MEXICO
CITY
(By
Republic Mexico City Bureau)
February 8, 2010 — For months, the
leaders of Tancitaro had held firm
against the drug lords battling for
control of this central Mexican town.
Then one morning, after months of
threats and violence from the
traffickers, they finally surrendered.
Before dawn, gunmen kidnapped the
elderly fathers of the town
administrator and the secretary of the
City Council. Within hours, both
officials resigned along with the mayor,
the entire seven-member City Council,
two department heads, the police chief
and all 60 police officers. Tancitaro
had fallen to the enemy.
Across Mexico, the continuing ability of
traffickers to topple governments like
Tancitaro's, intimidate police and keep
drug shipments flowing is raising doubts
about the Mexican government's
3-year-old, U.S.-backed war on the drug
cartels.
Far from eliminating the gangs, the
battle has exposed criminal networks
more ingrained than most Americans could
imagine: Hidden economies that employ up
to one-fifth of the people in some
Mexican states. Business empires that
include holdings as everyday as gyms and
a day-care center.
And the death toll continues to mount:
Mexico saw 6,587 drug-related murders in
2009, up from 5,207 in 2008 and 2,275 in
2007, according to an unofficial tally
by the respected newspaper Reforma.
Cartels have multiplied, improved their
armament and are perfecting
simultaneous, terrorist-style attacks.
Some analysts are warning that Mexico is
on the verge of becoming a "narco-state"
like 1990s-era Colombia.
"We are approaching that red zone," said
Edgardo Buscaglia, an expert on
organized crime at the Autonomous
Technological University of Mexico.
"There are pockets of ungovernability in
the country, and they will expand."
For the past decade, he said, parts of
Mexico have been sliding toward the
lawlessness that Colombia experienced,
in which traffickers in league with
left-wing rebels controlled small towns
and large parts of the interior through
drug-funded bribery and gun-barrel
intimidation.
In the latest sign of the cartels' grip,
on Wednesday the National Action Party
of President Felipe Calderón announced
it was calling off primary elections in
the northern state of Tamaulipas because
drug traffickers had infiltrated
politics.
And in Chihuahua, the government is
redeploying troops from the embattled
city of Juarez to the countryside
because of fears that the cartels are
cementing their control in smaller
border towns.
Even Calderón, who a year ago angrily
rebutted suggestions that Mexico was
becoming a "failed state," is now
describing his crackdown as a fight for
territory and "the very authority of the
state."
"The crime has stopped being a
low-profile activity and has become
defiant . . . . plainly visible and
based on co-opting or intimidating the
authorities," he told a group of Mexican
ambassadors last month. "It's the law of
the 'bribe or the bullet.' "
Towns on the ropes
In places like Tancitaro, population
26,000, the battle already may be lost.
In the past year, gunmen killed seven
police officers, murdered a top town
administrator and kidnapped others, said
Martin Urbina, a city official. The
reasons were unclear - most of the town
leaders are in hiding and could not be
reached for comment - but the drug
traffickers were apparently demanding
the removal of certain police officers,
Urbina said.
When the traffickers kidnapped the two
officials' fathers on Nov. 30, it was
the last straw.
"If someone comes and puts a pistol to
your head, what are you going to do?"
said Gustavo Sánchez, who was appointed
by the Michoacan state governor as
interim mayor after the mass
resignation. "It's happening in all of
the states, not just here."
In Vicente Guerrero, in Durango state,
34 of 38 police resigned after the
police chief and four officers were
kidnapped. The victims have not been
found.
In the border town of Puerto Palomas,
the police chief fled to the United
States and asked for asylum in March,
saying Mexican officials could not
protect him. In October, traffickers
killed the town administrator in Puerto
Palomas.
In the northern town of Namiquipa,
traffickers killed the mayor and two top
town officials last year. Police there
are woefully outgunned, police Chief
Jesus Hinojosa said. There are only 15
weapons for 39 police officers.
Often the cartels target city officials
they believe are cooperating with
federal authorities, said Juan Manuel
Bautista, the City Council secretary in
the western town of Novolato, where
traffickers have killed 25 police, two
city councilmen and a town administrator
in the past two years.
Other times, they are simply lashing
back at the most convenient targets, he
said.
"In these small-town governments,
everyone knows your business and who you
are," Bautista said. "If they want to
take revenge on you, it's easy."
Even when governments replace police
chiefs, mayors and town councils, it's
often only a matter of time before the
replacements are bribed, intimidated at
the barrel of a gun or killed, and the
scenario repeats itself, said Bernardo
Gonzalez Arechiga, an expert on crime at
the Monterrey Institute of Technology
and Advanced Studies.
In May, federal officials arrested 10
mayors in Michoacan state on charges of
protecting smugglers.
In June, Mauricio Fernández, a mayoral
candidate in the wealthy Monterrey
suburb of San Pedro Garza Garcia, was
recorded telling a meeting of supporters
that he had negotiated a truce with the
Beltrán Leyva gang as a way of
guaranteeing security in the town.
Fernández later denied any contact with
the gang. He easily won the July 2
election.
Financial octopus
The attempt to dismantle the cartels has
created a new appreciation for how deep
their financial networks go, said Joel
Kurtzman, a senior fellow at the Milken
Institute, an economic think tank in
Santa Monica, Calif.
In many towns, smugglers pay for
playgrounds and other things the
government cannot afford. Bank loans are
expensive and hard to get in Mexico, a
lingering effect of the country's bank
crises during the 1990s, so traffickers
have stepped in to provide
small-business loans.
"What people did not recognize in Mexico
was how deeply ingrained in both the
economy and society the drug trade was,"
Kurtzman said. "So it's not as if the
drug traders are unpopular - they're
looked at in many cities like Robin
Hoods."
Since 2006, the number of Mexican
citizens and companies on the U.S.
Treasury's blacklist of suspected drug
smugglers has nearly doubled, from 188
to 362.
They are as varied as a day-care center
in Culiacan, a gym in Hermosillo and an
electronics company in Tijuana. There
are meat packing plants, horse stables,
dairies, hotels, a mining company and
gasoline stations.
Dozens of those companies are still
operating because Mexican prosecutors
lack few legal tools to shut them down,
Buscaglia said.
In March, the financial magazine Forbes
included Joaquín "Chapo" Guzmán in its
list of the world's billionaires for the
first time. Guzmán, the head of the
Sinaloa Cartel, was listed at No. 701
with a net worth of about $1 billion.
In fact, Guzmán's cartel and other gangs
probably bring in $3.8 billion just to
Sinaloa state alone, said Guillermo
Ibarra, an economist who used bank and
government statistics to compile an
estimate this year.
That is 20 percent of the state's
economy, twice as much as all of its
factories put together. The drug trade
employs about a fifth of the state's 2.6
million population, either directly or
indirectly, he said.
"It trickles down to construction, to
car sales, you name it," Ibarra said.
"Drug money ends up everywhere."
The cartels' criminal activities also
are becoming more diverse, Buscaglia
said.
La Familia Michoacana, which produces
methamphetamine at clandestine
laboratories in Michoacan state, has
broadened into prostitution, protection
rackets and software piracy.
Street vendors in Mexico now sell music
CDs and DVDs stamped with "FM," the
gang's logo.
Likewise, the Zetas, once the elite hit
men of the Gulf Cartel, now run
kidnapping-for-ransom rings in Mexico
City and steal gasoline from government
pipelines. Pemex, the state-run oil
company, says it lost $747 million in
stolen fuel in 2008.
Gangs going strong
The cartels also have found ways to
defend their core drug business by
moving marijuana farms to U.S. national
parks, finding new smuggling routes
through Africa and into Europe, and
strengthening their supply lines in
Central America.
Drug prices and purity in the United
States, the main measure of trafficking,
shows the crackdown is having only mixed
results.
Cocaine prices in the United States
jumped from $132 a gram to $182 a gram
from September 2007 to September 2008,
the latest date for which the Drug
Enforcement Administration has released
numbers.
But during the same period,
methamphetamine got stronger and
cheaper, dropping from $213 per gram to
$184 per gram.
To offset tighter border security,
Mexican traffickers are setting up
marijuana farms on public lands in
California, Washington and Oregon, a
U.S. Department of Justice report said
in July. The number of marijuana plants
seized in the United States soared from
3.2 million in 2004 to 8 million in
2008.
Their product is also improving, the
report said: Marijuana potency in 2008
was the highest it has ever been.
The cartels also are expanding into new
territory.
Since 2008, Mexican drug smugglers have
been arrested in Australia, New Zealand
and the African nations of Sierra Leone
and Togo. U.S. prosecutors say the Gulf
Cartel has struck deals with the New
York mob and the Ndrangheta Mafia of
Italy to smuggle cocaine into Europe.
In the United States, cartel operatives
have been detected in 195 cities, as
distant as Anchorage, Alaska, and as
small as Ponca City, Okla., a report by
the U.S. Justice Department said.
In Arizona, the Sinaloa Cartel has
operations in Phoenix, Tucson, Douglas,
Glendale, Naco, Nogales, Peoria, Sasabe,
Sierra Vista and Yuma. The Gulf Cartel
also has some operatives in Nogales, and
the Juarez Cartel has outposts in
Phoenix, Tucson and Douglas, the report
said.
Buscaglia said his research has turned
up links to Mexican traffickers in 47
countries worldwide.
"Mexico has become an exporter of
instability," he said.
At the same time, the cartels are
acquiring weapons that are "increasingly
more powerful and lethal," the U.S.
Government and Accountability Office
said in a June report.
Five rocket launchers, 271 grenades,
2,932 assault rifles, a submarine loaded
with cocaine, and an anti-aircraft gun
complete with blast shield were all
seized by Mexican authorities between
March 2008 and August 2009.
In September, traffickers fired an
anti-tank rocket at soldiers while
trying to free a comrade who had been
detained.
The gangs also are getting better at
carrying out coordinated, military-style
operations.
On July 11 and 12, La Familia launched
15 attacks in eight cities on police
stations and a police bus, killing 14
officers.
And on May 16, Gulf Cartel gunmen freed
53 prisoners in a commando-style raid on
a prison in Zacatecas state.
Prolonged war
Calderón and the Obama administration
insist that the Mexican government still
has the upper hand against the cartels.
"We have a serious problem, but the good
news is that we're confronting it, and
better yet, we're making progress,"
Calderón told the ambassadors last
month.
But in the past year, doubts have been
growing.
A report by the U.S. Joint Forces
Command warned in January 2009 that
Mexico was ripe for a "rapid and sudden
collapse" because of the drug cartels.
And in a report to the West Point
military academy, former U.S. drug czar
Barry McCaffrey said the cartels could
"overwhelm the institutions of the state
and establish de facto control over
broad regions of northern Mexico" within
eight years.
Former President Ernesto Zedillo, writer
Carlos Fuentes, former foreign minister
Jorge Castañeda and the former chief of
Calderón's National Action Party have
publicly questioned the president's
strategy.
In Colombia, the government was able to
re-establish control in rural areas by
eliminating a "demilitarized" zone that
had been granted to the leftist
guerrillas, renewing attacks on them and
spraying coca fields with pesticides.
The United States has helped with $5.8
billion in aid since 2000.
But in Mexico, the government needs to
focus on the prosecution of crimes
instead of flooding the streets with
troops, Buscaglia said.
Only about half of detainees are ever
convicted, and most are low-level thugs,
not the money launderers, accountants
and managers who keep the cartels
running.
Of the more than 53,000 arrests since
the crackdown began, only 941 are in
Sinaloa, despite the fact that that
state is the heart of one of the biggest
smuggling empires, Buscaglia said.
The government also needs laws allowing
authorities to shut down suspected
money-laundering operations and seize
their assets without going through a
criminal trial, he said.
Only three things could change the
balance, said Ray Walser, an expert on
Latin America at the conservative
Heritage Foundation: a massive increase
in U.S. drug aid, a large
addiction-treatment program in the
United States or the legalization of
drugs in the United States.
None of these measures seems to be on
the horizon, Walser said.
"The problem that Calderón has in
winning this war will be that he can't
offer the citizens courts, mayors and
policemen that are safe and honest and
not corrupt," Kurtzman said.
"As a result, this is likely to remain a
stalemate with a lot of killing on both
sides for a long time."
