A stuffed bear hangs from a cross of a child's grave at the children section of the San Rafael cemetery in Ciudad Juarez (Courtesy Reuters).

Latin America has the ignominious distinction of being one of most violent regions in world. Though not known for its wars or even (at least violent) border disputes, homicide rates average nearly 20 per 100,000 people. Central and South America are among the most murderous regions worldwide, behind only  Southern Africa. Six of the ten most violent nations in the world are in Latin America, with Honduras and El Salvador claiming the number one and two spots. The biggest headline-grabber this last year has been Mexico, which counted some 12,000 deaths in 2011 and over 40,000 drug related homicides since the start of President Calderón’s term (non-official estimates put these numbers even higher). Though Mexico is not the most violent in per capita terms, this escalation has deeply impacted the country.

But the region’s security outlook is not all gloom and doom. Ciudad Juárez, still Mexico’s most violent city, saw its homicides drop by almost half since 2010, to just under 1,700 this year. Given the well-documented inertial effect of violence (i.e. violence tends to breed more violence, ratcheting up the effect over time), this is a doubly encouraging trend. Further south, the Brazilian government rolled out its “Favela Pacification Program” beyond the original pilot (launched in 2008), sending Police Pacification Units (UPPs) to 19 favelas in Rio de Janeiro. Since last year, the city’s homicide rate dropped 13 percent and armed confrontations with police were down by a quarter. Meanwhile, Guatemala enjoyed a relatively peaceful year, with a slight (2.5 percent) decline in murders, bringing its homicide rate under 40 for the first time since 2004.

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

Soldiers stand guard in their military vehicle outside a clandestine drug processing laboratory discovered in Zapotlanejo (Courtesy Reuters).

There are many theories out  there about why we have seen a huge uptick in violence in Mexico – now running close to 25,000 homicides a year. An interesting academic paper by Melissa Dell, PhD candidate at the Massachusetts Institute of Technology (MIT),  tests one particular theory – elaborated by Eduardo Guerrero among others — that the policies spearheaded by Calderón and the PAN more generally have actually caused the increase in violence.  To do so she uses statistical models to examine how PAN victories in close mayoral elections affect violence locally, and whether they have “spillover effects”, causing traffickers to divert their routes to neighboring municipalities.

She finds that when a new PAN mayor comes in after a close election, homicides become 9 percent more likely, and drug traffickers are much more prone to have confrontations with the police. The movement of drugs also shifts to nearby towns  — causing an increase in violence there — confirming the so-called cucaracha, or cockroach, effect.  Dell argues that government’s policy is behind these statistically significant differences, and specifically that  the PAN’s decisions — from top to bottom — to take on drug traffickers more aggressively than other parties is behind the surge.

This rigorous analysis is extremely helpful, and is the type of work that academics should be sharing with policymakers on both sides of the border. Yet we should also be mindful of the limitations.  For one, Dell only considers locally produced drugs – marijuana, heroin, meth – leaving out the biggest cash cow, cocaine. Her analysis also exclusively focuses on drugs and not organized criminal groups’ other businesses such as extortion, kidnapping and human trafficking (she does nod to these, but finds no adequate dataset to use). As the business model has changed, so too have the targets, bringing these criminal groups much closer to the general population –as customers and as prey.

This leads to the third limitation – the assumption that “more than 85 percent of the [drug] violence consists of people involved in the drug trade killing each other,” a figure repeated a number of times without any footnotes. Though this has also been the mantra of the federal government over the last five years, so far neither the Mexican government nor outside sources have provided any proof that this is true. Of the nearly 50,000 drug trade-related deaths since 2006, the Attorney General’s office has investigated less than 1,000 (and solved less than 350). Given the shifting commercial interests of the criminals (bringing them closer to innocent civilians), it seems doubtful that the deaths are  still almost all between the gangsters themselves, or that the percentage of bad guys killing bad guys hasn’t changed.  Indeed, as a recent Human Rights Watch report points out, there are many cases of misclassification, where the authorities presume that murder victims are linked to drug traffickers until proven otherwise (which they rarely are, since the Attorney General’s office investigates less than 2 percent of the killings). The rise in extrajudicial killings by the military, also laid out in detail by Human Rights Watch, further questions these claims.

Finally Dell makes the assumption –  repeated in the press and elsewhere – that drug-related violence picked up with Calderón and his “war against narcotraffickers.” But the data show that the uptick started earlier, under president Fox, increasing some 40 percent from 2004 to 2005, and another 25 percent from 2005-2006. This doesn’t necessarily disqualify a PAN-ista effect (given both Fox and Calderón hail from the same party), but it needs to be explored more, as the security policies of the two differed in some respects.

The paper provides some policy suggestions, particularly regarding how to best use scarce law enforcement resources (for starters, don’t set up roadblocks). But the other more ominous implication is that if drug traffickers are rational economic actors, and PAN victories are so costly for them (in terms of relocating their routes or bringing in competitors), it makes sense for them to invest up front – and buy more local elections. As we head into 2012, all should be worried about this conclusion.

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

Mexican Gov. Enrique Pena Nieto answers reporters' questions at the National Press Club in Washington (Molly Reilly/Courtesy Reuters).

It seems the campaign book so popular in the United States has headed south of the border. After a recent tour through Washington, DC, and New York, former governor and likely PRI presidential candidate Enrique Peña Nieto just released Mexico, the Great Hope. An efficient state for democracy with results.

Arguing that the successive PAN administrations have left the country worse for the wear, Peña Nieto lays out his vision for a government based on guaranteeing citizens’ basic rights (such as security), getting the economy growing at its full potential, and reaffirming Mexico’s leadership as an emerging power on the world stage. He calls for a number of economic reforms, including opening Petróleos Mexicanos (PEMEX) to private investment (still maintaining state ownership), as well as widening the tax base and simplifying the tax code. On security, he favors a more comprehensive strategy geared first and foremost to reducing the violence.

Most of his positions are quite sensible. Mexico needs to (and is already starting to) focus on lowering the escalating levels of violence, as opposed to concentrating on taking down drug kingpins. Economically, opening up PEMEX would increase foreign investment and improve Mexico’s overall competitiveness, boosting jobs and growth in the process. Reforming the tax code would also go a long way to enhancing and diversifying government revenues and  hopefully make it easier to start up businesses. But these two  reforms are also politically difficult — having been on the legislative table for years now, and repeatedly stymied by Peña Nieto’s own party. If he wins, perhaps the former governor will be Mexico’s equivalent of a “Nixon in China” – able to change the dynamics precisely because of his party’s ties to PEMEX’s union – but that remains to be seen.

Much will also depend on the United States. For Mexico to reach its economic potential, the United States will have to grow as well, as the economies today are indelibly intertwined. A U.S. immigration reform – if it happens — also could change things for Mexico. For all its big vision, the book makes clear that there is much that needs to happen during the next presidential term in Mexico to fulfill  this “great hope.”

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.

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.

An obvious question is how does this affect crime and violence? The answer is less obvious. Overall, the data shows no straightforward correlation. Patrick Corcoran lays out many other factors that affect public safety, including each officer’s moral compass,  the chances of getting caught the severity of the punishment. Daniel Sabet’s study on corruption within the Tijuana police makes this point, laying out the complicated calculus  behind an officer’s decision to fall in (or not) with the bad guys.

Still, the graph below of police salary vs. homicide rate by state suggests that police pay does matter. While we see a lot of variation at the low and the middle end of the scale, high salaries and low violence are strongly correlated. The top nine payers– including states that are in drug traffickers’ line of fire (e.g. Baja California) –  have relatively few murders per capita. While not the only and last word, this should encourage lagging state governments to rethink their spending priorities.

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

Andean protesters shout slogans against the government in Lima (Enrique Castro-Mendivil/Courtesy Reuters).

Last month Peruvian President Ollanta Humala signed the popular consultation law, approved unanimously by Congress in August. This new law will require all public and private investors to consult local indigenous groups if and when their activities may affect their communities or ancestral lands. This is an important democratic step forward, reaching out to citizens who have for years been left out of the political process. In Latin America more broadly, incorporating indigenous communities into politics is a key challenge for consolidating democracy. But these types of laws also have their dangers, specifically potentially negative effects on investment and economic growth. Peru is only the latest of the Andean countries to take on the so-called “indigenous question” — trying to balance economic development with greater social inclusion.

Of its neighbors, Colombia has the longest history and the best track record. It incorporated indigenous consultation into the 1991 Constitution, and then created a Division of Indigenous Affairs in the Ministry of the Interior, as well as offices of indigenous affairs within each of its military commands. To be sure, things haven’t gone perfectly – for instance some indigenous groups accuse President Santos of ignoring their interests in the latest national development plan. But overall Colombia has been successful, enabling a greater voice for all of its citizens while also attracting billions in investment in oil production, coal mining, and other industries.

More cautionary tales come from Bolivia and Ecuador. Both nations have large indigenous populations which historically have been socially and politically marginalized, and excluded from the economic benefits of resource extraction — often by foreign companies — taking place on their land. As these groups have increasingly organized and mobilized, their distrust and animosity has led to conflicts, violence, and the fall of more than one democratically elected government.

Current Presidents Evo Morales of Bolivia, and Rafael Correa of Ecuador have both struggled to balance inclusion with economic development. Morales has perhaps gone the farthest in providing a voice for indigenous groups within the new Constitution, but in return has seen foreign investment plummet. Since Morales’s election in 2006 Bolivia’s natural gas output has stagnated, and proven reserves have shrunk by about a third. In Ecuador, Correa began with the backing of the Confederation of Indigenous Nationalities of Ecuador (CONAIE), but is now at odds with the country’s largest indigenous organization, backing away from many of their demands regarding new mining projects.

While Peru’s indigenous communities have yet to organize politically, there is a growing discontent among these masses, which took a toll on the previous government’s popularity and led to several uprisings around natural resources extraction. The most violent of these – known as the “Baguazo” – occurred during the summer of 2009 in the Amazonian province of Bagua, where 22 indigenous protesters and 12 police officers died in clashes over mining projects in the area.

For Peru, it remains to be seen whether Humala can channel these pent up frustrations positively into the political process without scaring off investment. As the Ecuadorean and Bolivian examples show, more than just rhetoric — or leftist credentials — are needed. But if the new government can pull off this delicate balance, it will help support continued fast paced economic growth.

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.