"COCA IS MORE THAN A PLANT, more than an herb," Gaston Ugalde told us as we sat in his studio in La Paz's bohemian Sopocachi neighborhood on my first evening in the 13,000-foot-high capital. Ugalde, Bolivia's most popular artist, is a wild-looking man in his early sixties, with shoulder-length gray hair and a thick beard and mustache that suggest Jesus Christ by way of an aging Jim Morrison. "Coca leaf brings people together. It's a means of communication," he went on in painstaking but near-flawless English, which he'd picked up as an art student in Vancouver decades ago. "You chew, you drink, you talk. It is great for your health, your stomach, your teeth—it has a lot of positive aspects to it."

It was one week before our soggy hike through the jungles of Chapare, and Abramson, who has lived in Bolivia for two and a half years, led me to Ugalde, the shaggy prophet of the coca revolución. Born and raised in La Paz, Ugalde has been billed as Bolivia's Andy Warhol, churning out playful, pop-arty collages, sculptures, and paintings filled with references to the country's indigenous culture. Ugalde has been a devotee of coca since he was in his twenties, and over in the corner was the reason we'd chased him down: a series of collage portraits—Aymara Indians, obscure Bolivian leftists—done entirely with coca leaves. Early in his career he studied with William E. Carter, a U.S. anthropologist who spent several years in Bolivia in the sixties and seventies, observing the effects of coca chewing on Andean Indians, who've been using the leaf, a stimulant akin to a powerful energy drink, since well before the rise of the Inca empire. One study's results showed that regular chewers ate more food than non-chewers, which contradicts the view of coca as an appetite suppressant. Ugalde made his first coca-leaf portrait in 1988, to celebrate the beneficial effects. In 2002 he displayed a series of coca portraits in a New York City gallery. Then, last year, Ugalde's artistic passion collided auspiciously with the Bolivian zeitgeist. Shortly after his inauguration, Morales summoned Ugalde to the palace, a grandiose colonial edifice on the Plaza Murillo, in the heart of La Paz, and asked him to make the official presidential portrait—using coca leaf. Coca portraits of Simón Bolívar and Che Guevara followed (all hang prominently in the palace), as did posters that appear on highway signs and in other strategic locations, showing Aymara peasants and a single word: COCA.

To the U.S. government, Ugalde epitomizes everything that's gone wrong with Bolivia since Morales came to power. The country, they say, has become intoxicated with coca. Morales and his cocalero cronies in the government (a coca farmer heads up the anti-narcotics effort) have relentlessly driven home the message that the leaf is a wholesome symbol of Bolivian identity. According to local sources in the Chapare, bands of cocaleros recently raided a U.S.-funded institute promoting alternative-crop development, sent the American scientists and researchers packing, and reopened the place as a college for traditional coca use, run by Cubans and Venezuelans. The Chapare town of Shinahota, epicenter of Bolivia's cocaine trade in the seventies and early eighties, has reportedly been selected as the site of a factory to produce coca flour (used to make bread), set to open later this year, that locals say is being financed by Venezuelan president Hugo Chavez.

Problem is, even with the new flour business, the numbers don't add up. According to surveys, Bolivians need roughly 30,000 acres of coca for "traditional uses," including chewing and consumption of mate de coca (a kind of tea). That amount of coca leaf has long been legally provided by growers in the Yungas region of northern Bolivia. Yet the law that Morales proposed last year would raise the legal cultivation limit of coca in Bolivia to roughly 50,000 acres, and a 2006 United Nations survey states the total acreage as significantly higher—close to 68,000. Some 75 percent of the coca leaf, U.S. officials estimate, is distilled into cocaine base and exported to Brazil and Argentina, as well as Europe and, in small amounts, the United States. "Bolivia is heading back to becoming a major supplier of cocaine in the international drug trade," I was told by one American official in the Chapare. "It's now going to be right up there with Peru and Colombia."

Why would Morales promote a crop whose principal end product is cocaine? After all, angering the United States government may be fine if you're Hugo Chavez, the swaggering president of oil-rich Venezuela (and Morales's close friend in the region, which has lately seen left-leaning presidents come to power in Ecuador, Argentina, Peru, and Nicaragua). But if you're the leader of Bolivia, the poorest country in South America, making an enemy of George Bush may not be the wisest strategy. U.S. officials speculate that Morales believes he's merely making de jure what was a de facto situation: that farmers in the Chapare were already growing about 20,000 acres of the crop illicitly, despite decades of anti-coca policies. A top American official in the Chapare says that Morales has found himself in an impossible position: He owes his presidential victory to the support of the cocaleros, from whose ranks he rose. At the same time, Morales knows that it would be foolish to prevent the Bolivian army and police from taking out cocaine labs and smugglers. His position is that there will be no zero coca, just zero cocaine. His constituency is the growers, after all, not the narcotraficantes. A Western diplomat in La Paz describes Morales's mind-set this way: "His whole history is that of a coca-growing leader. Now combine that fact with his need to feed his political base and the fact that he doesn't see [coca] as particularly harmful. They tell you that 'We're just producing the bullets; you have got to get the gun'. But it's not an intellectually satisfying argument."

I ran into Gaston Ugalde the following evening at Le Comédie, the best French restaurant in La Paz. The artist laureate was holding court at a center table, surrounded by half a dozen beautiful young women. Around town Ugalde is known as a party animal, and his celebrity has grown since he became the official court painter. He spotted me walking in with a friend and flashed a small smile. I told him that before dawn we'd be flying down to Cochabamba, in the Andes, and from there we'd drive to the Chapare, where coca is king. He had a dreamy look in his eyes. "Buen viaje," he said.