Sipsey Street Exclusive: "In at the beginning." The State Department & the Gunwalker Scandal. Part 1. "To take the fight to the Mexican drug cartels."

James Steinberg, former Deputy Secretary of State.

It began auspiciously.

Obama Eyeing Jim Steinberg As Deputy Secretary Of State, Official Says

Barack Obama is leaning towards appointing former deputy national security adviser Jim Steinberg as his Deputy Secretary of State, a well-connected Democratic source tells the Huffington Post.

The potential appointment of Steinberg -- an Obama adviser during the campaign, respected voice on international affairs, and Clinton-era national security official -- is significant for a variety of reasons, none more so than what it could mean for the department as a whole.

With Sen. Hillary Clinton reportedly set to accept the job of Secretary of State, questions have surrounded which other figures would fill out the staff. Steinberg is not a Clinton loyalist -- like, say, Richard Holbrooke -- having counseled Obama during the primary. He is well regarded throughout the party, known, as his former Brookings Institute colleague Michael O'Hanlon put it, as "an incredible networker, but someone who masters the substance as well." According to the New York Times, Clinton had been "reassured" by Obama that she "could select her own staff" as Secretary of State.

Steinberg has been rumored to be in the running for the post of national security adviser. Should he end up at State, that would almost certainly clear the NSA path for retired four-star general and former Marine commandant Jim Jones, who has been discussed as the frontrunner for the spot regardless.

Two other names that were once floated for that post no longer appear to be in the running. Greg Craig has taken the job of counsel to the president. Susan Rice, one of Obama's chief foreign policy aides on the campaign trail, has been thought to being heading towards an advisory role, a deputy position at the National Security Council, or the post of ambassador to the United Nations.

A former Clinton aide, discussing the construct of an Obama cabinet, noted that Craig and Rice were two of the most vocal critics of Sen. Clinton's foreign policy capacity and gravitas during the Democratic primary. It didn't seem coincidental, the source said, that they would not be working alongside Clinton in the future administration.

Steinberg took office as Deputy Secretary of State on January 28, 2009

A little more than two years later, it was announced that Steinberg's time in the Obama State Department was over. From the New York Times, 30 March 2011:

The State Department’s No. 2 official, James B. Steinberg, is leaving to become dean of the Maxwell School at Syracuse University, Secretary of State Hillary Rodham Clinton said in a letter to her staff Wednesday. President Obama plans to nominate William J. Burns, the undersecretary of state for political affairs, to succeed Mr. Steinberg as deputy secretary.

Mr. Steinberg’s departure is not a big surprise: there had been rumors he wanted to return to academia for some time. He had been dean of the Lyndon Johnson School of Public Affairs at the University of Texas before joining the Obama administration in January 2009. He also never became particularly close to Mrs. Clinton, despite having served as deputy national security adviser to President Bill Clinton, her husband.

Mrs. Clinton heaped praise on Mr. Steinberg, describing him as an “indispensable” partner. “On every foreign policy challenge, big and small, he has helped formulate our policy and oversee its execution,” she wrote. Mr. Steinberg, she said, played “Oscar to Jack Lew’s Felix,” referring to Jacob J. Lew, her other deputy, who left earlier this year to become Mr. Obama’s budget director.

With his occasionally brusque demeanor, Mr. Steinberg is a contrast to the affable Mr. Lew. But together the two were a formidable team: Mr. Steinberg the foreign-policy thinker, Mr. Lew the budget whiz and skilled operator on Capitol Hill. Mr. Lew was replaced by a Morgan Stanley executive, Thomas Nides.

Mr. Steinberg devoted a lot of attention to Asia, patching up strains with Japan over an American airbase there and mobilizing pressure on North Korea over its nuclear program and aggression toward South Korea. He traveled frequently to China, working to stiffen Beijing’s response to the North Korean leader, Kim Jong-il. Mr. Steinberg also worked on issues involving Israel and the Balkans.

A year ago, there were reports that Mr. Steinberg was a candidate to be dean of the Edmund A. Walsh School of Foreign Service at Georgetown University, which he denied. Like the Lyndon Johnson School, the Maxwell School at Syracuse is a highly regarded graduate school for public affairs.

The Taipei Times reported his departure with barely disguised glee.

US Deputy Secretary of State James Steinberg, a pro-China diplomat with little sympathy for Taiwan, has resigned and will return to academia. He is to be replaced by William Burns, a Middle East expert who is currently undersecretary for political affairs and the department’s third-ranking official.

The move is unlikely to have an immediate impact on US-Taiwan relations at a time when Washington is preoccupied with developments in the Arab world.

Announcing Steinberg’s departure on Wednesday, US Secretary of State Hillary Rodham Clinton said: “Jim has been particularly instrumental in shaping our renewed engagement in the Asia-Pacific.”

“From managing our expanding relationship with China, to reaffirming our historic alliance with Japan, to addressing challenges on the Korean Peninsula, Jim has been at the center of shaping our efforts,” she said.

Clinton said Steinberg had been a “fixture” at meetings with the National Security Council (NSC) and frequently represented the US State Department at the White House. (Emphasis supplied, MBV.)

Insiders said Steinberg has been at least partly responsible for US President Barack Obama’s decision to put Taiwan’s request to buy advanced F-16 aircraft on the backburner. He is said to have argued in private that F-16 sales to Taiwan would not result in enough benefits to justify upsetting Beijing.

US-Taiwan Business Council president Rupert Hammond-Chambers said US decisions regarding Taiwan were made collectively through an interagency process, coordinated by the NSC.

“That said, Steinberg did have the power to say no. It was a power he exercised reflexively when it came to Taiwan,” he said.

“I believe his actions spoke volumes for his view of Taiwan and the issues he believed it created for the US-China relationship. We can only hope that his successor takes a more balanced view of American interests on Taiwan and injects some badly needed ambition into our goals for US-Taiwan relations,” he said.

“I’m hopeful that a reassessment of our Taiwan policy will accompany the change,” said Walter Lohman, director of Asian studies at the Washington-based Heritage Foundation.

“US-Taiwan relations right now are going nowhere. Steinberg was a well-known advocate for closer relations with China and I think that tendency was undermining movement in US-Taiwan relations,” Lohman said. . .

Steinberg will be remembered for his “strategic reassurance” policies toward Beijing.

Analyzing these policies in the Wall Street Journal, Kelley Currie, a nonresident fellow at the Project 2049 Institute, wrote: “There is a chance that the US is starting a quiet but important strategic shift away from a policy that incorporates an understood, if often inchoate, desire to see China become a more liberal and democratic society, toward an acceptance of China as a permanent authoritarian state.”

Gerrit van der Wees, editor of the Washington-based Taiwan Communique, said Steinberg was “too soft on China.”

“On Taiwan, Steinberg regrettably clung too much to old ‘one China’ policy mantras and was not able to engage the US in more creative thinking and action in support of Taiwan’s democracy and international space. He also was overly cautious on US arms sales to Taiwan,” he said.

Taiwan, along with Hillary Clinton, was glad to see the professional backside of James Steinberg. Steinberg's last day as Deputy Secretary of State was 28 July 2011.

Since early March, this reporter has been using what sources I could find to explore what the State Department knew about the Gunwalker Scandal and when they knew it. Two names kept popping up in the mixture of whispered facts and gossip. One was James Steinberg. He was, I was told, "In at the beginning."

As the highest ranking Obama loyalist at State (and the political marriage of convenience that made Hillary Clinton Secretary of State automatically divided loyalties at Foggy Bottom between "hers" and "his"), Steinberg was, as Hillary said, "a 'fixture' at meetings with the National Security Council (NSC) and frequently represented the US State Department at the White House" simply because he was the most welcome of the senior State department officials. Steinberg was the most welcome, and the heir apparent with the ear of President should Hillary ever put a wrong foot forward or tire of the job. She did neither.

So Steinberg was left in an odd position that he didn't relish. He was wired in to the NSC and the President yet singularly powerless to shape foreign policy in the face of Hillary's ability to get what she wanted. Said one long time State watcher: "Hillary always valued loyalty above everything and Steinberg wasn't loyal." Steinberg was seen as a "traitor" to the Clintons because he had previously been in the Clinton administration but had backed Obama in the primaries. He wasn't as bad in the eyes of the Clintonistas as some of the other Obama partisans like Greg Craig and Susan Rice, so he was accepted, without grace, as "Obama's man at State."

One of the first subjects Steinberg was called upon to deal with was security on the Mexican border. Something had to be done, and the Obama administration decided upon a surge to the border.



On 24 March, Steinberg participated with DHS Secretary Napolitano and Deputy Attorney General David Ogden in a press conference on U.S.-Mexico Border Security Policy. This press conference, preceded a visit by Hillary Clinton to Mexico City. Here is the policy announcement that preceded what became the Gunwalker Scandal.



I present the transcript here in its entirety because it is, in its own way, a foundational document of the Gunwalker Scandal.

Press Briefing by Napolitano, Steinberg and Ogden on U.S.-Mexico Border Security Policy

Secretary of Homeland Security Janet Napolitano, Deputy Secretary of State Jim Steinberg and Deputy Attorney General David Ogden gave this press briefing on border security issues between the U.S. and Mexico. They described "the administration's comprehensive response to the situation along with the border with Mexico" under the Merida Initiative and other programs.

Mr. Gibbs: Good morning, guys. I want to discuss an issue that's very important to the President this morning -- the steps we are taking on both sides of the border, working with our Mexican partners to support the Mexican government's campaign against the violent cartels and to reduce contraband in both directions across the border.

Under the Merida Initiative, we're investing $700 million this year to work in collaboration with Mexico on law enforcement and judicial capacity. DHS, DOJ and Treasury are all ramping up personnel efforts directed at the Southwest border. We're renewing our commitment to reduce the demand for illegal drugs here at home. The President admires President Calderón's courage and determination to confront and dismantle the drug cartels, and we stand shoulder to shoulder with him in that fight.

Mexico undoubtedly faces serious challenges, but it is vigorously confronting them. Mexico's drug-related violence is carried out among the warring cartels and against government forces.

The U.S.-Mexico relationship is getting sustained high-level and comprehensive attention. President-Elect Obama met with President Calderón in January. Chairman Mullen visited Mexico on March 5th and 6th. Secretary of State Clinton goes to Mexico tomorrow. And Secretary Napolitano and Attorney General Eric Holder visit April 1st and 2nd, all ahead of the President's visit on the way to the Summit of the Americas April 16th and 17th.

Because this effort has so many facets, the U.S.-Mexico relationship and our efforts to help address the increase in violence in Mexico are being coordinated with the White House through the National Security Council and the Homeland Security Council.

Today, Department of Homeland Security Secretary Janet Napolitano, Deputy Secretary of State Jim Steinberg, and U.S. Deputy Attorney General David Ogden will lay out the administration's comprehensive response to the situation along with the border with Mexico, and will take a few questions.

So let me hand it off to a return guest to the briefing room, Secretary Napolitano.

Secretary Napolitano: Thank you. Good morning. There are a number of issues involved, a number of actions being undertaken by DHS in conjunction with the Department of State, the Department of Justice, with respect to Mexico. And I'm just going to go through a whole inventory of actions that are underway. Some we have already undertaken in the last several weeks; others are being taken either today or in the immediate future.

First we are doubling the number of law enforcement personnel that are working in border-enforcement teams along the border. These are called BEST teams. These are teams that combine state and local with ICE and CBP personnel. Every state along the border will now have BEST teams. New Mexico previously had not had one. But just to give you a sense of how effective they are, they have already made more than 2,000 criminal arrests and seized nearly 8,000 pounds of cocaine.

We are also strengthening Operation Armas Cruzadas. This is our operation where we work to seize arms that are going south to be used in this violent war in Mexico.

Just this past week, March 7-13, we seized 997 firearms in one week that were going into Mexico, along with $4.5 million in conjunction with those firearms. So that is underway.

We are tripling the number of Department of Homeland Security Intelligence Analysts located on the Southwest border.

We are increasing the ICE -- that's Immigration and Custom Enforcement -- Attaché personnel in Mexico by 50 percent. These will primarily be located in Mexico City, working alongside the Attorney General of Mexico.

We will be increasing our efforts on what's called Operation Firewall; this is a Treasury-directed initiative that's designed to interdict money laundering that is going back and forth between the drug cartels in Mexico and where they get the cash, which is in the United States.

We are doubling the number of agents in our violent crime alien sections along the border. This is designed to prosecute violent recidivist aliens.

We're quadrupling the number of border liaison officers. This is designed to make sure -- these officers work between us on the border and Mexican law enforcement on the border -- make sure that things are properly coordinated and goes smoothly.

We are bolstering technology and resources with a significant increase in our biometric identification deployment. What does that mean? What that means is the capacity of state and local law enforcement on the border to run fingerprints on people they've apprehended, that are in the jails and so forth, to make sure they've been run through the ICE databases among other things to identify whether they are criminal aliens.

We are embarking on increased screening of rail that goes south from the United States into Mexico. There are in reality only eight rail lines that actually transverse that border, so we are working to have 100 percent screening on those rail crossings into Mexico.

We are moving mobile X-ray units to the border. These will be used to help identify anomalies in passenger vehicles. Well, what does that mean? That means we're trying to identify vehicles that are carrying arms into Mexico that are being used in the drug war in Mexico.

We are moving today 100 more CBP personnel to the border to do outbound inspections. We are moving 12 teams of cross-trained dogs. They can be used to detect both weapons and currency to the Southwest border. We are moving three mobile response teams of Border Patrol agents to deploy to the border. And we're increasing the number of license plate readers on -- to look for the plates of suspected smugglers.
They will be deployed, again, to the outgoing lanes and ports of entry.

In terms of grant funding, Operation Stonegarden, we are changing the grant guidance for our remaining balances in that grant pool. It will be immediately modified to focus $59 million to enhance current state, local, and tribal law enforcement operations and assets along the border. And we will expand the scope of Operation Stonegarden funds to pay for additional law enforcement personnel, overtime, travel, and the like for deployment of state and local tribal officials to the border.

In addition, we are engaging state and local law enforcement in a way I don't think has been done previously with regular calls and conferences with state and local law enforcement in those border areas, in those border counties. So we really get a better sense of what's happening on a real-time basis in this issue with -- in this battle, actually, that is ongoing in Mexico.

Let me just say there are a number of other actions being undertaken, and you'll hear DOJ and Department of State here in a minute.

One question I anticipate you'll ask is where are we with the National Guard. And we are still considering and looking at that. One of the things I wanted to be able to do is to meet with the Governor of Texas, to ask specifically what he is thinking about with respect to Guard along the Texas-Mexico border. I will see him on Thursday; I'll be in Texas to meet with him. And as you just heard, both the Attorney General and I will be in Mexico next week to consult with the Minister of the Interior there and the Attorney General about what other actions can be taken.

Our goal is twofold. One is to provide assistance to the government of Mexico, to break up these huge cartels which are funneling tonnage quantities of illegal drugs into our country on a regular basis, and are conducting this war of violence within Mexico that has resulted in over 6,000 homicides, over 550 of which were assassinations of law enforcement and public official personnel.

The second is to guard against an increase in violence in the United States as a result of the actions undertaken in Mexico.

We've seen some increase in violence between -- primarily between cartels, themselves -- kidnappings, for example, in the Phoenix area and the Houston area. But what we want to do is to better secure the border area against further violence and make it a safe and secure area where, of course, the rule of law is upheld and enforced. So that gives you an inventory of all the things that are happening right now with respect to homeland security and the border in this very, very important initiative.

And now I think it's your turn. Thank you.

Deputy Secretary Steinberg: Thank you, Madam Secretary. Good to be back in the briefing room.

I just want to put this effort in the context of our broader relationship with Mexico. This partnership between the United States and Mexico is as important as any bilateral relationship that we have and extends not only to these critical questions of counter-narcotics and law enforcement, but the full range of issues that engage our two countries.

And as Robert said, this is part of what has been a very clear effort by this administration from the beginning to build and strengthen that partnership, beginning with the President's meeting with President Calderón before inauguration -- carrying on that very important, very special tradition -- to the Secretary's visit tomorrow to Mexico, where she'll be engaged with President Calderón and her counterparts, talking about not only our partnership in dealing with crime, law enforcement and counternarcotics, but some of the broader issues that engage our two countries dealing with the G20 summit that's coming up, where Mexico will be a key partner: the U.N. Security Council, where Mexico sits on the Security Council; the upcoming Summit of the Americas; climate change, another area where Mexico has taken an important leadership role.

And so we have a very rich agenda with Mexico. But one of the things clearly that has been important to both countries is this deep partnership to deal with the problems of narcotics, law enforcement and violence. It's a partnership that began clearly in the previous administration, with the Merida Initiative, which is a comprehensive partnership between the two countries to deal with a full range of issues associated with crime and violence along the borders and in Mexico. It represented a profound and strategic commitment by President Calderón to address these deep challenges, which not only affect us here in the United States, but profoundly affect the safety and security of citizens in Mexico.

That partnership really is quite comprehensive. It deals not only directly with the border issues that Secretary Napolitano had talked about, but more profoundly with the law enforcement and criminal justice system in Mexico dealing with legal reform, dealing with issues of corruption, dealing with issues of strengthening the capacity of the Mexican state to meet these challenges, which are so important to our common well-being. It's an effort that has been supported by the Congress, on a bipartisan basis. It is an effort that involves every -- almost every agency in the federal government. The State Department has played a key role as the chair of the high-level Merida Group, which brings together all of the key agencies in our government with their counterparts in Mexico. But it also extends to dealing with some of the systemic challenges that Mexico faces as it deals with the crime and drugs problem, including creating economic opportunity, strengthening education in Mexico, bringing technology to bear on both sides of the border to deal with these challenges.

And so it really is quite a unique and comprehensive set of engagements that really represents an important commitment by both of us to deal with this problem, the challenges in this. And it's something that we deal with not only bilaterally but also in regional contexts with the core Central American countries, which are also an important component of addressing this problem, as well as a number of the countries in the Caribbean.

So let me turn it over to David.

Deputy Attorney General Ogden: Thank you, Jim. Under the President's leadership, and together with the State Department and DHS, the Department of Justice stands ready to take the fight to the Mexican drug cartels.

We're all concerned about the increased levels of violence in Mexico, and we very much admire the courage and resolution of our Mexican counterparts who are bravely confronting these cartels in their own backyard. And we'll resolve to do everything we can to work together with them to destroy these criminal organizations.

For more than a quarter century, U.S. law enforcement agencies have recognized that the best way to fight the most sophisticated criminal enterprises is through intelligence-based investigations to target the greatest threats. Under the leadership of the Justice Department, the command and control of La Cosa Nostra, which was once the most powerful organized-crime group operating in the United States, has been effectively dismantled, with many of its most senior leaders behind bars. Built on this same approach, and together with our Mexican counterparts, the Department's Mexican cartel strategy confronts those cartels as criminal organizations rather than simply responding to individual acts of violence.

That strategy is carried out by prosecutor-led, intelligence-based task forces that bring together all DOJ and DHS and other relevant law enforcement agencies to disrupt and dismantle the drug cartels through investigation, prosecution, extradition of their leaders, and the seizure and forfeiture of their assets.

As we've found with other large criminal groups, if you take their money and lock up their leaders, you can loosen their grips on the vast organizations that are used to carry out their criminal activities. Attorney General Holder and I are committed to taking advantage of all Department resources and those of associated agencies to target the Mexican cartels. We will investigate and prosecute the criminals who smuggle drugs into the United States and distribute and sell them in our cities and towns. We will also investigate and prosecute those who smuggle guns, bulk cash and contraband from the United States to Mexico.

Just last month, the Attorney General announced the arrest of more than 750 individuals on narcotics-related charges under Operation Accelerator, a multi-agency, multinational effort that targeted the Mexican drug-trafficking organization known as the Sinaloa cartel. Through Operation Accelerator, prosecutors and federal law enforcement agencies, led by DEA, delivered a significant blow to the Sinaloa cartel by seizing $59 million, hundreds of firearms, and more than 12,000 kilograms of cocaine and 12,000 pounds of methamphetamine.

A similarly sweeping DOJ-led initiative against the Gulf cartel, announced in September 2008, called Project Reckoning, produced similarly dramatic results. The President has directed us to take action to fight these cartels. And Attorney General Holder and I are taking several new and aggressive steps as part of the administration's comprehensive plan.

Those steps include the following: DOJ's Drug Enforcement Administration, which already has the largest U.S. drug enforcement presence in Mexico, with 11 offices in that country, is placing 16 new DEA positions in Southwest border field operations, specifically to target Mexican trafficking and associated violence.

The DEA is also deploying four new mobile enforcement teams to specifically target Mexican methamphetamine trafficking, both along the border and in U.S. cities impacted by the cartels.

DOJ's Bureau of Alcohol, Tobacco, Firearms and Explosives is increasing its efforts by adding 37 new employees in three new offices, using $10 million in Recovery Act funds, and redeploying 100 personnel to the Southwest border in the next 45 days to fortify its Project Gunrunner, which is aimed at disrupting arms trafficking between the United States and Mexico.

ATF is doubling its presence in Mexico itself, from five to nine personnel working with the Mexicans, specifically to facilitate gun tracing activity, which targets the illegal weapons and their sources in the United States.

DOJ's Office of Justice Programs is investing $30 million in stimulus funding to help state and local government and law enforcement combat narcotics activity along the Southwest border and in high-intensity drug trafficking areas. Additionally, the state and local law enforcement in those areas can apply for COPS and Byrne Justice Assistance Grants, a total of $3 billion of which were provided in the stimulus package.

DOJ's Organized Drug Enforcement Task Forces Program, or OCDETF, is adding personnel to its strike force capacity along the Southwest border.

And the FBI is stepping up its efforts in the region by creating a Southwest intelligence group, focusing its activities on -- increasing its focus on public corruption, kidnappings and extortion related to the cartels' activities.

As the Department did in dismantling La Cosa Nostra, these new resources will build on the framework already in place to disrupt and dismantle the Mexican drug cartels.

Mr. Gibbs: Let's take a couple questions.

Question: Madam Secretary, first for you, can you tell us, does this effort suggest a shift in the thrust of the agency's mission from preventing terrorism to preventing the spread of organized crime?

And for you, Deputy Secretary, if you could tell us -- statements by the Mexican President suggest that Mexico is a bit miffed right now about some of the statements that have been made about Mexico by this administration. Is there a new commitment that Secretary Clinton is taking with her when she goes to Mexico tomorrow? Thank you.

Secretary Napolitano: Yes. No, our Department is always engaged in the fight on terrorism. This Department was stood up in the wake of 9/11. It is a central tenet of our Department, and those efforts are ongoing and, if anything, stronger now than perhaps before.

But our Department has a very broad mission; we have to be able to multitask. And as we multitask, one of the things that has happened -- one of the changes in the threat environment has been what is going on in Mexico.

So we need to make changes in order to deal with that particular threat. And again, it's twofold. One is, we want to help our colleagues in Mexico, but it does have an impact on safety and security within the United States.

So it's not only consistent with the Department of Homeland Security's mission, but it is one of the ongoing threats to safety and security today.
But to return to the beginning of your question, the answer is, absolutely not. And we will always be embarked on that fight.

Deputy Secretary Steinberg: I think the Secretary's trip is part of this broader effort by the administration, really from the beginning, to demonstrate that we really see this as a critical partnership and one that requires as much high-level attention as any bilateral relationship that we have.
The President already developed his own ties with President Calderón. The fact that he will be making an early visit himself to Mexico before the Summit of the Americas really represents the importance that we attach to it.

The Secretary I think really wants to stress that while we have a critical set of issues that we need to deal with in terms of law enforcement, counternarcotics, guns and the like, and the violence problem, that we really value Mexico a partner across the board. And the leadership that President Calderón has showed in courageously taking on this challenge, which is vital to the well-being of his own country, but also across the board, in showing leadership in so many different areas. And Mexico is stepping out, not just in the hemisphere but globally, to play a big role in the G20, showing great leadership on the climate change agenda, one of the first of the recently emerged developing countries to take a major commitment to reduce greenhouse gases.

So I think we want to give a very strong signal, and her visit I think will emphasize the fact that we really appreciate this remarkable leadership we're seeing from Mexico and the importance of this partnership that we've been building.

Question: I think a lot of people along the border, particularly in Texas, who were hoping for a large influx in personnel are going to look at the announcements today as pretty modest and incremental. How do you assure those folks who are looking for hundreds or even thousands of troops or border personnel that this is really going to protect Americans in their security?

Secretary Napolitano: Well, first of all, it is a very robust movement of personnel. DHS alone, it's 350 specifically dedicated to cartel -- in addition to what we already had moved there. So it is a very robust movement.

Secondly, empowering state and local law enforcement and helping them with their resources by moving millions and millions of dollars to them along the border is a very robust move. So when I say we're moving $59 million of Stonegarden money, that's money that will immediately become usable by local police departments, sheriffs' departments and the like along the border.

And the third is, the border itself has a number of assets already located there -- thousands, actually, located along the border. So there's already a very, very heavy federal presence. We add to it, we target, we dedicate. And then, as I said earlier, I anticipate that there will be more announcements as we work with Mexico and work through this drug cartel issue.

So, if anything, this is really the first wave of things that will be happening. And we're already seeing, I think, some changes along the border. For example, the communities at the border towns themselves, some of them are actually reporting a decrease in violent crime. The issue is, obviously, can that be sustained over time and what needs to happen over time for that to continue.

So this is going to be an ongoing piece of very, very significant work.
Question: Can I follow up on that?

Mr. Gibbs: Yes.

Question: Can you explain the $700 million that is from the package, it's additional to the Merida Initiative funds already --

Deputy Secretary Steinberg: The $700 million is the existing appropriations for the Merida Initiative. As you know, we've committed a total of $1.4 billion over three years. And so we'll be looking forward to additional funding in the FY 2010 budget for Merida.

Question: So the five helicopters -- are the helicopters already approved?

Deputy Secretary Steinberg: Correct. Those are already approved.

Question: Second, Secretary Gómez-Mont that you saw last week. After the meeting with you, he give us a press conference, to the Mexican media, and told us that he found doubts on the U.S. government in terms of sharing intelligence with the Mexicans, because the -- there are corruption in the high levels of government in Mexico. Is that true? Can you explain to us why you have doubts on that?

Secretary Napolitano: Have doubts, is that what you said?

Question: Doubts of giving information, intelligence information, to the Mexican authorities, because you have the problem of -- in Mexico, has the problem of drug corruption at the high levels of the government.

Secretary Napolitano: It has been a problem in Mexico.

Question: -- said you have doubts to share information with Mexico.

Secretary Napolitano: And that's why the meeting with the Minister of the Interior, the Attorney General of Mexico, that I've had over the last two weeks have been so important, because we need to be able to share information. We want to share it, and we want to make sure that it doesn't get into the hands of the cartels. And historically, that has been a problem with respect to intelligence sharing in Mexico. I think we all recognize that.

But I also think we have in place some tools to deal with that. And one of the initiatives under Merida is to recruit law enforcement personnel in Mexico. And that, in and of itself, will be an anti-corruption measure.

Question: I have a question here. Mexico has always complained that part of the reason they have this huge drug-trafficking problem is because of U.S. consumption of drugs here. So I was wondering if your plan encompasses some sort of plan to fight against consumption here.

And on the other hand, restrictionist groups in the U.S. have said that this is all the more reason why the border wall needs to be completed. Can you tell us what's going on with the completion of the wall along the border?

Secretary Napolitano: With respect to demand, yes, that is part and parcel and needs to be. This is a supply issue and it's a demand issue. In the stimulus package, there was approximately $70 million for drug courts, which have been very effective in reducing recidivism among drug offenders. I look forward to working with the new head of the National Drug Control Office to see what else can be done to increase our demand-reduction programs. But that obviously has to be a part.

In terms of the wall itself, we are going to complete the sections that had already been begun and for which there already were appropriations. To the extent we request any other sections it will part and parcel of a system that includes technology and manpower. But if you've ever worked on these cartel cases, as I have as prosecutor, you know that a wall is not the best way to spend our dollars to prevent these drugs from coming into the United States and to be able to apprehend and prosecute the smugglers themselves.

Question: Madam Secretary, you said that this is -- this is all taking place right now. So we are to understand that the plan that you detailed previously, that personnel, that new personnel, is already there in place? Or they will be moving into their positions --

Secretary Napolitano: It's both.

Question: It's both.

Secretary Napolitano: It's both. Some have already started; some are in the process of moving. Obviously, you know, you've got to get agents and they've got to actually physically move to the border and all the rest. So some of it is underway; some are already there.

For example, I mentioned the screening of rail going southbound along those eight rail lines -- that has already begun. But the additional 100 Border Patrol agents that are only going to focus on southbound interdictions, that's underway. So it's both.

Question: And by -- when do you hope to have everything in place?

Secretary Napolitano: Well, I think it's going to be ongoing, but the things I've mentioned today are all things that will be completed within, at the longest, 90 days.

Mr. Gibbs: Yes, sir.

Question: Madam Secretary, do you already have an assessment of what are the risks if the Mexican government fails in this struggle against the drug smugglers?

Secretary Napolitano: Yes. I believe that the Mexican government will not fail, and I believe that our role is to assist in this battle because we have our own security interest in its success. But yes, one of the things we do at the Department is to plan for even the most remote contingencies, and we have those plans. But even to say it, I think, overestimates the situation.

Question: Can I follow on that, Madam Secretary?

Question: Yes, Madam Secretary, on the issue of arms, part of the problem -- I mean, the question basically is, do you -- how success do you expect to be in this effort to clamp down on the trafficking of arms going into Mexico, where part of the problem is, you know, all these (inaudible) along the border? I mean, do you expect to go up against the people who sell these arms, which is part of the problem? I mean, maybe you can be successful in stopping arms, but if you don't do anything -- do something on the source of this illegal business, how can you expect to have a real impact on this issue?

Secretary Napolitano: Several things. One is, first of all, you've got to interdict the arms. You've got to stop them from going into Mexico. That's why we're increasing the southbound inspections. That's why we're moving the technology to the border to help with screening going into the border. We're coordinating with Mexico because they can do more by way of southbound screening on their side of the border.

But then the Department of Justice, moving their agents down there, as David said, and increasing tracing, that will help us identify who are -- who is putting those arms into the arms -- those guns into the arms of the traffickers moving south. And out of that, there can reasonably be seen more prosecution of actual arms dealers who are intentionally and knowingly putting arms into the hands of the smugglers.

So that is part of the reason why the Department of Justice is such an essential part of this initiative on Mexico. (Emphasis supplied, MBV.)

Question: Madam Secretary, what are the most compelling arguments you have heard for and against sending National Guard troops to the border, and what does Governor Perry need to tell you to convince you to do what he's asking?

Secretary Napolitano: Well, the questions for Governor Perry are very logistical in my view: Why 1,000? Where was that -- where did that number come from? Where in Texas? Texas has a huge border with Mexico. And what does he anticipate the Guard doing?

And those are the kinds of things that I think then I will transmit to the Secretary of Defense and the President in the ongoing decision about Guard -- yes/no, and if so how many and where.

Mr. Gibbs: Thank you, guys.

Nothing there about gunwalking is there? Nor is there any mention of Fast and Furious, which had yet to be launched as part of the surge described. But that is the point, say my sources. Policy is strategy enunciated. Tactics flow from strategy. The policy that got the Obama administration into trouble was the surge and the desire, in the words of Napolitano, for "more prosecution of actual arms dealers who are intentionally and knowingly putting arms into the hands of the smugglers."

This fit with the Obamanoids preconceived notion -- promoted by the Brady Campaign, the Mexican Government and other entities -- that the violence in Mexico was a direct result of the access in the United States to civilian market firearms. As we will see in "In at the beginning," Part 2, it was this obsession, translated into policy, that laid the predicate for the Gunwalker Scandal. And the State Department was a full participant in the policy that led to gunwalking, for they were "in at the beginning."