"I don't battle anymore! I uplift motherfuckers!" - GZA
Wednesday, March 25, 2009,11:33 PM
Jay-Z's Secrets To Personal Success
With nearly 40 million albums sold and a business empire that includes clothing, fragrances, the New Jersey Nets, sports bars, liquor, and hotels, Jay-Z has transformed himself into one of the most potent brands in the world

By: Anthony DeCurtis

"With education comes refinement," Jay-Z observes late one Friday afternoon. He's lounging on a couch in a studio at the Chelsea Piers Sports and Entertainment complex on the far west side of Manhattan and speaking between nibbles of a takeout salad in a plastic container and sips from a bottle of water. In his everyday speech, as in his raps, Jay-Z is inclined toward aphorisms, the compressed expression of complicated ideas, delivered with rhetorical flair. It's hard-earned wisdom, graced by a poet's touch.

He is relaxing after a typically jam-packed day that included a photo shoot, an interview, and a meeting about his potential involvement in a forthcoming video game. He celebrated his 39th birthday the night before with the staff of his Rocawear clothing line, so a mild fatigue has set in. Slender and six feet three inches tall, Jay-Z is an imposing figure, even in relative repose. He's wearing distressed jeans that hang loosely from the middle of his hips, black sneakers, and a long-sleeved black T-shirt that has replaced the pristine short-sleeved white one he wore before changing for his photo shoot. The look is studiously casual...until you glance at his left wrist and notice a diamond watch so thick it could pass for a weight band.

The winter sky is growing gray in the bank of windows behind him as the sun sets over the Hudson River. Jay-Z returns to the narrative of what, in the 19th century, would have been called his sentimental education, the education of his emotional life. That journey to refinement began in the rugged Marcy Projects in Brooklyn's Bedford-Stuyvesant district, and now continues in arenas and boardrooms, in posh homes and VIP hideaways, around the world.

Jay-Z feels comfortable in all of these realms. "I've never looked at myself and said that I need to be a certain way to be around a certain sort of people," he explains. "I've always wanted to stay true to myself, and I've managed to do that. People have to accept that. I collect art, and I drink wine...things that I like that I had never been exposed to. But I never said, 'I'm going to buy art to impress this crowd.' That's just ridiculous to me. I don't live my life like that, because how could you be happy with yourself?"

Staying true to yourself might stand as a succinct summary of Jay-Z's philosophy of success. The notion goes back to Shakespeare's "To thine own self be true," and further back than that to the Greeks. But for Jay-Z, it has an urgently contemporary meaning. Even, or perhaps, especially, in recessionary times, amid the thousands of entertainment and lifestyle choices consumers have available to them, what separates winners from losers is a commitment to a single proposition: You are the product. If people believe in you, they will believe in what you create. Jay-Z understands this and is down with it.

By selling nearly 40 million albums and building a business empire that extends far beyond music into clothing, fragrances, the New Jersey Nets, sports bars, liquor, and hotels (to name just a few of his seemingly innumerable investments), Jay-Z has transformed himself into one of the most potent brands in the world. But that brand retains its power only if people remain convinced that the product they are purchasing somehow genuinely reflects Jay-Z and his tastes. As he famously put it in one of his raps, "I'm not a businessman/I'm a business, man."

"My brands are an extension of me," he says. "They're close to me. It's not like running GM, where there's no emotional attachment." The reference is apt, given the government's ongoing potential bailout of two major automobile companies. Jay-Z notes that resonance with a pause and a chuckle.

"My thing is related to who I am as a person," he says. "The clothes are an extension of me. The music is an extension of me. All my businesses are part of the culture, so I have to stay true to whatever I'm feeling at the time, whatever direction I'm heading in. And hopefully, everyone follows."

In conversation, Jay-Z's speech is slower, calmer, and more deliberate than in the propulsive, deep-voiced, and often incendiary raps that have made him a titan in the world of hip-hop, a man whose sales and staying power have elevated him above all but a handful of potential rivals. He's an engaged and animated speaker, quick to touch you in a friendly way to emphasize a point.

But as laid-back and accessible as he seems, he also exudes a calm air of confidence. He doesn't need to be aggressive or impose his will in a ham-fisted manner. Half a dozen people are floating around the studio, ready to read any sign of need or impatience on his part. He's cooperative and congenial in the way that only someone who knows he can immediately put an end to any experience that moves in an unpleasant direction can be. "Jay-Hova," he has called himself, echoing the name of the mighty, vengeful God of the Hebrew Bible. He has anointed himself the "God MC."

But he has also rapped that he "never prayed to God/I prayed to Gotti." Perhaps there is a distinction to be drawn between Jay-Z, the battle MC who to this day engages in raw exchanges with younger rappers looking to take him down, and Shawn Corey Carter, the far-sighted businessman who cofounded his own label, Roc-A-Fella Records, in 1996; who served as president and CEO of Def Jam Records from 2005 to early 2008 and helped launch the careers of Kanye West, Young Jeezy, and Rihanna; who sold his Rocawear clothing line in 2007 for $204 million, while retaining a major stake in the company; and who, following a path blazed by Madonna and U2, forged a $150 million deal last year with the concert-promotion firm Live Nation.

Last summer, Forbes ranked Jay-Z seventh on its "Celebrity 100" list of the ultrafamous and ultrapowerful. The magazine estimated his annual income at $82 million, and other sources have reported his net worth at $350 million. If that doesn't seem enviable enough, last year Jay-Z married Beyonce Knowles, one of the world's most desirable women. It is part of his attitude of ultimate cool that he never publicly talks about her.

Jay-Z moves in exclusive circles of all types. Musicians, actors, designers, politicians, captains of industry, and athletes all want to get next to him. He has developed an easygoing manner that enables him to cross these cultural boundaries in ways that make him seem accessible but still dignified, always aware of who he is. "I'm a mirror," he says. "If you're cool with me, I'm cool with you, and the exchange starts. What you see is what you reflect. If you don't like what you see, then you've done something. If I'm standoffish, that's because you are."

Occasionally, stereotypes rear their heads and uncomfortable situations arise. "It's hilarious a lot of times," he says. "You have a conversation with someone, and he's like, 'You speak so well!' I'm like, 'What do you mean? Do you understand that's an insult?' "

Growing up, however, Shawn Carter was far from the likeliest candidate for this sort of mind-boggling success. He was always recognized as bright--even today, the first word anyone who meets Jay-Z invariably uses to describe him is smart--and in the sixth grade, he tested at 12th-grade levels. But the Marcy Projects in Brooklyn were overrun by drugs and violence in the '80s. His father left the family when Carter was 11, and his mother had to raise him, his older brother, and his two older sisters. When he was 12, Carter shot his brother for stealing his jewelry. (They have since reconciled.) Carter attended high school with fellow Brooklynites the Notorious B.I.G. and Busta Rhymes, but dropped out to deal drugs in a region that extended from Brooklyn to Maryland and Virginia--as he details in his music--and to dabble in the still-nascent hip-hop game.

Along with the dealers who ran the neighborhood around the Marcy Projects, Jay-Z remembers identifying sports figures as his first models of success. "Growing up where I grew up, we looked to athletes," he recalls. "They were our first heroes. They came from the same places we came from. I mean, you can't watch TV and see someone who is successful that you can really relate to. That person isn't real, he doesn't exist. But athletes traveled the world, had these big houses, and gave their families a better life. We were like, 'Wow, that's really cool.' These guys get paid millions of dollars to play the game they love."

Around the same time that he began to identify with athletes, Carter experienced another revelation: hip-hop. He began writing nonstop in notebooks, keeping his mother and siblings awake at night as he pounded the kitchen table to create beats. He hooked up with local rapper Jaz-O, who brought him to England when he toured there. Carter recorded with Jaz-O and also with Big Daddy Kane. But despite the acknowledgment of his skills (and his growing anxiety that either violence or the law would eventually catch up with him on the streets), Carter was reluctant to give up dealing. He was rolling in a Lexus and making more money, as far as he could tell, than most rappers.

Still, he decided to take the plunge, but no record company was willing to offer him a contract. So with two partners, Carter formed Roc-A-Fella Records, and, in 1996, released his debut album, Reasonable Doubt, which established him as a major figure on the hip-hop scene. It was a heady moment, but Jay-Z barely realized it at the time. "I was naive," he recalls. "I made that album to impress my friends, so they would say, 'Oh, wow, look what you did!' It was my first album on the label that we owned. I was like, 'Okay, what happens now?' "

What happened was that Jay-Z left drug dealing behind and began to build his empire, moving steadily from "grams to Grammys" as he puts it in one song. But the process wasn't easy. The treachery of life on the streets, where he faced bullets at close range, turned out to be nothing compared with what he would encounter in the upper echelons of the music business. "I come from a world that's completely different from the music industry, and it wasn't recognizable to me at all," he says. "I come from a place where you had to keep your word, where people would stick with you no matter what. That's impossible in the music business, where if you're not hot, people are not talking to you. I just tried to be a man of my word."

The choice of Roc-A-Fella as his label's name would prove telling. On one hand, it's standard hip-hop braggadocio to establish a connection between a fledgling rapper and one of the richest and most powerful families in American history. But it also suggested the means through which Jay-Z would eventually establish his own business empire. The Rockefeller family and other 19th-century industrialists established a monopolistic hold on all aspects of the goods they produced. If you owned the mines that produced coal, for example, you also bought the railroads that transported it, the refineries that prepared it for market, and the utilities that provided its end product to the general population.

As Jay-Z's career has progressed in the past dozen years, he has sought to establish a similar hold on the lifestyle market for which his music provides the soundtrack, and in which he stands as the ideal model to emulate. Rather than providing anything as tangible as coal or oil, Jay-Z, through his myriad branded investments, manufactures a way of being that makes it at least theoretically possible to never leave the world of his products. You can enjoy his music while sporting Rocawear clothing (estimated as doing $700 million a year in business), wearing one of his fragrances, and sipping his Ace of Spades champagne. You can attend his concert and end the night at one of his 40/40 nightclubs. His videos, DVDs, and CD booklets provide free exposure for all of his products, all of which, in turn, enhance every other aspect of the Jay-Z brand.

The question then becomes how, with all this marketing and glossy brand extension, does Jay-Z maintain the credibility in the hip-hop world that made him such a marketable star in the first place? "We are excited to partner with an industry giant such as Elizabeth Arden," Jay-Z declared in the press release announcing his fragrance line, which made its debut last year. No matter how deeply you've absorbed the potency of Jay-Z's mainstream reach, that sentence still makes you do a double take. This is the man who took the film American Gangster as the inspiration for his most recent album? Jigga what?

But Jay-Z believes deeply in the aspirational power of hip-hop, the notion that the music's truest fans want to see their heroes succeed and want to emulate them. He draws a sharp distinction between hip-hop and rock 'n' roll, whose stars have often expressed disdain for business and success. "I noticed that difference early on, like if you were successful in rock 'n' roll, that was a really bad thing," Jay-Z says with a laugh. "You almost had to hide it. You had these guys selling 200 million records with dirty T-shirts on. I was like, 'Come on, man. Come on. We know you're successful.'

"Hip-hop is more about attaining wealth," he continues. "People respect success. They respect big. They don't even have to like your music. If you're big enough, people are drawn to you."

Consequently, any discussion of credibility, or keeping it real, elicits a response of disbelief from him. "That's an insecure emotion," he explains. "You make your first album, you make some money, and you feel like you still have to show face, like 'I still go to the projects.' I'm like, why? Your job is to inspire people from your neighborhood to get out. You grew up there. What makes you think it's so cool?"

Of course, Jay-Z has not been immune to those insecurities himself. In 1999, he was arrested for stabbing a record executive in a New York club, and in 2001, he was charged with possession of a loaded handgun. Against his lawyer's advice, he pleaded guilty to a misdemeanor charge in the stabbing case and was sentenced to three years' probation. The gun charge was dropped.

It's generally thought that those brushes with potential incarceration cured Jay-Z of the need to prove that he could still live the thug life. He has rapped about both of those arrests ("Put that knife in ya/Take a little bit of life from ya/Am I frightenin' ya?"), but has shown no further inclination to transform his words into deeds that would put an end to the extraordinary life he has created for himself. In fact, quite the opposite. He has been baited relentlessly by other rappers--Nas, to cite just one example, taunted "Gay-Z" for his "dick-suckin' lips"--and has responded in kind, but only in song. In real life, he has taken steps to ease those rivalries and ensure that tragedies such as the killings of Tupac Shakur and the Notorious B.I.G. never happen again.

That's because too much is at stake now, far more than money or bling. At 39, Jay-Z is old enough to think about the cultural impact that hip-hop has already had, and the critical role he has played in it. "Hip-hop has done so much for racial relations, and I don't think it's given the proper credit," he says. "It has changed America immensely. I'm going to make a very bold statement: Hip-hop has done more than any leader, politician, or anyone to improve race relations.

"I'll explain why I say that," he continues. "Racism is taught in the home. We agree on that? Well, it's very hard to teach racism to a teenager who's listening to rap music and who idolizes, say, Snoop Dogg. It's hard to say, 'That guy is less than you.' The kid is like, 'I like that guy, he's cool. How is he less than me?' That's why this generation is the least racist generation ever. You see it all the time. Go to any club. People are intermingling, hanging out, having fun, enjoying the same music. Hip-hop is not just in the Bronx anymore. It's worldwide. Everywhere you go, people are listening to hip-hop and partying together. Hip-hop has done that." He pauses, as if marveling at the idea, and then repeats it for emphasis: "Hip-hop has done that."

Something else that hip-hop has done, in Jay-Z's view, is help to elect Barack Obama. "Rosa Parks sat so Martin Luther King could walk, and Martin walked so Obama could run," Jay-Z told a concert audience in the crucial swing state of Ohio shortly before the November election. "Obama is running so we all can fly, so let's fly." He recorded a get-out-the-vote message for robo calls to African-American voters during the primaries. Perhaps even more extraordinarily, after a particularly heated primary debate, Obama brushed off Hillary Clinton's attacks with a gesture of wiping lint off the shoulders of his suit, and hip observers recognized an unmistakable reference to Jay-Z's song, "Dirt Off Your Shoulder."

Jay-Z's eyes widen as he recalls that moment. "I felt like, man, what time are we living in, where a presidential nominee is making reference to a rapper?" he says. "What a beautiful place we've come to. Growing up, politics never trickled down to the areas we come from. But people from Obama's camp, and Obama himself, reached out to me and asked for my help on the campaign. We've sat and had dinner, and we've spoken on the phone. He's a very sharp guy. Very charming. Very cool.

"It's surreal," continues Jay-Z. "I couldn't imagine anything like that could happen. I didn't vote until I was an older adult. I didn't think I would ever vote, because it didn't matter who was in office. The situation never changed where we lived. Our voices weren't heard."

Jay-Z walks idly around the studio as crew members break down the set for his photo shoot. He's rapping along with a hip-hop track that's blasting in the room. When the sound system abruptly shuts off, Jay-Z continues rapping and moving to the music, like Wile E. Coyote in the moment before he looks down and realizes that he has run off the cliff. Jay-Z catches himself, looks around the room in mock surprise, and laughs. It's the sort of self-deprecating gesture he's good at, acknowledging that all eyes are on him, but humorously taking the edge off whatever intimidation factor his presence might have.

That's a quality he brings into the boardroom as well. He's far from just a figurehead or a media front man. He takes his businesses as seriously as his artistry, and he goes at both with the same level of determination. He's clear about his own views, willing to listen to others, eager to keep everybody loose and motivated, and far more interested in long-term strategy than short-term gain. Even in the current economic environment, which is challenging to say the least, he's insistent on executing his game plan rather than making changes that might not ultimately be right for his brands.

"He's smart as hell," says Neil Cole, chairman and CEO of the Iconix Brand Group, the company that bought Rocawear two years ago for more than $200 million. "He understands himself as a brand, and it's incredibly well thought out. We meet every week, and there's nothing impulsive about him. He's very consistent, and he won't settle. If something's not right, he's not going to do it for more money. He'll wait to get it right. He has a wonderful taste level about where he wants to take the brand. . .and himself."

Michael Rapino, the president and CEO of Live Nation, echoes Cole's assessment of Jay-Z. "In meeting with superstars about potential deals, there are some who spit out 'How much can I get?' and the meeting is over, because you know you're starting out on the wrong basis," he says. "When we sat down with Jay-Z, 'How much money are you going to pay me?' came up in maybe the seventh conversation. The first conversation was, 'Can we change the business together?'

"Right there, we knew we had a common agenda," continues Rapino. "It was like, 'I'm hungry. The business is changing. I'm a change agent, and I have a lot of years left.' Then the creativity flows. You don't become the best in the world at what you do, and then flip the off switch. Jay-Z wants to win. And for him it's also about the integrity of the win. He's a true partner, always looking for the win-win. He's asking, 'How do we win together?' "

Indeed, part of the refinement Jay-Z has attained entails that big-picture vision of success. It's a vision that extends beyond business and beyond music. It's about what makes your life meaningful, and it goes beyond lifestyle to a way of life. "I'm hungry for knowledge," says Jay-Z. "The whole thing is to learn every day, to get brighter and brighter. That's what this world is about. You look at someone like Gandhi, and he glowed. Martin Luther King glowed. Muhammad Ali glows. I think that's from being bright all the time, and trying to be brighter.

"That's what you should be doing your whole time on the planet," he concludes. "Then you feel like, 'My life is worth everything. And yours is too.' "

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posted by R J Noriega
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Saturday, March 14, 2009,2:48 PM
Soaps, Sex and Sociology
From The Economist print edition

Do women who watch telenovelas have fewer babies (but more men)?

THE glamorised world portrayed on the nightly telenovelas (soap operas) on Brazilian television is, superficially at least, about as representative of the country as a whole as Marie Antoinette and her shepherdesses were of 1780s’ France. But they are all about aspiration. About 40m people watch the mid-evening novela from Globo, the leading network. The action often takes place in Rio de Janeiro, where Globo is based, among families which are smaller, whiter and richer than average. New research suggests that by selling this version of the country to itself, Globo has boosted two important social trends.

The soaps blossomed under Brazil’s military regime of 1964-85. The generals subsidised sales of television sets to build a sense of nationhood in a large and then largely illiterate country. National news was meant to do the job, but the soaps got the audience. Their scriptwriters and directors, many of whom were on the left, saw them as a tool with which to reach the masses. Their plots often tilt in a progressive direction: AIDS is discussed, condoms are promoted and social mobility exemplified.

How much impact do the soaps have on real life? As recounted in papers from the Inter-American Development Bank, researchers tracked Globo’s expansion across the country and compared this to data on fertility and divorce.*

The results are most striking for the total fertility rate, which dropped from 6.3 children per woman in 1960 to 2.3 in 2000, despite contraception being officially discouraged for some of that time. This was because women moved to cities and opted to have fewer babies. The papers argue that the small, happy families portrayed on television contributed to this trend. Controlling for other factors, the arrival of Globo was associated with a decline of 0.6 percentage points in the probability of a woman giving birth in a given year. That is equivalent to the drop in the birth rate associated with a woman having two extra years of schooling

The effect on divorce was smaller, but noticeable. The researchers found that between 1975, when divorce was first mooted, and 1984 about one in five of the main characters in Globo soaps were divorced or separated, a higher percentage than in the real Brazil. These break-ups were not just a result of machismo: from the mid-1960s to the mid-1980s about 30% of female lead characters in novelas were unfaithful to their partners. The researchers find that the arrival of Globo in an area was associated with a rise of 0.1-0.2 percentage points in the share of women aged 15-49 who were divorced or separated. The authors reckon that watching “empowered” women having fun in Rio made other women (a few of them anyway) more independent.

Other research shows that divorce and lower fertility are linked to less domestic violence. So the influence of soaps may be far more positive than critics of their vapidity claim. If Globo could now come up with a seductive novela about tax reform its transformation of Brazil would be complete.

* “Television and Divorce: Evidence from Brazilian Novelas,” by Alberto Chong and Eliana La Ferrara (January 2009) and “Soap Operas and Fertility: Evidence from Brazil,” by Eliana La Ferrara, Alberto Chong and Suzanne Duryea (October 2008).


posted by R J Noriega
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Friday, March 13, 2009,2:09 PM
Ecko's startup story: Rhinos and maxed credit
By Jessica Harris

To launch his streetwise fashion line, Ecko burned up his credit cards and learned to dampen checks to slow down the bank's cashing them.

NEW YORK (FORTUNE Small Business) -- Fortune Small Business recently sat down with fashion designer Marc Ecko, founder and CEO of Marc Ecko Enterprises, at his Batcave-like headquarters in lower Manhattan. Ecko, 36, told us how he got his burgeoning streetwear empire off the ground. Below are edited highlights from Ecko's conversation with FSB contributor Jessica Harris; for more, see our video of the interview.

FSB: How did you become exposed to hip hop and graffiti - elements that have influenced your fashion?

Ecko: I grew up in the 1980s, in this really eclectic New Jersey town called Lakewood that had a large population of blacks and Latinos. Hip hop was something you had to go out and find back then - it wasn't something that found you.

FSB: You went to college planning to become a pharmacist like your father. What changed your mind?

Ecko: I wasn't happy with the idea of being a pharmacist. I was more passionate about art. And every time I tried to make a business out of art, whether it was airbrushing T-shirts or making custom denim jackets for friends, I felt valid among my peers because they made a big deal out of it.

FSB: What set you apart from your competitors in the fashion world?

Ecko: I had a rich education around graphic design and illustration, even though it was kind of a street education. Today, I consider myself less a traditional designer in the 'Mr. Armani, Mr. Klein' sense of the word and more of a curator. I have good chops at embellishing an item. I know how to apply art and illustration and give a context to core fashion foundation pieces that gives them a different energy.

FSB: What was the hardest part of getting off the ground?

Ecko: Probably learning to fully understand the word "independent." When [you launch a company] you start signing your name to things that commit you fiscally and legally.

FSB: You were capital-constrained in the early days. How did you pay the bills?

Ecko: Credit cards, credit cards, credit cards. [Plus], I learned that the barcodes at the bottom of a check are actually magnetic, so if you wet them down you could slow the bank's ability to cash the check. You could buy 15, sometimes 20 additional terms that way.

FSB: A few years after you started your company, you almost went bankrupt. How did you turn yourself around?

Ecko: It helped that the streetwear space started to get validation. We also put more emphasis on merchandising. I was good at [stuff like] graphic T-shirts and fleece. We started to study the sales reports: "Hey, you did that well, the consumer liked it and they reordered." Or you might have loved that piece there, you might have been emotional about it and thought it was the greatest piece of design [ever], but guess what, they hated it.

FSB: Tell me about Marc Ecko Cut and Sew, your new line.

Ecko: It's an extension of my brand. If you grew up on Ecko Unlimited then you can relate to Cut and Sew. Ecko Unlimited appeals to a slightly younger demographic. Cut and Sew is an older demographic, slightly more dressed up but still casual and still richly embellished.

FSB: Your company mascot is a rhinoceros. How did you come up with that?

Ecko: My dad had a collection of wooden rhino sculptures that I used to play with as a kid. Later on I had a line of 25 T-shirts in the range and one of them carried our rhino logo. I remember buyers saying, "What are you trying to say? Is this some kind of wannabee Timberland (TBL) thing?" But the consumer responded and validated the rhino so i started using it more and more. I wanted a logo mark, not just a word mark. I knew that if I could take all the lifestyle stuff that I embody and sublimate it onto this creature, it would be a recipe for success

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,11:32 AM
Cybercrime-as-a-service takes off
By Ry Crozier

Malware writers that sell toolkits online for as little as $400 will now configure and host the attacks as a service for another $50, a security expert has said.

Speaking at the Vasco Banking Summit in Sydney yesterday, the company's technical account manager, Vlado Vajdic, told delegates that cyber crime was becoming so business-like that online offerings of malicious code often included support and maintenance services.

Additionally, he said, cybercrime outsourcing would become a key trend in 2009.

"It was inevitable that services would be sold to people who bought the malware toolkits but didn‘t know how to configure them," Vajdic said.

"Not only can you buy configuration as a service now, you can have the malware operated for you, too. We saw evidence of that this year."

"Investors get malware developers to write code for them and then get the writers to host and distribute it, too."

Vajdic showed delegates an email purported to be from a malware 'provider' offering hosted services for an extra $50 for three months.

Vasco's regional director for Pacific, India and Japan, Dan Dica, said company researchers buy the kits online and disassemble them to try to learn the secrets of their programming.

"The kits come with maintenance, support and a user guide," Dica said.

"For $400 you can become a hacker."

Vajdic said that toolkit creators increasingly appeared to apply commercial development techniques in their creation.

"There's evidence of solid software engineering practices being built into them," he said.

"Today's bad guy is a business person that attracts investment, has malware writers working under them and probably even employs a project manager. These people are high-flyers."

Vajdic also said that the malware writers often viewed themselves as being involved in a legitimate business.

"They say it is spyware or that it's for research purposes only and they can't control what you do with it," Vajdic said.

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Monday, March 02, 2009,2:15 PM
How America Lost the War on Drugs.
After Thirty-Five Years and $500 Billion, Drugs Are as Cheap and Plentiful as Ever: An Anatomy of a Failure.

Ben Wallace-Wells

On the day of his death, December 2nd, 1993, the Colombian billionaire drug kingpin Pablo Escobar was on the run and living in a small, tiled-roof house in a middle-class neighborhood of Medellín, close to the soccer stadium. He died, theatrically, *ridiculously, gunned down by a Colombian police manhunt squad while he tried to flee across the barrio's rooftops, a fat, bearded man who had kicked off his flip-flops to try to outrun the bullets. The first thing the American drug agents who arrived on the scene wanted to do was to make sure that the corpse was actually Escobar's. The second thing was to check his house.

The last time Escobar had hastily fled one of his residences - la Catedral, the luxurious private prison he built for himself to avoid extradition to the United States - he had left behind bizarre, enchanting *detritus, the raw stuff of what would *become his own myth: the photos of *himself dressed up as a Capone-era gangster with a Tommy gun, the odd collection of novels ranging from Graham Greene to the Austrian modernist Stefan Zweig. Agents from the Drug Enforcement Administration, arriving after the kingpin had fled, found neat shelves lined with loose-leaf binders, carefully organized by content. They were, says John Coleman, then the DEA's assistant administrator for operations, "filled with DEA reports" - internal documents that laid out, in extraordinary detail, the agency's repeated attempts to capture Escobar.

"He had shelves and shelves and shelves of these things," Coleman tells me. "It was stunning. A lot of the informants we had, he'd figured out who they were. All the agents we had chasing him - who we trusted in the Colombian police - it was right there. He knew so much more about what we were doing than we knew about what he was doing."

Coleman and other agents began to work deductively, backward. "We had always wondered why his guys, when we caught them, would always go to trial and risk lots of jail time, even when they would have saved themselves a lot of time if they'd just plead guilty," he says. "What we realized when we saw those binders was that they were doing a job. Their job was to stay on trial and have their lawyers use discovery to get all the information on DEA operations they could. Then they'd send copies back to Medellín, and Escobar would put it all together and figure out who we had tracking him."

The loose-leaf binders crammed in Escobar's office on the ground floor gave Coleman and his agents a sense of triumph: The whole mysterious drug trade had an organization, a structure and a brain, and they'd just removed it. In the thrill of the moment, clinking champagne glasses with officials from the Colombian police and taking congratulatory calls from Washington, the agents in Medellín believed the War on Drugs could finally be won. "We had an endgame," Coleman says. "We were literally making the greatest plans."

At the headquarters of the Office of National Drug Control Policy in Washington, staffers tacked up a poster with photographs of sixteen of its most wanted men, cartel leaders from across the Andes. Solemnly, ceremoniously, a staffer took a red magic marker and drew an X over Escobar's portrait. "We felt like it was one down, fifteen to go," recalls John Carnevale, the longtime budget director of the drug-control *office. "There was this feeling that if we got all sixteen, it's not like the whole thing would be over, but that was a big part of how we would go about winning the War on Drugs."

Man by man, sixteen red X's eventually went up over the faces of the cartel leaders: KILLED. EXTRADITED. KILLED. José Santacruz Londoño, a leading drug trafficker, was gunned down by Colombian police in a shootout. The Rodríguez Orejuela brothers, the heads of the Cali cartel, were extradited after they got greedy and tried to keep running their organization from prison. Some U.S. drug warriors believed that the busts were largely public-relations events, a showy way for the Colombian government to look tough on the drug trade, but most were less cynical. The crack epidemic was over. Drug-related murders were in decline. Winning the War on Drugs didn't seem such a quixotic and open-ended mission, like the War on Poverty, but rather something tangible, a fat guy with a big organization and binders full of internal DEA reports, sixteen faces on a poster, a piñata you could reach out and smack. Richard Cañas, a veteran DEA official who headed counternarcotics efforts on the National Security Council under both George H.W. Bush and Bill Clinton, can still recall the euphoria of those days. "We were moving," he says, "from success to success."

This is the story of how that momentary success turned into one of the most sustained and costly defeats the United States has ever suffered. It is the story of how the most powerful country on Earth, sensing a piñata, swung to hit it and missed.


For Cañas and other drug warriors, the death of Escobar had the feel of a real pivot, the end of one kind of battle against drugs and the beginning of another. The war itself had begun during the Nixon administration, when the White House began to get reports that a generation of soldiers was about to come back from Vietnam stoned, with habits weaned on the cheap marijuana and heroin of Southeast Asia and hothoused in the twitchy-fingered freakout of a jungle guerrilla war. For those in Washington, the problem of drugs was still so strange and new in the early Seventies that Nixon officials grappled with ideas that, by the standards of the later debate among politicians, were unthinkably radical: They appointed a panel that recommended the decriminalization of casual marijuana use and even considered buying up the world's entire supply of opium to prevent it from being converted into heroin. But Nixon was a law-and-order politician, an operator who understood very well the panic many Americans felt about the cities, the hippies and crime. Calling narcotics "public enemy number one in the United States," he used the issue to escalate the culture war that pitted Middle Americans against the radicals and the hippies, strengthening penalties for drug dealers and devoting federal funds to bolster prosecutions. In 1973, Nixon gave the job of policing these get-tough laws to the newly formed Drug Enforcement Administration.

By the mid-1980s, as crack leeched out from New York, Miami and Los Angeles into the American interior, the devastations inflicted by the drug were becoming more vivid and frightening. The Reagan White House seemed to capture the current of the moment: Nancy Reagan's plaintive urging to "just say no," and her husband's decision to hand police and prosecutors even greater powers to lock up street dealers, and to devote more resources to stop cocaine's production at the source, in the Andes. In 1986, trying to cope with crack's corrosive effects, Congress adopted mandatory-minimum laws, which hit inner-city crack users with penalties as severe as those levied on Wall Street brokers possessing 100 times more powder cocaine. Over the next two decades, hundreds of thousands of Americans would be locked up for drug offenses.

The War on Drugs became an actual war during the first Bush administration, when the bombastic conservative intellectual Bill Bennett was appointed drug czar. "Two words sum up my entire approach," Bennett declared, "consequences and confrontation." Bush and Bennett doubled annual spending on the drug war to $12 billion, devoting much of the money to expensive weaponry: fighter jets to take on the Colombian trafficking cartels, Navy submarines to chase cocaine-smuggling boats in the Caribbean. If narcotics were the enemy, America would vanquish its foe with torpedoes and F-16s - and throw an entire generation of drug users in jail.

Though many on the left suspected that things had gone seriously awry, drug policy under Reagan and Bush was largely conducted in a fog of ignorance. The kinds of long-term studies that policy-makers needed - those that would show what measures would actually reduce drug use and dampen its consequences - did not yet exist. When it came to research, there was "absolutely nothing" that examined "how each program was or wasn't working," says Peter Reuter, a drug scholar who founded the Drug Policy Research Center at the RAND Corp.

But after Escobar was killed in 1993 - and after U.S. drug agents began systematically busting up the Colombian cartels - doubt was replaced with hard data. Thanks to new research, U.S. policy-makers knew with increasing certainty what would work and what wouldn't. The tragedy of the War on Drugs is that this knowledge hasn't been heeded. We continue to treat marijuana as a major threat to public health, even though we know it isn't. We continue to lock up generations of teenage drug dealers, even though we know imprisonment does little to reduce the amount of drugs sold on the street. And we continue to spend billions to fight drugs abroad, even though we know that military efforts are an ineffective way to cut the supply of narcotics in America or raise the price.

All told, the United States has spent an estimated $500 billion to fight drugs - with very little to show for it. Cocaine is now as cheap as it was when Escobar died and more heavily used. Methamphetamine, barely a presence in 1993, is now used by 1.5 million Americans and may be more addictive than crack. We have nearly 500,000 people behind bars for drug crimes - a twelvefold increase since 1980 - with no discernible effect on the drug traffic. Virtually the only success the government can claim is the decline in the number of Americans who smoke marijuana - and even on that count, it is not clear that federal prevention programs are responsible. In the course of fighting this war, we have allowed our military to become pawns in a civil war in Colombia and our drug agents to be used by the cartels for their own ends. Those we are paying to wage the drug war have been accused of *human-rights abuses in Peru, Bolivia and Colombia. In Mexico, we are now *repeating many of the same mistakes we have made in the Andes.

"What we learned was that in drug work, nothing ever stands still," says Coleman, the former DEA official and current president of Drug Watch International, a law-and-order advocacy group. For every move the drug warriors made, the traffickers adapted. "The other guys were learning just as we were learning," Coleman says. "We had this hubris."

"At the beginning of the Clinton administration," Cañas tells me, "the War on Drugs was like the War on Terror is now." It was, he means, an orienting fight, the next in a sequence of abstract, generational struggles that the country launched itself into after finding no one willing to actually square up and face it on a battlefield. After the Cold War, in the flush and optimism of victory, it felt to drug warriors and the American public that abstractions could be beaten. "It was really a pivot point," recalls Rand Beers, who served on the National Security Council for four different presidents. "We started to look carefully at our drug policies and ask if everything we were doing really made sense." The man Clinton appointed to manage this new era was Lee Brown.

Brown had been a cop for almost thirty years when Clinton tapped him to be the nation's drug czar in 1993. He had started out working narcotics in San Jose, California, just as the Sixties began to swell, and ended up leading the New York Police Department when the city was the symbolic center of the crack epidemic, with kids being killed by stray bullets that barreled through locked doors. A big, shy man in his fifties, Brown had made his reputation with a simple insight: Cops can't do much without the trust of people in their communities, who are needed to turn in offenders and serve as witnesses at trial. Being a good cop meant understanding the everyday act of police work not as chasing crooks but as meeting people and making allies.

"When I worked as an undercover narcotics officer, I was living the life of an addict so I could make buys and make busts of the dealers," Brown tells me. "When you're in that position, you see very quickly that you can't arrest your way out of this. You see the cycle over and over again of people using drugs, getting into trouble, going to prison, getting out and getting into drugs again. At some point I stepped back and asked myself, 'What impact is all of this having on the drug problem? There has to be a better way.' "

In the aftermath of the Rodney King beating, this philosophy - known as community policing - had made Brown a national phenomenon. The Clinton administration asked him to take the drug-czar post, and though Brown was skeptical, he agreed on the condition that the White House make it a Cabinet-level position. Brown stacked his small office with liberals who had spent the long Democratic exile doing drug-policy work for Congress and swearing they would improve things when they retook power. "There were basic assumptions that Republicans had been making for fifteen years that had never been challenged," says Carol Bergman, a congressional staffer who became Brown's legislative liaison. "The way Lee Brown looked at it, the drug war was focused on locking kids up for increasing amounts of time, and there wasn't enough emphasis on treatment. He really wanted to take a different tactic."

Brown's staff became intrigued by a new study on drug policy from the RAND Corp., the Strangelove-esque think tank that during the Cold War had employed mathematicians to crank out analyses for the Pentagon. Like Lockheed Martin, the jet manufacturer that had turned to managing welfare reform after the Cold War ended, RAND was scouting for other government projects that might need its brains. It found the drug war. The think tank assigned Susan Everingham, a young expert in mathematical modeling, to help run the group's signature project: dividing up the federal government's annual drug budget of $13 billion into its component parts and deciding what worked and what didn't when it came to fighting cocaine.

Everingham and her team sorted the drug war into two categories. There were supply-side programs, like the radar and ships in the Caribbean and the efforts to arrest traffickers in Colombia and Mexico, which were designed to make it more expensive for traffickers to bring their product to market. There were also demand-side programs, like drug treatment, which were designed to reduce the market for drugs in the United States. To evaluate the cost-effectiveness of each approach, the mathematicians set up a series of formulas to calculate precisely how much additional money would have to be spent on supply programs and demand programs to reduce cocaine consumption by one percent nationwide.

"If you had asked me at the outset," Everingham says, "my guess would have been that the best use of taxpayer money was in the source countries in South America" - that it would be possible to stop cocaine before it reached the U.S. But what the study found surprised her. Overseas military efforts were the least effective way to decrease drug use, and imprisoning addicts was prohibitively expensive. The only cost-effective way to put a dent in the market, it turned out, was drug treatment. "It's not a magic bullet," says Reuter, the RAND scholar who helped supervise the study, "but it works." The study ultimately ushered RAND, this vaguely creepy Cold War relic, into a position as the permanent, pragmatic left wing of American drug policy, the most consistent force for innovating and reinventing our national conception of the War on Drugs.

When Everingham's team looked more closely at drug treatment, they found that thirteen percent of hardcore cocaine users who receive help substantially reduced their use or kicked the habit completely. They also found that a larger and larger portion of illegal drugs in the U.S. were being used by a comparatively small group of hardcore addicts. There was, the study concluded, a fundamental imbalance: The crack epidemic was basically a domestic problem, but we had been fighting it more aggressively overseas. "What we began to realize," says Jonathan Caulkins, a professor at Carnegie Mellon University who studied drug policy for RAND, "was that even if you only get a percentage of this small group of heavy drug users to abstain forever, it's still a really great deal."

Thirteen years later, the study remains the gold standard on drug policy. "It's still the consensus recommendation supplied by the scholarship," says Reuter. "Yet as well as it's stood up, it's never really been tried."

To Brown, RAND's conclusions seemed exactly right. "I saw how little we were doing to help addicts, and I thought, 'This is crazy,' " he recalls. " 'This is how we should be breaking the cycle of addiction and crime, and we're just doing nothing.' "

The federal budget that Brown's office submitted in 1994 remains a kind of fetish object for certain liberals in the field, the moment when their own ideas came close to making it into law. The budget sought to cut overseas interdiction, beef up community policing, funnel low-level drug criminals into treatment programs instead of prison, and devote $355 million to treating hardcore addicts, the drug users responsible for much of the illegal-drug market and most of the crime associated with it. White House political handlers, wary of appearing soft on crime, were skeptical of even this limited commitment, but Brown persuaded the president to offer his support, and the plan stayed.

Still, the politics of the issue were difficult. Convincing Congress to dramatically alter the direction of America's drug war required a brilliant sales job. "And Lee Brown," says Bergman, his former legislative liaison, "was not an effective salesman." With a kind of loving earnestness, the drug czar arranged tours of treatment centers for congressmen to show them the kinds of programs whose funding his bill would increase. Few legislators came. Most politicians were skeptical about such a radical departure from the mainstream consensus on crime. Congress rewrote the budget, slashing the $355 million for treatment programs by more than eighty percent. "There were too many of us who had a strong law-and-order focus," says Sen. Chuck Grassley, a Republican who *opposed the reform bill and serves as co-chair of the Senate's drug-policy caucus.

For some veteran drug warriors, Brown's tenure as drug czar still lingers as the last moment when federal drug policy really made sense. "Lee Brown came the closest of anyone to really getting it," says Carnevale, the longtime budget director of the drug-control office. "But the bottom line was, the drug issue and Lee Brown were largely ignored by the Clinton administration." When Brown tried to repeat his treatment-centered initiative in 1995, it was poorly timed: Newt Gingrich and the Republicans had seized control of the House after portraying Clinton as soft on crime. The authority to oversee the War on Drugs passed from Rep. John Conyers, the Detroit liberal, to a retired wrestling coach from Illinois who was tired of drugs in the schools – a rising Republican star named Dennis Hastert. Reeling from the defeat at the polls, Clinton decided to give up on drug reform and get tough on crime. "The feeling was that the drug czar's office was one of the weak areas when it came to the administration's efforts to confront crime," recalls Leon Panetta, then Clinton's chief of staff.


The administration was not doing much better in its efforts to stop the flow of drugs at the source. Before Clinton had even taken office, Cañas - who headed drug policy at the National Security Council - had been summoned to brief the new president's choice for national security adviser, Anthony Lake, on the nation's narcotics policy in Latin America. "I figured, what the hell, I'm going back to DEA anyway, I'll tell him what I really think," Cañas recalls.

The Bush administration, he told Lake, had been sending the military after the wrong target. In the 1970s, drugs were run up to the United States through the Caribbean by a bunch of "swashbuckling entrepreneurs" with small planes - "guys who wouldn't have looked out of place at a Jimmy Buffett concert." In 1989, in the nationwide panic over crack, Defense Secretary Dick Cheney had managed to secure a budget of $450 million to chase these Caribbean smugglers. (Years later, when a longtime drug official asked Defense Secretary Donald Rumsfeld why Cheney had pushed the program, Rumsfeld grinned and said, "Cheney thought he was running for president.") The U.S. military loved the new mission, because it gave them a reason to ask for more equipment in the wake of the Cold War. And the Bush White House loved the idea of sending the military after the drug traffickers for its symbolism and swagger and the way it proved that the administration was taking drugs seriously.

The problem, Cañas told Lake, was that the cocaine traffic had professionalized and was now moving its product through Mexico. With Caribbean smugglers out of the game, the military program no longer made sense. The new national security adviser grinned at Cañas, pleased. "That's what we think as well," Lake said. "How would you like to stay on and help make that happen?"

Taking a new approach, the Clinton administration shifted most military assets out of the Caribbean and into the Andes, where the coca leaf was being grown and processed. "Our idea was, Stop messing around in the transit countries and go to the source," Cañas tells me. The administration spent millions of extra dollars to equip police in Bolivia and Colombia to bust the crop's growers and processors. The cops were not polite - Human Rights Watch condemned the murders of Bolivian farmers, blaming "the heavy hand of U.S. drug enforcement" - but they were *effective, and by 1996, coca production in Bolivia had begun a dramatic decline.

After Escobar fell, the American drug agents who had been chasing him did not expect the cocaine industry to dry up overnight - they had girded for the fallout from the drug lord's death. What they had not expected was the ways in which the unintended consequences of his downfall would permanently change the drug traffic. "What ended up happening - and maybe we should have predicted this would happen - was that the whole structure shattered into these smaller groups," says Coleman, the veteran DEA agent. "You suddenly had all these new guys controlling a small aspect of the traffic."

Among them was a hired gun known as Don Berna, who had served as a bodyguard for Escobar. Double-crossed by his boss, Berna broke with the Medellín cartel and struck out on his own. For him, the disruption caused by the new front in America's drug war presented a business opportunity. But with the DEA's shift from the Caribbean into Bolivia and Colombia, Berna and other new traffickers had a production problem. So some of the "microcartels," as they became known, decided to move their operations someplace where they could control it: They opened negotiations with the FARC, a down-at-the-heels rebel army based in the jungles of Colombia. In return for cash, the FARC agreed to put coca production under its protection and keep the Colombian army away from the coca crop.

Berna and the younger kingpins also had a transportation problem: Mexican traffickers, who had been paid a set fee by the cartels to smuggle product across the U.S. border, wanted a larger piece of the business. The Mexican upstarts had a certain economic logic on their side. A kilo of cocaine produced in Colombia is worth about $2,500. In Mexico, a kilo gets $5,000. But smuggle that kilo across the border and the price goes up to $17,500. "What the Mexican groups started saying was, 'Why are we working for these guys? Why don't we just buy it from the Colombians directly and keep the profits ourselves?' " says Tony Ayala, a retired DEA agent and former Mexico country attache.

The remaining leaders of the weakened Cali cartel, DEA agents say, traveled up to Guadalajara for a series of meetings with Mexican traffickers. By 1996, the Colombians had decided to hand over more control of the cocaine trade to the Mexicans. The Cali cartel would now ship cocaine to Guadalajara, sell the drugs to the Mexican groups and then be done with it. "This wasn't just happenstance," says Jerome McArdle, then a DEA assistant agent for special operations. "This was the Colombians saying they were willing to reduce their profits in exchange for reducing their risk and exposure, and handing it over to the Mexicans. The whole nature of the supply chain changed."

Around the same time, DEA agents found themselves picking up Mexican distributors, rather than Colombians, on the streets of New York. Immigration and customs officials on the border were meanwhile overwhelmed by the sheer number of tractor-trailers - many of them loaded with drugs - suddenly pouring across the Mexican border as a consequence of NAFTA, which had been enacted in 1994. "A thousand trucks coming across in a four-hour *period," says Steve Robertson, a DEA special agent assigned to southern *Texas at the time. "There's no way we're going to catch everything."

Power followed the money, and Mexican traffickers soon had a style, and reach, that had previously belonged only to the Colombians. In the border town of Ciudad Juárez, the cocaine trafficker Amado Carrillo Fuentes developed a new kind of smuggling operation. "He brought in middle-class people for the first time - lawyers, accountants - and he developed a transportation division, an acquisitions division, even a human-resources operation, just like a modern corporation," says Tony Payan, a political scientist at the University of Texas-El Paso who has studied the drug trade on the border. Before long, Carrillo Fuentes had a fleet of Boeing 727s, which he used to fly cocaine, up to fifteen tons at a time, up from Colombia to Mexico. The newspapers called him El Señor de los Cielos, the Lord of the Skies.

The Mexican cartels were also getting more imaginative. "Think of it like a business, which is how these guys thought of it," says Guy Hargreaves, a top DEA agent during the 1990s. "Why pay for the widgets when you can make the widgets yourselves?" Since the climate and geography of Mexico aren't right for making cocaine, the cartels did the logical thing: They introduced a new product. As Hargreaves recalls, the Mexicans slipped the new drug into their cocaine shipments in Southern California and told coke dealers, "Here, try some of this stuff - it's a similar effect."

The product the Mexican cartels came up with, the new widget they could make themselves, was methamphetamine. The man who mastered the market was a midlevel cocaine trafficker, then in his late twenties, named Jesús Amezcua. In 1994, when U.S. Customs officials at the Dallas airport seized an airplane filled with barrels of ephedrine, a chemical precursor for meth, and traced it back to Amezcua, the startling new shift in the drug traffic became clear to a handful of insiders. "Cartels were no longer production organizations, whose business is wrapped up in a single drug," says Tony Ayala, the senior DEA agent in Mexico at the time. "They became trafficking organizations - and they will smuggle whatever they can make the most profit from."

It is only in retrospect that these moments - the barrels of ephedrine seized in Dallas, the quiet suggestion that meth had worked its way into the cocaine supply chain - take on a looming character, the historic weight of a change made manifest. Up until methamphetamine, the War on Drugs had targeted three enemies. First there were the hippie drugs - marijuana, LSD - that posed little threat to the general public. Then there was heroin, a horrible drug but one that was largely concentrated in New York City. And, finally, there was crack. What meth proved was that even if the DEA could wipe out every last millionaire cocaine goon in Colombia, burn every coca field in Bolivia and Peru, and build an impenetrable wall along the entire length of the Mexican border - even then, we wouldn't have won the War on Drugs, because there would still be methamphetamine, and after that, something else.

Gene Haislip, who served for years as one of the DEA's top-ranking administrators, believes there was a moment when meth could have been shut down, long before it spiraled into a nationwide epidemic. Haislip, who spent nearly two decades leading a small group at the agency dedicated to chemical control, is his own kind of legend; he is still known around the DEA as the man who beat quaaludes, perhaps the only drug that the U.S. has ever been able to declare total victory over. He did it with gumshoe methodicalness: by identifying every country in the world that produced the drug's active ingredient, a prescription medication called methaqualone, and convincing them to tighten regulations. Haislip believes he was present the moment when the United States lost the war on methamphetamine, way back in 1986, when meth was still a crude biker drug confined to a few valleys in Northern California - a decade before the Mexican drug lords turned it into the most problematic drug in America. "The thing is, methamphetamine should never have gotten to that point," Haislip says. And it never would have, he believes, if it hadn't been for the lobbyists.

Haislip was known around the DEA as precise-minded and verbal. His impulse, in combatting meth, was the same one that had pushed the drug warriors after Escobar: the quixotic faith that if you could just stop the stuff at the source, you could get rid of all the social problems at once. Assembling a coalition of legislators, Haislip convinced them that the small, growing population of speed freaks in Northern California was enough of a concern that Congress should pass a law to regulate the drug's precursor chemicals, ephedrine and pseudoephedrine, legal drugs that were used in cold medicine and produced in fewer than a dozen factories in the world. "We were starting to get reports of hijacking of ephedrine, armed robbery of ephedrine, things that had never happened before," Haislip tells me. "You could see we were on the verge of something if we didn't get a handle on it."

All that was left was to convince the Reagan administration. One day in late 1986, Haislip went to meet with top officials in the Indian Treaty Room, a vast, imposing space in the Eisenhower Executive Office Building: arches, tiled floors, the kind of room designed to house history being made. Haislip noticed several men in suits sitting quietly in the back of the room. They were lobbyists from the pharmaceutical industry, but Haislip didn't pay them much attention. "I wasn't concerned with them," he recalls.

When Haislip launched into his presentation, an official from the Commerce Department cut him off. "Look, you're way ahead of us," the official said. "We don't have anything to suggest or add." Haislip left the meeting thinking he had won: The bill he proposed was submitted to Congress, requiring companies to keep records on the import and sale of ephedrine and pseudoephedrine.

But what Haislip didn't know was that the men in suits had already gone to work to rig the bill in their favor. "Quite frankly," Allan Rexinger, one of the lobbyists present at the meeting later told reporters, "we appealed to a higher authority." The pharmaceutical industry needed pseudoephedrine to make profitable cold medications. The result, to Haislip's dismay, was a new law that monitored sales of ephedrine and pseudoephedrine in bulk powder but created an exemption for selling the chemicals in tablet form - a loophole that protected the pharmaceutical industry's profits.

The law, drug agents say, sparked two changes in the market for illegal meth. First, the supply of ephedrine simply moved overseas: The Mexican cartels, quick to recognize an emerging market, evaded the restrictions by importing powder from China, India and Europe and then smuggling it across the border to the biker groups that had traditionally distributed the drug. "We actually had meetings where we planned for a turf war between the Mexicans and the Hells Angels over methamphetamine," says retired DEA agent Mike Heald, who headed the San Francisco meth task force, "but it turned out they realized they'd make more money by working together." Second, responding to a dramatic uptick in demand from the illegal market, chemical-supply companies began moving huge amounts of ephedrine and pseudoephedrine out to the West Coast in the form of pills, which were then converted into meth. Rather than stemming the tide of meth before it started, the Reagan administration had unwittingly helped accelerate a new epidemic: Between 1992 and 1994, the number of meth addicts entering rehab facilities doubled, and the drug's purity on the street rose by twenty-seven percent.

Haislip resolved to have another go at Congress, but the issue ended up in a dispiriting cycle. The resistance, he says bitterly, "was always coming from the same lobbying group." In 1993, when he persuaded lawmakers to regulate the sale of ephedrine in tablet form, the pharmaceutical industry won an exception for pseudoephedrine. Drug agents began to intercept shipments of pseudoephedrine pills in barrels. Three years later, when lawmakers finally regulated tablets of pseudoephedrine, they created an exception for pills sold in blister packs. "Congress thought there was no way that meth freaks would buy this stuff and pop the pills out of blister packs, one by one," says Heald. "But we're not dealing with normal people - we're dealing with meth freaks. They'll stay up all night picking their toes."

By the time Haislip retired, in 1997, the methamphetamine problem was really two problems. There were the mom-and-pop cooks, who were punching pills out of blister packs and making small batches of drugs for themselves. Then there were the industrial-scale Mexican cartels, which were responsible for eighty percent of the meth in the United States. It took until 2005 for Congress to finally regulate over-the-counter blister packs, which caused the number of labs to plummet. But once again, the Mexican groups were a step ahead of the law. In October 2006, police in Guadalajara arrested an American chemist named Frederick Wells, who had moved to Mexico after losing his job at Idaho State University. An academic troublemaker who drove around campus with signs on the back of his pickup truck raging at the college administration, Wells had allegedly used his university lab to investigate new ways that Mexican traffickers could use completely legal reagents to engineer meth precursors from scratch. "Very complicated numerical modeling," says his academic colleague Jeff Rosentreter. By the time Wells was arrested, the State Department had only just succeeded at pressuring Mexico to restrict the flow of pseudoephedrine, even though Wells had apparently been hard at work for years creating alternatives to that chemical. The lobbying by the pharmaceutical industry, Haislip says, "cost us eight or nine years."

For some in the drug war, it was a lesson that even the most promising efforts to restrict the supply of drugs at the source - those that rely on legal methods to regulate legally produced drugs - remained nearly impossible, outflanked by both drug traffickers and industry lobbyists. The tragedy of the fight against methamphetamine is that it repeated the ways in which the government tried to fight the cocaine problem, and failed - racing from source to source, trying to eliminate a coca field or an ephedrine manufacturer and then racing to the next one. "We used to call it the Pillsbury Doughboy - stick your finger in one part of the problem, and the Doughboy's stomach just pops out somewhere else," says Rand Beers. "The lesson of U.S. drug policy is that this world runs on unintended consequences. No matter how noble your intentions, there's a good chance that in solving one problem, you'll screw something else up."


Within the Clinton White House, the reform effort spearheaded by Lee Brown had created a political dilemma. Republicans, having taken control of Congress in 1994, were attacking the administration for being soft on drugs, and the White House decided that it was time to look tougher. "A lot of people didn't think Brown was a strong leader," Panetta tells me. As senior figures within the administration cast about for a replacement, they started by thinking about who would be the opposite of Brown. "We wanted to get someone who was much stronger, much tougher, and could come across that way symbolically," Panetta says.

During the planning for a possible invasion of Haiti, Panetta and others had discovered a rising star at the Pentagon, a charismatic, bullying four-star general named Barry McCaffrey, who had annoyed many in the Pentagon's establishment. In 1996, halfway into his State of the Union address, Clinton looked up at McCaffrey, a lean, stern-seeming military man in the balcony, and informed the nation that the general would be his next drug czar. "To succeed, he needs a force far larger than he has ever commanded before," Clinton said. "He needs all of us. Every one of us has a role to play on this team." McCaffrey, the bars on his epaulets shimmering, saluted. It was one of the president's biggest applause lines of the night.

For the drug warriors in McCaffrey's office, "the General" was everything the languid, considered, academic Lee Brown had not been. "It was clear from the outset that here was a guy who would take advantage of the bully pulpit and who, unlike Brown, would probably be able to get things done," says Bergman, Brown's former liaison. "One thing that surprised us all was how thoughtful he was - he wasn't a knee-jerk, law-enforcement guy. He understood there needed to be money for treatment. He prided himself on being very sensitive to the racial issues, and he was sensitive to the impact of sentencing laws on African-American men." McCaffrey imported his own staff from the Southern Command - mostly men, all military. They lent the White House's drug operation - previously a slow place - the kinetic energy of a forward operating base. "We went to a twenty-four-hour clock, so we'd schedule meetings for 1500," one longtime staffer recalls. "His people sat down with senior staff and told us what size paper the General wanted his memos on, this kind of report would have green tabs, this would have blue tabs."

The General's genius was for publicity. "He was great at getting visibility," Carnevale says. McCaffrey held grandstanding events everywhere from Mexico to Maine, telling reporters that the decades-long narrative of impending doom around the drug war was out of date - and that if Congress would really dedicate itself to the mission, the country had a winnable fight on its hands. Drug-use numbers were edging downward; even cocaine seemed to be declining in popularity. "We are in an optimistic situation," McCaffrey declared.

For the first time ever, McCaffrey had the drug czar's office develop a strategy for an endgame to the drug war, a plan for finishing the whole thing. The federal government needed to reduce the amount of money it was spending on law enforcement and interdiction. But McCaffrey believed this was only possible once it could guarantee that drug use would continue to decline. "The data suggested very strongly that those who never tried any drugs before they were eighteen were very likely to remain abstinent for their whole lives, but that those who even smoked marijuana when they were teenagers had much worse outcomes," says McCaffrey's deputy Don Vereen. So the General decided to focus the government's attention on keeping kids from trying pot.

The "gateway theory," as it became known, had a natural appeal. Because most people who used hard drugs had also smoked marijuana, and because kids often tried marijuana several years before they started trying harder drugs, it seemed that keeping them off pot might prevent them from ever getting to cocaine and heroin. The only trouble is, the theory is wrong. When McCaffrey's office commissioned the Institute of Medicine to study the idea, researchers concluded that marijuana "does not appear to be a gateway drug." RAND, after examining a decade of data, also found that the gateway theory is "not the best explanation" of the link between marijuana use and hard drugs. But McCaffrey continued to devote more and more of the government's resources to going after kids. "We have already clearly committed ourselves," he declared, "to a number-one focus on youth."

"That decision," Bergman says, "was where you could see McCaffrey begin to lose credibility."

In 1996, less than a year into his term, the new drug czar met Jim Burke, a smooth-talking, silver-haired executive who chaired the Partnership for a Drug-Free America - the advertising organization best known for the slogan "This is your brain on drugs." "Burke personally was very hard to resist," one of his former colleagues tells me. "I've seen him sell many conservative members of Congress and also liberals like Mario Cuomo."

Burke told McCaffrey a simple story. In the late 1980s, he said, the major television networks had voluntarily given airtime to the Partnership to run anti-drug ads aimed at teenagers. The number of teenagers who used drugs - especially marijuana - declined during that period. But in the early 1990s, Burke said, the rise of cable TV cut into the profits of the networks, which became stingier with the time they dedicated to anti-drug advertising. The result, the adman told the General, was that the number of teenagers who used drugs was climbing sharply - to the outrage of Dennis Hastert and other conservative members of Congress. As a clincher, Burke handed McCaffrey a graph that showed the declining amount of airtime dedicated to anti-drug advertising on one axis and the declining perception among teenagers of the risks associated with drugs on the other. "I'm ninety-nine percent sure," one staffer at the Partnership tells me, "that it was that conversation that sold McCaffrey."

The General mobilized his office, lobbying Congress to allocate enough money to put anti-drug advertising on the air whenever teenagers watched television. His staff was skeptical. For all of McCaffrey's conviction and charisma, he didn't have much in the way of facts. "That was all we had - no data, just this one chart - and we had to go and sell Congress," Carnevale recalls. But Congress proved to be a pushover. Conservatives, who held a majority, were thrilled that soft-on-pot liberals in the Clinton administration finally wanted to do something about the drug problem. "At some point, you have to draw a line and say that some things are right and some things are wrong," says Sen. Grassley, explaining his support of the measure. "And using any drugs is just flat-out wrong." To the Partnership's delight, Congress allocated $1 billion to buy network time for anti-drug spots aimed at teenagers.

The General was also starting to make friends beyond the Clinton administration. The drug czar had found a natural ally in Hastert, who had become the GOP's de facto leader on drug policy. The former wrestling coach struck few as charismatic - his joyless and drudging style, his form like settled gelatin - but his experiences in high schools had left him with the feeling that the drug issue, in the words of his longtime aide Bobby Charles, "had become extremely poignant." Hastert wasn't quite Lee Brown; he believed that the prime focus of the drug war should be to increase funding for military operations in Colombia. But he and his staff had grown frustrated with the exclusively punitive character of drug policy and wanted the Republicans to take a more compassionate stance. His staff had studied the RAND reports and largely agreed with their conclusions. "We felt if you didn't get at the nub of the problem, which was prevention and treatment, you weren't going to do any good," says John Bridgeland, a congressional aide who helped coordinate Republican drug policy. Hastert eventually won $450 million to be used, in part, to expand a faith-based program discovered by Bridgeland: Developed by a former evangelical minister, it brought together preachers, parents and drug counselors to fight the problem of "apathy" through "parent training" and "messages from the pulpit."

But with McCaffrey's emphasis on kids came another, almost fanatical focus: going after citizens who used pot for medical purposes. If he was fighting marijuana, the General was going to fight it everywhere, in all its forms. He threatened to have doctors who prescribed pot brought up on federal charges, and dismissed the science behind medical marijuana as a "Cheech and Chong show." In 1997, voters in Oregon introduced an initiative to legalize medical marijuana in the state. "I'll never forget the senior-staff meeting the morning after the Oregon initiative was announced," Bergman says. "McCaffrey was furious. It was like this personal affront to him. He couldn't believe they'd gotten away with it. He wanted to have this research done on the groups behind it and completely trash them in the press." As the General traveled to the initiative states, stumping against medical marijuana, his aides sneered that the initiatives were "all being mostly bankrolled by one man, George Soros," the billionaire investor who favored decriminalizing drugs.

Even for those who shared McCaffrey's philosophy, the theatrics seemed strange: There he was, on evening newscasts, effectively insisting that grandmothers dying of cancer were corrupting America's youth. His office pushed arguments that, at best, stretched the available research: Marijuana is a gateway drug that leads inexorably to the abuse of harder drugs; marijuana is thirty times more potent now than it was a generation ago. "It didn't track with the conclusions our researchers came to," says Bergman. "It felt like he was trying to manipulate the data."

McCaffrey had taken the drug war in a new direction, one that had little obvious connection with preventing drug abuse. For the first time, the full force of the federal government was being brought to bear on patients dying from terminal diseases. Even the General's allies in Congress were appalled. "I can't tell you how many times I went to the Hill with him and sat in on closed-doors meetings," Bergman recalls. "Members said to him, 'What in the world are you doing? We have real drug problems in the country with meth and cocaine. What the hell are you doing with medical marijuana? We get no calls from our constituents about that. Nobody cares about that.' McCaffrey was just mystified by their response, because he truly believed marijuana was a gateway drug. He truly believed in what he was doing."

For the cops on the front lines of the War on Drugs, the federal government's fixation with marijuana was deeply perplexing. As they saw it, the problem wasn't pot but the drug-related violence that accompanied cocaine and other hard drugs. After the crack epidemic in the late 1980s, police commissioners around the country, like Lee Brown in Houston, began adding more officers and developing computer mapping to target neighborhoods where crime was on the rise. The crime rate dropped. But by the mid-1990s, police in some cities were beginning to realize there was a certain level that they couldn't get crime below. Mass jailings weren't doing the trick: Only fifteen percent of those convicted of federal drug crimes were actual traffickers; the rest were nothing but street-level dealers and mules, who could always be replaced.

Police in Boston, concerned about violence between youth drug gangs, turned for assistance to a group of academics. Among them was a Harvard criminologist named David Kennedy. Working together, the academics and members of the department's anti-gang unit came up with what Kennedy calls a "quirky" strategy and convinced senior police commanders to give it a try. The result, which began in 1995, was the Boston Gun Project, a collaborative effort among ministers and community leaders and the police to try to break the link between the drug trade and violent crime. First, the project tracked a particular drug-dealing gang, mapping out its membership and operations in detail. Then, in an effort called Operation Ceasefire, the dealers were called into a meeting with preachers and parents and social-service providers, and offered a deal: Stop the violence, or the police will crack down with a vengeance. "We know the seventeen guys you run with," the gangbangers were told. "If anyone in your group shoots somebody, we'll arrest every last one of you." The project also extended drug treatment and other assistance to anyone who wanted it.

The effort worked: The rates of homicide and violence among young men in Boston dropped by two-thirds. Drug dealing didn't stop - "people continued what they were doing," Kennedy concedes, "but they put their guns down."

As Kennedy reflected on the success of the Boston project, which ran for five years, he wondered if he had discovered a deeper truth about drug-related violence. If the murders weren't a necessary component of the drug trade - if it was possible to separate the two - perhaps cities could find a way to reduce the violence, even if they could do nothing about the drugs.

In 2001, Kennedy got a call from the mayor of San Francisco that gave him a chance to examine his theories in a new setting. The city had experienced a recent spike in its murder rate, much of it caused by an ongoing feud between two drug-dealing gangs - Big Block and West Mob - that had resulted in dozens of murders over the years. Could Kennedy, the mayor asked, help police figure out how to stop the killings?

Kennedy flew out to San Francisco and met with police. But as he researched the history of the violence, it seemed to confirm his findings in Boston. Though both Big Block and West Mob were involved in dealing drugs, the shootings were not really drug-related - the two groups occupied different territories and were not battling over turf. "The feud had started over who would perform next at a neighborhood rap event," says Kennedy, now a professor at John Jay College of Criminal Justice. "They had been killing each other ever since."

Such evidence suggested that drug enforcement needed to focus more narrowly on those responsible for the violence. "Seventy percent of the violence in these hot neighborhoods comes back to drugs," Kennedy says. "But one of the profound myths is that these homicides are about the drug trade. The violence is driven by these crews - but they're not killing each other over business." The real spark igniting the murders, he realized, was peer pressure, a kind of primordial male goad that drove young gang members to kill each other even in instances when they weren't sure they wanted to.

Given that police departments had already locked up every drug dealer in sight and were still having problems with violence, Kennedy thought a new approach was worth a try. "There's a difference between saying, 'I'm watching this, and you should stop,' and putting someone in federal lockup," he says. "The violence is not about the drug business - but that's a very hard thing for people to understand."

But in the early days of the Bush administration, police departments were in no hurry to experiment with an approach that focused on drug-related murders and mostly ignored users who weren't committing violence. Kennedy's efforts proved to be yet another missed opportunity in the War on Drugs - an experience that made clear how difficult it is for science to influence the nation's drug policy.

"If ten years ago the medical community had figured out a way to reduce the deaths from breast cancer by two-thirds, every cancer clinic in the country would have been using those techniques a year later," Kennedy says. "But when it comes to drugs and violence, there's been nothing like that."


Instead of pursuing the Boston Gun Project and other innovative approaches to fighting drug violence, the federal government decided to escalate its military response in Colombia. For the past decade and a half, cooperation from officials in Bogotá had been halfhearted, sporadic and deeply corrupt. But by 1999, the country, it seemed, was on the verge of collapsing into civil war. The drug money that had flowed into Colombia had found its way into the hands of the rebel militia - the FARC - which had been laying siege to the Colombian government. The Clinton foreign-policy team, having spent the previous few years dealing with the consequences of failed states in Somalia and the Balkans, was deeply concerned about the possibility of a failed narco*state in America's own back yard.

One afternoon in June 1999, a dozen senior Clinton officials filed into the National Security Council's situation room, summoned by Sandy Berger, the president's national security adviser. Even though Bogotá had ceded control of vast swaths of the country to the left-wing rebels, they were told, recent peace talks had collapsed. "The FARC had basically always been jungle campesinos - they were a pretty austere bunch," says Brian Sheridan, who was in charge of the Pentagon's counternarcotics effort at the time and attended the meeting. "All of a sudden, they were leveling these attacks that had gotten more and more audacious." When FARC rebels had emerged from the jungle for a round of peace talks the previous fall, they had brandished brand-new AK-47s and Dragunovs, as if on military parade. One U.S. official observed at the time that the weaponry was "far beyond" what the Colombian army had - in a pitched battle, the Clinton administration worried, the *Colombian government could plausibly collapse.

The White House advisers weren't the only officials in Washington concerned about Colombia. Earlier that day, two men who attended the briefing - Rand Beers of the State Department and Charlie Wilhelm of the Defense Department - had gotten a call from the Republican caucus on the Hill. Dennis Hastert, who had been elevated to Speaker of the House six months earlier, wanted to see them right away. "It was kind of unusual," Beers recalls - but when Hastert called, you came.

When Beers and Wilhelm arrived, Rep. Porter Goss, then the chairman of the House Intelligence Committee, handed them a piece of paper. It was a copy of a supplemental spending authorization that the Republicans planned to offer immediately. Crafted by Bobby Charles, Hastert's longtime aide, the bill would have more than doubled military aid to Colombia to take on the rebels and narcotraffickers -to a staggering $1.2 billion a year. But it was the politics of the situation that worried Beers as much as the money. "It occurred to me that if the administration was going to do anything on Colombia, it better do it soon," he says now, "or the Republicans would once again outflank what they perceived as the I-never-inhaled Clinton administration." Beers told the Republicans he would take a look, and then hurried to Berger's meeting.

Throughout much of the Clinton administration, the hope had been that the United States would be able to reduce its military aid to the Andes as the cocaine epidemic waned. Now, as Berger's group heard from intelligence agents, that hope seemed to be fading. Narcotraffickers were paying off the FARC so they could grow coca in the jungles of Colombia. The FARC were then turning around and using the money to buy weapons to stage attacks on the Colombian government.

Berger decided to act. Rather than oppose the Republican plan, he agreed to negotiate on an assistance package to bail out the Colombian government. The result was Plan Colombia - nearly $1.6 billion to escalate the War on Drugs in the Andes. The new program would arm the military and police in their fight against the FARC, launch an ambitious effort to spray herbicide on coca crops from the air and provide economic assistance to poor farmers in rural villages. The initial aid, officials decided, would be heavily concentrated in Putumayo, a rebel-run province in the jungle.

No one is sure what convinced President Clinton to approve such an ambitious escalation in the War on Drugs. But some observers at the time speculated that the critical factor was a conversation with Sen. Christopher Dodd, the Connecticut Democrat, whose state is home to the helicopter manufacturer Sikorsky Aircraft. In early 2000, Clinton unveiled Plan Colombia - and Sikorksy promptly received an order for eighteen of its Blackhawk helicopters at a cost of $15 million each. "Much has been made of the notion that this was Dodd looking to sell Blackhawks to Colombia," Beers tells me. He pauses before adding, "I am not in a position to tell you it didn't happen."

Plan Colombia would be the Clinton administration's primary and most *costly contribution to the War on Drugs, the major counternarcotics program it bequeathed to the Bush administration. But as with so many other aspects of American drug policy, the plan had an unintended consequence: As it evolved, the emphasis on supplying arms to the Colombian government ended up having less to do with drugs and more to do with helping Bogotá fight its enemies. Colombia used the military aid to target the left-wing FARC - even though many believed that right-wing paramilitaries, who were allies of the government, were more directly involved in narcotrafficking. "It wasn't really first and foremost a counternarcotics program at all," says a senior Pentagon official involved in the creation of Plan Colombia. "It was mostly a political stabilization program."

In July of 1999, Gov. George W. Bush of Texas traveled to Cincinnati to visit Hope Temple, a former crack house that had been turned into a church. It was an almost unbearably hot day. Bush was on a tour through the Midwest during which he was testing out his philosophy of compassionate conservatism, trying to see if its rhetoric and principles could sustain a winning presidential run. "The American dream is vivid," Bush told audiences, "but too many feel, 'This dream is not meant for me.' " John Bridgeland, the congres*sional aide who had helped steer federal funding to Hope Temple, says Bush was "overwhelmed" by his visit to the church that day, and stayed the whole afternoon. That evening, Bush spoke about the fervent *religiosity of the place and the rough joys of the addict's redemptions. "These," he said, "are the armies of compassion."

This was a strange moment in the politics of the drug war: Just as the Clinton administration was toughening its rhetoric, influential Republicans were going all soft and gentle. John DiIulio, a political scientist from the University of Pennsylvania who would become a key Bush adviser, was disgusted by the "perverse consequences" of harsh sentencing laws that had put millions of young Americans in prison, disbelieved the "sweeping scientific claims" made about the dangers of medical marijuana and wanted to expand "meaningful drug-treatment opportunities in urban areas." DiIulio and his contemporaries were troubled, too, by the racial imbalances of the War on Drugs: Blacks, who comprised only fourteen percent of drug users, made up seventy-four percent of those in prison for drug possession. It was not as if the Republican Party had suddenly taken up a position on the far left of the drug war. But it did seem, for a moment during the 2000 campaign, as if some moderation were possible.

Three months later, when the Bush campaign released its drug policy, even the most experienced drug warriors were impressed. The platform balanced spending between demand- and *supply-side programs, stressed treatment and doubled the number of community anti-drug coalitions. When Bush won the White House and DiIulio became the director of the Office of Faith-Based Programs, they raided the team of compassionate conservatives surrounding Hastert: Bridgeland became director of the White House Domestic Policy Council, and Charles became assistant secretary of state for narcotics control. The new administration, DiIulio believed, would take the lead in "reforming drug-related sentencing policies that *research had shown were having perverse consequences."

"If you look back at that campaign document, it really is pretty impressive," says Carnevale, who ended up heading the drug office's transition team for the Bush administration. "Which is kind of remarkable, given what happened next. They've appointed a drug czar who ran like hell from a very sensible policy."

It took Bush nearly a year to pick his drug czar, and almost no one felt encouraged by his choice: John Walters, a laconic Midwesterner who had served as Bill Bennett's chief of staff during the administration of George H.W. Bush. "We all knew who Walters was," one longtime drug warrior tells me, "but he wasn't what you would call an inspiring figure, even to conservatives." When Walters submitted his first National Drug Control Strategy to Bush in February 2002, it became clear that the administration's focus had narrowed: Walters was devoted to Plan Colombia and to a prevention campaign that would keep kids from trying drugs for the first time, aimed particularly at marijuana - even though the number of first-time pot smokers had been flat for half a decade. Longtime drug warriors like Carnevale were stunned. "We were going back to an Eighties-style drug policy," he says - one that emphasized the kind of military and law-and-order programs that had been proven not to work, while ignoring programs, particularly treatment, that did.

Walters also had a complaint with the ads that the Partnership for a Drug-Free America had created for the drug czar's office under McCaffrey. They were, he said, too soft. He had a point. The ads, which ran under the slogan "The Anti-Drug," had been designed by a committee of academics who apparently believed that kids needed to be shown that not doing drugs could be fun too. In one characteristic spot, a pen draws an animated landscape, with a cartoon boy avoiding the advances of cartoon dealers before driving off into the distance with a cartoon dragon on a cartoon motorcycle. "My name is Brandon, and drawing is my anti-drug," the narrator says sweetly. The commercials made abstinence seem so lame they could have been designed by the cartels. "A lot of the ads that were produced were really boring," admits Philip Palmgreen, a University of Kentucky communications professor who served on the ad committee. Walters not only wanted harder-hitting messages - he also wanted the focus "to narrow around marijuana," according to one staffer at the Partnership who asked not to be identified. "Very candidly, the Partnership pushed back against that because the problems associated with marijuana are not very dire." But Walters disagreed, the staffer adds, "and we lost."

Walters refused to be interviewed for this story, but his office did make available one of his top advisers, David Murray. I asked him why his boss had narrowed the focus to marijuana, even though studies had disproved the causal link between marijuana and hard drugs. "If you're going to have a national office of drug-control policy, you look at the most prevalent drug in the society that's readily available - you don't go after meth first thing," he says. "You think about it like an epidemiologist, and you go for the vector that's most likely to spread, and that's teen marijuana users."

The new ads took a counterintuitive approach. "We wanted to make sure we were getting through to the thrill-seekers - those teenagers who are much more likely to use drugs - and convince them that it was more exciting not to do drugs," says Palmgreen. In a heralded spot called "Pete's Couch," the teenage narrator says, "I smoked weed and nobody died. I didn't get into a car accident. I didn't OD on heroin the next day. Nothing happened. We sat on Pete's couch for eleven hours." Then the camera shifts to show other teenagers, presumably those who haven't smoked weed, doing fun things - biking, playing basketball, flirting with girls. "You have a better shot at dying out in the real world," the narrator says, "but I'll take my chances out there." The advertising community was impressed with the spot: "Finally, an admission that smoking pot isn't calamitous," cheered Slate's advertising columnist, Seth Stevenson. Said Palmgreen: "Really good spots. The focus groups of thrill-seekers gave them great grades."

But the reality is that such ads - no matter how persuasive - do little if anything to prevent teens from trying pot. In 2005, a government-commissioned study designed to evaluate the prevention campaign over five years delivered its conclusions: Kids who had been *exposed to the campaign ended up with rates of drug use that were roughly the same as those of the control group, who had not seen the ads. Murray loudly challenged the study's methodology, but when Congress asked federal analysts at the Government Accountability Office to assess the findings, the GAO upheld the report. The anti-drug campaign had not worked at all.

There was another problem with the Walters approach: Just as the federal government asserted the dangers of smoking pot, the states - first California, then three others - were permitting doctors to legally prescribe marijuana to relieve the chronic pain that came with cancer, polio and other debilitating long-term diseases. Attorney General John Ashcroft dispatched federal agents to begin raiding the suppliers and purchasers of medical marijuana in California - people who were operating completely within state law. The raids were even more surreal in their theatrics than the ones that had been launched by McCaffrey: In one particularly ludicrous incident, a forty-four-year-old post-polio sufferer named Suzanne Pfeil, who smoked prescription marijuana to relieve her pain, was hauled off to jail by DEA agents who pointed automatic rifles at her head and handcuffed her to her wheelchair. The rhetoric reached the level of crusade: Walters called citizens who plant and tend marijuana gardens "terrorists who wouldn't hesitate to help other terrorists get into the country with the aim of causing mass casualties."

What was striking to many veteran drug warriors was how fully the drug czar's office had bet on the youth marijuana initiative. For all Ashcroft's bluff talk about wanting to "escalate the War on Drugs," only a very small portion of it was being escalated. Funding for drug courts, which channel nonviolent drug offenders through treatment programs rather than prison, was zeroed out, and funding for local police was gutted. Carnevale, who quit his job after overseeing the transition in 2000, began to feel he was in a time warp. "This White House is walking away from prevention funding and treatment," he says now. "They haven't supported the community anti-drug coalitions, which actually work pretty well, and domestic law enforcement is flat or declining. To have a successful drug policy, you need all these elements, and what this administration has done is go crazy on exactly the element that doesn't work."

By the summer of 2005, the drug czar's failures were beginning to spill out into the open. For four years, while he focused obsessively on pot, Walters had done virtually nothing about meth, which was rapidly devastating the red states that had elected his boss. Walters struck a strangely discordant note on the growing epidemic, insisting that even as methamphetamine spread from the West Coast to the East, it remained a regional problem, not a national one, and therefore did not place high on his list of priorities. That September, the House's meth caucus asked Walters to come in for a meeting, to see if they could restore some element of dialogue and begin to rebalance the budget. The drug czar, once again downplaying the issue, sent Murray in his place. The congressmen, who had excluded the press to prevent grandstanding, went through the budget in detail and told the drug deputy what they wanted restored to fight meth. But, according to one staffer, Murray just sat there: "He didn't even bother to ask a question."

Incensed, Rep. Mark Souder, a Republican who chairs the House Subcommittee on Drug Policy, walked out of the room and held an angry press conference. Murray's testimony, he said, had been "pathetic" and "an embarrassment," and Walters was not doing his job: "If he does not lead, we need a change of the drug czar." Sen. Grassley, the Iowa Republican, echoed Souder a few days later. "What I've never understood," he said, "is why they took marijuana so much more seriously than methamphetamine, when methamphetamine is a much more serious drug."

By virtually every objective measure, the White House had lost the War on Drugs. Last year, Walters boasted that drug use among teenagers has fallen since 2002 - ignoring the fact that overall drug use remains unchanged. The deeper problem is that the drug czar has stopped measuring anything other than drug use. During the 1990s, at the direction of Gen. McCaffrey, Carnevale had created a comprehensive system to measure whether we were winning the drug war. The system took into account drug price and availability in the United States, how difficult it was for drug smugglers to get their product into the country and the consequences of drug use on public health and crime. But Walters simply tossed out that system of evaluation - as well as the unflattering facts it highlighted. "Had we kept it," Carnevale tells me, "we would see that the Bush administration has not made a positive impact on any of the measures."

Most unexpectedly of all, crime - a problem that seemed to have been licked a decade ago - is beginning to creep back up. In October 2006, the Police Executive Research Forum released a report declaring that violent crime in the country was "accelerating at an alarming pace." Murders were up twenty-seven percent in Boston over the previous year, sixty percent in San Antonio and more than 300 percent in Orlando. Even in the cloistered world of policing, complaints began to build about the numbers and about the cuts in federal funding. "The reality is a lot of police officers are politically conservative folks," says Ron Brooks, the president of the National Narcotics Officers' Association. "But there's been a lack of leadership in this administration on this issue."


While the drug czar was cracking down on medical marijuana, the Bush administration was also overseeing a dramatic escalation in its overseas front of the War on Drugs. From the start, the White House had trumpeted Plan Colombia as an essential weapon in its anti-drug arsenal, eliminating inconvenient rules that had gotten in the way of a full military commitment to the project. For "those in the drug business," Walters declared in January 2002, "now is the time to get out." But despite the billions the administration spent on the program, and the new impunity given to the Colombian military, nobody really knew whether it was working. In July 2006, Adam Isacson decided to see for himself.

Isacson, a scholar who runs the Colombia program at the Center for International Policy, flew down to the Andes to construct his own assessment of Plan Colombia. He decided to make two stops - in Medellín, to determine how much the country's security situation had improved, and in Putumayo, to determine the success of the plan to eradicate the drug traffic. Regular assessments compiled by the White House drug office suggested that the crop-eradication program had reduced the acreage under coca cultivation in Colombia, but Isacson was skeptical: The price of cocaine on the American street had not risen, and separate estimates by the United Nations undercut the Bush administration's findings.

The modern Medellín he found looked more like Miami than a front in the drug war. The government and its paramilitary allies had secured the city, and U.S. officials went out of their way to praise the cooperation they were getting from Colombian police and military units - which had been cleansed, they said, of corruption. When Isacson pressed people about why the violence had decreased so dramatically, he was told repeatedly that "the paramilitaries won" - that government-supported forces had simply driven off the left-wing guerrillas and ended civil war in the city.

The paradox for Americans was that paramilitary commanders, such as Don Berna, had also taken control of the cocaine trade and retained enough political clout, according to a study by a Colombian think tank, to alter the composition of the Colombian Senate. When Don Berna was arrested two years ago, the entire bus transportation system of Medellín shut down for a day. "The command came down from the prison phone," says Aldo Civico, a professor of international relations at Columbia University who has done *extensive research on drug smugglers and the paramilitaries. Don Berna is now in a jail cell south of Medellín, from which he continues to control his trafficking organization. "It is a signal to everyone that Don Berna is the one who is in power in Medellín," Civico says.

In Putumayo, Isacson found tent cities buried in the thick jungle, migrants living underneath sheets of plastic. Though tens of millions of American dollars had been spent on trying to improve the local economy, the main road that farmers were supposed to use to ferry their legitimate products to market was still unpaved, and a factory American money had built in 2003 was already shut down. Putumayo had been the first target of Plan Colombia's spray-eradication efforts and the site of its initial success: Coca cultivation had been cut by ninety-three percent from 2000 to 2004. But the place Isacson saw only two years later was "depressed." With no real financial incentive to switch to legitimate crops, farmers in the region had once again begun planting coca: Cultivation doubled in 2005. "We didn't see anything to suggest the improvement was sustainable," Isacson tells me.

The problem was that coca had simply moved next door, to the rural province of Nariño, along the country's Pacific Coast. Traffickers were planting strains of coca that could grow from seed to harvest in just six months. "The spray planes eradicated Putumayo," Isacson says, "and then all of a sudden coca cultivation starts in Nariño, and you see the same pattern - coca money means all these nightclubs and stores go up in these nothing towns, the police start reporting a sharp increase in murders, and eventually the provincial government is overwhelmed." The traffickers hopscotched across the country - Putumayo to Nariño, Nariño to Antioquia - always one step ahead of the drug agents and soldiers.

"As a drug-control policy," Isacson says, "it's hard to come to any conclusion other than that Plan Colombia has failed." In June of this year, the CIA released an assessment that confirmed Isacson's conclusion. Admitting that it had previously been undercounting the coca crop, the agency issued revised numbers showing that six years of Plan Colombia, at nearly $1 billion a year, had not cut coca cultivation at all. The effort to stop cocaine at its source had not made a dent.

"We've been working in Colombia for thirty years, and we don't have a hell of a lot to show for it," says Myles Frechette, the American ambassador to Colombia during the Clinton administration. "This is like a cancer. Every year the lesion, if you took a snapshot, would be bigger."


At night, the population of el Paso, Texas, is 700,000, and that of Ciudad Juárez, just across the border, is 1.4 million. During the day, those numbers shift, as Mexicans stream across the cobblestone bridge over the Rio Grande for legal work in the United States. Every twelve hours, the two cities pass 100,000 people back and forth, squeezing them from end to end like the contents of a water balloon. "Among them," says Tony Payan, the political scientist at the University of Texas-El Paso and an expert in the dynamics of the local drug trade, "you see the spotters, the lingerers, mostly young men who are just standing there, watching out for when the coast is clear or when an American border agent who's been paid off by the cartel comes on duty. Then they tell the people that need to know, so they can make their drug runs across the border into Texas." With the failure of Plan Colombia, a handful of bridges along the Mexican border have become the main front in the War on Drugs.

Cocaine trafficking in Mexico has its own prehistory. For generations, family networks of smugglers had moved marijuana and cheap, black-tar *heroin across the border -veteran DEA agents were accustomed to arresting the grandsons of men they had arrested years earlier - and the whole drug traffic in Mexico was small enough, by the mid-1980s, that it was effectively controlled by one man, Miguel Angel Felix Gallardo, who ran a violent trafficking organization out of Tijuana. As Colombian groups, chased from the Caribbean by American interdiction efforts, began to look to the southwest border in the early 1990s, Felix Gallardo discovered he could no longer control the traffic himself from prison. "He had a meeting with his lieutenants and divided the Mexican border crossings up among them, creating the modern cartels," Payan says. "His nephews kept Tijuana, and one group got the Sinaloa-Arizona crossing, another got Laredo-Nuevo Laredo, and Amado Carrillo Fuentes got El Paso-Juárez."

Mexican officials along the border, whose PRI party had kept a lock on national power for seventy years, allowed traffickers to move their product in exchange for reduced violence. "In order to coexist, the government looked the other way as long as the cartels didn't wreak havoc in the country," says Armand Peschard-Sverdrup, director of the Mexico Project at the Center for Strategic and International Studies. "It became somewhat of a safety valve in terms of dealing with organized crime, as a way of mitigating the political instability." Though the U.S. government pushed Mexican officials to crack down on corruption, its pleas and threats went largely unheeded. By 1997, Carrillo Fuentes - the Lord of the Skies - was moving tons of cocaine across the border every year and had amassed a fortune worth $25 billion. But that same year, Carrillo Fuentes died on an operating table in Mexico City, where he had been undergoing plastic surgery to change his appearance and avoid detection: In the ghoulish post-mortem photographs, his face is speckled like a snake's skin, two shades of brown and one of pink. Juárez fell into a testy, three-way competition for control of the drug trade, and the murders took on a symbolic vocabulary of their own: Tortured victims piled in oil barrels filled with concrete and buried alive, members of opposing cartels murdered and left to rot in car trunks in their own neighborhoods, snitches killed and left on the side of the road. The violence between cartels is so pervasive, Payan says, "if you move into a home in Juárez, you will never know whether there's a body underneath the floor in your dining room."

At the beginning of the Bush administration, it looked like Mexico might actually begin to bust corrupt cops who did business with drug smugglers. In 2000, when Vicente Fox, the reforming, conservative rancher and friend of George W. Bush, took power, he began prosecuting dirty police officers, throwing tens of thousands of them off the force. "There were unintended consequences," says Peter Andreas, a Brown University professor who has studied drug trafficking along the border. "Many of the corrupt cops went to work in the drug trade" - a shift in power that had the effect of professionalizing the violence. In addition, an estimated 90,000 Mexican soldiers deserted during the Fox administration, many of them signing up with the cartels.

In Juárez, the effect was devastating. Free to operate as they pleased, the cartels began to split, with capos challenging one another openly for control of the drug corridors. Local and state police killed each other over the right to protect the traffic. A new gang called the Zetas, made up of Mexican soldiers who had quit their day jobs to take over the drug trade, waged war in Juárez and killed 100 people in the corridor around Nuevo Laredo in the summer of 2005. The gaudy theatrics of the murders have only intensified as drug gangs seek to guarantee that their killings send a message by getting media attention: Last year, gunslingers wearing military uniforms walked into a popular nightclub in Uruapan and dumped the severed heads of five rivals on the dance floor, like soccer balls. Over the past year, drug-related murders in Mexico's border states have doubled, driven primarily by the booming trade. "What we're seeing is the Colombianization of Mexico," says Andreas.

For those who have studied American drug policy, the catastrophe along the border looks like a final reckoning for overseas interdiction. "It's like a balloon effect - we've never succeeded in cutting off the traffic, we've just pushed it around," says Payan. "We cut off supply in the Caribbean, and it came here. We cracked down on the Colombian traffickers, and it just meant the Mexicans traffickers got wealthier, and the violence came here." Like many DEA agents and border experts, Payan was consumed last summer by the story of Zhenli Ye Gon, a Chinese pharmaceutical executive whose house Mexican police raided, suspecting him of diverting meth components from China for illegal use. Inside they found $206 million in cash -final evidence of just how far the meth epidemic has spiraled out of control since pharmaceutical lobbyists prevented Gene Haislip from forestalling it with a simple federal regulation. Payan believes, as do many in the DEA, that Ye Gon is a harbinger of the next frontier in the War on Drugs.

"Even if somehow we could manage to get the drug trade away from the Mexican border, it will come through Asia next," he says. "Instead of fighting a border war, we'll be fighting it in containers. But unless we can reduce demand, it's a zero-sum game."

Even by conservative estimates, the War on Drugs now costs the United States $50 billion each year and has overcrowded prisons to the breaking point - all with little discernible impact on the drug trade. A report by the Government Accountability Office released at the end of September estimated that ninety percent of the cocaine moving into the United States now arrives through Mexico, up from sixty-six percent in 2000. Even Walters acknowledges that for all of the efforts the Bush administration has devoted to overseas drug enforcement, the price of cocaine has dropped while its purity has risen. More than forty percent of Americans support legalizing marijuana, yet the government continues to target pot smokers. In October, the administration announced it was planning a new military offensive, dubbed Plan Mexico, with a price tag of $1.4 billion. Things look so bleak that Walters was recently moved to describe a momentary upward blip in drug prices as "historic progress."

There are a handful of battles in the War on Drugs that have actually been won, times when fresh thinking prevailed over politics - but they are not the kind of victories that the Bush administration is eager to trumpet. In the summer of 2003, the police department in High Point, North Carolina, held its annual command-staff retreat in a small conference center themed to look like the log cabins of the pioneers who settled the region. One topic dominated the conversation: an increase in violent crime that was concentrated in three drug-dealing neighborhoods in the city. "The place we were at was that all the traditional enforcement was making no difference," says the department's deputy chief, Marty Sumner. "We agreed we weren't going to be able to eliminate drug use. We weren't even going to try to go after drug use. We wanted to change the marketing of the drug."

Sumner's department called in the Harvard criminologist David Kennedy. The High Point police had worked with Kennedy before, adopting the Boston Gun Project's policy of trying to break the link between drugs and crime. Now the criminologist told them that he had a new kind of project to propose, one that went beyond the Boston experiment. Kennedy's pitch was simple: The trick, he said, wasn't to focus on eliminating drugs but rather to shut down the most "overt" drug markets, the ones operating so openly that they attracted prostitution and violent crime. "Instead of looking at it as a drug problem, we decided to think of it as a drug-market problem," Sumner says. "What the public really couldn't stand was the violence associated with public drug markets." Dealers operating in the open are targets for stickup men and other would-be robbers, and the public swagger and turf consciousness of street slingers can cradle violent, simmering beefs.

High Point police began in the West End neighborhood, one of the city's three overt drug markets. A team of officers staked out the site, videotaping hundreds of hand-to-hand sales and mapping out a complete anthropology of the West End drug market. They found it was strikingly small: Sumner had expected as many as fifty dealers working there, but it turned out there were only sixteen. Before long, the *officers had enough evidence to put away each of the sixteen dealers for good. But they didn't. Instead, Sumner and Kennedy called them in for a meeting. They showed each of them the portfolio of evidence against them and said that unless they stopped dealing drugs, the whole file would be handed over to the prosecutors and they'd be in jail for years. Family members were brought in to urge the dealers to stop, and social-service providers pledged assistance with food, housing and job training.

"We didn't think it would work," Sumner tells me, "but the drug markets have disappeared."

For five years before the program went into effect, the number of drug-related murders in High Point had stayed steady, around fifteen a year. In 2007, in the program's fourth year, it has plummeted to two. Violent crime in the West End has declined by thirty-five percent. "The use of drugs isn't something we could affect," says Kennedy. "But the violence was." His logic has an appealing clarity for overworked police departments: There are now more than sixty cities in the United States that use some version of Kennedy's program, edging away from thirty-five years of punitive measures that have turned the United States into the world's leading jailer to a social-work model that encourages communities and cops to engage the problem on a more human level. The real radicals of the War on Drugs are not the legalization advocates, earnestly preaching from the fringes, but the bureaucrats -the cops and judges and federal agents who are forced into a growing acceptance that rendering a popular commodity illegal, and punishing those who sell it and use it, has simply overwhelmed the capacity of government.

In 2000, voters in California, whose prisons now hold nearly twice as many inmates as they were designed to incarcerate, passed a referendum called Proposition 36, which has since sent more than 150,000 nonviolent drug *offenders to treatment instead of prison. The program is not perfect: Though the outcomes for those who make it through treatment are surprisingly strong, many convicts simply skip the sessions, and there are few enforcement mechanisms to compel them to attend. But the program, according to a study conducted by researchers at UCLA, still saves tax*payers $2.50 for every dollar put in. And a pilot program in Honolulu which requires near-constant drug tests of those on probation and provides incremental punishments for each extra failed test - suggests an effective model for treating hardcore addicts, says Angela Hawken of UCLA and Pepperdine University. "It offers the promise that we might *really be able to solve this problem."

In recent years, there have been flickers of political progress that suggest America's drug policy is ready for a historic shift. Democrats in both the House and Senate have voted to cut proposed funding for Plan Colombia and have pushed for hearings on sentencing reform. As the politics of crime and drugs have lost their power to move votes, some conservatives, including Republican senators Jeff Sessions and Sam Brownback, have begun to question the logic of mandatory-minimum sentences. "There is a more promising environment for drug-policy reform than at any time since the Carter administration," says Ethan Nadelmann, executive director of the Drug Policy Alliance and one of the country's foremost critics of the drug war.

But despite their evident success, the most forward-looking programs remain buried at the fringes of drug policy, featured not in the president's budgets but in academic journals and water-cooler talk in cities like High Point. Experimentation at the community level is more imaginative than programs that are federally sanctioned. "We haven't had the kind of national leadership that blesses this and encourages it," says Caulkins, the RAND researcher from Carnegie *Mellon. "So this kind of innovation stays below the radar." Thirty-five years after Richard Nixon launched the War on Drugs, the most promising *programs continue to be shunted aside by Washington's unswerving emphasis on law and order.

The drug war, in the end, has been undone in no small part by the sweeping and inflexible nature of its own metaphor. At the beginning, in the days of Escobar, the campaign was a war as seen from the situation room, a complicated assault that spanned multiple fronts, but one which had identifiable enemies and a goal. Today, the government's anti-drug effort resembles a war as seen from the trenches, an eternal slog, where victory seems not only unattainable but somehow beside the point. For the drug agents and veterans who busted Escobar, the last decade and a half have been a slow, agonizing history of defeat after defeat, the enemy shifting but never retreating. "You get frustrated," Joe Toft, a former DEA country attache in Colombia, tells me. "We've never had a true effort where the U.S. as a whole says, 'We're never going to crack this problem without a real demand-reduction program.' That's something that's just never happened."

Toft, now a private security consultant, thinks back to the heady days after the fall of Escobar, the days when winning the War on Drugs seemed only a matter of dispatching more American helicopters to the Andes. "The first couple years, I had this very naive idea that I was really going to make a huge impact," he says. "But after a while, you start realizing that without a concerted effort to reduce demand, it's not going to happen. Over the years, I came to see my job as basically keeping the lid on the garbage can trying to sit on that lid and prevent that garbage can from overflowing. If you talk to a hundred agents, that's what almost all of them would say. We're just being realistic."

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