Drug Policy

Since I published a short article on the drug war in Mexico on Tuesday (and re-published it in a posting below) I’ve received a number of responses and questions related to gun shops on the border and the weapons they sell that end up in the hands of drug cartels in Mexico. I’d like to thank everyone who sent feedback and clarify a few points. I do incorrectly imply in the article that gun shops on the border sell hand grenades and rocket-propelled grenade launchers. The border gun shops do not legally sell these. However, these type of weapons used by Mexican drug cartels have been seized by customs officlas making their way south through the border. How they are purchased is somewhat unknown, but many of these are making their way to Mexico through the United States. I received many skeptical emails regarding the number of gunshops along the border. In fact, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) estimates that there are about 6,650 Federal Firearms Licensees in this area, and the border is 2,000 mile long, meaning that there are 3.3 gun shops per mile (I said 3 per mile in the article). If we include all the shops in border states (not just near the border), the number rises to 9,161 locations. Lastly, I received e-mails questioning the term “cop killer,” or “mata policias” in Spanish, which is a term commonly used in Mexico to refer to the FN Five-seveN, a weapon which if loaded with the right bullets can shoot through body armor, vehicle doors, and windows. Other weapons commonly bought on the border and trafficked to Mexico include AK-47s , AR-15 assault rifles, Colt .38 Supers, and Glock 9 millimeters. This is not new news. The U.S. government recognizes that U.S.-purchased weapons are fueling Mexico’s violence. In fact, ATF acting director Michael Sullivan said last year that investigators have traced 90 to 95 percent of weapons seized in Mexico to the United States. William Hoover, Assistant Director for Field Operations at ATF said in a congressional testimony last year that “It is a major challenge for ATF to adequately identify and disrupt the illegal sources of firearms and ammunition, while participating in the interdiction of shipments firearms and ammunition destined for Mexico.” What’s impressive is the lackluster response to such a serious problem. About 100 U.S. firearms agents and 35 inspectors patrol the border for gun smugglers, compared to 14,400 Border Patrol agents that patrol northward movements.

I wrote the following piece on the U.S. role in Mexico’s security challenges for foreignpolicy.com. President Calderón is fighting America’s third war, and America’s backing his enemies. By Shannon O’Neil When President-elect Barack Obama is sworn in next week, he’ll become the proud owner of several wars. There is the familiar mayhem in Afghanistan and reluctant optimism in Iraq. And then there is America’s forgotten war: the war on drugs. That battle’s newest front is its southern neighbor Mexico, whose president, Felipe Calderón, Obama met on Monday. If Calderón speaks his mind, he could put it simply to Obama: We are fighting your war, and you are supplying our enemies -- with demand for their drugs, money for their cartels, and guns for their violence. Mexico is fighting for its life, and Calderón has ratcheted up the battle since becoming president in 2006. Still, the picture remains grim. Please click here to continue reading on foreignpolicy.com.

When the United States thinks about the drug war, most focus on Colombia and Mexico. Yet concerted efforts in these two countries are leading to problems elsewhere. Argentina may be the next victim. Drugs are available throughout the country, specifically a lower-cost and highly-addictive smokable cocaine residue called paco. News articles highlight the worries of government officials and non-governmental organizations over the social costs of increased drug consumption, both in human lives and increased crime rates. But this may be just the beginning for Argentina. In response to enforcement elsewhere, Argentina is increasingly becoming a drug producing and transit country of methamphetamine in particular, also known as crystal meth or ice. Last July Mexico outlawed imports of ephedrine and pseudoephedrine, two common cold medicine drugs that are the basis for crystal meth. In response to Mexico’s crackdown, domestic meth production in the United States rose. But the United States is not alone. Production also seems to have moved to countries with less restrictive import rules for these basic ingredients. Two weeks after Mexico’s ban, nine Mexicans and an Argentine were arrested in Buenos Aires for running a meth lab linked to the Sinaloa cartel. Since then, Argentina has experienced several violent episodes - more reminiscent of Mexico’s than Argentina’s recent past. In two separate cases, one in August and one in October, three Argentine narcotraffickers were abducted, handcuffed, and sprayed with bullets; their bodies left to be found days later. Argentina’s entry into the drug trade has built up in recent years. Twenty-six tons of ephedrine were imported to Argentina in 2007, compared to only 5 tons in 2006. This 5-fold increase still falls below the legal annual maximum of 37 tons, meaning that there is still more potential for legally supplying the ingredients for ultimately illegal drugs. Recent regulations limit importers to registered pharmaceutical laboratories, but a November case shows the weakness of this strategy. Last month Argentine police arrested Mario Roberto Segovia in Rosario, accusing him of trafficking 9 tons of ephedrine worth $35 million dollars. Segovia had received permission from the Argentine government to import the ephedrine used to make the drugs and had recently requested permission to legally import 2.5 kilos more. Following Segovia’s arrest and facing increased international pressure, Argentine policymakers may choose to further regulate ephedrine imports. But this is not Argentina’s only problem. Regulating cash flows will be just as important to halt the nascent illegal drug industry. Here, Argentina’s recent policy decisions are even more worrisome. In a desperate attempt to bring cash into Argentina, the country’s Congress passed a law on December 18, 2008 that provides tax incentives for repatriated undeclared offshore funds. While the country’s basic tax rate on earnings is 35%, the plan offers a 1% rate on money that is repatriated and invested in industry, infrastructure or farming. Funds that are repatriated but invested in other sectors will pay a maximum tax rate of 8%. Argentines have about $140 billion in offshore accounts, so the government is hoping that some of those funds will return, benefiting the economy. But the law also opens a door for money laundering. Faced with increasing economic woes, it is unlikely that the Argentine government will scrutinize the history of incoming investment flows. In effect, Argentina is offering a very attractive rate for money launderers – a mere 1 %. This can only deepen the danger for a country that’s becoming a hub of ephedrine and pseudoephedrine trafficking, and will accelerate drug related violence and corrosion of institutions.

It’s hard to believe that Calderon is coming up for 2 years in office, one-third of his term. Much has been said of Calderon’s domestic agenda, but in the op-ed below, published in Mexico’s major English-language newspaper, The News, I analyze his foreign policy achievements. I argue that President Calderon has done much to restore Mexico’s bilateral relationships, but that so far his administration has failed to take on a global leadership role. With four more years in office, Calderon should shift Mexico’s foreign policy course to actively shape the international agenda. It’s time for Mexico to lead BY Shannon O’Neil Special to The News November 28, 2008 As he celebrates his two-year anniversary in office, President Felipe Calderón gets mixed reviews on his domestic and foreign policy. Many point to the numerous successful reforms - pension, tax, justice, and energy - that have passed as evidence he can deftly guide serious issues through a divided Congress. These achievements do stand in stark contrast to the gridlocked Vicente Fox administration. Yet others dismiss these reforms as too little, too late, and lament the wasted potential for real change. This ambivalence is not limited to national politics. While much lower in profile, Calderón´s foreign policy elicits both praise and dismissals. It shines in comparison to Fox´s, which left Mexico’s relations with Venezuela and Cuba in tatters and U.S. relations weakened by recriminations on both sides. But as in the domestic arena, many worry Calderón is wasting the opportunity to fundamentally transform Mexico’s role on the world stage. Upon entering Los Pinos, Calderón quickly moved to repair broken bilateral fences. In his first year, he returned Mexican ambassadors to both Venezuela and Cuba, taking the first necessary steps to re-engage with all of Latin America. He followed up with visits to Argentina and Chile, and received Presidents Tabaré Vázquez of Uruguay and Luiz Inacio Lula da Silva of Brazil at home. Through these renewed ties, his government pushed to increase trade and to further energy partnerships - all important for Mexico´s future. This new hemispheric camaraderie permitted Mexico´s successful U.N. Security Council seat bid, providing Calderón a new international platform in 2009. While at times seeming almost desperate to ignore his northern neighbor - during his first trip there as head of state in April he even bypassed Washington - Calderón’s administration has actually made more concrete headway with the United States than many of his predecessors. The harsh realities of his "get tough" domestic agenda, and the increasing worries of U.S. policy-makers about drug-related violence in Mexico, have facilitated this newfound cooperation. Negotiations with President George W. Bush culminated in the three-year package known as the Mérida Initiative, which provides $400 million in the first year for the fight against the drug cartels. Just as important, these discussions changed the terms of the drug war debate, getting the United States to at least grudgingly accept some responsibility in the violence and to promise to stem the flow of illegal guns and money into Mexico. QUIET CONFIDENCE On other bilateral issues, Calderón has been notably silent. Coming on Fox’s burned heels, he has virtually ignored U.S.-bound migration in his discussions with the U.S. president. Calls for better treatment of Mexico’s citizens abroad, and for economic development and job creation at home to stem the steady human flow outward, have been geared almost exclusively to his domestic audience. On NAFTA, too, the administration has been uncommonly reticent, particularly amid calls by U.S. democrats for its renegotiation. Two years in, Calderón’s foreign policy has promoted better Latin American relations, and assuaged past rifts with the United States. Not bad - but not visionary. As the 13th-largest economy in the world, and according to The Economist, soon to break into the ranks of the top 10, Mexico has been decidedly quiet on the international front. It is time for Mexico to lead. The current financial crisis provides an unprecedented opportunity. Given its own tortuous history with financial upheaval (and more than one near-death experience of its banking sector), Mexico has quite a lot of wisdom to share. And since the exclusive G-7 has given way to the G-20 in worldwide negotiations, Mexico now has a seat at the table. Other countries understand this. Brazil is the most obvious example, and one to be emulated rather than envied. Its steady and confident leadership on the world stage (backed by good macroeconomic policies and solid domestic economic growth), seduces not just international businesses and investors, but also worldwide diplomats. Having the world’s ear, Brazil´s eminence has become a self-fulfilling prophecy. In contrast, Mexico´s more timid foreign policy stance leaves it out of the game. In the coming months, we will likely see a narrowing of the Mexican government’s domestic policy agenda. The unfortunate combination of escalating criminal violence, the almost certain National Action Party losses in next year´s midterm elections, and the deepening of the global financial crisis will prove too much for an ambitious reform program in the second half of the president´s term. But this unlucky trifecta for the home front opens the opportunity for a more aggressive foreign policy approach. Mexico should turn outward in earnest, building on the solid blocks of support developed so far by Mexico´s diplomats. With now two years of distance from Fox´s unfortunate travails, the arrival of a new administration in Washington provides an opening for the Calderón government to shift Mexico´s foreign policy course. Through the U.N. Security Council seat, its OECD and G-20 membership, and its intricate economic, security, social, and cultural ties with what is still the most powerful world economy and government, Mexico has a chance to shape the international agenda. It is an opportunity Calderón should not waste. About the writer: Shannon O’Neil is Douglas Dillon Fellow for Latin America Studies at the Council on Foreign Relations in New York.

Since Calderon took office nearly 2 years ago, crime has increased at an alarming rate. Spilling beyond border drug violence, assaults, shootouts and kidnappings frighten citizens across the country. Perceived widespread corruption in the ranks of public security forces heightens the unease. In the wake of a particularly high profile and gruesome kidnapping/killing, Mexico’s civil society marched on mass in August 2008, demanding change. In response, local and national governments signed a pact-the “Acuerdo Nacional por la Seguridad, la Justicia y la Legalidad”-to improve Mexico’s public security. Based on this agreement on October 22, 2008, President Calderon sent two reforms to Congress to overhaul Mexico’s federal police system, combining existing forces and redrawing responsibilities. Mexico’s federal police is currently composed of two separate federal forces: the Agencia Federal de Investigacion (AFI) and the Policia Federal Preventiva (PFP). Although on the operational side both forces report to the Ministry of Public Security (SSP), on administrative issues the AFI is linked to the Attorney General’s office, the PGR. Reforming two already-existing laws, the Federal Police Law and the Federal Attorney General Office’s (Procuraduria General de la Republica, PGR) Law, the new bills would merge these two police forces into one single branch under the SSP. This should, according to the Calderon administration, clarify the different roles of the SSP and the PGR and as a result strengthen their mandates. The executive argues that the new centralized police force will make the federal police more efficient, more effective, and less corrupt. If congress approves the reforms, the first one would transform the PFP into an autonomous new Federal Police. The second reform would reorganize the PGR and change the process of selection and training of its officials in the effort to improve its performance. In this process, the AFI would disappear. Its officers could join the new Federal Police police force, but only after they prove- by undergoing an invigorated evaluation and certification process- that they are qualified (i.e. not corrupt among other skills). It is good to see the Mexican government taking on these serious challenges, but it is not all that clear that the reforms will improve the situation. Given that today’s PFP suffers from corruption, it is unclear how the consolidation of authority and renaming of its force will clean up the system. Mexico’s past two Presidents also revamped the federal police with great fanfare, but with few material results. The infiltration by drug traffickers into the most elite forces combating organized crime, as was revealed last month, is just the most recent reminder that Mexico’s police forces do not have adequate measures in place to stem corruption. The proposed laws don’t look to change this situation. Furthermore, while the new police force’s greater autonomy could increase efficiency, it will also reduce its interaction with the PGR. Whether the reforms then boost the new police’s ability to investigate and procure evidence on crime is a question. Lastly, corruption is not exclusive to the federal police forces. State and local police forces, as well as the army and other government agencies (which are now all involved in the battle against organized crime) are all contaminated with corruption. The federal police accounts for less than 5 percent of Mexico’s total police presence. Therefore, although at this point almost any change is welcome, the Mexican government must address the dire situation of local police forces. It also needs to tackle the impunity (due to malfunctioning court systems) that allows corruption to flourish. Though seemingly insurmountable, cleaning up all these links in the “rule of law” chain are necessary to turn back the tide of organized crime, and better the lives of ordinary Mexican citizens.

While the world was glued to televisions waiting for the result of the U.S. elections last night, Mexico lost one of its most important leaders in its struggle against organized crime and drug trafficking. Juan Camilo Mouriño, Mexico’s Interior Minister, died along with seven others when a government plane that was carrying them to Mexico City crashed into the city’s busy Reforma Avenue in what appears to have been an accident. Among those killed was also José Luis Santiago Vasconcelos, an important presidential adviser on security and judicial reform matters, who had headed Mexico’s elite force to combat organized crime (SIEDO) and had been in charge of extraditing numerous narcotraffickers. The Interior Minister is the second most important position in Mexico’s government, comparable to the vicepresidential position in the United States, and is usually responsible for negotiating with the legislative branch. President Calderon had assigned Mouriño to spearhead the government’s efforts against organized crime and to reform Mexico’s security institutions. In an administration that has rested heavily on President Calderon’s closest confidants in its decision-making process Mouriño was probably the closest to Calderon. It is unclear who could fill Mouriño’s shoes. His death is indeed a blow to Calderon and to Mexico’s efforts against organized crime, drug trafficking, and corruption.

Colombian President Alvaro Uribe was hailed for his plan to demobilize the country’s paramilitaries, but observers warn the groups are reforming under a different guise.

I’ve finally seen a full breakdown and explanation of the numbers behind the first year of the Merida Initiative, the Bush Administration’s proposal to cooperate with and aid Mexico in the fight against drugs and terrorism. It can be found here in the second Appendix. This ambitious plan aims to better arm Mexico’s front line civilian and military agencies, to create new roles and offices necessary to better monitor and fight crime, to transform the workings of police and judicial institutions, and to increase the role of civil society organizations in these processes. Looking at the actual budget breakdown, the focus on long-term institutional changes and professionalization of law enforcement and judicial agencies—which are essential for the sustainability of any success in the war against drugs—is not particularly impressive. Direct training for police and judicial officials comprises only $35mn of the $500 mn. Adding in office equipment, computer systems, forensic labs, and support for civil society that is directly tied toward increasing transparency and accountability increases the amount for institutional improvements to nearly $100 mn. Yet this is still just 20% of the money designated for FY2008. Instead, the Merida expenditure is front-loaded toward the gear. These include over $100 mn for 8 transport helicopters, $100 mn for 2 surveillance planes, and $140 mn for other equipment including satellite communication systems, ion scanners, x-ray technologies, and extensive database development. The main reason given for this breakdown is that the Mexican military and civilian agencies need more sophisticated machinery right now to combat the drug trade. While this may be true, there are significant drawbacks to this approach. First, institutional changes and professionalization take a long time to take root and achieve real results—so the sooner these changes begin the better for Mexico and the United States. Second, policies to reduce corruption and strengthen the rule of law provide less quantifiable benefits. They are much more likely to get cut from future budgets, particularly if the Merida Initiative is not deemed an rapid success (which, without improvements in the performance of the police and judiciary, is likely). Finally, given the real deficiencies in law enforcement and judicial institutions in Mexico, does the United States really want to equip them with sophisticated technologies before beginning expansive efforts at professionalization? Until these institutions are more transparent and accountable, improving surveillance and other capacities may be counterproductive. These issues need to be debated when Congress takes up the Merida Initiative, most likely in February. While this agreement is an important step for U.S. security and for bilateral relations, its success will depend in large part on its structure. In order to make the most of this opportunity to work closely with Mexico and to improve the safety of citizens on both sides of the border, greater support for real changes to Mexico’s institutions—from the start—is vital.

Romesh Bhattacharji, a South Asian counternarcotics expert, says India’s success with legal poppy growing though an international licensing program could be replicated in Afghanistan.

What a difference a year makes. Just a year ago Mexican President Felipe Calderon’s mandate appeared uncertain following a contested election that gave him a razor-thin winning margin of 250,000 votes over PRD candidate Andres Manuel Lopez Obrador (AMLO). Last December 1st he was stoically watching Representatives come to blows on the Congressional floor as PRD representatives tried to prevent his formal inauguration. Now his approval ratings top 60%, and he has achieved important if incremental reforms to the public pension system, the fiscal system, and the electoral system. This impressive turnaround highlights Calderon’s political astuteness. Unlike President Vicente Fox before him, Calderon has mastered the art of Congressional compromise, and his team has eagerly worked with opposition party leaders to hammer out viable legislative reforms. His foreign policy has also astutely asserted his independence from the United States, whether by speaking out against the treatment of Mexican migrants to reaching out to Leftist governments in the region, notably Presidents Ignacio Lula da Silva of Brazil, Fidel Castro of Cuba, and Hugo Chavez of Venezuela. Finally, Calderon has focused on an issue affecting voters’ daily lives: insecurity and violence. His tough "law and order" initiatives, including sending out nearly 30,000 military troops to combat drug trafficking, have gained him many fans in Mexico and abroad (including the United States). Yet Calderon’s successes also result from the calculations and positioning of the other political parties. With AMLO’s continuing defiance of the sitting government, the PRD has divided. The recalcitrance of many factions of the PRD to work with the government leaves them without policy accomplishments, weakening their electoral appeal. Continuing demonstrations against a popular President, such as disrupting Mexico’s State of the Union address traditions, have instead burnished Calderon’s image and discredited the PRD in the eyes of many citizens. In a turnaround from the Fox years, the PRI has made strategic choices to work with the PAN under Calderon. Hoping to appear Presidential for 2012, several key PRI leaders have forged a good working relationship with the Calderon administration. Each of the major reforms through Congress, pensions, fiscal, and electoral, were supported by important segments of the PRI. Despite these noteworthy successes, there are significant challenges that face the government, and which will determine the rest of Calderon’s tenure. These include: The drug war. Calderon has made headway with record seizures and arrests of key cartel members, interrupting at least temporarily the steady flow of drugs north. He has also negotiated the Merida Initiative with the Bush administration, which would exponentially increase U.S. assistance for Mexico’s war against drugs to some US$500 million a year for roughly the next two years. If passed, this agreement would transform the relationship between Mexico and the United States, locking in cooperation on drug and other crime oriented issues. Yet to truly succeed in lessening the daily violence in Mexico, fundamental reforms to the judiciary and police systems are necessary. Without these underlying changes, more money and more guns will not improve security in the longer-term. In fact, despite Calderon’s initiatives, the numbers of deaths in the war on drugs, and the violence in Mexico’s towns and cities, has if anything increased. How long the public will support this status quo remains to be seen. Migration. Calderon has also dropped any talk of pushing immigration reform in the US (a wise move given the domestic political currents in the US), and instead has focused on defending Mexican rights abroad (a popular move with domestic constituencies in Mexico). But unless Mexico can create hundreds of thousands of jobs each year for the next several years, migration to the United States will continue to be an unfortunate necessity. A U.S. crackdown, like that advocated by many of the current Presidential candidates - would strongly affect the Mexican economy and the basic income of millions of citizens that depend on remittances. Economic Competitiveness. Mexico has made great strides in opening up its economy and strengthening its institutions in the last two decades, but much more needs to be done to compete effectively on a global level. The concrete steps the Calderon government is taking to build Mexico’s infrastructure, including roads, ports, and airports, are crucial. But these need to be done more extensively and quickly. And they cannot be the only changes to the economy. Greater regulatory strength and independence, lower underlying costs of electricity, telecommunications, and improving health and education services, are crucial for Mexico’s future. Unless changes occur in these other areas, these bottlenecks will hamper economic growth and job creation. While more has been done in the first year than many expected, Calderon’s honeymoon is decidedly over, and the three main political parties are already starting to position themselves for the mid-term 2009 elections. This may mean that the window of cooperation is closing, limiting major reforms. This would be unfortunate for Mexico, and for its future.

Here is a recent interview I conducted with Bernard Gwertzman at the Council on Foreign Relations: Interview November 6, 2007

Shannon O’Neil, CFR’s Mexico expert, says Washington’s $1.4 billion multiyear plan to bolster Mexico’s crackdown on drug and criminal rings, while drawing criticism, is likely to win congressional approval. 

A rise in drug use in Iran is one overlooked consequence of the surge in opium production in the Taliban-run provinces of southern Afghanistan.

Has the once ballyhooed U.S. "war on drugs" been put on the policy backburner? Many experts think it has, and also that this might be a good thing.