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"Khun Sa has increased his power through intimidation, execution and murder," says an official of the U.S. Drug Enforcement Administration, which has more than 20 agents in Thailand. "He pays his men well and has won surprising loyalty from them." In 1978 he even tried to make a deal with the U.S. to sell it 500 tons of raw opium over a five-year period for $30 million. DEA officials convinced the Carter Administration that such preemptive buying would be futile, since Khun Sa could still flood the market with opium. Officials now estimate that about 600 tons of opium is harvested each year in the area, most of it in the vast poppy fields of northern Burma. Of this, at least 125 tons is lashed to mountain ponies and carried to the Thai-Burmese border, where it is refined into 90% pure heroin. The 12% tons of heroin thus produced provides about twice the world's demand.
As long as Khun Sa did not threaten Thailand's national security, Bangkok refrained from direct attacks on him. But last year he made a deal with Burma's Communist Party to provide its cadres with rice in return for opium. The Communists soon became a major supplier. Khun Sa's army in turn acted as a conduit that enabled Communists to establish a toehold near the Thai border.
Khun Sa's tactics, meanwhile, became ever more brutal. One Thai government informant was buried alive, another drawn and quartered on the main street of Ban Hin Taek. In 1980 the American wife of DEA Agent Michael Powers was gunned down on a street in the northern city of Chiang Mai. Bangkok offered a $25,000 reward for the warlord's head. When a group of Thai paramilitary troops set off to capture Khun Sa and cop the reward, they were ambushed by Shan mercenaries. The open clash on Thai soil enraged Bangkok, already under mounting pressure from both the U.S. and Australia to crack down on the heroin trade. Says a Western diplomat in Bangkok: "The Thais finally concluded it was not in their interest to allow Khun Sa to function in Thailand. The domestic and international costs became too high."
The destruction of Ban Hin Taek may disrupt the heroin flow for a while. Thai officials claim they have swept Khun Sa's mercenaries out of Thailand and captured ten tons of guns and ammunition worth $2 million. But narcotics officials admit that the opium war is far from over. Says one Bangkok agent: "The syndicate will start up again. The problem is not supply but demand. People will continue to want heroin and be willing to pay big money for it." —By Marguerite Johnson. Reported by David DeVoss/Bangkok