3: Historical Evolution of the INT
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Introduction
Illegal narcotics trafficking in Latin America remained essentially a regional
phenomenon until the mid-1970s. At this time a series of events joined in a coyuntura or
conjunction altering illegal narcotics trafficking in the Western hemisphere and
transforming it into a transnational phenomenon. Marijuana was the drug of choice for the
counterculture movement that dominated the middle-1960s to early 1970s in the United
States.(1) During 1970 heroin use and addiction in the
United States was considered to have reached epidemic proportions.(2)
Poppies, from which heroin is refined, were grown in Mexico but the quality of heroin
produced in Southeast Asia was preferred to the "tar-like" Mexican Brown heroin.
In 1973, Turkey, a primary producer of heroin and marijuana, entered an agreement with the
United States to shut down its poppy fields and destroy its marijuana crop. Subsequently,
the bulk of the illegal narcotics trafficking transferred from Southeast Asia to Latin
America.
Latin America, with its long tradition of smuggling and the existence of a
well-developed underground economy provided a ready-made structure for contraband trade
such as illegal narcotics trafficking.(3) Because of its
long history of emerald and coffee smuggling, Colombia was especially well situated with
smuggling routes. Two other events during this time contributed to Colombia becoming the
nexus of illegal narcotics trafficking in the Americas. In 1973 General Augusto Pinochet
overthrew the Allende regime in Chile. In Chile a group of Cuban exiles, thrown out of
Cuba when Fidel Castro took power, had set up a regional trade in cocaine smuggling. Using
ports of entry through South Florida, they serviced a small but growing cocaine demand.(4) The few Cuban-Chileans not jailed or deported by Pinochet's
police moved to Colombia, bringing with them their technological expertise in drug
production and transportation. Only two years elapsed before Colombians assumed complete
control of the trade and excluded all foreigners.
By 1977, Mexico announced the marijuana eradication campaign using the herbicide
paraquat had eliminated the marijuana problem in Mexico.(5)
The eradication campaign, coupled with the discovery of poisoned marijuana being sold,
served to secure Colombia's niche in the marijuana market. "By 1978, Colombian gold
accounted for three quarters of the marijuana sold in the United States."(6) These events coincided with an increased demand for illegal
drugs in the United States fostered the burgeoning underground economy in Colombia.
Estimated revenues for drug producing, refining and transhipping countries in 1990 were
reported as approximately $8 billion dollars(7). According
to the International Financial Action (GAFI) organized crime moves approximately $100
billion dollars within U.S. territory with $85 billion of which has ties to drug
trafficking and banked in the United States.(8)
Dimensions of the Problem
Samuel I. del Villar notes "there is no single illicit drug market between the
United States and Latin America" and it is important to understand illicit drug
markets "differentiate along different drug lines and along the roles that different
countries play in their structure."(9) Cocaine users
number about one-third as many as marijuana users in the U.S. However, the cocaine market
"is richer in terms of expenditure and revenues due to its high price."(10) While Peru, Bolivia, and Ecuador have been the primary
producers of coca leaf, Colombia has become the major center for processing and
transhipping cocaine. Concomitant with these developments is the domination of the illegal
narcotics trade by loosely formed coalitions of drug traffickers called cartels. Two of
these, the Cali and Medellín cartels, make their homes in Colombia and comprise the two
or three crime families who control the enterprise.(11)
Within these cartels five major syndicates appear to handle approximately 80% of
Colombia's cocaine exports.(12) Though difficult to
discover levels of revenues generated, Thoumi notes "estimates suggest that Colombian
narcobusinessmen's profits have fluctuated between $2 and $5 billion per year."(13) The accumulation of such vast wealth has put enormous
political, social, and economic power into the hands of cartel members. As such they have
become challengers to a weakening state and furthering its de-legitimization.
Examination of the INTs historical and structural development suggests they have become
transnational corporations or, more correctly, firms whose emerging organizational
structure is that of the network organization.(14)
Relationship structures characterize this type of organization as much as its formal
organizational structure. Moreover, many component parts are outside the legal TNC
structure as suppliers and other firms with mutual interests.
In his studies on American organized crime, Peter Lupsha has identified network
analysis as crucial to understanding the growing power of organized crime. Network
analysis identifies causation patterns through examining a variety of social relationships
and interactions. "Among . . . the various analytical issues of networking are group
cohesion, social distance measures, clique patterns, proximity and proximity flows,
network density and centrality, influence patterns, affective and instrumental
associational ties."(15) He notes that trust is the
most critical of variables in all interactions, whether that trust exists through
blood-tie relations or patron-client relations that may or may not contain a coercive
element. Lupsha's approach incorporates in measurable ways the element of illegality that
had been missing in more traditional models of TNCs.
Network analysis identifies arrangements easing adaptation by operating units to the
local environments in which they are embedded while retaining a common orientation with
the other units of the TNC/network. Thus, rather than using structure as an integrative
mechanism, each operating unit adopts structures congruent with their specific
environments, a significant factor in achieving superior returns.(16)
Rather than relying on hierarchical power, network organizations allocate power, in part,
by the degree of point centrality.(17) Power within the
network is partially dependent upon the number of linkages controlled by any one portion
of the network. If the parent organization controls critical linkages, it will retain
centrality. Such would be the case when coordination remains controlled by the parent
organization for coordination is the decision-point for resource allocation (i.e., it
controls investment decisions).
Important to remember, however, is members of the network need not be owned by the
parent, only bound by contracts, mutual purpose, or advantage to the network. Contrast
this with more traditional mechanisms such as vertical integration. Earlier explorations
of similarities of between the INT and TNCs attempted to conceptualize the Colombian
cocaine cartels as vertically integrated corporations, but found that many necessary
components of the production and transportation chain not owned by the cartels.
Considering system elements as network components with a common purpose of maximizing
profit on illegal narcotics, this factor becomes unimportant.
In the case of the INT networks, component parts align in a common mission, the
production and distribution of illegal drugs. The network expands to encompass all phases
of the operation, from cocoa leaf gathering to "retail" sales. The Colombian
cocaine cartels involvement in critical phases of the operation enables them to maintain a
high degree of centrality in the general network through providing strategic direction.
Allied organizations, occupying comparatively weaker positions within the network, perform
specialized functions within the network. Their relationship with the coordinating center
(the Colombian cocaine cartels) is often a function of their criticality to the complete
operation. In actuality, however, there are many TNCs along the drug production chain, the
most clearly defined TNC to emerge being the Colombian cocaine cartels.
As noted earlier in this chapter the INT had remained largely a regional phenomenon
until 1974 when a coyuntura (conjunction) of events came together. This conjunction
provided what Dunning considers specific and location specific advantages. These
advantages operate in a specific geographic location along with the advantages of
internalizing certain transactions rather than relying on markets.(18)
Colombian scholar Francisco Thoumi agrees that many factors identified in the
international business literature could be applied to Colombia. He argues that Colombia's
unfortunate choice as a drug trafficking center is the result of "a set of factors,
many of which are present in other countries, but which as a package are unique to
Colombia, [which] gave this country its cost advantage in cocaine production and
distribution."(19) The proximity of a major consumer
market in the U.S., a large Colombian population living in the U.S., and a monopoly on the
technology necessary for refining and transhipping are just some factors that provide
Colombia with a comparative advantage.
Turf wars and minimal coordination among older and emerging narcotraficantes
characterized Phase One (1974-1980) of the INT. The first "narco-entrepreneur",
Benjamin Herrera Zuleta had himself developed from a background in emerald smuggling.
Power within the already existing contraband smuggling network reflected its particular
environment until cocaine dominated the inventory of smuggled goods. Usurpation of known
smuggling routes by the emerging narco-entrepreneurs resulted in two phenomena. The first
was concern over the increased security risk to long established contraband routes by
using them to transport drugs. Secondly, the "administrative heritage"(20) of the contrabandistas that had operated on a decentralized
decision making basis increasingly came under attack by the emerging narcotraficantes.
During this period approximately 4-5 crime families emerged as leaders of the INT in
Colombia. Two of these, the Medellín and Cali cartels, began to dominate. Coordination
increased by sharing "specialized competencies" in response to increased
globalization of the INT. This included the communication and transportation expertise
developed by Pablo Escobar and Carlos Lehder. Bartlett and Ghoshal note that as firms seek
to globalize their operations and achieve global standardization and economies of scale,
assets become centrally managed. The result is a loss of flexibility for local operations.
The emerging pattern in this instance, however, is toward dispersed assets that are
interdependent and specialized.
Arango and Child argue that such sharing among narcotraffickers represents a key
distinction between the Colombian mafia and the Sicilian mafia. The nascent
narcotraffickers " . . . did not begin their business in a closed form, but worked
from an `open door' policy." Narcotraffickers who lacked the transportation or
financial capacity of the capos or leaders could agree to contract their services for
transportation and distribution. Several reasons accounted for the system's success. First
distributing the risk increased economic security. Distributing the risk ensured a
mechanism to pay for the services of friends, politicians and public officials and ensure
a smooth transportation and distribution system. In this way the business of
narcotrafficking embraced a wide social stratum including not only those normally bribed,
but also bankers, intellectuals, artists, cattle ranchers and farmers. Additionally, the
lack of a vertical hierarchy, domination of the market by one organization [the Colombian
mafia] and its democratic character, made it very appealing as an alternate path for those
seeking, if not wealth, then an initial capitalization of other legal interests. Arango
and Child point out that the `open' character of the Colombian mafia has been its central
weakness, allowing infiltration by law enforcement agents.
Arango and Child overlook two very important elements in the character of the Colombian
INT contributing to its success and the success of the capos to elude capture and trial.
Escobar's adoption of Lehder's transportation route and subsequent contracting out
transportation and insurance services initiated the stratification of the Colombian INT
into two strata identified by Krauthausen and Sarmiento. The oligopolic stratum is
composed of capos who have the knowledge, not only of the smuggling routes, but of the
business itself. They have figured out how to establish a route, defend it, and ultimately
offer services of the route to those who do not or cannot acquire such for themselves.
These services may include not only transportation, but capitalization of the cocaine,
insurance of its delivery, payment, and money laundering services. Thus, risk is
distributed. The competitive sector consists of the mid-level traffickers, street-sellers,
and consumers. Security is weakest in this stratum and attention from law enforcement
strongest. At this level greater room exists for violence among traffickers over settling
accounts as each section is highly compartmentalized and lacks access to enforcement that
exists on the oligopolic level. It would appear the oligopolic sector is not as open as
Arango and Child proposes, while the more open competitive sectors lend themselves to
greater possibilities of infiltration. On the other hand, dispersion across and
involvement of a variety of social actors can account for the continued success of the
capos at eluding capture or remaining arrested for only a short period during different
organizational phases of the INT.
In the following section I trace the historical evolution of the Colombian INT as Phase
One develops. During this phase its growth and restructuring of its organization into a
transnational corporation or firm become clear. The following chapter covers Phase Two and
Phase Three of the INT in Colombia.
Phase One: Sorting It Out and Coming Together, 1974-1980.
Krauthausen and Sarmiento note that contraband smuggling has an ancient and venerable
history rooted in the colonial epoch of Colombia.(21) To
sell their wares to the French, English, and Dutch in the Caribbean, the Colombians
regularly circumvented attempts by Spain to limit or proscribe the trading of colonial
goods. Over the years smuggling grew into a large underground economy in Colombia.
Although emerald and coffee smuggling dominated the underground economy, the FBI in the
United States identified a Medellín-Havana drug connection as early as 1958.(22)
According to Arango and Child, the Cosa Nostra, well-established in Cuba at this time,
arranged with Colombians in Medellín to process morphine, heroin, and cocaine for
transport to Cuba.(23) Caribe antioqueños, whose
contraband history dated from colonial times, entered an alliance with the United Fruit
Company to exploit the booming banana trade using their shipping expertise. By the late
1960s transatlantic banana ships, besides their legal cargo of bananas, were carrying
marijuana in specially hollowed-out ships' hulls.(24) A
well-established, full service route developed in Uraba, providing both legal and illegal
services to merchants. Motels sprung up, financial exchange houses, liquor stores,
lawyers, accountants all found a place in the boomtown atmosphere of Uraba at the
beginning of the 1970s.(25) In 1974 stricter controls on
shipping ports displaced the marijuana trade to the Guajira. Older contrabandistas,
originating in Medellín during the years of the Cuban connection, had identified the
change in drug preference from marijuana to Cocaine and decided to specialize in cocaine.(26) Smuggling routes of the older antioqueños were well
established structurally and socially. Knowledge was secure concerning which authorities'
cooperation existed or was easily secured to ensure the smooth operation of the smuggling
routes. Knowing which politician's influence could be counted on favored the nascent
narcotraffickers.(27)
Between 1973 and 1976 there was little coordination, beyond the established smuggling
routes, among the Colombian traffickers. This changed as these who became the leaders of
the Medellín and Cali coalitions, finished serving their apprenticeship and the vendettas
and turf wars subsided. The following sections track the development of the Cali and
Medéllin coalitions of crime families that became known as cartels.
Cali Cartel
The capture in Cali in June 1975 of Benjamín Herrera Zuleta, a veteran drug trafficker
known as the "Black Papa of Cocaine" created a power vacuum and a fight for
control of the routes Herrera had opened to the United States.(28)
Into this vacuum stepped a criminal gang known as the Band of Chemists, controlled by
brothers Gilberto José and Miguel Angel Rodriguez Orejuela and José Santacruz Londoño.
The gang had been implicated in a number of high profile kidnappings for ransom(29), as well as counterfeiting money and prescriptions. The
Orejuela brothers were considered leaders among various gangs in their neighborhoods.
These allegiances were put to good use as they established laboratories and transport
bases for cocaine in the southern part of Colombia bordering the Amazon and the coca
producing countries of Bolivia and Peru.
Although the brothers had begun transporting only small amounts of cocaine, they came
to the attention of Colombian authorities as early as 1975. Gilberto was captured with 180
kilos of coca paste in Peru while aboard a plane owned by Tulio Enrique Ayerbe, member of
a wealthy, traditional family from the Valle del Cauca. Meanwhile Gilberto's childhood
friend, Hernando Giraldo Soto had been charged with contracting existing smuggling routes
into the United States. Soto's success is reflected in records revealing that between
March and October of 1978, the Chemists had transported $26 million dollars worth of
cocaine into New York.(30) Ishido Kawai, a large jewelry
store proprietor in Colombia and involved for some years with emerald contraband, handled
money-laundering for the Cali group during this time. Kawai aided Rodriguez Orejuela in
the acquiring the Bar J Ranch in Alabama that later served as a key landing strip in the
United States for planes transporting cocaine.(31)
Meanwhile members of the Cali cartel were investing heavily in Colombian industries,
including a chain of drugstores and construction companies.
Members of the Cali cartel have not been pursued as vigorously as members of the
Medellín cartel. Colonel Jaime Ramirez Gomez, commander of the Anti-narcotics Unit of the
National Police, noted that the Cali cartel has so thoroughly penetrated the social
relations of the Valle del Cauca that they have become "virtually invincible."(32) The list submitted by Ramirez Gomez of those linked to
narcotics trade in the Cauca reads like a social register of fine old families in the
area. This explains the lack of diligent prosecution of narcotraffickers on the local
level and lack of violence that characterizes Cali cartels. Limited local prosecution
reduces the amount of violence necessary for the Cali cartel to accomplish its ends.(33) Ultimately, narco-violence has propelled the Colombian
government's anti-narcotics policy, a point elaborated later in greater detail.
Medellín Cartels
Recall that such coordination as existed among traffickers was limited to the old
Antioqueño smugglers whose operational center was Medellín. Their principal points of
disembarkation were the ports of Uraba, Baranquilla, and Cartagena along the Atlantic
Coast. The Antioqueño group was lead by three older contrabandistas; Alfredo Gómez
López, [known as El Padrino or Godfather], Jesús Emilio Escobar Hernández and Fabio
Restrepo Ochoa. This group of contrabandistas often coordinated their activities with the
emerald smugglers of Boyacá whose center of operations normally was in Bogotá.
Destruction of the first Medéllin cartel began January 1976 with the capture of some
principal contacts of the Cartel in New York(34). A
resulting war for control of the smuggling route developed in March 1976. The old emerald
contrabandista, Fabio Restrepo Ochoa, narrowly evaded capture by the airport police in
Bogotá, only to return home to Medellín and be disposed of at the hands of his nephew,
Jorge Luis Ochoa.(35) Jorge Luis assumed leadership of an
organization considerably weakened by the vendettas and turf wars of the past two years
and a distribution system unable to accommodate the growing demand for cocaine.(See Table
3b)
At this point, fellow Colombian Carlos Lehder Rivas had finished serving time in the
penitentiary in Danbury, Connecticut for marijuana smuggling. During his two years in
prison, Lehder dreamed of setting up a distribution system of cocaine beyond the few kilos
being smuggled strapped to the bodies of "mules" or human carriers. In prison he
met and established contacts with George Jung, an American, imprisoned for flying
marijuana from the California coast to eastern college campuses.(36)
Lehder and Jung became close friends in prison as Lehder sketched out his dream of using
small airplanes that could land at clandestine airstrips to transport cocaine. Lehder
would prove to be pivotal in the Medellín cartel. Raised in the United States during his
adolescence, he was more comfortable in the United States than any of the Ochoas. He
formed a cultural bridge between Colombia and the United States that none of the other
cartel members could provide. Lehder was charismatic, spoke English well, and had the
capacity to seduce weaker men with his will and vision.
Following his discharge from Danbury prison, Carlos Lehder returned to his hometown
Armenia in the Quindio province of Colombia. Viewed with less awe by the rising Colombian
traffickers such as the Ochoas, Pablo Escobar and Gonazalo Rodriguez Gacha, Lehder never
was completely at home in Medellín. Lehder began building his cocaine empire a few kilos
at a time, shipping them in modified suitcases and using Jung as his American contact.
Still determined to set up his airline route, Lehder encountered numerous obstacles to
finding reliable pilots until he was introduced to Barry Kane, an attorney who, more
importantly, owned his own plane.(37) Considered a player
and risk-taker in Cape Cod circles, Kane enthusiastically embraced Jung and Lehder's plan
smuggling cocaine via airplanes from Colombia into the United States. Money to finance as
large a venture as Jung and Lehder dreamed of was nonexistent, so they set about
generating capital for their venture.
Among Lehder's early smuggling activities was the smuggling of cars into and out of
Colombia. Efforts to smuggle cocaine out in Chevrolet station wagons resulted in Lehder
being arrested and placed in a Medellín jail. Lehder's prison stay was not long and soon
he was back into smuggling small amounts of cocaine with his partner, George Jung. By the
summer of 1977, Jung was burning out from the hecticness of the smuggling he and Lehder
engaged in to meet the demand for the cocaine. In 1978 on a fishing trip to the Bahamas
two coincidental events occurred. After a year of delays in agreeing to smuggle cocaine in
by air, Barry Kane announced his readiness to begin operations with Lehder. By May of
1978, Lehder had enough cash to buy the Beckwith house on Normans' Cay in the Bahamas.
Normans' Cay provided the ideal harbor for ships as large as yachts and a concrete
airstrip three thousand feet in length. Strategically located between Colombia and the
U.S., it provided refueling for the small Cessna airplanes that became the workhorses of
the smuggling trade. Despite occasional raids by the Bahamian police, Lehder continued
transporting cocaine through Normans' Cay. By the end of the year, conservative estimates
of cocaine transported into the United States(38) reached
approximately $150 million dollars wholesale.
Pablo Escobar, a nondescript young man who had grown up in Envigado, the tough blue
collar suburb of Medellín, advanced his criminal career working for older members of the
Antioqueños. As a mula he carried drugs, engaged in auto smuggling and kidnaping. His
shy, quiet-spoken demeanor did not suggest the enforcement capabilities he would build for
the cartels nor of a personal philosophy of revenge for every arrest and/or slight.(39) Although mistrustful and disapproving of Carlos Lehder's
flamboyant manner, Escobar recognized the value of airline transportation for the
distribution of cocaine. Beginning in 1976, Lehder was using Escobar's ranch as the
pick-up site for cocaine in Colombia. In 1978, Escobar was contracting out Lehder's
transportation services to other narcotraffickers.
There have been many attempts by cartel leaders to eliminate the security risks posed
to the organization by the smaller traffickers who contract their services. Major efforts
include establishing large processing laboratories under control of the cartel leaders
rather than the highly mobile `mom and pop' processing laboratories dominating the
business. While such small enterprises distribute the economic risks, it increases
security risks both with law enforcement and quality control over the product.
Leading the effort to streamline laboratory processing was Gonazalo Rodriguez Gacha, a
shadowy member of the Medellín cartel whose prominence did not emerge until the mid
1980s. Known as El Mejicano for his love of things Mexican, Rodriguez Gacha's roots
extended to the Leticia region where he and a lower level trafficker, Evaristo Porras,
brokered coca leaves and paste for the cartel. Rodriguez Gacha began buying up large
tracts of jungle lands and setting up processing laboratories placed under control of
local cartel members. In the following section, the Colombian state is situated within
this period of cartel development.
The Colombian State, the INT, and the End of the National Front
Alfonso Lopez Michelsen was the first president elected through competitive elections
in sixteen years. Dismantling the coalition rule of the National Front regime was the
dominating task of his administration. There developed a series of turning points that
would have considerable impact upon the subsequent administrations of Julio Cesar Turbay,
Belisario Betancur, and Virgilio Barco.
Recognizing that dismantling coalition rule required more than manipulating the rules
of the game, Lopez Michelsen proposed a Constituent Assembly rather than a Congress. The
purpose of this institutional adjustment was twofold. First it would provide for the
revamping of the administrative structure of the country through financially strengthening
the departments and municipalities. It was hoped this would curb the mushrooming brokerage
and clientelist politics that were developing without responsibility and accountability.(40)
The second purpose for the formation of a Constituent Assembly was to reform Colombia's
archaic civilian judiciary which criminals and guerrillas easily subverted. (41) Deficiencies in the civilian judiciary served as a
justification to expand the scope of crimes tried under military justice. After months of
maneuvering, Lopez received Congressional approval of a Constituent Assembly. The victory
proved ephemeral when declared unconstitutional by the Colombian Supreme Court weeks
before the 1978 presidential elections.(42)
Another turning point during the Lopez administration was a change in the military from
its constitutional base to what Leal Buitrago calls an autonomous political base.(43) The catalytic episode for this change, in 1977, of the
military was the breakup of the first national civic strike (paro) ever called in
Colombia. Repression of the national strike by the military resulted in official estimates
of fourteen dead and thirty-one wounded. The military was unable to contain the strike
despite the later discovery of the involvement of a small number of workers and union
organizers. Two weeks later General Varon Valencia declared the situation
"explosive".(44)
For the first time the Colombian military acted as an autonomous institution. In a
letter presented to President Lopez by a delegation of thirty-three generals and admirals,
the military demanded that Lopez enact emergency measures to improve the internal security
of the country through the granting of greater powers to the armed forces.(45) Lopez sidestepped their demands by promising the new
Constituent Assembly would meet these requirements. This promise collapsed when the
amendment for the Constituent Assembly was struck down by the Supreme Court.
As the general economic goals of the National Front remained in place, Lopez Michelsen
attempted to strengthen Colombian financial institutions. He attempted to establish
realistic, market-oriented interest rates and required that Colombians own majority shares
in Colombian banks. To bolster his "nationalistic" approach to the Colombian
economy, Lopez unilaterally rejected any further AID assistance from the United States.
Lopez's efforts were thwarted, however, by the growing world recession affecting demand
for minor, non-traditional exports from Colombia.(46)
These exports, which were the foundation for export diversification, were in turn devalued
by growing inflation. Foreign exchange, generated by a boom in the coffee and service(47) industries, fueled inflation.
To capture some of this foreign exchange Lopez ordered, in 1975, the reopening of la
ventanilla sinestra at the Banco de la Republica or Central Bank.(48)
At this side window, or so-called "sinister window", dollars were exchanged for
pesos with no questions asked. Thoumi notes that between 1976-1982 $2.3 billion entered
the services account of the balance of payments.(49)
To curtail the growing inflation generated by this increase in the money supply, Lopez
cut back on public investment in 1976 and devalued the Colombian peso in 1977.(50) The result was increased interest rates, decreased
availability of credit, and an official exchange rate that was larger than the black
market exchange rate.
The election of Julio Cesar Turbay Ayala in 1978 represents the most significant change
in the Colombian military's power. Passage of Decree 1923 the Statute on Security, in
1978, extended the power of the executive to declare a state of siege and expanded the
powers of the military. These expanded powers include the following: 1) an increase in the
types of crimes that could be tried by the military; 2) augmentation of the arrest powers
of the armed forces; 3) lengthened sentences for crimes such as kidnappings and extortion;
and 4) a prohibition of news coverage of public disturbances while they were occurring.(51) Although this extension of powers was officially directed
against the narcotraficante, it was most often used against the guerrillas.
Wide-spread reports of arbitrary detentions and torture prompted an investigation by
Amnesty International in 1979 and 1980. Their findings concluded that the "systematic
use of psychological and physical torture against political prisoners is wide spread in
Colombia."(52) According to the report, incidents of
military harassment were not restricted to armed opposition groups, but included doctors,
trade unionists, campesino leaders, and journalists. The Turbay government angrily denied
the charges.
Toward the end of 1980, 150 judges resigned in protest over the assassination of two
judges involved in the prosecution of local narcotraficantes.(53)
When confronted by the angered jurists, Minister of Defense General Luis Carlos Camacho
Leyva and Justice Minister Felio Andrade could only suggest that the jurists arm
themselves. He promised the police and the security forces would attempt to increase
protection. This response proved ironic for two reasons. First the National Police had
been incorporated into the armed forces under control of the Minister of Defense, leaving
the country without any security forces answerable to civilian authorities.(54) Second, a survivor of a second attack on the judges alleged
that a police officer riding a motorcycle opened fire.(55)
Apart from their acceptance of a civilian government, the Colombian military
increasingly came to view themselves as the unique defenders of Colombian national
traditions and values. Opposition to these traditions became fused with the concept of
subversion identified with the battle "between godless communism and Christian (and
capitalist) democracy."(56)
The 1979 Constitutional Reform, initiated by the Turbay administration, sought to
return to Congress some powers it had lost through the Constitutional Reform of 1968. This
measure also sought to reduce judicial power through eliminating judicial self selection
and political parity of all but the most senior officials of the judiciary. In 1981, two
years after its enactment, the Supreme Court declared the Reform unconstitutional.(57) Some observers considered curtailment of executive power,
similar to the proposed Lopez reform, as basis for action by the Supreme Court.
When Turbay entered office in 1978, the industrial expansion that had begun declining
during the Lopez administration plummeted into a full scale recession. Medellín that had
become, during the 1960s and 1970s, the center of manufacturing for Colombia, producing
80% of all manufactured goods(58), bore the brunt of the
industrial recession.(59) The textile industry, which grew
only by 2% in 1978, registered a negative growth of 12% in 1979 of which only 2.5% growth
recovered in 1980.(60)
The tight money policies begun during the Lopez administration continued with the same
foreign exchange policies through the Central Bank. As noted earlier in the chapter the
amount of foreign exchange generated between 1976-1982 was approximately $2.3 billion with
an estimated $1.1 billion derived from narcodollars. During Turbay's administration the
peso remained overvalued relative to the dollar paralleling a rise in smuggling and
speculative investment.(61) In 1980 the GDP fell to 4%
compared to the growth rate of 5.5% experienced during the previous three years.(62) By the end of Turbay's administration, a deepening industrial
recession combined with efforts to deregulate the burgeoning financial sector, developed
into a crisis "sparked by the questionable loans of a number of banks to associated
conglomerate firms."(63)
Summary
In Phase One the INT is only one of several activities supportive of, but not yet
dominating, Colombia's underground economy. During this time the strongest smuggling
organization, composed of old Antioqeño smugglers and known as the first Medellín
cartel, is deposed. The second Medellín cartel, whose new leaders include the Ochoa
family and Pablo Escobar, replaced Medellín Cartel I. The Calí cartel develops along
similar lines but in closer association with local leaders who are quite consciously
incorporated into the differing aspects of the trade. Associations remain loose and
informal with occasional cooperation on specific projects. Lehder's restructuring the
trade with an air transportation system alters this arrangement. Pablo Escobar identifies
the greater advantages of a wholesaler rather than a retailer in the trade. As such he
offers a range of services not easily available to smaller traffickers and decreases his
own security risks while increasing his profits. The Ochoas, with the deepest roots in the
older Medellín cartel, have the greatest influence and most thorough knowledge of
smuggling routes needed to ensure smooth operations. At the end of the seventies, however,
these different components had yet to come together in a formalized fashion that would
evolve during phase two.
The Colombian state was not especially beleaguered by the evolving INT. The first
post-Front governments of Lopez Michelsen and of the Turbay administration (for its first
two years) were preoccupied with dismantling the institutions of coalition rule and
engaged in contestation over the institutional structures such change would incur. The
constitutional basis of the military changed to a more autonomous basis. The failure of
the military to contain a small number of strikers in the national strike of 1977 and the
signing of a National Security decree by President Turbay marks a turning point where the
military began behaving as an independent actor. Increasingly, it viewed itself as the
unique defenders of Colombian national traditions and values. Opposition to these
traditions became fused with the concept of subversion and identified with the battle
"between godless communism and Christian [and capitalist] democracy."(64) This change in self-perception seriously influenced the
military's conception of its role in the war on drugs in Colombian as the INT evolved.
Colombian economic institutions experienced some reverses during this time, but such
reverses do not seem to have threatened their existence as institutions. Use of la
ventanilla sinestra as a legitimate mechanism to recapture illegal monies could be said to
have provided a breathing space for economic policies.
Although the number of assaults on court justices and investigators
increased, they were not considered proportional to the growing INT. The assaults were
more frequently perceived as a continuation of the guerrilla conflict that had continued
since the end of la violencia.
Table 1. THE CALI CARTEL
All
Functions
All Functions
José
Santacruz-Londono
Rodriguez-Orejuela
Organization
Organization
|
|
|____________________________________________________________|
|
|
___________________________
__________________________________________
|
|
|
|
|
Afranio
Hernando
Giovanni
Luis
Jesus
Arizabaleta-
Restrepo-
Caicedo-
Santacruz-
Rivera-
Arzayus
Ochoa
Tascon
Echeverry
Reyes
Organization
Organization
Organization
Organization
Organization
El Cartel de Cali
Source: Fabio Castillo, Lacoca Nostra (Bogotá: Editorial Documentos Periodistas, 1991)
Table 2. Cartel de Medellín
ALL
FUNCTIONS ALL
FUNCTIONS
ALL FUNCTIONS
Pablo
Jorge
José
Escobar-Gaviria
Ochoa-Vasquez
Rodriquez Gacha___________________________________
Organization
Organization
Organization
|
|
|
|
|
_________________________________________________________________________
|
Distribution
Supply/
Transportation
Undefined
Undefined
Bogota
Distribution
Distribution
Functions
Functions
Organizations
Juan
Luis
Joaquinn
Rigoberto
Dayro
Rodrigo
Osorio/
Servulo
Castano-Velaszuez
Builes-Gomez
Correa-Arroyave
Chica
Alonso
Munoz
Alfonso Duarte
Organization
Organization
Organization
Organization
Organization
Organization
Fernando
Gustavo
Jairo
Elkin
Ivan &
Gustavo
Fernando
Galeano-Perrio
Herrera-Zuleta
Mejia-Rueda
Correa
Valderram-Suesc
Carillo
Organization
Organization
Organization
Organization
Organization
Organization
Manuel Antonio
Francisco
Hugo
Alvaro
Leon
Ochoa-
Pedro
Garces-Gonzalez
Moncada
Osando-Ochoa
Gonazlez
Carvajal
Ortegon
Organization
Organization
Organization
Organization
Organization
Organization
Carlos
Octavo
Francisco
Carlos
Alberto
Ochoa-
Camilo
Piedrahita-Tabares
Barbosa
Guarin
Prieto
Zapata Vaszuez
Organization
Organization
Organization
Organization
Organization
TRANSPORTATION
Oscar
Evaristo
Fernando
Luis Carlos
Londono-Quiroz
Porras
Hernandez Velasquez
Organization
Organization
Organization Organization
_______________________________________________________________________
Source: Fabio Castillo, Lacoca Nostra (Bogotá: Editorial Documentos Periodistas, 1991)
1. William O. Walker III, Drug Control in the Americas,
Revised Edition (Albuquerque: University of New Mexico Press, 1989, 189.
2. Ibid.
3. Francisco E. Thoumi, "Some Implications of the Growth of the
Underground Economy in Colombia", Journal of InterAmerican Affairs and World
Studies Summer 1988, 36.
4. Guy Gugliotta and Jeff Leen, Kings of Cocaine. (New York:
Harper & Row, 1990), 23.
5. Elaine Shannon, Desperados: Latin Drug Lords, U.S. Lawmen, and
the War America Can't Win (New York: Viking Press, 1988), 73.
6. Ibid.
7. Rensselaer W. Lee, "Colombia's Cocaine Syndicates" Crime,
Law and Social Change No. 16, 1991, 5.
8. ....DRUG TRAFFICKING UPDATE, No. 30 Lima, Peru. October 13, 1992,
1.
9. Samuel I. del Villar, "Rethinking Hemispheric Antinarcotics
Strategy and Security", Chapter 8 pg.106 in The Latin American Narcotics Trade and
U.S. National Security, ed. Donald J. Mabry (Westport: Greenwood Press, 1989)
10. Ibid., 107.
11. Jonathan F. Galloway and Maria Velez de Berliner, "The
Worldwide Illegal Cocaine Industry", paper presented at the 28th Annual Convention of
the International Studies Association, Washington, D.C., April 15-18, 1987, 17.
12. Lee, "Dimensions of...", 95.
13. Francisco Thoumi, "The Economic Impact of Narcotics in
Colombia", in Peter Smith, ed. Drug Policy in the America (Boulder: Westview
Press, 1992)
14. Patricia McRae and David Ackerman, "The Illegal Narcotics
Trade (INT) As a TNC: Implications for the TNC/Government Interface" Paper presented
at the 1993 annual meeting of the American Political Science Association, Washington,
D.C., September, 1993, 2-8.
15. Lupsha, "Networks Versus Networking: An Analysis of an
Organized Crime Group" in Career Criminals, 59.
16. S. Ghosahl and N. Nohria, "Horses for Courses:
Organizational Forms for Multinational Corporations". Sloan Management Review,
1993. Vol. 34 No. 2., 23-35.
17. S. Ghosal and C.A. Bartlett, "The Multinational
Corporation as an Interorganizational Network" Academy of Management Review,
1990. Vol. 15 No. 4, 603-625.
18. J.H. Dunning, "The Eclectic Paradigm of International
Production: A Restatement and Some Possible Extensions," Journal of International
Business Studies, 1988. Vol. 19 No. 1, 366-390.
19. Francisco Thoumi, "An Institutionalist..." mimeo, 4.
20. Barlett and Ghosahl define administrative heritage as a
collection of forces which include the history of the firm's development and the
personalities of its leaders. Christopher A. Bartlett and Sumantra Ghosal, Managing
Across Borders: The Transnational Solution (Boston, MA: Harvard Business School Press,
1989)
21. Krauthausen and Sarmiento, 140.
22. Mario Arango and Jorge Child, Narctrafico imperio de la
cocaina (Medellin: Editorial perception, 1984), 162-163.
23. Ibid. This is also one of the earliest instances of law
enforcement cooperation between Colombian law enforcement and that of the United States.
Colombian officials in conjunction with the FBI raided the laboratory in Medellín. See
also El Espectador, May 21, 1959.
24. Ibid., 179-181.
25. Ibid., 181.
26. Ibid.
27. Ibid.
28. Fabio Castillo, Los jinetes de la cocaína (Bogotá:
Editorial Documentos Periodisticos, 1987), 41.
29. Castillo lists a series of kidnappings involving family members
of foreign diplomats in Colombia, among them the Swiss diplomat Hermann Buff, 42-45.
30. Ibid., 45.
31. Ibid., 46.
32. Ibid., 49.
33. Colombian sociologist, Alvaro Camacho, suggests that Cali
differs markedly from other Colombian cities which harbor narcotrafficates in that the
elite of Cali has always prided itself on its philanthropy and civic pride and as such has
always been careful "...to produce at least the appearance of resolving the
structural problems of the dominated." ["Urban Violence in Cali" in Violence
in Colombia: The Contemporary Crisis in Historical Perspective (Wilmington: Scholarly
Resources Imprint, 1992), 251.
34. Castillo notes that "soldiers" of the Colombian drug
queen, Griselda Blanco, operating out of Queens, New York were sentenced and others
assassinated during the numerous turf wars that occurred between individual traffickers
during this time period.
35. Ibid., 65.
36. Guggliotta and Leen, 37-56.
37. Ibid., 44.
38. Ibid., 89.
39. Ibid., 28-30. Guggliotta and Leen describe in some detail
Escobar's patience for waiting long periods to exact his revenge. Although arrested for
only a short time in 1974, Escobar's arresting officer at that time would be gunned down
five years later in Medellín.
40. While the National Front had been effective in subduing the
violence associated with partisan politics and patron-client relationships, a vacuum
developed as a corollary to the National Front which limited political participation.
Francisco Leal Buitrago suggests that the structural change of the National Front altered
the face to face exchange characteristic of patron-client relationships to
brokerage-client relationships which had a more institutional structure. (See
"Modernizacion del estado y crisis politica" presented at the research
conference, "Violence and Democracy in Colombia and Peru" held at Columbia
University, 30 November 1990)
41. Colombia's judiciary will be dealt with in more detail in
subsequent chapters.
42. Hartlyn, The Politics of..., 210.
43. Francisco Leal Buitrago, Estado y politica en colombia,
2nd edicion aumentada, (Bogota: Siglo veintiuno de colombia, 1989), 278.
44. Ibid.
45. Hartlyn, The Politics....., 217-218.
46. Hartlyn, The Politics of..., 138. The Colombian economy
and its financial institutions are dealt with in more detail in a later chapter.
47. The service industry in Colombia has long been the means by
which contraband dollars have been repatriated to Colombia and with the boom of tourism
has been a favorite mechanism to repatriate narcodollars.
48. Ibid., 139.
49. Francisco E. Thoumi, "Some Implications of the Growth of
the Underground Economy in Colombia", Journal of InterAmerican Affairs and World
Studies, Summer 1988, 43.
50. Hartlyn, The Politics of...., 140.
51. Hartlyn, The Politics of..., 217.
52. Latin America Regional Reports Andean Group RA-80-04, 16
May 1980, "Amnesty Finds Torture Evidence", 4.
53. Latin America Weekly Report WR-80, 31 October 1980,
"Judges Face Chicago-style Mafia Attacks", 2.
54. "The Central-Americanization of Colombia: Human Rights and
the Peace Process" An Americas Watch Report, January 1986, 18.
55. LAWR, WR-80. Ibid.
56. Americas Watch Report, January 1986, 16.
57. Hartlyn, The Politics of..., 225.
58. Arango Jaramillo, Impacto de..., 81.
59. Ibid, 89.
60. "Textile Crisis Set to Continue", Latin American
Regional Reports Andean Group RA-81-02, 27 February 1981, 8.
61. Hartlyn, The Poltics of..., 202.
62. Sloan, Public Policy in..., 31.
63. Hartlyn, The Politics of..., 203. Arango in Impacto
de... discusses in more detail precisely which banks made these loans and who were the
major principals in the conglomerate firms that were recipients of these loans. Arango
suggests strong linkages between both bankers and firm members to emergent narcotraficante
leaders.
64. Americas Watch Report, January 1986, 16.
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