From: Ed Husain
Sent: Thursday, January 26, 2012 3:19 PM
To: Shannon O’Neil

Very bold stance in your blog yesterday on undocumented immigrants and how they are, essentially, part of the U.S. social fabric.

From: Shannon O’Neil
Sent: Thursday, January 26, 2012 3:20 PM
To: Ed Husain

Thanks – I guess bold is good. And it is true: millions are parents, spouses, or siblings of U.S. citizens. They are not going to leave even if it is hard to get a job…

From: Ed Husain
Sent: Thursday, January 26, 2012 3:27 PM
To: Shannon O’Neil

I prefer bold any day over ‘weighing options’ — taking a stance is more compelling to this reader rather than presenting alternate arguments.

My hunch is to agree with you: it’s a very humane and morally obliging argument. Not to mention economically more viable.

I struggle with its logical conclusion, though: an amnesty for illegal immigrants, and thereby encouraging others to break the law and migrate in the hope of future amnesties.

From: Shannon O’Neil
Sent: Thursday, January 26, 2012 3:36 PM
To: Ed Husain

The difference is this. Especially for Mexican migrants, given the combination of absolute number caps on legal visas combined with the large number of Mexican family members here, parents, kids, and siblings have to make the choice of growing up (for years potentially) apart waiting for a legal family visas, or coming illegally. So do you want to wait and do the paper work and hope you get to see your 4 year old when he/she is 8-9 years old? Or do you bring them illegally? That is an inhumane law, and should be changed. If you can bring your kid within months, then I think people would wait.

Same with parents that are illegal. Do you send them back, meaning they won’t see their kids for 10 years (at least), at least here in the United States? Yes they are illegal, but in part because of the dysfunction of current laws. So laws in my view need to be changed to reflect realities.

From: Ed Husain
Sent: Thursday, January 26, 2012 3:54 PM
To: Shannon O’Neil

Not much of a choice between obeying the law and parting from one’s family for an indefinite amount of time. Thanks for explaining. I come to this with a European bias where we have a mess with consequences of legal and illegal immigration and no ’solution’ in sight. The US seems better suited to absorb immigrants (legal or otherwise). In Europe, we’re wrestling intensely with identity, race, multiculturalism, and what it means to be ‘European’. In contrast, immigrants here integrate into the United States and adopt the U.S. Constitution and history as their own.

Any other readers who would like to weigh in should feel free to do so in the comments section. I look forward to your feedback.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Photographs of missing people are on display at a square in Queretaro (Courtesy Reuters).

Last Wednesday, Human Rights Watch (HRW) released its report “Neither Rights Nor Security: Killings, Torture and Disappearances in Mexico’s ‘War on Drugs’.” The report is incredibly thorough – based on two years of research in the states of Baja California, Chihuahua, Guerrero, Nuevo León and Tabasco, and incorporating information from over 200 interviews. It charges Mexican security forces with routinely violating citizens’ most basic rights during President Felipe Calderón’s six years in office, and further argues that these horrific tactics are not incidental, but endemic to the government’s drug war strategy.

Some of the most worrisome statistics and findings include:

·       Formal human rights abuse complaints increased seven-fold, from 691 during the 2003-2006 period, to 4,803 from 2007-2010

·       Of some 3,700 military investigations into human rights abuses in the past four years, just 15 – less than one half of one percent — resulted in convictions

·      Formal complaints of “degrading treatment” – read torture — at the hands of security forces more than tripled since 2006

Based on witness testimonies and material evidence in specific cases HRW investigated they find:

·       Law enforcement – including the Army, Navy, Federal Police as well as local and federal judicial investigative police — participated in over 170 specific cases of torture – including beating,    asphyxiating, water boarding, electrically shocking and sexually torturing detainees

·       Others facilitate this torture –  medical examiners fail to document signs of physical abuse on detainees, and judges admit confessions and other evidence acquired through torture, even when the victim protests

·       Law enforcement played a part in 39 “forced disappearances” and 24 extrajudicial killings of civilians

After a meeting with HRW representatives Calderón agreed to investigate the findings, though he did say that the “main threat to the human rights of Mexicans is from criminals”.

Why have human rights violations expanded so drastically?  One explanation lies in the use of the military.  Armed forces are trained to kill the enemy on the battlefield, not police neighborhoods to ensure basic public safety. With some 50,000 soldiers now on the front-lines of the drug war, this disconnect can lead to abuses of the rule of law.

Another reason is the profound weakness of Mexico’s judicial system.  Most crimes – likely 80 plus percent — are never even reported. Of the few complaints filed, the Attorney General’s Office (PGR) investigates only one in every five; even fewer go to trial. In the end, only one to two of every hundred crimes end in a conviction. Once prosecutors do move forward with a case however, the chances of acquittal are slim, as roughly 9 in 10 of all suspects brought to court end up in jail. This has less to do with the stellar cases built around airtight evidence, and more to do with the underlying system, which is stacked against defendants – resulting in few safeguards and a de facto presumption of guilt.

Finally, Mexico doesn’t even have the laws needed in some cases to prosecute bad behavior. For instance, only eight of Mexico’s thirty-two states have laws against forced disappearances and only sixteen have formally criminalized torture. What it does have is opportunities to limit citizen rights – such as the arraigo procedure, which lets prosecutors lock up individuals for up to 80 days if they’re allegedly involved in organized crime, and vaguely defined “flagrancia” rules that dictate when police officers can make arrests without a warrant.

The spike in human rights complaints is worrisome on many levels. First and foremost, it reflects the government’s utter failure to protect thousands of citizens from itself. But more strategically, the abuses described in the report run counter to the state’s long-term aims.  In order to “win” the war on organized crime, Mexico’s government must have society’s support. Egregious human rights violations will just push away the one force the narcos can’t match. To end drug related violence, Mexico must construct a truly democratic rule of law, in which the means to and the ends are one and the same. To do so, the government must track and punish human rights abuses and abusers as fervently as it does those on its Most Wanted lists.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Peña Nieto, outgoing Institutional Revolutionary Party governor in the State of Mexico, is silhouetted against the national flag before delivering his sixth and final state report in Toluca (Courtesy Reuters).

I had the pleasure of speaking at and moderating a panel last Thursday at the Council of the Americas/Americas Society with Claudio X. González, Chairman of the Board of Kimberly-Clark de Mexico and on the board  of a number of top Mexican corporations, as well as Alberto Ardura, Managing Director and Head of Capital Markets for Latin America at Deutsche Bank. Some of the most interesting issues raised were the relationship between security and the economy, and the future of the energy sector.

Overall, the political and economic outlook was quite positive, despite the formidable challenges the next administration will face. Mr. González highlighted that Mexico presents something of a paradox – despite increasing insecurity, the economy is picking up. He credited this in large part to orthodox economic policies that have kept deficits and inflation low, leading to GDP growth in the realm of 4-5 percent (outpacing current market estimates). Mr. Ardura echoed this view, saying that the fifteen plus years of fiscally responsible policies have made Mexico’s economy the healthiest in the hemisphere, with some of the best macroeconomic fundamentals in the world (certainly among emerging markets).

Still, both panelists remained concerned about Mexico’s future competitiveness and growth. Despite its macroeconomic prowess, it has fallen behind Brazil, Peru, Colombia, and even less orthodox Argentina. The main holdups are security, the closed energy sector, education, and the concentration within so many sectors of the Mexican economy.  They felt that if the government could tackle a few of these major issues, it could pick up the speed of annual growth to five or six percent — transforming Mexico in the process.

The speakers were quite optimistic about the PRI, both on its ability to get things done if it wins the presidency (particularly if it wins a majority in Congress, ending legislative gridlock), and on substance — especially the possibility of opening the energy sector.

But some in the audience doubted the positive momentum, particularly the veracity of the new, more modern PRI that looks set to capture Los Pinos next July. Many (at the podium and in the audience) remained skeptical about whether the “dinosaurs” of the party would stand down, allowing these more comprehensive reforms to strengthen Mexico’s public institutions and jump-start its economy.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Bundles of confiscated drug money worth two million euros ($2.7 million) are displayed at a police headquarters in Madrid January 18, 2011. (Andrea Comas/Courtesy Reuters).

On Tuesday, the UN Office on Drugs and Crime (UNODC) released a new report on global money laundering, “Estimating Illicit Financial Flows Resulting from Drug Trafficking and Other Transnational Organized Crime.” The upshot? It is really hard to estimate. But, the report does provide some tangibles. Surveying numerous studies, it calculates that illicit global proceeds amount to over $2 trillion dollars every year (roughly 3.6 percent of global GDP), with some $1.6 trillion of this laundered. Within these staggering figures, roughly $870 billion of these revenues relate to drug trafficking and organized crime, and close to $580 billion of those illicit funds are laundered through financial institutions. The study drills down and looks specifically at the global cocaine market, estimated at some $85 billion. Most of this, again, is laundered.

The report provides some hints as to how this happens. Of the $85 billion cocaine market, most (estimated at $61 billion) stays in the retail markets – the United States and Europe primarily. Producers – mostly Andean farmers – receive in total $1 billion, or just over 1 percent of the gross profits. This leaves, by their estimates, roughly $23 billion for those processing and moving the drugs from the fields to the domestic wholesalers. Shipping cocaine from producing regions to transit locations generates at least $8 billion in profits.

When it comes to laundering this money, at least half occurs locally, and most of the rest in nearby countries. In South America, the report estimates that some $13 billion dollars of laundered cocaine  money likely flows into and through local banks and local businesses, and roughly $7 billion is probably cleaned nearby, often in the Caribbean. The report also touches on the profound (and mostly negative) impacts of these flows on local economies, including corruption, real estate price distortions, large income disparities, and weaker growth (since criminals aren’t usually looking for long term productive investments in local economies).

The report ends on a fairly pessimistic tone. Drawing on a separate, heavily cited 2009 report from the U.S. Department of Justice’s National Drug Intelligence Center, the UNODC estimates that Mexican and Colombia’s drug-related money laundering may amount to between $18 and $39 billion each year. The authors argue that, unlike taking down kingpins (who are easily replaced), seizing illicit funds has much more severe and long lasting impacts on illicit trade. But, then the report  goes on to show that our global ability to find and stop these financial flows is abysmal – estimated at far less than 1 percent – not much different than the fees brokers charge to clients to buy and sell stocks, and less than hedge funds take to manage your (legal) money. With the cost of doing business – at least in terms of money laundering – remaining low, the UN office points out the vital need for international law enforcement to truly step up and follow the money.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

At least 27 people were found dead in the Guatemalan village near the border with Mexico last May. Police look at a message written with a victim's blood, which reads: ‘What’s up, Otto Salguero, you bastard? We are going to find you and behead you, too. Sincerely, Z200.’ (Courtesy Reuters).

In the House Foreign Affairs Committee’s recent hearing, “Has Merida Evolved? Part One: The Evolution of Drug Cartels and the Threat to Mexico’s Governance,” Committee Chairman Connie Mack (R-Fla), among others, expressed his support for a U.S. counterinsurgency program (COIN) to fight Mexican drug traffickers. Calling the cartels “a well-funded criminal insurgency raging along our southern border,” Mack said the only way to win the drug war is through an “all U.S. agency” COIN approach, which would require greater U.S. military involvement.

I’d tend to agree instead with this article by Patrick Corocan, which says that sending U.S. troops into Mexico will not provide a long-term solution to the country’s security challenges, first because the nature of narco-violence is distinct from that of an insurgency (so a COIN response to it would be inappropriate) and because of the “practical difficulties” involved in such an approach (including a popular backlash to it in Mexico).

This week the U.S. Senate Caucus on International Narcotics Control released its report, “Responding to Violence in Central America,” which draws attention to the rapid escalation of violence in the region – most of it tied to the ramped up activity of organized crime, as detailed by the Woodrow Wilson Center study I discussed last week. The report offers a number of policy recommendations to deal with the problem, the most critical (and innovative) of which include placing more emphasis on extraditions of drug traffickers to the United States, improving witness protection programs and expanding cooperation between U.S. law enforcement and regional counterparts. It also notes that while U.S. security assistance for Central America has grown over the past three years, it is likely to stagnate – or even decline – in the future,  making it even more critical for countries in the region to seek other sources of security funding by reaching out to other donors and to the domestic private sector.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Governors (L-R) Jose Guadalupe Osuna Millan of Baja, Humberto Moreira Valdes of Coahuila, Texas Governor Rick Perry, California Governor Arnold Schwarzenegger, Jose Natividad Gonzalez Paras of Nuevo Leon, Arizona Governor Janet Napolitano and Eduardo Bours Castelo of Sonora pose as characters from the movie "Terminator" at the 26th Border Governors Conference (Courtesy Reuters).

This week the Mexican state of Baja California will host the two-day Border Governor’s Conference. Started nearly two decades ago, the annual meeting brings together governors from all four U.S. and six Mexican border states to discuss the issues directly affecting their states and citizens. At its height in the early 2000s, the governors and their ministers met not just with each other but also with representatives from Commerce, Homeland Security, the Environmental Protection Agency (EPA), and other departments and agencies to influence border-centered debates in both Washington, DC and Mexico City.

But in recent years the conference has fallen on hard times, a victim of polarizing politics. The 2009 session hinted at the divides, as the governors of Arizona, California and Texas failed to make it to Monterrey due to “scheduling conflicts.” It hit its nadir in 2010 in the wake of Arizona SB 1070. The Mexican governors wrote a letter calling the law “discriminatory [and] racist” and announced their plan to boycott the meeting if hosted, as planned, by Arizona Governor Jan Brewer in Phoenix. Brewer cancelled the conference in retaliation. In the end, Governor Richardson of New Mexico held the meeting, but no other U.S. governors attended, leaving the future of this consultative mechanism in limbo.

The conference also has suffered from a sprawling agenda and size. With its initial successes the agenda items grew, as did the number of participants. In recent years there have been some 25 working groups on topics ranging from wildlife to science and technology. The influx of hundreds of staffers and activists has made the process much more cumbersome, and reduced the intimacy and spirit of cooperation that guided the conference in the past. Reduced in large part to the signing of agreements and photo opportunities, many governors (particularly from the United States), began skipping the event.

As the United States and Mexico search for common ground and mutual solutions to pressing problems, it is time to revitalize this mechanism. It should refocus on practical problems facing the border states and their residents. Rather than covering the gamut, the agenda should be streamlined to emphasize a few vital issues. It must enable leaders to actually meet and discuss the serious challenges facing their states and constituencies, re-energizing the consultative element of the event. Most pressing today is security, where policy so far has been guided from the center, even though the effects are concentrated on the border.

Once refocused, the border governors need to organize better to influence their respective governments, shaping policies that in turn shape the border. One potential model is the Pacific Northwest Economic Region (PNWER), which brings together state legislators, governors, civil society and businesses to lobby the federal government and strengthen U.S.-Canada border security and the region’s economic competitiveness. Another is scaling up the San Diego Association of Governments’s (SANDAG) annual binational conference, which brings together local leaders in California and Baja California to address just one broad agenda item at each meeting – such as the economic impact of wait times at shared border crossings.

As Arizona Governor, Janet Napolitano repeatedly said that one of her closest day-to-day working relationships was with Sonora Governor Eduardo Bours. This reality – that cross-border issues and events strongly affect border state residents’ daily lives — hasn’t changed. Revitalizing the Border Governor’s Conference is one means to address these shared challenges, and reincorporate regional problem-solving strategies into larger U.S.-Mexico debates.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Narco Killings 2011 Map (Courtesy WM Consulting).

There has been much debate in Mexico about the number of drug-related killings since the start of drug war in 2006. The Mexican government provides an official database that puts this figure at some 35,000. Others, such as Reforma, provide an estimate near the official number — but more current — now totalling some 37,000.

As important as the total numbers is their breakdown. Here, the Mexican government provides some estimates, sorting the murders according to whether they were acts of aggression, executions or occurred as a result of a confrontation. Walter McKay at WM Consulting has built a useful tool by scouring local newspapers in many (but not yet all) Mexican states. This map depicts the murders according to whether the victim was a civilian, politician (or other high profile individual), or law enforcement official, and also shows the sites of car bombs and mass graves. McKay puts the number of deaths as a result of the drug war at some 47,000, significantly higher than the government estimate. As the policy debates continue, these various sources of information will be vital to informing steps forward.

This week the Woodrow Wilson Center released its report, “Organized Crime in Central America: The Northern Triangle”, which has many well researched and written chapters on the accelerated rise of criminal structures over the past three decades in El Salvador, Honduras and Guatemala. To bolster weak rule of law institutions vulnerable to the influence of organized crime in the region, it argues, the U.S. will need to contribute more funds to the region’s security initiatives – even as individual  countries play a greater part by collecting more taxes. Though overall the picture is disheartening, this useful study lays out the complex factors underlying the violence in Central America today.

It also shows that while all Central American nations struggle with crime and violence, the real security challenges are in the Northern Triangle – where the magnitude and type of organized criminal operations are unparalleled. This finding questions the traditional blanket regional approach taken by the United States (through CARSI), or the way other Latin American or European countries develop multilateral security initiatives within Central America.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Container ship sails beneath Golden Gate Bridge en route to port in California (Robert Galbraith/Courtesy Reuters).

Today the Council on Foreign Relations is releasing its independent Task Force report, “U.S. Trade and Investment Policy.” Led by Andrew H. Card — former White House Chief of Staff under George W. Bush – and Thomas A. Daschle – former U.S. Senator and Senate Majority Leader – and directed by my CFR colleagues Edward Alden and Matthew Slaughter, the 22 members took on the increasingly thorny issue of the future of  U.S. trade policy.

One of the most interesting discussions within the report is of multinational corporations. While representing less than 1 percent of all companies, they provide nearly a quarter of all private sector jobs, nearly 40 percent of all U.S. capital investment, and conduct the vast majority of research and development. These are the engines of today and tomorrow’s economy – and as such the United States needs to become much more competitive in attracting these corporations to its shores.

Another important discussion involves the increasing skepticism among the U.S. public toward trade’s benefits. The group rightly points out this has occurred not because of the general public’s lack of understanding or “ignorance”, but because of the experience of the average American worker. Over the last ten years –the time frame within which trade became a much harder sell — nearly all American workers saw their real earnings fall. U.S. based export oriented jobs – which in general pay more than domestically oriented ones – haven’t grown, even as the world economy exploded. Inequality too has grown during this time frame. And while the report rightly points out that trade was not the only, or perhaps even the deciding factor behind these shifts, it did play a role. As such, any new policy must take into account and work to enhance the widespread benefits of trade for America’s citizens.

Too often participants in policy debates come out as for or against trade, without defining for what end. Here, the Task Force usefully defines the main goals of U.S. trade and investment policies as “improving American living standards and advancing America’s broader interests.” To better meet this end it provides several concrete recommendations, including prioritizing service sector opening in ongoing trade negotiations, reforming the tax code and removing protectionist regulations on international mergers and acquisitions in order to encourage foreign investment in the United States, streamlining the WTO and creating stronger international trade enforcement mechanisms, and expanding adjustment assistance programs to provide a broader safety net for American workers.

As is often the case in trade oriented debates, Task Force members weren’t able to reach a unanimous consensus on what a better trade policy would look like, and how to get there. It is worth looking at the additional dissenting views section to get a sense of the varied perspectives on the report’s conclusions.  Still, everyone did agree to the Task Force’s basic takeaway – that the administration and Congress must revise America’s trade strategy or risk losing out on the enormous potential gains of deeper global engagement.  The report is well worth a read, offering insights on how the United States can emerge from the recession and financial crisis a stronger and more capable leader in the international economy.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Workers harvest soybeans at a farm in Tangara da Serra, Brazil (Paulo Whitaker/Courtesy Reuters).

A recent article by Mariano Turzi argues that soy is the most recent of Latin America’s commodity booms, creating many of the same challenges that metals, minerals, and oil brought in the past. Whether economic booms and busts, populist leaders, or fights between more powerful (e.g. Brazil) and weaker (e.g. Paraguay, Uruguay, and Bolivia) nations in the supply chain, Turzi worries about the fallout for the Southern Cone and its future.

Mexico Evalúa recently released the first study I have seen evaluating the outcomes of Mexico’s New Security Model. The results are mixed, at best. Some of the most fundamental measures differentiating the new security model from its predecessors – such as tracking law enforcement officers and their arms in a national database – have not become universal, and in fact have actually declined in recent years. The huge government outlays – now six times the amounts at the start of Calderon’s term – remain at times unspent and in others poorly accounted for. Accountability in general remains perhaps the biggest challenge. Mexico Evalúa finds it hard to judge these programs from the outside, as few metrics are provided. The military maintains even less oversight than the other security agencies they analyze. But reports such as these are at least a start toward pushing for more openness, evaluation, and in the end, better outcomes.

Finally, the Justice Department’s National Drug Intelligence Center’s annual report shows cocaine prices increased by a third and purity decreased by more than two thirds from 2007 to 2010. This seems to have led to a decline in cocaine use – down by almost a quarter — confirming the findings of the Substance Abuse and Mental Health Services Administration report included in last week’s reads. Less positive, methamphetamine production (north and south of the border) seems to have reached an all time high, driving prices down, while purity has continued its steady climb.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.