Mexico: The Struggle for Balance
MIN READApr 8, 2010 | 08:54 GMT
By Scott Stewart This week's Geopolitical Intelligence Report provided a high-level assessment of the economic forces that affect how the Mexican people and the Mexican government view the flow of narcotics through that country. Certainly at that macro level, there is a lot of money flowing into Mexico and a lot of people, from bankers and businessmen to political parties and politicians, are benefiting from the massive influx of cash. The lure of this lucre shapes how many Mexicans (particularly many of the Mexican elite) view narcotics trafficking. It is, frankly, a good time to be a banker, a real estate developer or a Rolex dealer in Mexico. However, at the tactical level, there are a number of issues also shaping the opinions of many Mexicans regarding narcotics trafficking, including violence, corruption and rapidly rising domestic narcotics consumption. At this level, people are being terrorized by running gunbattles, mass beheadings and rampant kidnappings — the types of events that STRATFOR covers in our Mexico Security Memos. Mexican elites have the money to buy armored cars and hire private security guards. But rampant corruption in the security forces means the common people seemingly have nowhere to turn for help at the local level (not an uncommon occurrence in the developing world). The violence is also having a heavy impact on Mexico's tourist sector and on the willingness of foreign companies to invest in Mexico's manufacturing sector. Many smaller business owners are being hit from two sides — they receive extortion demands from criminals while facing a decrease in revenue due to a drop in tourism because of the crime and violence. These citizens and businessmen are demanding help from Mexico City. These two opposing forces — the inexorable flow of huge quantities of cash and the pervasive violence, corruption and fear — are placing a tremendous amount of pressure on the Calderon administration. And this pressure will only increase as Mexico moves closer to the 2012 presidential elections (President Felipe Calderon was the law-and-order candidate and was elected in 2006 in large part due to his pledge to end cartel violence). Faced by these forces, Calderon needs to find a way to strike a delicate balance, one that will reassert Mexican government authority, quell the violence and mollify the public while also allowing the river of illicit cash to continue flowing into Mexico. An examination of the historical dynamics of the narcotics trade in Mexico reveals that in order for the violence to stop, there needs to be a balance among the various drug-trafficking organizations involved in the trade. New dynamics have begun to shape the narcotics business in Mexico, and they are causing that balance to be very elusive. For the Calderon administration, desperate times may have called for desperate measures.
(click here to enlarge image) In past decades, this turbulence was normally short lived. When there was a fight between the organizations or cartels, there would be a period of intense violence and then the balance between them would either be restored to the status quo ante or a new balance between the organizations would be reached. For example, when the Guadalajara cartel dissolved following the 1989 arrest of Miguel Angel Felix Gallardo, and the Arellano Felix Organization (AFO) and the Sinaloa cartel emerged from the Guadalajara cartel to fill the power vacuum, there was a brief period of tension, but once balance was achieved, the violence ebbed — and business returned to normal. However, the old model of cartel conflicts has changed. The current round of inter- and intra-cartel violence has raged for nearly a decade and has intensified rather than abated; there appears to be no end in sight. In fact, death tolls are far higher today than they were five years ago. This inability of the cartels to reach a state of balance is due to several factors. First is the change of products. Mexican drug cartels have long moved marijuana into the United States, but the increase in the amount of cocaine being moved through Mexico in the 1980s and 1990s changed the dynamic — cocaine is far more compact and far more lucrative than marijuana. Cocaine is also a "strategic narcotic," one that has a transnational supply chain far longer than drugs like marijuana or methamphetamine, and that long supply chain is difficult to guard. Because of this, organizations involved in the cocaine trade tend to be more aggressive and violent than those that smuggle drugs with a shorter supply chain like marijuana and Mexican opium. At first, Mexican cartels like the Guadalajara cartel only smuggled cocaine through their smuggling routes into the United States on behalf of the more powerful Colombian cartels, which were seeking alternate routes to replace the Caribbean smuggling routes that had been largely shut down by American air and sea interdiction efforts. Over time, however, these Mexican cartels grew richer and more powerful from the proceeds of the cocaine trade, and they began to take on an expanded role in cocaine trafficking. The efforts of the Colombian government to dismantle the large (and violent) organizations like the Medellin and Cali cartels also allowed the Mexicans to assume more control over the cocaine supply line. Today, Mexican cartels control much of the cocaine supply chain, with their influence reaching down into South America and up into the United States. This expanded control of the supply chain brought with it a larger slice of the profits for the Mexican cartels, so they have become even more rich and powerful. Of course, this large quantity of illicit income also brings risk with it. The massive profits that can be made by controlling a smuggling corridor into the United States are a tempting lure to competitors (internal and external). This means that the cartels require enforcers to protect their personnel and operations. These enforcers and the escalation of violence they brought with them are a second factor that has hampered the ability of the cartels to reach a balance. Initially, some of the cartel bosses served as their own muscle, but as time went by and the business need for violence increased, the cartels brought in hired help to carry out the enforcement function. The first cartel to do this on a large scale was the AFO (a very aggressive organization), which used active and current police officers and youth gangs (some of them actually from the U.S. side of the border) as enforcers. To counter the AFO's innovation and strength, rival cartels soon hired their own muscle. The Juarez cartel created its own band of police called La Linea and the Gulf cartel took things yet another step and hired Los Zetas, a group of elite anti-drug paratroopers who deserted their federal Special Air Mobile Force Group in the late 1990s. The Gulf cartel's private special operations unit raised the bar yet another notch, and the Sinaloa cartel formed its own paramilitary unit called Los Negros to counter the strength of Los Zetas. With paramilitary forces comes military armament, and cartel enforcers graduated from using pistols and submachine guns to regularly employing fully automatic assault rifles, rocket-propelled grenades and hand grenades. As we have previously noted, thugs with such weapons do pose a threat, but when those weapons are in the hands of highly-trained gunmen with the ability to operate as an integrated unit, the threat is far greater. The life of a cartel enforcer can be brutish and short. In order to find additional personnel to beef up their ranks, the various cartel enforcer units formed outside alliances. Los Zetas worked with former Guatemalan special forces commandos called Kaibiles and with the Mara Salvatrucha street gang (MS-13). La Linea formed a close alliance with the American Barrio Azteca street gang and with Los Aztecas, the gang's Mexican branch. Cartels also recruit heavily, and it is now common to see them place "help wanted" signs in which they offer soldiers and police officers big money if they will quit their jobs and join a cartel enforcer unit. In times of intense combat, the warriors in a criminal organization can begin to eclipse the group's businessmen in terms of importance, and over the past decade the enforcers within groups like the Gulf and Sinaloa cartels have become very powerful. In fact, groups like Los Zetas and Los Negros have become powerful enough to split from their parent organizations and, essentially, form their own independent drug-trafficking organizations. This inter-cartel struggle has proved quite deadly as seen in the struggle between AFO factions in Tijuana over the past year and in the more recent eruption of violence between the Gulf cartel and Los Zetas in northeastern Mexico. This weakening of the traditional cartels was part of the Calderon administration's publicized plan to reduce the power of the drug traffickers and to deny any one organization or cartel the ability to become more powerful than the state. The plan appears to have worked to some extent, and the powerful Gulf and Sinaloa cartels have splintered, as has the AFO. The fruit of this policy, however, has been incredible spikes in violence and the proliferation of aggressive new drug-trafficking organizations that have made it very difficult for any type of equilibrium to be reached. So the Mexican government's policies have also been a factor in destabilizing the balance.