A Lucrative War

On 15 September, the eve of Mexico’s bicentenary, President Felipe Calderón threw the country a $3 billion birthday party. An hour before midnight, he took the tricoloured flag from his honour guard, stepped onto the balcony of the Palacio Nacional and delivered the traditional Independence Day grito: a long succession of vivas echoing those of the soon-to-be-martyred priest Miguel Hidalgo at the beginning of Mexico’s 11-year war with Spain in 1810. It was an impressive piece of stagecraft, but the most memorable part of the night was the fireworks show, the rockets bursting from behind the cathedral and filling the sky as if the city itself were in flames.

Calderón’s big bash might not have been such a good idea. The last centenary fell just before the outbreak of the revolution that toppled the kleptocratic regime of Porfirio Díaz and marked the beginning of a decade of civil war. Mexico is now suffering levels of inequality not seen since Díaz’s time, and some of the worst violence since the revolutionary era. The border city of Ciudad Juárez – the site of the first major battle against Díaz’s troops – took no chances: it cancelled its independence celebrations, as did more than a dozen other towns and cities.

There have been more than 2000 killings in Juárez so far this year. On 24 August, the day the city announced the cancellation, 12 people were killed in violence allegedly related to organised crime: more than a quarter of that day’s national total (if you don’t count the 72 Central and South American migrants found dead in the north-eastern state of Tamaulipas, executed en masse by their kidnappers). Nationwide, in a single three-week period, the mayor of the Tamaulipas town of Santiago was found dead, his body showing signs of torture (six police officers including the mayor’s bodyguard were subsequently arrested); four decapitated corpses were hung from a bridge in Cuernavaca; 27 unidentified men said to be members of a cartel known as the Zetas were killed in a shoot-out with the army in Ciudad Mier, also in Tamaulipas; eight ‘presumed sicarios’, or hitmen, were killed in a 13-hour gun battle with the army in northern Veracruz; eight people died after Molotov cocktails were thrown into a bar in Cancún; soldiers at a checkpoint in the northern city of Monterrey opened fire on a carload of civilians, killing a 52-year-old man and his teenage son and injuring five others; two headless and limbless corpses were found outside a children’s museum in the capital of the south-eastern state of Guerrero; and another mayor was assassinated when gunmen interrupted a meeting in the town hall of El Naranjo, San Luis Potosí. Hundreds more died less spectacularly.

The violence is dizzying, all the more so because so little light has been shed on it by the press, either in Mexico or abroad. Most accounts stick to the official narrative: the bloodshed is simply the result of heightened competition between drug cartels for control of profitable smuggling routes, and of the military battling it out with the bad guys. The dead are generally identified only as ‘pistoleros’ or ‘sicarios’; their killers as ‘armed commandos’. The most basic facts are left unspecified: body counts, names, places, dates. When the 27 alleged Zetas were killed by the army in early September, some early reports placed the shoot out in Tamaulipas, others in the neighbouring state of Nuevo León. Even in high-profile incidents such as the arrest of Edgar Valdez Villarreal, a senior cartel figure better known as ‘La Barbie’, there are conflicting accounts: Valdez was either arrested just outside Mexico City or in a small town in Guerrero; he was either detained after a gunfight that lasted more than an hour and involved more than a thousand policemen, or he voluntarily turned himself in and asked to be delivered to the US witness protection programme. (Whatever happened, when Valdez was paraded in handcuffs before the press, there was a sly smile on his face.) The government, the opposition, the cartels and the various factions within all of them spread disinformation as a matter of policy, which means that political gossip tends to revolve around who stands to profit from which distortion. To make things more complicated, there is a great deal at stake for Mexico’s powerful neighbour to the north. The two most pernicious strands of contemporary American politics – nativism and the all-encompassing discourse of ‘security’ – feed into the notion that Mexico is slipping into anarchy.

Horrific though it is, the violence is neither inexplicable nor entirely senseless. It is the result of a struggle over drug distribution in which a remarkable number of players have come to have a deep investment: not only the narcos, but their ostensible opponents on both sides of the international border and of the hazier divide separating legality from criminality. Drugs are an old business in Mexico. Farmers in the remote high sierra of the western state of Sinaloa have been growing opium poppies since the late 19th century – and marijuana long before that – but smuggling did not become a viable enterprise until the US created an illicit market by regulating the use of opiates in 1914. Then, as now, drugs flowed one way: north. The American appetite for forbidden intoxicants grew quickly in the second half of the last century. As the US market expanded, so did the smuggling industry that serviced it. Until the early 1970s the smugglers were subordinate to the local politicians and military and police commanders under whose protection they were permitted to operate, and who in turn took their place in a chain of command that rose all the way to the presidency.

This arrangement ran smoothly until marijuana’s newfound popularity led Richard Nixon to declare a ‘war on drugs’ and to begin putting pressure on the Mexican government to staunch the flow. Even then, other motives were concealed beneath the American government’s apparent concern for the health of its citizens: Nixon’s chief of staff recorded in his diary that in the course of a briefing on drug enforcement in 1969, the president had ‘emphasised … that the whole problem is really the blacks. The key is to devise a system that recognises this while not appearing to.’ That year, Nixon ordered a massive policing effort on the Mexican border called Operation Intercept. Relatively little contraband was found and Mexico was furious about the crackdown, but the US administration considered it a success. Gordon Liddy, then the co-chair of Nixon’s narcotics task force, would later write: ‘It was an exercise in international extortion, pure, simple and effective, designed to bend Mexico to our will.’ It worked: the next anti-drug effort was called Operation Co-operation. Seven years later, with logistical help from the US, Mexico launched its first major military operation against the drug trade. Operation Condor, led by a general who had taken part in the massacre of students at Tlatelolco in 1968 and the anti-guerrilla campaigns of the 1970s Dirty War, dislodged hundreds of peasants from the western sierras. Complaints of torture by federal troops abounded.

In the 1980s a massive expansion of the cocaine market in the States coincided with the growth of leftist guerrilla movements in Central and South America. Under the cover of the drug war, Reagan took on both at once. In 1986, he signed a directive that linked narco-trafficking to ‘insurgent groups’ and ‘terrorist cells’ abroad, and declared the narcotics trade a threat to national security. The effect was to militarise the war on drugs, converting what had once been a matter for domestic law enforcement into an instrument of foreign policy.

At the same time, and not coincidentally, Mexico was undergoing a shift to neoliberalism under the presidencies of Miguel de la Madrid and Carlos Salinas, both of whom were educated, or partially educated, in the US. The smuggling business, too, was about to take a neoliberal turn. It had consolidated in the 1980s under one man, Miguel Angel Félix Gallardo. Known as El Padrino, or the Godfather, Félix Gallardo emerged from the old system: he was a former policeman and chief bodyguard to the governor of Sinaloa. When a US Drug Enforcement Agency officer working undercover in Mexico was kidnapped and killed, the first Bush administration pushed hard for Félix Gallardo’s arrest. Negotiations for the trade pact that would later be known as the North American Free Trade Agreement were underway and Salinas wanted to keep the Americans happy, so in 1989, Félix Gallardo was arrested. But Félix Gallardo had seen what was coming and by then he had divided up his empire, distributing the most valued smuggling routes, or plazas, to trusted lieutenants. Just as Salinas was breaking up and privatising hundreds of state-owned industries, so Félix Gallardo was breaking up his domain, effectively creating what are now the Tijuana and Sinaloa cartels. The first boss of the Juárez cartel, Rafael Aguilar Guajardo, was a commander in the Federal Security Directorate, the political police.

The timing could not have been better for Mexico’s traffickers. US drug enforcement efforts in the Caribbean had put sufficient pressure on the maritime smuggling routes favoured by Colombian traffickers to push the cocaine trade overland into Mexico. In 1993 and 1994, US immigration officials began pouring resources into securing the border at two major urban crossing sites – between El Paso and Ciudad Juárez, and between San Diego and Tijuana. Perversely, this helped the cartels seal their monopolies on the trade. ‘Borders breed smuggling,’ the sociologist Fernando Escalante explains: ‘A closed border breeds organised smuggling. It favours cartels, it favours organised crime.’

Despite the increased policing, the new trade policies meant that goods and money – if not people – could cross more freely between the US and Mexico. Months before Nafta came into effect in 1994, the DEA reported that Mexican drug runners (they were not yet called cartels) were buying trucking companies and factories along the border in anticipation of a boom. The increase in trade between the two countries would make smuggling much easier, and the deregulation of the Mexican financial system that preceded the pact created almost infinite opportunities for concealing illicit earnings.

The broader effects of Nafta and the reforms that accompanied it were more diffuse and far more destructive. A constitutional amendment passed as a precondition for the trade pact did away with the legislation that since the 1930s had forbidden the private sale of communally held farmland. Now cheap and highly subsidised American corn flooded the Mexican market. Local farmers were unable to compete: 1.1 million small farmers and 1.4 million others dependent on the agricultural sector lost their livelihoods. Campesinos left ancestral holdings, forced into the uncertainties of migrancy, both within Mexico and abroad. Villages were left almost abandoned. In a few short years, extraordinary wealth was concentrated in the hands of a tiny minority while the dream of an agrarian republic that had sustained the country for most of the 20th century collapsed. The anticipated shift to export-oriented manufacturing was a failure. Few of the promised jobs in the foreign-owned assembly plants known as maquiladoras materialised. The ones that did soon vanished as companies pursued still cheaper labour in China.

Nearly 30 per cent of the population now works in the informal economy – washing car windows on street corners, selling tacos, sodas, DVDs. Cuts to education have helped create a new class of young people: the 7.5 million so-called ninis who aren’t in school and don’t have jobs (‘ni estudian ni trabajan’). The minimum wage has lost two thirds of its buying power and nearly half the population lives in poverty. In his book on the epidemic of murders of young women in Ciudad Juárez, Huesos en el desierto (‘Bones in the Desert’, 2002), González Rodríguez wrote of the vast new class of the uprooted and excluded, poor migrants from the countryside who now find themselves wandering in a ‘vertiginous universe of technology and productivity, merchandise and calculation’.

Just as this class was beginning to emerge, Mexico experienced its greatest political upheaval since the revolution: the PRI, which had been in government since 1929, began to lose its grip on power. Between 1989 and 1999, the National Action Party (the PAN), which represented the socially conservative transnational elite that had profited most from the PRI’s economic policies, won the governorships of eight states, including the border states in which the most important drug trafficking routes were situated. By 2000, when the PAN won the presidency with the election of the former Coca-Cola executive Vicente Fox, the old networks of political patronage that had contained and controlled the drug smuggling industry were in disarray. The cartel leaders broke free from the system that had kept them in check. The old arrangement was turned on its head. Traffickers had once worked for the police and the politicians: now the police and politicians were working for them.

The democratic renaissance prophesied by Fox’s allies delivered little. Corruption persisted. The transformation of the economy along neoliberal lines continued, but without even the tattered remnants of the PRI paternalism that had for almost a century redistributed some small portion of the nation’s wealth in exchange for votes and obedience. Now the market alone would rule, and the millions it left behind would have no option but to adjust to the new realities. ‘The campesinos,’ Fox’s finance secretary announced in 2003, ‘will have to transform themselves into industrial workers or true business people.’ Many have done precisely that – either in factories, fields and kitchens north of the border, or in the precarious employ of the drug cartels.

In the first half of the last decade, border cities like Tijuana, Ciudad Juárez and Nuevo Laredo experienced shocking levels of violence: assassinations, disappearances, full-scale gun battles in the streets. In most of the country, though, the murder rate was dropping. In the campaign leading up to the 2006 presidential election, Calderón, the candidate of the PAN, spent most of his energy denigrating his rival, the centre-left former mayor of Mexico City, Andrés Manuel López Obrador: violence and organised crime went almost unmentioned. Four days after the vote, amid widespread evidence of fraud, Calderón was declared the winner by less than 1 per cent. As many as two million López Obrador supporters flooded the centre of Mexico City. Tens of thousands took part in a sit-in, shutting down the core of the capital for weeks. The electoral tribunal ordered a partial recount, declared Calderón the winner and promptly destroyed the ballots. On the eve of his inauguration, a military escort had to hustle Calderón past leftist legislators who had seized the podium of the Chamber of Deputies. He was separated from Fox in the scuffle and had to pin the presidential sash to his own chest before being rushed away by guards.

Less than a fortnight later, Calderón called on the military once again, this time ordering 6500 troops to his home state of Michoacán to stem the rising violence there. The drug war was for him what the war on terror had been for George W. Bush. Like Bush, he lacked legitimacy in the eyes of at least half the population: the drug war ‘allowed him the tools he needed in order to govern’. Over the next two years, he would send 45,000 troops – a quarter of Mexico’s armed forces – to the northern border, the south-western state of Guerrero, and the so-called Golden Triangle, the mountainous poppy-growing regions of Sinaloa, Durango and Chihuahua. For most of the last century, the Mexican military had been almost unique in Latin America in keeping a respectful distance from civil institutions and from the US. Calderón changed that. In 2008, the two countries launched the Merida Initiative: Mexico accepted $1.3 billion in counter-narcotics funding from the US and an unprecedented level of military co-operation was established.

Everywhere the military has visited, the bloodshed has grown much worse. Between December 2006 – when Calderón took office and sent out the first troops – and July 2010, more than 28,000 Mexicans were murdered. The president has insisted that 90 per cent of the victims were cartel members, although only 5 per cent of the murders have been investigated, much less solved. In the first four years of his term, Mexico’s National Human Rights Commission received 4035 complaints alleging abuses by the armed forces – more than it had received in the previous 15 years – including allegations of murder, torture and rape. Because the military is charged with investigating itself, such abuses invariably go unpunished. And ‘because writing or saying what the military is up to could result in serious injury or death,’ the American journalist Charles Bowden notes in Murder City, his recent book about Juárez, few of the more serious abuses are ever reported.* At least 31 reporters have been killed or disappeared since 2006. Newspapers refer vaguely to attacks by ‘armed commandos’, but, Bowden writes, ‘the exact meaning lurking in the word “commando” is never spelled out.’ Calderón remains stubbornly optimistic. ‘If you see dust,’ he said in August, ‘it’s because we are cleaning the house.’

At all levels, from small municipal brigades to elite federal units, Mexican police have been involved in the violence, often acting as hit squads and kidnappers for the cartels. The military enjoys a better reputation, but it too has a long history of complicity. Narco money funds political campaigns, enriches bankers and mingles with the profits of legal enterprises inside and outside Mexico. Investigations in the US and Mexico have implicated Wells Fargo, Bank of America, Citigroup, HSBC and Santander (among others) in cartel-related money-laundering. Despite occasional rhetorical parries from Calderón, the narcos’ financial networks remain untouchable.

Despite this, the Mexican and US governments consistently represent the violence as a simple matter of cops and robbers, a fable echoed by the Mexican and US press. This is the implicit narrative underlying The Last Narco, Malcolm Beith’s book about Joaquín ‘El Chapo’ Guzmán Loera, the fugitive chief of the Sinaloa cartel. Beith traces Guzmán’s rise to narco-celebrity – in 2009 and again this year, Forbes magazine included him in its list of the world’s billionaires – from the tiny Sinaloan hamlet of La Tuna de Badiraguato, where his father scratched out a living as a cattle rancher and gomero, or opium worker. He recounts Guzmán’s war with the Tijuana cartel in the early 1990s and his arrest in 1993, and devotes a chapter to his escape in 2001 from a maximum security prison in Jalisco. He describes the rise of the Zetas – a group composed of former members of the Mexican special forces, which struck out on its own in 2003, having begun its existence as the Gulf cartel’s assassination squad – and the outbreak of fighting between Guzmán’s gunmen and the Juárez cartel, a quarrel that continues to claim thousands of lives. It’s a heroic war as Beith tells it in his wide-eyed account, and the impression we get is that the narcos live in a country of their own, one which they are occasionally forced to share with soldiers, police and the DEA.

We are told only in passing that as many as 97 per cent of the people of Badiraguato have ‘little choice but to become narcos’, because there is so little other work. ‘With a government that largely doesn’t care and a formal economy that takes pity on no one’, the narcos have become the respected elders of Sinaloan society, paying for schools, hospitals, churches and homes. The last time the military got involved in anti-drug operations in the area, during Operation Condor, ‘as many as 2000 communities were abandoned or destroyed’ without the arrest of a single major trafficker. Beith alludes briefly to the possibility that the federal government allowed Guzmán to escape from prison, but it is difficult to explain his escape without assuming high levels of official collusion. Again he mentions that the Mexican government’s failure to locate Guzmán despite the $5 million reward on his head and the unceasing efforts of the DEA, the military and the federales has led to ‘accusations of corruption’, but as he himself writes, the head of Mexico’s elite federal investigative agency, the AFI, has been accused of ‘fighting the war on drugs with one particular goal in mind: to consolidate power for Chapo’s cartel’. Of course, he adds, ‘nothing was proven.’

It would be easy to think that these were just rumours. But as the Guardian reported last month, Guzmán’s organisation does appear to have been the principal beneficiary of Calderón’s drug war. A disproportionately small number – less than a quarter – of the more than 80,000 drug-related arrests nationwide were of alleged Sinaloa members. In Ciudad Juárez, where the Sinaloans have been methodically slaughtering members of the Juárez cartel, less than 15 per cent of the alleged narcos arrested since the arrival of federal forces have been Guzmán’s men. This is no secret in Mexico. In the bestselling Herencia Maldita (‘Cursed Inheritance’), Ricardo Ravelo said that the point of the drug war appeared not to be to end the drug trade but ‘to finish off the so-called unorganised narco-trafficking, to leave the elites free to manage the trade in drugs on a grand scale’.

Meanwhile the flow of contraband to the United States has increased. Despite more than 28,000 deaths and the showcase arrests and killings of major cartel figures, the traffic continues unimpeded. Last year, the Mexican government confiscated less than half the amount of cocaine that it had seized in 1991. At the same time cocaine interdiction dropped sharply in the US, which the DEA mysteriously takes as a sign of success.

In August, Vicente Fox called for the return of Mexican troops to barracks and spoke of a possible legalisation of ‘the production, sale and distribution of drugs’. In February 2009, his predecessor, Ernesto Zedillo of the PRI, joined the former presidents of Brazil and Colombia in declaring that ‘the war on drugs has failed.’ Calderón, unfazed, has promised to keep the troops on the streets until the end of his six-year term. His support from the north has been unflagging. Obama has proposed extending the Merida Initiative, and has requested an additional $310 million for 2011. His administration appears to situate Mexico within the discourse of failing states battling insurgencies and requiring American help. It’s a bad fit – the cartels are not revolutionary cells so much as organisations of global capital – but the rhetoric provides a domestic pretext for folding Mexico into US security protocols. Carlos Pascual, the new US ambassador to Mexico, last summer confidently proposed ‘a new role’ for the Mexican military in Juárez, one consistent with counter-insurgency tactics employed by the US across the globe: they would secure the perimeter of five-block-square ‘safe zones’, and push that perimeter outward block by block. Hillary Clinton sounded a similar note at a press conference last month, claiming that the cartels were ‘morphing into, or making common cause with, what we would consider an insurgency’ and calling for a level of aid equivalent to that committed to Colombia. The outcry in Mexico was unanimous, and Obama quickly backed away.

Whatever shape it takes, the war on drugs continues to be even more profitable than the drug trade itself. All the killing keeps prices per gram high, so the cartels do fine, as do the legions of sicarios and the funeral directors they help to feed. The bankers who launder the money also win, as do the businessmen into whose enterprises the newly laundered funds are funnelled. The American weapons manufacturers stand to do nicely, as do the US security consultants and military contractors who will deposit almost all of the Merida funds into their own accounts, and who can expect to make billions more from the militarisation of the border on the American side: someone has to make the helicopters, the cameras, the night-vision goggles, the motion sensors, the unmanned drones, as well as build the private prisons that hold the migrants. Finally politicians too stand to gain, not only Calderón and the PRIistas who are likely to profit from his failure in 2012, but the Americans who have sponsored him: the agile ones who can leverage campaign contributions from the contractors, the populists who win votes by shouting about the barbarian hordes advancing through the Arizona desert, the moderates who get re-elected term after term by expounding in even tones about the need for something called ‘comprehensive border security’. The killing is therefore unlikely to stop.