add recent arrest data show a similar trend in increases of drug use among youthful arrestees.

    At the same time, funding for international and interdiction programs have been declining. DOD funding for interdiction has declined almost 50 percent. From a peak in 1992 of 854 million, it has gone down to 432 million.

    Now, I know that some of the witnesses speaking for the Administration today will say that it's all Congress' fault. That, however, is unfair to the truth, and a moment's glance at the record will show otherwise.

    The President's current request for DOD funding before Congress today, for example, is 50 percent below the 1992 number. Similarly, the Coast Guard budget requests for the last several years have consistently spent 40 to 50 percent less on drug interdiction than in 1992. This is despite the fact that overall spending has increased, so less money has meant less effort.

    Now, these lower numbers requested for drugs are not accidental. The Administration's stated policy was to cut funding for these programs. The purpose was to shift effort away from interdiction. The former drug czar is on record to this point. This change was called a controlled shift. The idea, according to the Administration, was to do more in source countries and to do more on treatment.

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    As a former drug czar noted, however, there was no control shift, and treatment has done nothing to stop teenage drug use.

    Instead, we saw declining efforts in both the transit zone and source countries. As chart four here illustrates, the results were a decline in seizures. This decline in U.S. effort was echoed internationally.

    Chart five now will show international efforts to seize cocaine also fell as U.S. emphasis shifted. In the meantime, as the State Department's ''International Narcotics Control Strategy Report'' notes, international drug cultivation increased in virtually every major drug-producing country in the world over the last 3 years.

    In addition, methamphetamine production and smuggling through Mexico has increased sharply. This new drug is now causing serious problems in the Southwest and the Midwest.

    So, as our international and interdiction efforts decreased, international drug production increased. Smuggling has increased. Trafficker bank accounts have gotten fatter. And more kids are using drugs and seeing fewer dangers in doing so.

    Now, I'm sure that we will hear today that these declines in international efforts were because Congress did not give the Administration the money. Well, let me make sure that we know what we're talking about. It was a Democrat-controlled Congress under a Democratic President that slashed our international drug programs. But, to be fair to my Democratic colleagues, the Administration simply did not support its own budget on the Hill. Congress, Democrat or Republican, does not simply rubber stamp Presidential requests; yet, when administrations fight for what they want and what matters to them, they usually do quite well.
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    When a Republican President was prepared to fight for his international budget, we saw increases. This was in a Democratic-controlled Congress. It was a hard fight, but the President was willing to make it.

    Absent this effort, administration budgets suffer. That is what we have seen with the international drug budget. This is true even though overall spending on drugs has increased.

    Last fiscal year Senator Coverdell and I helped to increase spending for international programs. This year again we fought to get the full funding for international budgets. The Administration did little to help. The bill passed, however, despite this. It passed despite the fact that the overwhelming majority of Democrats voted against the President's own request.

    As some of my Democratic colleagues have noted, the Administration simply took a leave of absence on the drug issue. From the beginning, the President distanced himself from the issue. The drug issue was demoted as a priority. Our international programs reflected this downgrading and, in context, the whole drug issue took a back seat.

    Now, with this background it is little wonder, then, why we have seen teenage drug use on the rise. Is it a surprise that kids see fewer dangers in using drugs? Is it a surprise that many parents are ready to run up a white flag?

    If our strategies are meant to make a difference, then where are we today?
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    I submit that our recent efforts have been a failure. Even General McCaffrey, who could not come here today, allowed this to be the case last week, yet the present strategy offers little new. Indeed, it has no substantive performance standards with which to measure success. It has no goals that we can hold it to. This is despite legislation that mandates such goals.

    It is a well-intentioned effort, but, in fact, it is thin, and this is not acceptable. We can't stand the status quo on this drug effort.

    So I hope that we would hear more today from the Administration about its efforts, how it's going to change this present environment. I hope we hear more about what is going to be done to reverse, then, our present dismal performance.

    Thank you, Mr. Chairman.

    Mr. COBLE. Thank you, Senator Grassley.

    You touched just about every base. I'll give a brief opening statement.

    Last month the National Household Survey of Drug Abuse confirmed what many of us have declared for years; that is, we're not doing the right things to reduce the number of drug users in America.

    The 1995 national survey, conducted by the Department of Health and Human Services, found that since 1992 more Americans are using drugs for the first time, starting at younger ages.
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    The President's response to this finding, in my opinion, has been disappointing. The President engaged the White House political machine in a public relations campaign to deny responsibility for the problem.

    I want to make it plain that I am not an election year recruit to the war on drugs. In fact, my opening statement today pretty well tracks what I said a little over a year ago at a public hearing. I have consistently criticized the President's decision to abandon a balanced approach between drug interdiction, prevention, and drug treatment. Instead, the President has favored a strategy that emphasizes treatment of hard-core drug addicts.

    I've emphasized that I'm not opposed to drug treatment. I have said that previously. I reiterate it today. But I am opposed to the President's decision to reduce drug interdiction and to leave our country's borders more vulnerable to drug smugglers.

    My colleagues and I, who sat on the former Merchant Marine and Fisheries Committee, on the Judiciary Committee, and on this committee have sent the unequivocal message to the President that his national drug control strategy is fatally flawed.

    The President argues that the Congress has failed to fund his drug budget at the levels he requested, but the fact is, the House passed 1997 appropriations bills provide an increase of over 8 percent over fiscal year 1996 levels. Overall spending on drug control has risen, on average, between 4 and 5 percent annually since the Bush Administration. But funding for source country programs and interdiction have been cut drastically.

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    It is obvious to me that the President's drug control spending priorities have not been effective in stopping drug use.

    Five major administration-sponsored surveys have confirmed that we simply are not on the right track.

    As we have said many times over the past several years, the President's strategy and overall message are not adequate to combat this critical problem facing our Nation.

    We are desperately in need of a strategy that will attack drug smugglers before their deadly cargoes reach our borders, and, just as important, we must have leadership from the White House.

    Pardon me for borrowing this phrase, but we need to send the unambiguous message to our children to just say no to drugs.

    I don't know how significant that is, but it can't hurt. I think a casual approach to drugs from the top has to send a message that is not the proper one.

    I am now pleased to recognize the ranking member of the committee, the gentleman from Tennessee, Mr. Clement.

    Mr. CLEMENT. Thank you, Chairman Coble.

    Senator Grassley, it's a great honor to have you over here on the House side with us today. I've sure kept up with your record over the years and I know your concern about fighting drugs and stopping drugs and saving our youth in this country.
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    Drugs and their impact on our communities are clearly one of the most complex problems facing the United States. My constituents rate reducing crime and drugs as one of our top priorities because it truly is destroying America. People that use controlled substances commit these heinous crimes, and many of them would never, never have committed those terrible crimes if they hadn't been on a controlled substance.

    Earlier this year I had the opportunity to see our front-line command centers in this effort in Key West, Panama, and Puerto Rico. We received many briefings that indicated that our source country interdiction efforts were forcing bales of coca leaves to be stranded and unable to get to the processing laboratories; that the cost of hiring a pilot to transport drugs has skyrocketed. We learned that more resources need to be allocated to west coast interdiction efforts, and we learned that Puerto Rico has become the focal point for smuggling drugs through the Caribbean to the continental United States.

    The interdiction strategy is like a constantly-changing chess match, with both sides trying to react to and anticipate the other's moves. Only this isn't a game. At stake is the future of our children and our communities.

    I do not believe that this is a partisan issue, either. Everyone, democrats and republicans, alike, wants to eliminate this threat. The only question is: what is the best way to reduce both the demand and supply of drugs?

    The enemy is smart and has millions of dollars in resources to find weaknesses in our effort to secure our borders, and we have tightened our adjacent maritime and air borders. They have moved south.
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    As interdiction in Mexico has increased, they have moved to Puerto Rico and eastern, the Caribbean. Police chiefs have said that mandatory sentencing has resulted in adult drug sellers using children to peddle their illegal merchandise.

    We must be prepared to fight these smugglers for years to come.

    I believe that, with the effort and support of our allies in Central and South America and the allocation of sufficient resources here in the United States, we can succeed. I honestly believe that is what our constituents want.

    I look forward to hearing from today's witnesses on their views on our national drug control policy and what we in Congress can do better to support these efforts.

    I also know that General McCaffrey, who I had opportunity to meet with for approximately two hours recently, is really on the front lines and really trying to make a difference and I know he wanted to be here, and I know he offered a number of other dates such as September the 13th and 16th and 18th where he could have testified before this hearing.

    As a lot of you know, he's out on the west coast. He spoke yesterday in Hawaii. Today he will stop in California to report on the heroin threat and to speak out, as he did earlier this week in Arizona, against a domestic threat—a State referendum to legalize the use of marijuana for medical purposes.

    But through it all—and the amount and the demand of illegal drugs in the United States, if I had to bring it back to any particular area, I'd have to say the destruction of the family has had a lot to do with the number of people that are taking illegal drugs today—the breakdown, the destruction of the family.
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    I hope, knowing that this is a very complex issue and we've got to fight it on a lot of different fronts, but let us put it in its proper perspective and let us fight not only the demand for drugs but also the flow of drugs into the United States.

    I don't know of a country on the face of the earth that is facing such a dilemma as we are today and thinking about a country as prosperous as the United States, the most prosperous country on the face of the earth, and yet we have our people destroying themselves, but not only destroying themselves, but destroying others.

    I'm committed to the proposition in the 104th Congress and to the next Congress to doing everything I can to try to make a difference.

    Thank you, Mr. Chairman.

    Mr. COBLE. Thank you, Mr. Clement.

    We have been joined by the gentleman from Delaware. Senator Biden, good to have you with us.

    Mr. BIDEN. Mr. Chairman, thank you very much.

    I'll be brief. I should start off by pointing out, when I ever attend a joint hearing over here I always feel much more important. You are so much higher. I mean, it's a—you sit up here and you feel like you really have some power.
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    [Laughter.]

    Mr. BIDEN. Over in the Senate side we—

    Mr. COBLE. Senator, that may be deceptive.

    Mr. BIDEN. I know in the Senate side we don't have much.

    Mr. Chairman, you and Mr. Clement and others and Senator Grassley and I have been working on this drug issue for a long time, and there is a debate—and I'm glad there is a debate now—once again. For a while the debate sort of slid off the front pages of the papers in America and it, quite frankly, slid out of the political context of what was going on in the House and the Senate, basically for the past 3 1/2 years.

    There is some old stuff, the good news and the bad news. I see John Walters—we've worked together on this issue since the first drug czar—and others we're going to hear from today who know this. This is preaching to the choir.

    The good news is that violent crime is down. Even youth crime has begun to fall. Overall drug use is level. But, despite all that positive news, drug abuse among children has risen, and it's alarming concern.

    We base that on surveys, primarily, but roughly it's gone from 5.5 percent of the children or a little over 5 percent of the children in that cadre of children that we consider to be teenagers and youth trying drugs to some over 11 percent.
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    A lot of people say, ''Well, you still have 89 percent of the kids who don't try, don't use.'' Well, I want to tell you, even if we kept at a constant level the percentage of children who tried for the first time and used marijuana or any other drug, we've got a real problem on the horizon. We've got 39 million kids under the age of 10 in the United States of America, and if everything stays constant, not one single percentage increase in use among young people in America, the problem goes up exponentially.

    We're going to produce more hard-core users at the end of that tube. We're going to produce more violent crime. We're going to produce more problems. We're going to produce more deaths. We're going to produce more requirement for more police, for more treatment.

    And so I think for us to finally begin to focus on this is important—very, very important.

    And I know there is criticism on both sides that this is a political year, a political issue. But I know the men and women up here are not going to let this die, assuming—now I know all of you are going to be around next year. I may not be around next year. I'm up for election. But, assuming I'm around, I'm not going to let it die, either. And so maybe we can regenerate some positive interest and focus on this.

    There's something we can do in the meantime. Let me add one thing, and I will finish with this, Mr. Chairman.

    I'm not sure the blame game is of any real consequence other than to get this back on top. As John and others and my colleague in the Senate know, I wrote a report. Before, back in the good old days, Mr. Chairman, when you all had a republican President, I used to write an alternative drug strategy. I got in the habit of, every year, writing a report on drug strategy. And so last year, in 1995, I wrote a report, and this is not particularly clairvoyant. It seemed awfully obvious.
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    It started off on the first page saying, ''The Nation has already seen its first signs of a trend that chills every parent: a rise in drug use among children. This is the proper focus of our national drug and crime debate in the months ahead. We should get about the business of—'' so on.

    And so all of a sudden we all went out there and discovered this issue. You know, a year later it got discovered, like, ''What in the heck happened? Man, this all happened overnight.''

    Well, it was happening, and we let our guard down. We let our guard down in the first 2 years of this Administration. They didn't do the job, in my opinion, in terms of focusing on this issue.

    With all due respect, the Congress, democrat and republican, alike, the last 4 years, up until the last 4 months, hasn't focused on this. We got preoccupied with budget deficits, which is necessarily a thing to be preoccupied with. We got preoccupied with how we were going to stop spending. It was literally off the scope, off the radar screen.

    So, in conclusion, Mr. Chairman, I think the question for us is: there are four or five things that will not change the landscape fundamentally but will change our approach and our attitudes to allow us to really have a springboard in the next Congress to deal with this focused problem of drug use among youth in America.

    There are five things I will not bore you with now, Mr. Chairman, that I have proposed. I take no pride of authorship in them. It's not like they're my original ideas. A couple are, but most are common-sense notions we all agree on that we could do now, democrats and republicans joining together right now and get them done before we leave and the President will sign them.
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    One is we've got a real problem, a thing called ''club drugs.'' You all have been speaking about them. We've been reading about them: Special K, Ropynol—Special K is an animal tranquilizer, Ropynol is a drug produced in other countries and is illegal here, but it literally induces amnesia. Unscrupulous men drop them in women's drinks, induce amnesia, increases rape, increases molestation—no ability to testify afterwards.

    This is the kind of thing that's on the horizon, a little like Pat Moynihan telling us in the 1980s that, ''Hey, there's a thing called 'crack.' It's in the Bahamas. We'd better get ready for it.'' We all kind of went, ''Blah-blah, yeah,'' and bang, but because of the leadership of Bill Bennett and others, when steroids started to blow up, when quaaludes started to come back we focused on them. We made them schedule one drugs and we stopped an epidemic.

    We can stop this beginning of a thing that's not an epidemic yet if we act now and make it a schedule one drug.

    Number two, I think Senator Hatch and I and many of you over here have been working on methamphetamine. As that old saying goes, ''You think crack's bad, wait until meth reaches the same proportions. You ain't seen nothing yet.''

    Literally you can predict it. Three years ago, I wrote a report because some of the experts down there came to me and told me about it saying, ''Hey, in Hawaii there is a thing called 'ice.' It's heading east.''

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    Literally you can trace its progression.

    Chuck Grassley and I tried to get more DEA agents, and we did—if you remember, Chuck—into the upper midwest because they were moving out of California and moving up into Idaho and Montana in the production of this. Now Idaho is a major producer State of methamphetamines. It's moving east. We could deal with it now—now—if we're willing.

    Thirdly, by dealing with precursor chemicals—the third thing is, we should write the check, folks. There is money in the crime trust fund now to release for programs related to youth and drug abuse. Let's just write the check before we leave. Let them get about the business of starting to spend it.

    The fourth thing is pharmacotherapy. I realize this is—I'm kind of a lone voice here, but I'll make you a bet you all come around on this one. There are potential medical helps for addiction and prevention that are sitting on the shelf that the chemical companies cannot spend the hundred million dollars it takes to produce because the return on their investment is not likely to be of value to them. They are not going to do it. We should be dealing with it, and I propose some alternatives I think everyone would agree with.

    The last thing is, we want to get tough. There is something we should get tough on right now, not fool around—liberals, conservatives, moderates have no disagreement on it that I'm aware of, and it will not change, will not end the problem, but there is an increasing—in this competitive market among the peddlers they are now literally targeting recovering addicts. They are going to the drug equivalent of the AA meetings and standing outside and they are targeting recovering addicts.
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    As we all know, the addicted population consumes about 60 percent of all the drugs out there. We should nail those SOBs. We should increase the penalties. We should send a message.

    It will not end the problem, but I think there are several things we can do, and the most important thing to do in any and all of these things would do beyond the substance of them, Mr. Chairman, in my view, is it will say, ''Hey, we're back in the game. We are back in the game. We understand the problem. We're taking concrete action to do something about it.''

    I thank you for your time and I yield the floor.

    Mr. COBLE. Thank you, Senator.

    It is good to have the gentlemen from California and Michigan with us, as well.

    I thank the first panel. Gentlemen, best laid plans of mice and men go awry, as you all know, particularly in the waning days of the Congress, and today is no exception.

    At 12 today the full Transportation and Infrastructure Committee will meet in this room for about an hour for a markup, so we will recess at 12 and hopefully resume on or about 1, and I regret this has occurred, but that is the schedule in these late days.
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    At the outset, gentlemen, as you may remember, this is our rule last time. I would appreciative if you all could tailor your remarks to around 5 minutes. Now, no one will be keel-hauled and jailed if you violate that, but because of the time constraint, if you could stay in the neighborhood of 5 minutes, that will be appreciated.

    The red illuminating light will be your warning that the 5-minute time has come.

    The first panel I am pleased to introduce to you all consists of: John Walters, former deputy director for Supply Reduction of the Office of National Drug Control Policy; Jess Ford, associate director, International Relations and Trade, National Security and International Affairs Division of the General Accounting Office; Pedro R. Pierluisi, the attorney general, Commonwealth of Puerto Rico. We weren't sure, sir, because of the storm, that you would be able to join us, but it's good to have you. And, finally, Dr. Peter Reuter, who is with the School of Public Affairs and the Department of Criminology at the University of Maryland at College Park.

    Gentlemen, thank you all for being with us. Mr. Walters, I will recognize you initially.

TESTIMONY OF JOHN P. WALTERS, PRESIDENT, NEW CITIZENSHIP PROJECT AND FORMER DEPUTY DIRECTOR FOR SUPPLY REDUCTION OF THE OFFICE OF NATIONAL DRUG CONTROL POLICY; JESS T. FORD, ASSOCIATE DIRECTOR, INTERNATIONAL RELATIONS AND TRADE, NATIONAL SECURITY AND INTERNATIONAL AFFAIRS DIVISION, U.S. GENERAL ACCOUNTING OFFICE; PEDRO R. PIERLUISI, ATTORNEY GENERAL, COMMONWEALTH OF PUERTO RICO; AND DR. PETER REUTER, SCHOOL OF PUBLIC AFFAIRS AND DEPARTMENT OF CRIMINOLOGY, UNIVERSITY OF MARYLAND, COLLEGE PARK
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    Mr. WALTERS. Thank you, Mr. Chairman.

    I'm pleased to be here. I appreciate the opportunity to testify. I'd like to ask that my prepared testimony be placed in the record, if that's acceptable.

    Mr. COBLE. Without objection.

    Mr. WALTERS. And I'll offer just a couple of summary points that may be pertinent to the discussion that has been conducted so far.

    When I served in the Administration in the Drug Policy Office, I thought that it wasn't a matter of the blame game as much as it was accountability, and that not only the American people but the Congress and others had a right to expect us to carry out the intent of the law, which was to create a strategy and help the President provide leadership to reduce the drug problem. We weren't the be all and end all, but we were responsible for the Federal responsibility of both leadership, programs, and policy.

    In that capacity—and it was a different time—if we had come before Congress with this kind of thing happening that you saw in these charts here with use, supply, and policy and programs producing the results or lack of results you see here, I would have fully expected that Senator Biden and his other colleagues in both the House and the Senate would have asked us to leave. The results are ridiculous. And, worse than that, the policy, or the alleged policy and programs contained in these documents offer no hope of turning it around.

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    There are no goals, as Senator Grassley mentioned in his opening statement. The programs offer—I defy any of the subsequent people to testify here or any of my colleagues to explain how this collection of policies and programs offers any hope of turning those numbers around. I'll talk a little bit in my 5 minutes about those specifics.

    I've worked with most of the people serving in Government now that will testify before you subsequently. Those I haven't worked with I know, for the most part, and they are fine people. They have not gotten the support.

    Last week Senator Biden dared me to blame the Congress as much as he's blamed the Executive Branch, and I'll mention some things that I think Congress should do before it goes home.

    First of all, the strategy is divided into roughly five parts: international, interdiction, law enforcement, treatment, and prevention. I want to briefly mention each one of those in my remaining time.

    Keep in mind, 72 million people, according to the latest survey, have used illegal drugs in their lifetime, and if you think that's a bunch of kids experimenting who later go on and don't try, over 22.6 million used them last year of that 72 million, almost 30 percent. And 7 million, according to the drug office—over seven million, according to their last estimates of 1994, are drug addicts. That has probably gone up.

    It's not something you turn around easily and it's not something that's a fleeting thing in youth that never continues.
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    In the international realm, what you have today I think is increasingly unlimited access to produce and transit drugs to the United States without any serious risk of harm. Our foreign policy I believe has not had a priority in this area. The visibility of the President, Secretary of State, the priority in meetings and others—and I believe there are hard-working people in the State Department, some of whom will testify before you, who have been working hard against the tide. But the fact of the matter is: other nations and this country knows—I think the citizens of this country know—this has not been a foreign policy priority.

    If you do not make it a foreign policy priority, none of the major supplier countries will make the effort to stop the supply. And it's not a matter of how much money we give them; it's not a matter of how much we cooperate with them; it's not a matter of show arrest or show raids; it's a matter of telling them, ''Look. This is a poison. It's a threat to American citizens. We will not continue business as usual if you don't reduce the flow.''

    Secondly, we have not used the sanctions available. Colombia, which has widely been shown to have its own president corrupted by drugs, depends on certain trade preferences conditioned on cooperation in drugs. The President has failed to provide the necessary trigger that Colombia is not cooperating, despite the fact that he decertified them for the purposes of the State Department.

    Congress should pass a resolution triggering those cut-offs of trade preferences.

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    In interdiction—and I'll just take 2 more minutes—we have cut, as those charts previously showed, the capacity of the U.S. forces to reduce the supply of drugs between South America and the United States. That has helped to contribute to the lowest prices and highest purities recorded in recent years. That fuels use. Discount prices, high potency fuel use and addiction. They're not the sole factor here, but they are a crucial factor, and we ought to learn by that experience and stop the stupid argument about whether or not you focus on supply or demand. You have to focus on both.

    We spent more money on Department of Education prevention spending than we spent on the Defense Department providing resources to interdict drugs. I ask you to ask the Defense Department representatives that will follow: what is the comparative amount we spent on bringing democracy to Haiti over the last several years in regard to and in comparison to what we spent on protecting Americans from drugs?

    I'm not against bringing democracy to Haiti. I'm not against AWACS time in Iraq or Bosnia. But compare the amount of AWACS time devoted to those missions and the amount of time devoted to protecting this country from drugs.

    It's not a matter of more spending; it's a matter of what are your priorities. And maybe we can't do everything, but my argument is: the American people have a right to expect and they do expect that we will protect our children and our streets.

    Since I've already gone over, let me just summarize on the demand side, and I'll be happy to take questions on law enforcement and treatment.

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    The key to making these programs work and the reason why this strategy doesn't do it is it doesn't come to grips with the realities. HHS has produced data showing that we have a 75 percent capacity utilization in treatment centers. We are cycling people through outpatient treatment that are hard-core addicts that need residential treatment.

    The current delivery system for these programs does not deliver the money to where the addicts are, it does not deliver quality treatment, and it does not deliver the kind of treatment that everybody that works in this field says they need. There is no serious effort in this strategy. In fact, in the beginning of the Clinton Administration they dismantled the one program, the capacity expansion program that was designed to deal with it.

    It's not the be all and end all, but before you dump more money in this system you'd better make sure someone's got a policy and program that's going to produce something.

    The same thing with drug-free schools. We have spent over $2 billion in the last several years on the drug-free schools program that has been a giant source of debate. The current Administration request—the request is $86 million below the 1992 level in the last year of the Bush Administration.

    The problem is not spending on the drug-free schools program. The report released earlier this year said kids say there is too much drugs in their school. They want the drugs out.

    You passed a law in the late 1980s saying, as a condition of receiving Federal assistance, every school district, including colleges and universities, had to have a drug policy and had to enforce it.
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    To the best of my knowledge, there has never been an IG compliance investigation anywhere in this country, although youthful drug use is going up and you get continued reports that drugs are in schools.

    I'm not against providing money. I don't think that's the key. But you'd better use a stick as well as a carrot and start and order the Education Department to conduct compliance reviews with the policies and actions of school districts around the country, beginning with the biggest ones. That's the stick here, and $86 or $26 or $36 million in this program in a block grant to schools that comes down to $2 per student is a ludicrous way of dealing with the problem that you have now.

    Finally, I think that the problem has to have serious leadership, and the statements of the President have been reprehensible in the early part of the Administration. They undermined hours and hours of Partnership for Drug-Free America ads when the President jokes about and leaves the lasting impression that his most important statement on drugs is, ''I didn't inhale,'' when he goes on youthful television and says, ''If I had it to do over again, I would inhale.'' What is that message? What was he trying to teach our young people?

    I believe in responsibility. You want to have them take responsibility? He ought to step up and take responsibility and say, ''That was wrong. I am a morally serious person on this subject. It was a mistake. It's not my message,'' and explain why, as the example or parent of the baby boomer generation that experimented with drugs, why our kids today should not make the mistake his generation made.

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    He is the moral leader in that regard, and when he acts to undermine the status of parents and other institutions, it has a profound effect. He's not the only one responsible, but that responsibility, that moral leadership, as you saw with Mrs. Reagan and President Reagan and President Bush, has important catalyzing effects that can't be measured.

    I know a lot of social scientists don't like the moral argument. They want to talk about treatment and they want to talk about all of the other programmatic solutions. But the meaning and the intention and the guidance of people is based on their sense of right and wrong, and you need to empower the sense of right and wrong that using drugs is wrong and standing against them is right and expect that from your leaders and expect that from your citizens.

    I'm sorry for going over, but thank you.

    Mr. COBLE. Mr. Walters, you recall in my opening statement I indicated that a casual response does not get it done, and you pretty well have emphasized that. Thank you, Mr. Walters.

    Gentlemen, I'm going to be more lenient. I'm going to—let's say near 10 minutes—Mr. Walters used about 10—because this is an important subject matter and I realize 5 minutes is a pretty narrow window.

    And don't worry about your doing it, Mr. Walters, because you gave good information, good evidence.

    And so you all keep in mind, let's all try to maybe stay in the area of 8 to 10 minutes, and I think that will give you a little more flexibility.
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    I'm pleased to recognize the attorney general from Puerto Rico.

    Mr. PIERLUISI. Good morning, Mr. Chairman and distinguished members of the subcommittee, as well as the caucus.

    Thank you for allowing me the opportunity of presenting the government of Puerto Rico's perspective on drug control policy.

    As I will testify today, the government of Puerto Rico is not only fighting crime within its boundaries, but it has also joined forces with the Federal Government to curtail the effects that drug trafficking is having on the island, as well as the rest of the Nation.

    Shortly after taking office, Governor Rossello realized that Federal and State efforts needed to be united in order to eliminate crime and drug trafficking. One of Governor Rossello's first official acts was to visit the Puerto Rico headquarters of every Federal law enforcement agency operating in the island. His itinerary extended from the Federal Bureau of Investigations and the DEA to the Coast Guard and the Postal Inspection Service, as well as several other Federal agencies.

    Since then, Federal and local agencies have joined their efforts, forming several task forces. The United Forces for Rapid Action, known in Puerto Rico as FURA for its Spanish acronym, is one of them. FURA is the largest working group dedicated to the investigation, detection, and seizure of drugs along the coastline of Puerto Rico. It is integrated by the Puerto Rico Police Department, the Puerto Rico Special Investigations Bureau, the National Guard, the U.S. Customs Service, and the U.S. Coast Guard.
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    Also, in a coordinated campaign that commenced on June 4, 1993, we have mobilized the National Guard of Puerto Rico units to support the state police in the rescuing of 77 communities where drug dealers had virtually taken control. After these initial operations, we supported and continue to support the rescued communities by rehabilitating and re-empowering them through a coalition of 18 social service agencies that comprise what we call ''The Quality of Life Congress.''

    Some of the major accomplishments of this thorough campaign directed at improving the living conditions of the residents of Puerto Rico include: seizures of 35,000 unregistered firearms; more than 12 tons of cocaine confiscated; recovery of more than $16 million in cash that had been in the possession of drug traffickers; shutting down of 250 ''retail outlets'' to which motorists could drive right up to and purchase illegal drugs—we call them actually ''drug points,'' and it's basically like a delivery service, and we eliminated 250 of them; 1,400 suspects taken into custody. Those are some of the statistics.

    Over 23,000 families in these 77 neighborhoods have, to date, been rescued. I should emphasize again ''rescued.'' We are basically restoring quality of life for these people. Past 5:00 in the afternoons, they could not go outside. Their kids could not play outside. Basically the drug lords were in control. In each of these 77 neighborhoods, as a result of this unprecedented initiative, we now can attest to a good and decent quality of life. That is what the fight against drugs is all about.

    Congressman Bill McCollum, chairman of the Subcommittee on Crime of the House Judiciary Committee, as well as Congressman Schumer, ranking minority member and former chairman of the same subcommittee, have described the program as a model that should be emulated in housing projects all across America.
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    I should say that Administrator Tom Constantine, who is present at this hearing, can also attest to the effectiveness of this program.

    It is evident that the growth of criminal incidents is directly linked to the proliferation of drugs in Puerto Rico. Our island has become a major point of entry for drugs originating in South America and destined to the United States mainland for various reasons. Following are some of the major ones.

    In the 1980s Florida was a drug smuggler's haven until the Federal Government invested heavily in manpower and high-technology surveillance. Fairly quickly the drug smugglers were captured or scared away from their Floridian paradise. The lure of money brought them to other pastures, and they began introducing their deadly profitable cargoes into the United States' market through a new trans-shipment area: Puerto Rico and the U.S. Virgin Islands.

    Puerto Rico is located 350 miles from South America and approximately 800 miles from Florida. The island's 300-mile coastline provides an ideal scenario for sea, land, and air smuggling of illegal contraband, such as drugs, weapons, and currency.

    There are more than 100 trafficking organizations currently operating in the eastern Caribbean, as reported by the DEA.

    Puerto Rico is a part of this great Nation, and once the drugs have entered the area, there are no more borders to cross. In other words, if they get past us, then they will show up on the streets of Miami, New York, or ''Small-Town USA.''
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    We estimate that over 7 tons of cocaine arrive in Puerto Rico on a monthly basis. At least 85 to 90 percent of these drugs are later transported into the United States mainland and destined primarily to the eastern seaboard cities of New York, Boston, Newark, Philadelphia, Atlanta, and Miami. The remaining 10 to 15 percent stays in Puerto Rico.

    By the way, that's what fuels the high crime situation in our island, because that 10 to 15 percent that stays in Puerto Rico is sold at these drug points that I mentioned to you and that we have been basically eliminating.

    The vast availability of cocaine in Puerto Rico is reflected in its relatively low cost and high purity, comparable only to those found in New York and other major eastern seaboard cities.

    Most of the violent deaths occurring in Puerto Rico are directly related to the upsurge in the smuggling of controlled substances and in the incidence of addition to such substances.

    In 1992, only 24 percent of the murders taking place in our island were directly related to drugs. By 1995 there has been a dramatic change. Now 63 percent of the murders are related to drugs.

    Based on these, as well as other well-documented facts, Governor Rossello sought the designation of Puerto Rico and the U.S. Virgin Islands as the seventh HIDTA of the Nation, and on November 2, 1994, we were designated as such.
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    Today we reaffirm our commitment to improve the lives of the residents of Puerto Rico and the rest of the Nation by presenting a united front against this drug epidemic. Our goal is to reduce the availability of drugs in the area and in the continental United States. Our collective efforts against drugs are making a difference.

    U.S. Secretary of the Treasury, Robert Rubin, stated before this committee, ''Because drug traffickers are shifting from the southwest to the Caribbean, Customs has put in place Operation Gateway in Puerto Rico and the Virgin Islands. Cocaine seizures in Puerto Rico, in the first half of the fiscal year 1996, were up 46 percent from the previous year, and seizures of heroin were also up substantially.''

    Yes, we are achieving significant results, but we still have far to go. Our borders are vulnerable, and although I have spoken mostly on our supply side strategy, we cannot forget the demand aspect of this problem. We have to question where did we go wrong socially and what can we do to turn the demand tide around?

    I'd like to conclude my testimony by quoting Governor Rossello on the conference entitled, ''Meeting the National Threat of Drug Abuse and Crime'' which was held in San Juan earlier this year. Then he stated, ''For the sake of an entire generation of young people, and for the sake of generations to come in the new millennium, may God be with us all as we strive to meet and to defeat the national threat of drug abuse and crime.''

    This concludes my formal remarks, but I'd like to—I'd be happy to answer any questions you may have, particularly on our interdiction efforts and the Coast Guard assets and effectiveness in our region.
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    Thank you, Mr. Chairman.

    Mr. COBLE. Thank you, sir.

    Let me say, if there are members of the third panel in the audience, if you have other things to do, you may leave, because, as I say, we're going to have a recess at 12:00 and then we will reconvene on or about 1:00, so if there are members of the third panel who need to do other things, there is no way we can get to you before 1:00—that's the third panel.

    Mr. Ford?

    Mr. FORD. Thank you, Mr. Chairman.

    If it would please the chairman, I'd like to have my full statement submitted for the record and I'll try to summarize briefly.

    Mr. Chairman, members of the subcommittee, I'm pleased to be here today to talk about a recent review we did on narcotics efforts in Mexico. We initiated the work at the request of Senator Grassley and the Senate Caucus on International Narcotics Control and another House subcommittee.

    Our review focused on four major areas: first, a discussion of the nature of the drug trafficking threat from Mexico; second, Mexican efforts to counter drug trafficking activities; third, U.S. strategy and programs intended to stem the flow of illegal drugs through Mexico; and, lastly, we discussed recent initiatives by the United States and Mexico to increase counter-narcotics activities.
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    Our report was issued in June of this year, and I believe it has been made available to the committee.

    The report builds on prior GAO reports and testimonies on U.S. and Mexican efforts to control drug activities, and many of the things that I'm going to talk about we found on our previous efforts.

    Mr. Chairman, let me paint a picture for you on the nature and magnitude of the problems we face from Mexico.

    Mexico is the primary transit country for cocaine entering the United States from South America. It is also the major source—a major source country for heroin, marijuana, and, most recently, methamphetamines. U.S. Government estimates indicate that up to 70 percent of the cocaine enters the United States through Mexico.

    In addition, Mexico supplies up to 80 percent of foreign-grown marijuana consumed in the United States, and from 20 to 30 percent of the heroin.

    Two-thirds of the cocaine entering Mexico arrives via maritime vessels, making detection and apprehension a very difficult process.

    During the past 3 years, Mexican trafficking organizations operating on both sides of the border have replaced U.S.-based outlaw motorcycle gangs as the predominant manufacturer and trafficker of methamphetamines, primarily in the western part of the United States.
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    The DEA estimates that up to 80 percent of the methamphetamine available in the United States is either produced in Mexico and transported to the United States or manufactured in the United States by Mexican traffickers.

    Moreover, its proximity to the United States, endemic corruption, and little or no financial regulation have combined to make Mexico a major money laundering center, a haven for the initial placement of drug profits into the world's financial system.

    Given this picture, it's not surprising that the State Department has declared no country in the world possesses a more-immediate narcotics threat to the United States than Mexico.

    Now let me briefly talk about what happened since the Mexican government assumed responsibility for the drug control efforts in late 1992.

    On the positive side, Mexico has eradicated substantial acres of marijuana and opium poppy; however, the number of drug-related arrests in Mexico has declined by two-thirds since 1992 from approximately 28,000 in 1992 to 10,000 in 1995.

    On average, 45 tons of cocaine was seized annually in Mexico between 1990 and 1992, but during the 1993 and 1995 period that dropped down to only 30 tons.

    According to U.S. officials, Mexican counter-narcotics efforts are hampered by pervasive corruption in key institutions, economic and political problems, and limited counter-narcotics and law enforcement tools and capabilities.
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    Now let me move to the resource issue.

    In late 1993, United States revised its international cocaine strategy from one that focused on intercepting drugs as they move through the so-called ''transit area,'' including Mexico, to stopping cocaine at its source. U.S. funding for counter-narcotics efforts in the transit zone declined from about $1 billion in fiscal year 1992 to approximately $570 million in 1995.

    Moreover, since 1992 direct U.S. counter-narcotics assistance to Mexico has been negligible because of Mexico's 1993 policy of not accepting most U.S. counter-narcotics assistance.

    Our ability to monitor previously-provided U.S. assistance—primarily helicopters—has been hampered by these reductions.

    Since our August, 1995, testimony before this subcommittee, there have been some positive signs. The U.S. Embassy now has elevated drug control importance in its overall country plan. It has also developed a drug control operating plan and has developed measurable objectives so that you can assess whether or not the program is effective.

    The Mexican government has recently signaled a willingness to develop a mutual counter-narcotics assistance program and has taken some important law enforcement, and money laundering legislation is now working through their system.

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    We believe these actions are positive signs.

    The U.S. and Mexico have created a framework for increased cooperation and are expected to develop a joint counter-narcotics later this year.

    Mr. Chairman, I would like to conclude with this one thought: Mexico is critical to the success of any U.S. strategy; thus, U.S. and Mexican officials must follow through on these new initiatives that I have just talked about if we are expected to try to deter any illegal drugs entering the United States.

    I'd be prepared to answer any questions you might have at this time.

    Mr. COBLE. Thank you, Mr. Ford.

    Dr. Reuter.

    Dr. REUTER. Thank you very much.

    I ask that my written testimony be submitted for the record. I'll summarize it here.

    I appreciate the opportunity to testify here.

    I was, before obtaining a position at the University of Maryland, at the Rand Corporation, where I directed a study on the effectiveness of drug interdiction, and particularly of military involvement in drug interdiction, in 1988. In my testimony I will stick strictly to issues related to drug interdiction.
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    In particular, what I would like to talk about is ways of analyzing how much should be spent on interdiction and whether the interdiction budget ought to be expanded at this time. I propose the classic academic answer, which is that we don't know nearly enough to make that decision in a sensible way, but maybe the discussion will be helpful.

    Secondly, I'll talk about how interdiction and the recent increase in adolescent drug use are related or not related.

    The framework for thinking about allocating the budget among different programs, including interdiction, is based on the notion that interdiction can affect the price of drugs and, by that, affect consumption, but can't really reduce drug imports directly. That is, given the maturity of the production, transportation, and domestic distribution system, it's impossible to have an interdiction system that's so effective that only a fixed amount of cocaine can enter this country.

    Instead, we can make doing the business sufficiently more expensive, that the price of cocaine goes up, consumption goes down, and less enters the country as a consequence.

    The way interdiction accomplishes this is simple in principle. Interdiction raises the cost of smugglers by increasing the risk that drugs get seized and the amount that they have to pay people who work for them, in return for taking risks of going to prison. They also lose assets, including transportation assets.

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    So the more intense interdiction is, then the higher the cost that smugglers face. The higher cost smugglers face, the higher import prices. And from higher import prices we get higher retail prices. Then, by magic, we get reduced consumption.

    All that is a matter of theory; there is, not much evidence. In particular, one of the critical missing elements, which I will talk about in the context of the EBR study, is that we have no idea what is the relationship of an increase in smugglers' costs and the increase in the retail price of cocaine.

    So, in fact, raising smugglers' costs by a fixed amount let's say by $5,000—might raise the retail price of cocaine by $5,000. That might raise the retail price by 20 percent if that $5,000 is 20 percent of total smugglers' costs.

    Then the question is: if we put another $500 million into interdiction, how would that compare in terms of raising retail price as compared to other price-raising strategies that we have, such as domestic enforcement or source country control?

    The only thing that we have at the moment that addresses this with relatively current evidence is the Evidence-Based Research—I think that's a wonderful name—Evidence-Based Research study of the interdiction program, which estimated that an additional $500 million would raise the smugglers' cost per kilo of cocaine by about $3,800.

    Mr. BIDEN. What is the cost of a kilo right now?

    Dr. REUTER. A kilo at the high wholesale level—that is probably at a point of entry, in a 100-kilo bundle—might sell for about $20,000. I'm certainly not up-to-date on 1996 prices, but it would be $15 to $25,000, I think—probably around 20 now.
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    Mr. BIDEN. So it would raise it from 20 to 23?

    Dr. REUTER. From 20 to 24, roughly. And you could regard that as a 20 percent increase, which would be a stunning effect if it translated into 20 percent increase in retail prices, or it could be regarded as $4,000 or $3,800 as compared to a retail price of $120,000, in which case it's not very much.

    The point is that we have here one systematic study of one program from which I would have drawn a conclusion different from ONDCP. I would have said that, even given the uncertainties, this provided a reasonable basis for shifting some assets into interdiction. But I have not seen the full study and there may be technical problems with it that don't show up in the summaries that are available for the general public.

    But we have that one study which shows that $500 million in interdiction would accomplish this increase, and we have nothing to compare that with. I have no idea if taking $500 million out of domestic enforcement would comparably sort of reduce prices so that it makes sense to do this.

    In general, there has been absolutely no interest in a continuing line of analysis that allows decisions about these programs to be made in a systematic fashion, comparing the effectiveness of these programs by some standard measure like how much they raise the retail price of drugs.

    This hearing, in large part, is called because of the concern about the increase in adolescent drug use. There is a question about how that relates to interdiction.
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    I've talked mostly about interdiction as it relates to cocaine. With respect to marijuana I imagine it's obviously somewhat more complicated by this existence of a very large domestic production industry.

    But it's very hard to see a price-raising program like the interdiction program as having very substantial effects on initiation rates amongst adolescents. Over the period from 1981 to 1992, there were sharp declines in the price of cocaine and more ambiguous movements in the price of marijuana. During that period, initiation rates plummeted.

    It is very easy to tell a story—and it isn't more than a story—that initiation rates are fairly insensitive to price.

    So the question is: is arguing about the interdiction program relevant to a concern about changing initiation rates amongst adolescents?

    I would say at the moment we have a very meager understanding of what drives adolescent drug use, but the price appears to be of secondary importance.

    Rise in adolescent drug use in the last 3 years was predicted only in the most general way by any analysts. We always have had a hypothesis of generational forgetting, but no reference as to whether this would happen in 1993 or 2003 or 2013. Even now no one has any kind of model as opposed to a sound bite that explains why we've seen this increase and what policy, if any, or environmental factors could explain it.

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    Similarly, next to nothing is known about how different enforcement programs affect initiation rates. Under these circumstances, choices about programs and policies like how much to spend on the interdiction budget will continue to be driven by impressions and beliefs rather than any solid evidence.

    Thank you, Mr. Chairman.

    Mr. COBLE. Thank you, gentlemen.

    Murphy's law is at work today, gentlemen. The old Murphy's law adage would be, ''If anything can go wrong, it does go wrong.''

    A member of our second panel has to depart imminently, and he has requested that we hear from him and question him.

    To do that—I'm willing to accommodate him if it will not inconvenience you all, and I'm going to let you all make that call. If we do alter the schedule to that end, it would require you all returning for questioning on or about 1:00.

    If you all can't do that, we will—can you all—what says the first panel to that?

    Okay. Well, I think then, for the benefit of the second panel—Administrator Constantine is still here? Sir, I regret that I can't do that, but I hate to impose on this panel. I didn't know about your schedule until today. Would it be possible for you to come back later in the day? And I hope you understand, sir, I'm uneasy about inconveniencing the first panel that's already in place, so why don't we, sir, just accept your written testimony and then we will hear from the second—your partner in the second panel after we conclude with the questioning of the first panel, if that's amenable to you. I regret we can't do it the other way, but I think, given the set of circumstances as they are, we'll do it that way.
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    Thank you, sir.

    Mr. CLEMENT. Mr. Chairman, as I understand it, you will accept Mr. Constantine's statement into the record as if read?

    Mr. COBLE. That's correct.

    Mr. CLEMENT. And then any questions or whatever we could ask into the record, itself, and—

    Mr. COBLE. That would be in order.

    Mr. CLEMENT.—for him to respond to our request.

    Mr. COBLE. That would be in order.

    Senator, do you want to be heard on this matter?

    Mr. GRASSLEY. It's your decision, sir.

    Mr. COBLE. This is an out-of-the-ordinary set of circumstances. The blame should be assigned to no one. It's just something that we can't control.

    So if you will submit your statement then, sir, I appreciate that and wish you well at your graduation down the road.
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    Thank you, gentlemen.

    Now, Senator Grassley, Mr. Clement and I usually impose the 5-minute rule upon us, as well, during questioning, so if you're not uncomfortable with that, I will recognize the Senator from Iowa for 5 minutes of questioning, and then we will move along.

    Thank you again, gentlemen, for being with us.

    Senator Grassley?

    Mr. GRASSLEY. The 5-minute rule is generally used in the Senate, so I'm very comfortable with it.

    Mr. Walters, in the past you have been involved with the development of a national drug strategy. I know from your testimony in past hearings that you're very familiar with the present drug strategy. I think you made that clear in your presentation today. And, of course, you're an expert on the present state of drug use in America.

    We all realize that everyone has his own opinion as to what should be included and emphasized in our national drug strategy, and I'm asking you your opinion. What is the level of effort suggested in the present drug strategy compared with years past? What is the level of commitment in this strategy as compared to previous strategies? And characterize it above or below previous years. And then, lastly, shortcomings that you might see in the present strategy, if any.
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    Mr. WALTERS. Yes, Senator. I'll try to take those in order.

    If you measure the strategy in aggregate amount of money asked for, it's roughly the same as the last strategy in 1992. Those previous strategies were going up. It's roughly at the same level in current figures or in deflated figures.

    The places the strategy is spending money are different. I think J.L. has already referred to the reductions in interdiction, reductions in international programs in some areas, big increases in law enforcement spending of different types, some decline but roughly constant treatment spending, and some declines but roughly constant prevention spending.

    But I think that illustrates that the problem is not how much money you spend; the problem is how you manage the money. And the problem, as I tried to outline in my opening statement, is I don't think there is the proper policy management, construction, and implementation of programs.

    I think you have to change the desire of foreign partners in source countries to do more themselves, and if they don't want to do more, spending more money is not going to make them do more. It is a big problem. It is not an easy problem for them. But I think the fundamental problem today is the will of our foreign partners and their perception that we are not serious as a Nation.

    I think that's the Federal Government, generally, and I would recommend, as I said in my opening statement, that the Congress take into its hands the ability to express, even if through resolution before you go home, our dissatisfaction with the performance of Colombia, Mexico, and other countries at this point in time.
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    If you can do that, it has an effect. I think you should do more down the line.

    In terms of interdiction, I take Mr. Reuter's point. We've been discussing this for some years now. But one point I'd like to make in the EBR study that he didn't make is that the study estimates that $500 million would cause a disruption of 130 metric tons' equivalent of cocaine. It also points out that United States consumes somewhere under 300 metric tons.

    The exact consequences of these disruptions and whether they—how much additional supply they can roll into the pipeline and how hard to do this, that is a legitimate source of debate.

    But the fact of the matter is—and it's not we should just do interdiction. The issue is, we should reduce the supply and reduce the demand at the same time—addictive demand, casual demand, source country supply, domestic supply.

    I think the overall management—the failure of overall management is reflected in the fact that this drug strategy doesn't have any numerical goals. They're hard to make, they're difficult to make, but they are also political. They stake the integrity of the President on reaching certain goals.

    My view is, if you try hard and you don't make it, or you seem to try hard, that's not a detriment; but if you don't try and you don't make it, then I think the American people have a right to hold you accountable, no matter where you sit in the Government. It's not a right, it's a privilege.
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    In terms of treatment, I talked about that at some length about the problems I think exist in the current treatment system and the failure to kind of come to grips with those. And in terms of prevention, I think a lot of what we do at the Federal level has to do with creating a certain kind of attitude.

    In a hearing last week, Senator Biden pointed out that, in meeting with young people in his District, they want an excuse to say no. They want adults to give them the moral support to say, ''I don't use drugs.''

    In an exchange with him afterwards, I said, ''Adults need that too.'' The American people and citizens and other leaders need to know that the climate in this country is that you are going to not tolerate sales and use. We ought to close open air drug markets, as Puerto Rico has tried to do with astounding success. We ought to insist that schools not tolerate drug use. We ought to insist that programs that receive money are accountable. We ought to insist that the highest-level officials—the President and his drug director—provide goals, as required by law, and link programs to the achievement of those goals.

    It doesn't do it.

    This is a strategy for failure. People don't like the drug war analysis. This is a strategy for a domestic Vietnam. We know this won't work, and I defy any subsequent witness to tie the programs and policies in this to reducing the current terrible trends.

    Now, if we continue, knowing this won't work, we're asking the young recruits that Mr. Constantine is going to go swear in to be ground up in the maw for no good achievement.
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    There are hundreds of them and thousands of them on the line, and we're not supporting them with the right kinds of policies at the national level.

    That's a long answer, but it was a long question. Sorry.

    Mr. COBLE. Senator Biden, your round for 5 minutes.

    Mr. BIDEN. Mr. Chairman, I'd be happy to yield if you want to go Senate, House—

    Mr. COBLE. Either way. Go ahead.

    Mr. BIDEN. All right. Dr. Reuter, you have been before my committee on the other side almost as much as Mr. Walters has. There is this ongoing debate that we've always had about the efficacy of interdiction and the allocation of resources.

    One of the things I am always reminded of—and I'm not sure that you were the first one to tell it to me, or whoever it was in the committee—to put this in focus, that it takes only 10 square miles to supply the entirety of the world's heroin supply.

    Dr. REUTER. The U.S. heroin, sir.

    Mr. BIDEN. If I'm not mistaken, the American consumes less than 10 percent of the world's heroin.
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    Dr. REUTER. Right.

    Mr. BIDEN. I was under the impression it was 10 square miles for the world's supply.

    Dr. REUTER. No.

    Mr. BIDEN. No? All right. So you've got 10 square miles, and we've watched it move. We've watched it move from Afghanistan to Burma. We watched it move into Peru. We watched it move all—I mean, we've watched this thing move.

    So keep in mind what we're dealing with here is a fairly porous borders, and in some sense necessarily porous.

    But I think that Mr. Walters makes a valid point. If we had the resources to add another half billion dollars to interdiction, if it would have the effect of taking 130 metric tons out of the supply in the United States, that would be a good thing, a positive thing. It wouldn't be bad.

    Dr. REUTER. Right.

    Mr. BIDEN. The problem I have is: where do we take it from? Or where do we add to?

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    This is a prelude to my question.

    As I understood your testimony, although we have now at least a study that says half a billion would affect 130 million metric tons—

    Dr. REUTER. 130 metric tons. Yes.

    Mr. BIDEN.—we don't have any comparable study to say, if you took a half a billion out of local law enforcement or you took a half a billion out of treatment or you took a half a billion out of any other sector, what that might do at the other end.

    Dr. REUTER. That's right. That's the point. If the EBR findings stand up to scrutiny—and I've not seen the detail, the study, itself—it makes, I think, a sort of good prima facie case that more interdiction would be a useful reallocation from most other domestic enforcement programs, or, from my point of view, from source country control programs, though there is scarcely $500 million left in that account.

    And so, as I say, I might have interpreted this differently, but it's one study of one program and you just don't know what you're comparing against.

    Mr. BIDEN. But don't you agree with Mr. Walters that there has not been—and I would argue there hasn't been for a while—enough emphasis from the foreign policy side of our equation on—

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    Dr. REUTER. I think there is this great American penchant for going to the fundamentals, and it's so often misleading. I mean, you go to prevention to stop demand at its beginning, or you go to production so you don't have to deal with the distribution, and so on.

    I think we have good arguments and lots of evidence to suggest that these are very elusive target. It is hard to persuade producer countries to act aggressively on our behalf, and even when they do act aggressively on our behalf, as has been the case historically with Mexico with respect to heroin previously, we get fairly modest results from that in terms of our own prices.

    I mean, there is a lot of very cheap land and labor there, and it is nothing we are going to do that's going to make that really expensive.

    Mr. BIDEN. I would argue, when we did have some cooperation in Colombia because of their own internal situation and because of initiatives, I'd argue—we had an argument at the Administration at that time, we lost an opportunity. We did not come in and fill any void to give any alternatives at that time, and some of us are arguing the Andean policy should be altered to provide for access for people to get back to their business.

    The irony was, at the very time we were telling those farmers in Colombia who were being shut down that they're out of manufacturing, they're off the farm, we were also going after them on the flower treaty we had with them and the number of treaties that they—so the last Administration had such a bogus foreign policy related to that, that I found it astounding.
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    Dr. REUTER. I hate to be so relentless about this, but you cannot raise the price of land and labor in Colombia enough to make any difference to the price here. If you make flower growing more profitable, the wages of Colombian labor might go up 25 percent. That would be wonderful and that would raise the price of leaf growing in Colombia by 20 percent, let's say. And that would be $0.02 on the price of a bundle of crack.

    It just is very seductive. It's very irrelevant.

    Mr. BIDEN. Mr. Chairman, my time is up and I have some other questions if we have time, but I'll submit them in writing if you wish.

    Mr. COBLE. Thank you, Senator. We have a vote on so we have to move along here.

    Mr. Walters, I'd like for you, during my 5-minute segment, to respond to what Dr. Reuter said, but I want to put a question to you first.

    You stated that the Clinton Administration's claim—in your testimony—that it will address the drug problem by increasing treatment slots for hard-core addicts is questionable. You further note that, while treatment spending almost tripled during the fiscal years 1988 through 1994, the number of persons treated declined by 145,000 people.

    Since the number undergoing treatment is falling or reducing, do you have any determination what became of the millions of dollars earmarked for that purpose?
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    Mr. WALTERS. Yes. Again, those are all numbers from the Clinton Administration drug office. I'm not calculating them myself. And they get them, I think, from HHS studies.

    There are some cases where the money improved the quality of certain treatment programs. It went from poor quality to high quality.

    I don't think there is any evidence—and I'd be happy to have Dr. Reuter, who also studies this stuff, if he has evidence, to respond here. I don't think there is any evidence that the overall system got better.

    Again, I think we've got a sterile debate—I said this to Senator Biden last week—over whether treatment works. HHS has a campaign. This is ''treatment works'' month. I believe treatment works. I've helped people get into treatment. If I had a family member that had a drug or alcohol problem, I would put them into treatment.

    But the kind of treatment they would get is not the kind of treatment hard-core addicts are going to get. I'm not going to take them down to those centers. I'm going to take them some place else.

    The problem is quality control. The problem is location. And the problem is modality of treatment.

    The problem is the system has maintained a block grant mentality. It has not provided built-in accountability in the system, so poor-quality treatment and rotating outpatient treatment gets the same support.
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    We have more hard-core addicts. They need long-term residential treatment and a variety of support services. The money that has been dumped in by the Federal Government at over $2 billion a year has gone to increasing, by their own estimates, the percentage of outpatient, not residential treatments.

    The bureaucracy has absorbed the money. The bureaucracy has apportioned the money in areas where you don't have the same kind of need.

    In 1989, the study we had showed that we were using treatment capacity at 80 percent. The latest study shows we're using it at 75 percent. So we've got more excess capacity that's not being used, while we still have virtually the same, if not more, addicts, depending on what estimate you use.

    Mr. COBLE. Thank you, sir.

    We have a vote on now. Senator Grassley, could you take the Chair while I go vote?

    I'll let Senator Grassley have the Chair, and we're going to have—let's do it that way.

    Mr. GRASSLEY [assuming Chair]. Mr. Clement?

    Mr. CLEMENT. Thank you, Mr. Chairman.
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    Mr. Walters, do you think we've truly had a war on drugs? And if we have had a war on drugs, when was that?

    Mr. WALTERS. I think the war metaphor is good. I support it to those that criticize it because it talks about mobilizing and focusing the country's attention. I think the peak of public concern about this was last—although it's now with violent crime, as far as I've seen in Gallup polls—a peak public concern. The peak before that was in roughly around 1988 and 1989.

    Between 1979 and 1992, overall drug use declined by 50 percent. The measured use of cocaine peaked in 1985 and dropped almost 80 percent—78 percent between 1985 and 1992.

    We did not radically reduce the number of hard-core addicts, however—the people who experimented in their teens and in the 1970s and early 1980s and who became addicts during that period of time and who continue to cycle through the system, as far as we can measure it, and are getting older and sicker and showing up more frequently in emergency rooms.

    I think in any other domestic social pathology—teenage pregnancy, HIV transmission, dropout rates, you name it, if we had a 50 to 80 percent decline we would consider that a remarkable success. We've done that with the entry pipeline for drug use. We have not done as good a job, as I said, with addiction, but the fact is, there are fewer people in the demographic years 1979 to 1992 that are going to end up as addicts.
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    But we're creating the addicts of the next five to 10 to 15 years today with these increases in teenage drug use.

    Mr. CLEMENT. Mr. Walters, you state that, according to the Administrative Office of the Courts, there has been a 10.3 percent reduction in Federal case filings between fiscal year 1992 and 1995. Yet, the testimony of the Department of Justice indicates that Federal prosecutors filed 3 percent more drug cases in 1995 than they did in 1992. How do you reconcile this apparently conflicting testimony?

    Mr. WALTERS. My testimony contains a footnote that explains it. There are several different accounting systems, and we've tried to be fair and present the various accounts here.

    I think I tried to use the most accepted to show that the filings, despite increases in spending that are quite extensive in law enforcement here, have been, I think, from my ability to gather who considers which accounting system best, have declined.

    But I have not tried to hide any of the conflicting evidence or other studies.

    Mr. CLEMENT. Well, as you know, it's—I don't think you took into consideration the number of State cases, either, the increase in that area.

    Mr. WALTERS. No. I just talked at the Federal record. Yes. That's fair.
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    Mr. CLEMENT. Mr. Walters, you seem to believe that aircraft and ship patrol hours should be used as a ruler to measure the success of our drug interdiction efforts. We did a little calculation that in 1991 the Coast Guard interdicted .96 pounds of marijuana and cocaine per aircraft and ship patrol hour. This rate increased to 2.99 pounds per patrol hour in 1994. Isn't this a result of smarter patrolling and interdictions due to increased intelligence?

    Mr. WALTERS. Yes. I agree that it's better to do this smarter than dumber. I do think, though, that when you're doing it smarter you need a certain level of resources, and actually the decline in ship hours—resources—and the central part of my testimony uses data from the joint task force that the Federal Government runs in Florida and reports their measure of resource decline causing an efficiency decline.

    But I certainly don't mean by saying ''dollars'' that dumb spending of dollars is a substitute for smart spending of dollars, and I think I've tried to make that clear across the board.

    Mr. CLEMENT. Which one do you think is most important: seizing the drugs or putting these drug kingpin operators out of business?

    Mr. WALTERS. My preference is neither of those; it's stopping the flow and reducing availability on the supply side.

    We ask the wrong question. We let agencies come up here and say, ''I've got so many arrests.''
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    I've tried to talk about the various measures and what they show, but I've tried to also make clear, the key—the contribution that supply reduction can make to demand reduction is to decrease availability, make it more expensive, make it harder to find.

    When we do that it's not a substitute for demand reduction but it helps demand reduction work. It's like taking a bridge. If you want to contr