For Chan Shee-fu the 1967 Opium War marked the beginning of the end. Far more importantly for the Shan movement as a whole, his defeat represented the last significant attempt by any rebel leader to establish himself as something more than just another petty warlord. After his troops retreated across the Mekong from Ban Khwan, Chan Shee-fu remained in the mountains near the Thai border, reportedly waiting for another crack at the KMT. (287)However for reasons never satisfactorily explained, the second battle never took place, and he returned to the northern Shan States in late 1967. Since Chan Shee-fu had lost a considerable amount of money, arms, and prestige at Ban Khwan, his troops began to drift away, and by late 1968 he had considerably less than a thousand men under arms. (288) Apparently convinced that another stint as a guerrilla would revive his sagging fortunes, Chan Shee-fu began making contact with a number of Shan rebel leaders. When Burmese military intelligence learned that he was engaged in serious negotiations with the rebels, they had him arrested and sent off to a Rangoon jail for an indefinite period of confinement. (289) Many of his officers and men were arrested as well, but Shan rebel leaders claim that several hundred more are still actively battling government forces in the northern Shan States. (290)
But there is a moral to this story. The rise and fall of Chan Shee-fu and the Shan National Army shows how difficult it is going to be for any Shan military leader to restore order in the strife-torn Shan States. Rather than producing an independent, unified Shan land, the Shan rebellion seems to have opened a Pandora's box of chaos that has populated the countryside with petty warlords and impoverished the people. When the rebellion began in 1958, there were only three or four rebel groups active in the entire Shan States. In mid 1971 one Shan rebel leader estimated that there were more than a hundred different armed bands prowling the highlands. But he cautioned that this was probably a conservative estimate, and added that "it would take a computer to keep track of them all. (291) Most of these armed groups are extremely unstable; they are constantly switching from rebel to militia (KKY) status and back again, splitting in amoebalike fashion to form new armies, or entering into ineffectual alliances. Moreover, the situation gets more chaotic every year as succeeding opium harvests pump more and more weapons into the Shan States. In the early 1960s the SNA was content with semiautomatic U.S. M-1 or M-2 carbines, but seven years later every armed band has to have its quotient of fully automatic M16s in order to survive. Although the SNA never managed to impose effective discipline on its local commanders, it achieved a level of unity that has yet to be equaled. Since its demise in 1965-1966, the military situation in the Shan States has become much more chaotic. In 1968 another faction made an attempt at drawing the movement together by establishing "the Shan Unity Preparatory Committee." It issued a few pompous communiques warning about threats of communism or offering a cease-fire, but collapsed after a few acrimonious meetings in Chiangmai, Thailand. (292)
Although most Shan rebel leaders speak loftily about millions of oppressed peasants flocking to their side, a few of the franker ones admit that people have become progressively alienated from the independence movement. Repeated taxation at gunpoint by roving Shan warlords has discouraged most forms of legitimate economic activity and reduced the peasants to a state of poverty. Salt prices have skyrocketed in the hills, and goiter is becoming a serious problem. In some of the more distant areas essential medicines like quinine have not been available for years. Vaccination programs and qualified medical treatment have almost disappeared.
Ironically, the political chaos, which has damaged most other forms of agriculture and commerce, has promoted a steady expansion of opium production in the Shan States. Since opium buys more guns and am munition in Thailand than any other local product, Shan rebels and the local militia (KKY) have imposed a heavy opium tax on mountain villages under their control. While mountain farmers sell all the opium they can produce to merchants who regularly visit their villages, the insurgency makes it difficult and dangerous to venture into the market towns to sell other agricultural commodities. Moreover, the Burmese government controls very few of the poppy-growing areas, and is therefore in no position to discourage opium production. Other nations can be pressured into abolishing poppy cultivation, but Burma can honestly claim that it is powerless to deal with the problem. If the present political situation continues, and there is every indication that it will, the Shan States will be growing vast quantities of opium long after the poppy has disappeared from Turkey or Afghanistan.
The Shan States' political tradition of being divided into thirty-four small principalities ruled over by autocratic sawbwas is only partly responsible for the lack of unity among present-day rebel leaders. Laos, for example, shares the same tradition of small valley principalities, but the Pathet Lao have managed to form a strongly unified national liberation movement.
Indeed, there are more important reasons for the chaotic political conditions inside the Shan States. The Shan rebellion and its accompanying chaos could not have survived had not the CIA, the KMT, and the Thai government intervened. None of these groups is particularly interested in the establishment of an independent Shan nation. However, each of them has certain limited political or military interests that have been served by providing the Shans with a limited amount of support and keeping the caldron bubbling. Although it is most definitely not in the KMT's interests for a powerful Shan leader like Chan Shee-fu to develop, the chaotic conditions promoted by dozens of smaller rebel groups are absolutely vital to their survival. The KMT Third and Fifth armies are only able to send their large, lightly guarded caravans deep into the Shan States because the Burmese army is tied down fighting the insurgents. The KMT recognizes the importance of this distraction and has financed a number of small Shan rebel groups. However, the KMT tries to keep the Shan armies small and weak by explicitly refusing to allow any Shan opium caravan larger than one hundred mules to enter Thailand. This policy was evidently adopted after the 1967 Opium War. (293) Perhaps the most notable victim of this new policy was the Shan State Army (SSA). Founded by students from Mandalay and Rangoon Universities, it began operating in the mountains west of Lashio in 1958 (294) but did not start smuggling opium until five years later. After shipping 160 kilos of raw opium to Thailand in 1964, the Shan State Army increased its shipments year by year, reaching a peak of 1,600 kilos in 1967. But with the exception of 80 kilos it managed to slip by the KMT in 1969, this was its last shipment of opium to Thailand. Relations between the KMT and SSA had never been good, but the KMT embargo on SSA opium smuggling brought relations to a new low. When the KMT Third Army tried to establish a radio post in SSA territory in late 1969, the two groups engaged in a series of indecisive running battles for over three months. (295)
The CIA has played an equally cynical role inside the Shan States. Although it too has no real interest in an independent Shan land, the CIA has supported individual rebel armies in order to accomplish its intelligence gathering missions inside China. Without the CIA's tolerance of its opium-arms traffic, the Shan National Army could never have occupied so much of Kentung State. However, the CIA refused to grant the SNA enough direct military aid to drive the Burmese out of the state and reestablish public order. During the 1950s the CIA had tried to turn the eastern Shan States into an, independent strategic bastion for operations along China's southern frontier by using KMT troops to drive the Burmese army out of the area. But after the KMT were driven out of Burma in 1961, the CIA apparently decided to adopt a lower profile for its clandestine operations. While direct military support for the SNA might have produced new diplomatic embarrassments, an informal alliance and the resulting breakdown of public order in Kengtung were entirely compatible with CIA interests. After the SNA forced the Burmese army into the cities and towns, the CIA's forward radio posts floated securely in this sea of chaos while its cross-border espionage teams passed through Burma virtually undetected. (296)
In the final analysis, the Thai government probably bears the major responsibility for the chaos. Most Thai leaders have a deep traditional distrust for the Burmese, who have frequently invaded Thailand in past centuries. No Thai student graduates from elementary school without reading at least one gruesome description of the atrocities committed by Burmese troops when they burned the royal Thai capital at Ayuthia in 1769. Convinced that Burma will always pose a potential threat to its security, the Thai government has granted asylum to all of the insurgents operating along the Burma-Thailand border and supplied some of the groups with enough arms and equipment to keep operating. This low level insurgency keeps the Burmese army tied down defending its own cities, while the chaotic military situation in Burma's borderland regions gives Thailand a reassuring buffer zone. Although Thai leaders have given Rangoon repeated assurances that they will not let Burmese exiles "abuse their privileges" as political refugees, they have opened a number of sanctuary areas for guerrillas near the Burmese border. (297) The Huei Krai camp north of Chiangrai has long been the major sanctuary area for Shan rebels from Kengtung State. The area surrounding KMT Third Army headquarters at Tam Ngop is the most important sanctuary for rebel armies from northeastern Burma: Gen. Mo Heng's Shan United Revolutionary Army, Brig. Gen. Jimmy Yang's Kokang Revolutionary Force, Gen. Zau Seng's Kachin Independence Army, Gen. Jao Nhu's Shan State Army, and General Kyansone's Pa-0 rebels are all crowded together on a few mountaintops under the watchful eye of KMT General Ly. Entrances to these camps are tightly guarded by Thai police, and the guerrillas have to notify Thai authorities every time they enter or leave. Even though activities at these camps are closely watched, Shan rebel leaders claim that Thai authorities have never made any attempt to interfere with their opium caravans. While foreign journalists are barred, Chiangmai opium buyers are free to come and go at will. (298)
In an effort to cope with an impossible situation, the Burmese government has adopted a counterinsurgency program that has legitimized some aspects of the opium trade and added to the general political instability. The Burmese army has organized local militia forces (KKY), granted them the right to use government-controlled towns as opiumtrading centers and major highways as smuggling routes and has removed all restrictions on the refining of opium. It is their pious hope that the local militias' natural greed will motivate them to battle the rebels for control of the opium hills. The logic behind this policy is rather simple; if the local militia control most of the opium harvest, then the rebels will not have any money to buy arms in Thailand and will have to give up their struggle. Despite its seductive simplicity, the program has had a rather mixed record of success. While it has weaned a number of rebel armies to the government side, just as many local militia have become rebels. On the whole, the program has compounded the endemic warlordism that has become the curse of the Shan States without really reducing the level of rebel activity.
In addition, the Burmese government has sound economic reasons for tolerating the opium traffic. After seizing power from a civilian government in 1962, Commander in Chief of the Army Gen. Ne Win decreed a series of poorly executed economic reforms, which crippled Burma's foreign trade and disrupted the consumer economy. After eight years of the "Burmese Way to Socialism," practically all of the consumer goods being sold in Burma's major cities--everything from transistor radios and motor bikes to watches, pens, and toothpaste-were being smuggled across the border from Thailand on mule caravans. On the way down to Thailand, Shan smugglers carry opium, and on the way back they carry U.S. weapons and consumer goods. By the time a bottle of Coca-Cola reaches Mandalay in northern Burma it can cost a dollar, and a Japanese toothbrush goes for $3.50 in Rangoon. (299) Afraid of straining the patience of its already beleaguered consumers, the Burmese government has made no real effort to close the black markets or stop the smuggling. Opium has become one of the nation's most valuable export commodities, and without it the consumer economy would grind to a complete halt.
The opium traffic itself has contributed to the chaotic conditions inside the Shan States by changing the military leaders from legitimate nationalist rebels into apolitical mercenaries. The case of Maj. On Chan is perhaps the most striking example. During the early 1960s he joined the Shan National Army and remained one of its more effective local commanders until the coalition split apart in 1965-1966. After deserting from the SNA, On Chan and about three hundred of his men were hired as mercenaries by the CIA and moved across the Mekong into northwestern Laos, where they fought in the Secret Army, disguised as local Lu militia. Two or three years later On Chan and his men deserted the Secret Army and moved back into the Shan States. With the ample supply of arms and ammunition be brought back to Burma, On Chan carved an independent fief out of eastern Kengtung. He has remained there ever since, trading in opium and fighting only to defend his autonomy. (300)
Since the Burmese army offers such convenient opium-trading facilities, corrupted rebel leaders frequently desert the cause for the more comfortable life of a government militia commander. While Chan Sheefu is the most notorious example of this kind of Shan military leader, the case of Yang Sun is much more typical. Yang Sun started his career in the opium trade as a government militia leader, but switched to the rebel side in the mid 1960s and opened a base camp in the Huei Krai region of northern Thailand. Several years later he changed his allegiance once more and soon became the most powerful government militia leader in Kengtung State. Although rebel leaders have tried to woo him back to their side, he is making so much money from the opium traffic as a militia leader that he has consistently brushed their overtures aside.
Thanks to the good graces of the Burmese army, Yang Sun patrols a strategic piece of geography between Kengtung City and the Thai border. Caravans traveling along government-controlled roads from the opium-rich Kokang and Wa states to the north have to pass through this area on their way to opium refineries in the three-border region to the south. Caravans belonging to both Law Sik Han, a powerful militia leader from Kokang, and Bo Loi Oo, the influential Wa States' militia commander, are required to stop in Kengtung City to have their opium weighed and taxed by Yang Sun before they can proceed down the road to their private opium refineries in Tachilek. In addition, Yang Sun's troops provide armed escorts between Kengtung City and the border for private merchant caravans out of the Kokang and Wa states. For a nominal fee of six dollars per kilo of opium, merchants are guaranteed safe conduct by the Burmese government and protection from bandits and rebels. (301)
Although some of the opium carried by Shan rebels and the KMT is smuggled across the border in raw form, most of the militia's opium is processed into smoking opium, morphine, or heroin at Shan militia (KKY) refineries in the Tachilek 'area before being shipped into nearby Thailand. Yang Sun operates a large opium refinery about six miles north of Tachilek capable of producing both no. 3 and no. 4 heroin. (302) This laboratory is only one of fourteen in the Tachilek region, which, according to a 1971 CIA report, processed a total of thirty tons of raw opium during 1970. (303) While this represents a considerable increase from the mid 1960s when Chan Shee-fu's morphine factory at Ving Ngun was the only known refinery, thirty tons of raw opium is still only a tiny fraction of Burma's total estimated exports of five hundred tons. The relative weakness of Burma's processing industry is one of the legacies of Chan Shee-fu's defeat in the 1967 Opium War. Since KMT caravans have continued to ship about 90 percent of the Shan States' opium to Thailand and Laos for processing in their own refineries or transshipment, the growth of Tachilek's laboratories has been hampered by a shortage of raw materials.
Until public order is restored to the Shan States, there is absolutely no chance that Burma's opium production can be eradicated or its heroin laboratories shut down. It seems highly unlikely that the squabbling Shan rebels will ever be capable of driving the Burmese army completely out of the Shan States. It seems even more unlikely that the profitoriented militia commanders would ever be willing to divert enough effort from their flourishing opium businesses to make a serious effort at cleaning the rebels out of the hills. Despite its claim of success, the Burmese army is even further away from victory than it was a decade ago.
If we eliminate the Burmese army and the Shan military groups, there are only two possible contenders for ultimate control over the Shan States-the Burmese Communist party and a coalition of right-wing rebels led by Burma's former prime minister U Nu. A year after he fled to Thailand in April 1969, U Nu concluded an alliance with Mon and right-wing Karen insurgents active in the Burma-Thailand frontier areas and announced the formation of a revolutionary army, the United National Liberation Front (UNLF). (304) To raise money U Nu and his assistants (among them William Young, now retired from the CIA) circled the globe, contacting wealthy financiers and offering future guarantees on lucrative oil and mineral concessions in exchange for cash donations. Burma's future was mortgaged to the hilt, but by the end of 1970 U Nu had a war chest of over $2 million. (305)
With the tacit support of the Thai government, U Nu built up his guerrilla army inside Thailand: three major bases were opened up along the Thailand-Burma border at Mae Hong Son, Mae Sariang and Mae Sot. (306) Recognizing Burma's ethnic diversity, U Nu divided the eastern part of the country into three separate military zones: the Mon and Burmese areas in the southeast, the Karen region in the east, and the Shan and Kachin states in the northeast. (307)
While the UNLF alliance gave U Nu a strong basis for operations in the Mon and Karen areas, he has almost no influence in the northeast. There are so many Shan armies that it would be meaningless to ally with any one of them, and they arc so divided among themselves that forming a coalition required special tactics. (308) Instead of allying with established rebel groups as they had done with the Mons and Karens, U Nu and his assistants assigned William Young and Gen. Jimmy Yang the task of building an independent rebel force inside the Shan States.
A member of Kokang State's royal family, Jimmy Yang began organizing guerrilla resistance in 1962. Since his family had worked closely with the KMT for more than a decade, he was able to finance his infant rebellion by sending caravans loaded with Kokang opium to Thailand under the protection of General Ly's Third Army. After three years of fighting in Kokang, Jimmy and some of his men moved to northern Thailand and built a base camp in the shadow of General Ly's headquarters at Tam Ngop. While his men raised chickens and smuggled opium in the mountains, Jimmy moved down to Chiangmai and became assistant manager of the most luxurious tourist hotel in northern Thailand, the Rincome Hotel.
Jimmy had known U Nu in Rangoon, and when the former prime minister first arrived in Thailand Jimmy renewed the friendship by soliciting a $10,000 contribution for democracy's cause from General Ly. (309) U Nu returned the favor several months later by appointing Brig. Gen. Jimmy Yang commander of the UNLF's northern region, the Kachin and Shan States, and reportedly allocated $200,000 from the war chest to build up an effective Shan army. (310)
Rather than trying to build up the five-thousand-man army he thought would be necessary to steamroll the hundred or so armed bands that roamed the hills, Jimmy decided to forge an elite strike force of about a hundred men to guarantee his security while he traveled through the strife-torn Shan States negotiating with bandits, opium armies, rebels, and government militia. In exchange for their allegiance, he planned to offer them officers' commissions and government jobs in U Nu's administration-to-be. By scrupulously avoiding the opium traffic and relying on U Nu's war chest for financial support, Jimmy hoped to remain aloof from the opium squabbles and territorial disputes that had destroyed past coalitions. Once the fighting was over, Jimmy intended to return the sawbwas to power. They would appeal to their dutiful subjects to come out of the hills; the rebels would lay down their arms and order would be restored. (311)
To implement his plan, Jimmy recruited about a hundred young Shans and equipped them with some of the best military equipment available on Chiangmai's black market: U.S. M-2 carbines at $150 apiece, M-16 rifles at $250 each, U.S. M-79 grenade launchers at $500 apiece, highgrade U.S. jungle uniforms, and Communist Chinese tennis sneakers. General Ly contributed some Nationalist Chinese training manuals on jungle warfare. Confidently, Jimmy set September 1971 as his target date for jumping off into the Shan States, but almost from the beginning his program was hampered by the same problems that had destroyed similar efforts in the past. When September 1971 finally arrived, Jimmy's men were deserting, potential alliances had fallen through, and he had been forced to postpone his departure indefinitely. (312)
Jimmy Yang's men deserted because of the same type of racial and political conflicts that had promoted disunity among previous Shan armies. While almost all his troops were Shans, Jimmy's instructors, like himself and most residents of Kokang, were ethnic Chinese. Since ethnic chauvinism is the most important tenet of Shan nationalist ideology, internal discord was almost inevitable.
In April 1971 Jimmy's deputy commander, a Shan named Hsai Kiao, met with members of U Nu's revolutionary government in Bangkok and presented Shan grievances. U Nu's assistants offered no major concessions, and several weeks later Hsai Kiao moved to Chiangrai, opening his own camp in the Huei Krai area. Shan recruits continued to desert to Hsai Kiao, and by September U Nu's northern command was a complete shambles. Jimmy was losing his men to Hsai Kiao, but Hsai Kiao, lacking any financial backing whatsoever, was sending them off to work in the mines at Lampang to raise money, Hsai Kiao plans to save enough money to buy a shipment of automatic weapons in Laos, pack them into the Shan States, and trade them for opium. With the profits from the opium-arms trade he eventually hopes to build up a large enough army to drive the Burmese out of Kengtung State. (313)
While Jimmy Yang's troop training program had its problems, his attempts at forging political alliances with local warlords encountered an insuperable obstacle-William Young. After he finished a fund-raising tour in the United States, William Young returned to Chiangmai and began building support for U Nu among the hill tribes of the eastern Shan States. Prior to making contact with Lahu and Wa leaders, Young spent months gathering precise data on every armed band in the eastern Shan States. He concluded that there were about seventeen thousand Lahu and Wa tribesmen armed with modern weapons. If only a fraction of these could be mobilized, U Nu would have the largest army in eastern Burma. (314)
Young began sending personal representatives to meet with the more important tribal leaders and arranged round table discussions in Chiangmai. In the mountains north of Kengtung City, the Young name still commands respect from Lahu and Wa Christians, and the enthusiastic response was to be expected. (315) However, Young's success among the animist Lahu south and west of Kengtung City was unexpected. The Young family's divinity in these areas had been preempted by an inno vative Lahu shaman, known as the "Man God" or "Big Shaman." In mid 1970, when William Young convened an assembly of Lahu chiefs at Chiangmai, the "Man God" sent one of his sons as a representative. When it was his turn to speak, the son announced that the "Man God" was willing to join with the other Lahu tribes in a united effort to drive the Burmese out of the Shan States. (316)
After receiving similar commitments from most of the important Lahu and Wa leaders in Burma, Young approached U Nu's war council without Jimmy's knowledge and requested $60,000 for equipment and training. The council agreed with the proviso that the money would be channeled through Jimmy Yang. In August 1970 Young arranged a meeting between himself, Jimmy, and the tribal leaders to reach a final understanding. When Jimmy adopted a condescending attitude toward the Lahu and Wa, they conferred privately with Young, and he advised them to withhold their allegiance. Young says that all the chiefs agreed to boycott the UNLF until they were confident of full support and claims that none of them are willing to work with Jimmy. (317)
Given these enormous problems, neither U Nu nor Jimmy Yang seems to have a very promising future in the Shan States. In fact, Jimmy feels that the Burmese Communist party and its leader Naw Seng are the only group capable of restoring order to the Shan States. According to Jimmy, Naw Seng and the Communists have all the assets their rivals seem to lack. First, Naw Seng is one of the best guerrilla strategists in Burma. During World War II he fought behind Japanese lines with General Wingate's British commando unit, the Chindits, and was awarded the Burma Gallantry Medal for heroism. Like many Kachin veterans, he enlisted in the First Kachin Rifles after the war, and quickly rose to the rank of captain and adjutant commander. (318) The First Kachin Rifles were sent into Communist-controlled areas, and Naw Seng played such an important role in the pacification program that one British author called him "the terror of the Pyinmana Communists." However, many prominent Burmese took a dim view of Kachins attacking Burmese villages under any circumstances, and there were reports that Naw Seng was about to be investigated by a court of inquiry. Faced with an uncertain future, Naw Seng and many of his troops mutinied in February 1949 and joined with Karen rebels fighting in eastern and central Burma. (319)After leading a series of brilliant campaigns, Naw Seng was driven into Yunnan by the Burmese army in 1949. Little was heard of him until 1969, when he became commander of a Communist hill tribe alliance called the Northeast Command and went on the offensive in the Burma-China borderlands. (320) In March 1970 the Communists captured three border towns, and by mid 1971 they controlled a fourhundred-mile-long strip of territory paralleling the Chinese border.
While Naw Seng's tactical skills are an important asset, Jimmy Yang feels that the Communists' social policies are the key to their success. Instead of compromising with the warlords, the Communists have driven them out of all the areas under their control. This policy has apparently resulted in a number of violent confrontations with the Kachin Independence Army, the remnants of Chan Shee-fu's forces, and government militi leaders such as Law Sik Han and Bo Loi Oo. In each case, the Communists have bested their rivals and pushed them steadily westward. Once in control of some new territory, the Communists have abolished the opium tax, which has impoverished the hill tribes for the last fifteen years, and encouraged the people to substitute other cash crops and handicraft work. In addition, the Communists have distributed salt, started a public health program, and restored public order. As a result of these measures, they have been able to develop a mass following, something that has eluded other army groups for so long. However, a crop substitution program takes up to five years to develop fully even under the best of circumstances, and so opium production has continued. Hill traders buy opium from villagers inside the Communist zones and transport it to such market towns as Lashio and Kengtung, where it is sold to g vernment militia, KMT buyers, pnd private opium armies. (321)