One of the CIA’s strategic objectives had been to provoke an attack by China across the Burmese border in retaliation for forays by the KMT. This plan misfired, however. In 1961 the Chinese did indeed launch a drive into the Shan States, but at the request of the Burmese government to deal, once and for all, with the KMT. The People’s Liberation Army drove the KMT remnant into Thailand, where it settled outside Chiang Mai. After this operation, the Burmese army discovered a fresh cache of weapons and supplies at the former KMT base, still in boxes with US markings, and containing more than five tons of ammunition and hundreds of rifles and machine guns. They also discovered more than a dozen opium-processing labs.
The CIA’s liaison to the KMT at its new quarters in Thailand was William Young, the son of a Baptist missionary. Young had joined the CIA in 1958 and quickly proved himself to be one of the Agency’s most capable hands, and one of the few CIA men respected by the tribal leaders. Young had been born in the Shan States and used his intimate knowledge of the culture and his fluency in the difficult languages of the hill country to recruit the local tribesmen as surrogate warriors in the CIA’s operations across Southeast Asia. Young was more than willing to indulge his hill tribe mercenaries in the opium trade with the excuse that “[a]s long as there is opium in Burma somebody will market it.”
In 1963 Young recruited KMT soldiers into a raiding force that led attacks on villages in northern Laos believed to be sympathetic to the Communist Pathet Lao. From 1962 to 1971 Young’s mercenaries carried out more than fifty cross-border ventures into China, where they monitored truck traffic and tapped phone lines. These expeditions were propelled by the CIA’s fear that China might intervene in Laos and Vietnam. His recruits were trained by the Thai secret police, taken to Mong Hkan, a CIA base near the Burma–China border, then from Mong Hkan into China using the Shan opium caravans as cover. The mules that carried bags of opium also packed radios and surveillance equipment.
Adapted from Whiteout: the CIA, Drugs and the Press