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Progress Pains

by Duncan Currie

The Mexican political reforms we applaud have helped cause the Mexican drug violence we deplore

How bad is the violence in Mexico? According to a Time report, “Frustration with the government’s inability to protect the citizenry against crime long ago reached the boiling point.”

Actually, that report was published in the fall of 1996, several months before Mexican drug czar Jesús Gutiérrez Rebollo was arrested for having links to the Juárez cartel. The mid-1990s were a harrowing period for our southern neighbor — a period in which it experienced an armed rebellion among rural Indians, a disastrous currency meltdown, its worst recession since World War II, high-profile political assassinations, an explosion of drug-related brutality, and major corruption scandals. Since then, the country has liberalized its economy, bolstered its financial system, strengthened its democratic institutions, and seen its murder rate drop considerably. “Mexico has made tons of progress,” says Howard Campbell, an anthropologist at the University of Texas, El Paso, and author of Drug War Zone.

Recognizing this progress can help us keep Mexico’s current drug mayhem in perspective. The relentless, ghastly violence in certain border cities — particularly Juárez, Nuevo Laredo, and Reynosa — has fostered the perception among Americans that the entire country is a lawless, blood-soaked hellhole. In fact, the carnage has been concentrated in a relatively small number of geographically important areas. “Parts of the country are probably more peaceful than they’ve ever been,” says Andrew Selee, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars. “And other parts are being torn asunder by violence between competing cartels.”

The regions that have been hit hardest are thoroughly integrated into the global economy, but also function as points of entry or exit for illegal drugs. Northern Mexico benefited handsomely from NAFTA, yet its chief manufacturing and commercial hubs along the U.S. border have become cauldrons of violence. Campbell reckons that six of the 32 Mexican states — Chihuahua, Durango, Guerrero, Michoacán, Sinaloa, and Tamaulipas — are now “close to being narco-states.”

On the other hand, he says, “the majority of the country is basically okay.” Indeed, large swaths of Mexico have been insulated from the drug havoc, and the capital city, though plagued by very real security problems, has a much lower homicide rate than the District of Columbia. As Mexico-based journalist Alexandra Olson has noted, the Mexican national murder rate was higher in 1997 (17 murders per 100,000 people) than it was in 2009 (14 per 100,000). Granted, because of the massive spike in drug-related killings, Mexico’s homicide rate has jumped since 2007 (when it was 10 per 100,000), but it remains well below that of Brazil, which is frequently touted as an emerging superpower.

This is not meant to sugarcoat the terror that Mexican drug-trafficking organizations (DTOs) and their gangland associates have inflicted. All of the DTOs enjoy corrupt alliances with local officials, many of whom feel they must accommodate the drug mafias in order to survive. Even those courageous mayors and police chiefs who want to investigate and prosecute DTO members often lack the necessary resources. Meanwhile, journalists aiming to expose underworld activity risk getting kidnapped or killed. Mexico is unquestionably embroiled in a severe crisis that threatens to erode its democratic gains.

Yet we should not exaggerate the crisis. The drug-related murders are heavily clustered in a few pockets of the country; the government continues to exercise full territorial control; and Mexico is nowhere near being a “failed state.” Pres. Felipe Calderón, in office since December 2006, has made significant strides in rooting out federal corruption, professionalizing Mexico’s police forces, cultivating intelligence capabilities, and upgrading the judicial system. “For the first time, the Mexican government is developing the tools to take on organized crime and uphold the rule of law,” says Selee.

To be sure, Calderón’s decision to tackle the DTOs with military muscle has led to heightened competition and infighting among them. The resulting surge of violence has led many critics to pronounce his strategy a disaster. That verdict seems premature. Calderón likely underestimated the magnitude of the problem before he deployed the army to confront it, but the increased violence does not necessarily reflect government ineptitude. Former Salvadoran guerrilla Joaquín Villalobos, now a consultant to the Calderón administration, argues that Mexican authorities have disrupted DTO operational structures, and that the subsequent bloodshed is a sign of cartel weakness rather than strength.

Villalobos is obviously not an impartial analyst. Yet when we review the available data, it becomes clear that innocent Mexican civilians face less risk than commonly believed. In a wide-ranging January 2010 study, political scientist David Shirk, director of the Trans-Border Institute at the University of San Diego, affirms that “the vast majority of drug-related violence occurs between and among organized-crime groups. If you do not happen to be or have ties to a drug trafficker, the odds of being killed by one are extremely slim.” Last year, he writes, the overall odds were roughly 1 in 16,300, though they were much greater in the states of Chihuahua (1 in 1,600), Durango (1 in 2,400), and Sinaloa (1 in 3,400).

Shirk uses statistics compiled by the Mexican newspaper Reforma, which he deems “a fairly reliable source” with a sound methodology for distinguishing drug-war murders from other homicides. According to the Reforma data, the number of drug-related killings in Mexico soared from 2,280 in 2007 to 5,153 in 2008 to 6,587 in 2009. More than two-thirds of the 2009 killings occurred in just five states (Chihuahua, Sinaloa, Guerrero, Durango, and Michoacán), with nearly one-third taking place in Chihuahua alone.

The ongoing cartel conflicts trace their roots back to the 1980s. Through the middle of that decade, Shirk explains, “DTOs operated with a level of impunity not seen before (or since) thanks to the protection then afforded to them by corrupt officials at very high levels in the Mexican government.” In the late Eighties, this arrangement started to unravel, and the DTOs began fracturing, which sparked a wave of internecine violence. During that same period, the relative influence of the Colombian cartels was declining, and the Mexican DTOs saw their share of the global drug business expand, a phenomenon that accelerated in the 1990s. By the dawn of the new millennium, says Selee, Mexico had become the epicenter of the hemispheric narcotics trade.

The government responded by adopting a sterner approach to the cartels. After the 9/11 terrorist attacks, elevated security at the U.S.–Mexican border made it more difficult to smuggle drugs between the two countries, which further squeezed the DTOs and exacerbated turf battles. Then Calderón launched his military offensive, and the number of killings shot up.

While it’s easy to blame him for igniting the current brushfire of violence, we should not overlook the fact that political reform has also inflamed the drug wars. A quarter-century ago, Mexico was effectively a one-party state ruled by the Institutional Revolutionary Party (PRI); today, it is a full-blown democracy. Calderón represents the conservative National Action Party, as did his predecessor, Vicente Fox, who in 2000 broke the PRI’s seven-decade stranglehold on the executive branch.

As Shirk points out, the relative peace and cooperation that prevailed among Mexican DTOs in the early 1980s was facilitated by ubiquitous corruption among members of the PRI. Decentralization and greater pluralism upset the crooked relationships that once shielded drug traffickers from internal competition and external law enforcement. In other words, Mexico’s democratic progress has indirectly caused splintering and strife among the DTOs, which in turn has fomented violence.

The more we appreciate this paradox, the better we will understand the country’s evolution. For all its warts, Mexico’s record over the past 15 years is one of substantial political and economic maturation. Since the completion of NAFTA, it has signed a slew of free-trade pacts, including deals with the European Union, Israel, and Japan. The 2010 Index of Economic Freedom (compiled by the Heritage Foundation and the Wall Street Journal) ranks Mexico ahead of Costa Rica, Portugal, France, and Italy. Its score easily outpaces the global average, and is markedly higher than it was in the late 1990s.

“Mexico has a very well-managed economy,” says Alberto Ramos, senior Latin America economist at Goldman Sachs. It has made huge improvements since the days of Pres. José López Portillo (1976–82), who nationalized the banks, and Pres. Carlos Salinas (1988–94), whose policy errors triggered the 1994–95 peso crisis. Following its post-Salinas financial meltdown, the country adopted inflation targeting and a flexible exchange-rate regime. As former Mexican central-bank governor Guillermo Ortiz has observed, these reforms boosted monetary freedom, aided capital-market development, and strengthened the overall financial system.

The Mexican economy is deeply enmeshed with that of the United States, and was therefore pulverized by the Great Recession. Real GDP shrank by 6.5 percent in 2009. However, the global credit bust did not spark a domestic banking collapse, underscoring Mexico’s new resilience, which stemmed from low inflation, a reduced debt burden, and a healthy stock of international reserves, among other things. While the country still needs sweeping labor, energy, and tax reforms — reforms that Calderón has championed but that probably won’t happen anytime soon — its economic stewardship is much better today than it was two decades ago.

Moving forward, Mexico should also embrace structural political reforms designed to enhance accountability and tighten the connection between voters and their elected representatives. Calderón has offered a litany of proposals, such as permitting citizen initiatives, establishing a second round in presidential contests (if no candidate secures a majority on the first ballot), and allowing for the reelection of federal legislators and local officials. These measures could serve to alleviate the persistent scourge of institutionalized corruption, which continues to hinder economic growth and impede Calderón’s anti-DTO campaign.

How can the U.S. help? Michael Shifter, president of the Inter-American Dialogue (a Washington think tank), says the Obama administration should increase police-training assistance and work more aggressively to curb the cross-border flow of assault weapons. Of course, as long as the U.S. both prohibits drugs and consumes an enormous quantity of them, Mexico will achieve only limited success in its fight against the cartels. Shifter and Campbell estimate that Mexican DTOs derive anywhere from 40 percent to 50 percent of their revenue from marijuana. Legalization is hardly a silver bullet, but if America did legalize pot, the traffickers would certainly feel a financial pinch.

Amid the grisly news of beheadings and other drug-related atrocities, it can be tough to remember just how far Mexico has come. Yet there are plenty of reasons to be encouraged. “I see Mexico responding to a real crisis in a very determined way,” says Selee. Whether its response will be sufficient to quell the violence is unclear; but the situation is not nearly as hopeless as many Americans think.

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