Drug War Capitalism (18 page)

The Mexican government has actively promoted mining investment, and today the sector is 70 percent foreign owned.[78] Mining projects have been among the most conflictive sites of recent capitalist expansion in Mexico, and the majority of gold and silver production in the country takes place in states with the highest rates of violence (Sonora, Chihuahua, Zacatecas, Guerrero, and Durango). “Mining production in Mexico has been skyrocketing, up 50% in 2010, and more than double in the ten years ending in 2010 what three centuries of mining by the Spaniards produced. Today, eight out of the top 11 gold producers in the country are Canadian, and gold production was up 118% between 2007 and 2012.”[79] In a move contrary to many of the policies passed by previous governments, taxes imposed on the mining industry, including a 7.5 percent royalty tax, were introduced as part of the tax reform, to the dissatisfaction of many foreign mining companies.[80] However, “forgotten in the flood of criticism is that as much as 60% of the royalty amount will be tax deductible.”[81] Anti-mining activists estimate there are fifty active mining conflicts in Mexico, and as investment in the sector continues to grow, the pro-mining/anti-mining divide is bound to become more polarized.

As we have seen, over the seven years since the war on drugs started in Mexico, a series of reforms have been passed that go a long way toward improving the country’s macroeconomic indicators. In February 2014, Mexico’s credit rating was again increased, this time to AAA, based on the energy and taxation reforms. The large financial institutions are pleased with Mexico’s performance, and Mexico’s economy is expected to grow faster because of the reforms.[82] But it has long been established that stronger macroeconomic performance does not translate to better quality of life, especially for the poor. Over the first six years of the war on drugs, the number of Mexicans living at or below the poverty line increased from 42.9 percent to 52.3 percent, according to the World Bank.[83] Austerity measures, decreasing labor standards and increasing precarity, and the increased cost of buying basic goods are forms of deepening structural violence against the poor majority.

Legal Reforms

We must also consider the judicial and rule of law aspects of the Mérida Initiative. In February 2012, the United States government announced a new training program for 8,500 prosecutors and investigators in Mexico.[84] By 2016, all of Mexico is expected to be using a US-style legal system, a complicated transition funded by the Mérida Initiative.[85] At one point, current Attorney General Jesús Murillo Karam claimed that drug trafficking had broadsided Mexico, as if it was a boogeyman that sneaked up on unassuming politicians and police in the dark of night. “We Mexicans had a justice system, an investigative system, and a policing system made for a country where the most serious crime was cattle rustling, which is to say, cows were stolen. And then all of a sudden, before we realized it, we were seated in a terrain where narcotrafficking, organized crime, the organization of crime had already surpassed all of the institutions,” he said.[86] His words not only betray the Mexican state’s level of involvement in the drug trade historically, but they imply that Mexico was a country without massacres, dispossession, and femicides before the drug war started, which is simply false.

Mexican officials used the specter of narcotrafficking to shift blame away from structural impunity and police abuses, the drug war has provided them with a chance to push for reformation of the justice system. “Mexico is doing things that go much beyond fighting drugs. Yes we’re fighting organized crime and organized delinquency, which is one aspect of drug trafficking, but the truth is that the struggle in Mexico is a struggle for the transformation of its security and justice institutions,” stated Alejandro Poiré Romero, who served as secretary of the interior during part of Felipe Calderón’s administration.[87]

Many human rights groups herald the transition to oral trials and an accusatory justice system as a positive step, and progressive groups have provided trainings promoting the new legal system. But the reforms also have their detractors: “Just as within globalized commerce [the United States] wants a world where everywhere there is a McDonald’s, an Applebee’s, a Home Depot, a Walmart, a Sam’s [Club]; they also want a world where tribunals are the same everywhere as they are in the United States, so that whatever legal issues they have can be dealt with perfectly well by a legal firm from the United States, which can operate in the US, in Puerto Rico, in Argentina, in Chile, and so on,” said Oscar Castrejón Rivas, the president of the College of Lawyers in Chihuahua City, during an interview in late 2011.[88] Chihuahua was one of the first states to adopt the new legal code, beginning in 2007, and Management Systems International (MSI), which was contracted by USAID to promote and carry out legal reforms in Mexico, maintains the state has what is “considered to be the most advanced, progressive criminal justice Code in Latin America.” Using US taxpayer money, MSI sent politicians from Chihuahua to Chile and Argentina to study their justice systems, since decades earlier, in the 1990s—funded by USAID, the World Bank, the United Nations, and the Inter-American Development Bank—both South American countries transitioned toward an accusatorial system.

When I spoke to Castrejón Rivas just over a year later, he told me that “in the opinion of the community of people in Chihuahua and the lawyer’s forum, what has happened has been a counter-reform, something very different than what Washington and USAID promised.” Incarceration rates increased, and “basically, the presumption of innocence has been cancelled.” There is no doubt that the Mexican justice system is racked with irregularities, and advocacy groups—some of which are US funded—are clamoring for reform. But the statistics are generally lost amid the barrage of publicity claiming the USAID-imposed model will clean up Mexico’s justice system.

It is also important to note that at the same time as the US-backed reforms to the legal system are being carried out, the penetration of Mexico’s judiciary by criminal groups is on the rise. “In many cases, judges, court officials and legal professionals are unable to act freely or fully independently because they are faced with threats, intimidation, harassment and other forms of undue pressure,” according to a 2011 report by the UN’s special rapporteur on the independence of judges and lawyers.[89] “The impetus behind rule of law projects has often been the belief that markets require predictable legal structures to protect property rights, facilitate foreign direct investments, and contract enforcement—that is, to establish U.S. law as the ‘lingua franca for business and politics.’”[90] In addition to USAID, the Quebec Bar Association, the US Federal Judicial Affairs Council, the National Judicial Institute, the National Democratic Institute, and the Federal Judicial Affairs Council have all been involved in promoting such legal reforms in Mexico. The economic bases for the reforms have been established by the Mexico Competitiveness Institute, which “identifies the creation of an objective and reliable justice system as Mexico’s top priority to improve competitiveness and to attract both foreign and domestic investment,” according to a statement by USAID chief Roger Garner.[91] “Our Mérida programs in Mexico are designed to support those Mexican institutions as they fundamentally change their entire justice system and train an estimated 1 million people in new, more transparent and accountable ways of administering justice.” Garner didn’t mention that the Mexican Competitiveness Institute receives funding from the Mexican Council of Businessmen and USAID, and does consulting work for the US Embassy and the World Bank. His comments reflect the classic US echo chamber, though which US-funded civil society groups reinforce the State Department’s policy prescriptions.

The push to change Mexico’s legal system could impact Mexican legal traditions, which, according to law professor Deborah M. Weissman, include “ongoing attention to indigenous rights, constitutionally designed cooperative land use, corporative models of labor relations, and legal pluralism.”[92] In turn, these changes could negatively impact popular resistance to mega-projects with foreign beneficiaries. The US rule of law program in Mexico falls in lockstep with counterinsurgency efforts. “If you look at the allocation of rule of law money, it’s for surveillance, it’s for activating, whatever the heck that means, new prisons in Mexico, it’s for training Mexicans with regard to the adversarial and oral trial systems, yet they do not introduce the jury system,” Weissman told me. “You have a rule of law program in what is essentially a plan to militarize the drug war. You see that everywhere.”

Take this telling example of the connections between US police training and US-backed reform from 1960s Venezuela: “In the first place, the Venezuelan legal system had to be changed. Venezuelan law required the arrest of a police officer who killed a suspect, this, according to the
Los Angeles Times
reporter, frequently meant three months in jail while awaiting trial. But ‘under American tutelage, a policeman who killed a terrorist would be examined in one day by a civilian board of lawyers, and would be quickly restored to duty.’”[93]

The use of torture to obtain confessions is a common tactic used by Mexican police and soldiers, and the practice shows no signs of waning. In 2008, Felipe Calderón modified the constitution to introduce
arraigo
, a legal provision allowing the lengthy detention of suspects on the pretext that it allows authorities more time to gather evidence against them. This increases the possibility that torture be used against individuals or groups detained by the state. According to Mexican human rights groups, “This measure is clearly a form of arbitrary detention contrary to the obligations of human rights that Mexico has acquired, and violates, among others, the right to personal liberty, legality, presumption of innocence, due process and the right to an effective remedy.”[94]

Arraigo can be applied without any formal charges being laid, and the accused are held incommunicado for a period of up to forty days (which can be extended to eighty days with a warrant). In a 2011 report, the Inter-American Commission on Human Rights noted that it “received complaints having to do with the use of arraigo to hold individuals in private homes, hotels, and military facilities without respect for judicial guarantees, indicating that those being held in this manner have been subjected to torture for the purpose of obtaining confessions.”[95]

Who Benefits?

Some of the most important companies in the world will gain from financial and legal reforms in Mexico. The country is the world’s largest exporter of flat screen TVs and fridge-freezer units, and the manufacturing sector includes investment from firms including Toshiba, Hitachi, Mitsubishi, Pioneer, Ericsson, Sony, Sanyo, Panasonic, Xerox, Siemens, Foxconn, and Motorola, among others. Recent announcements indicate that new investment in auto and aerospace manufacturing in central Mexico will continue.

“Mexico fell into a deep recession in 2009 when American demand for Mexican-made imports collapsed. But the recovery under President Felipe Calderón has been notable, with growth expected to reach almost 4 percent this year, roughly twice that of the United States,” according to an article published in the
New York Times
in 2012
.
[96] In 2008, before the financial crisis spread to Mexico, FDI reached $23.2 billion, and fell the next year to $11.4 billion.[97] FDI has since rebounded: to $19.43 billion in 2011, and by 2013, to over $35 billion, primarily in manufacturing (73.8 percent), mining (7.9 percent), and commercial services (4.9 percent).[98]|[99]

An important and underreported aspect of the Mérida Initiative is the building of new border crossings and expansion of existing ones, both key demands of the US commercial sectors.
“Financially, investment in border crossings and infrastructure has not matched the exponential increase in trade crossing the border each year,” reads a December 2012 memo from the Council on Foreign
Relations.
[100] This infrastructure is necessary for the
maquila
(assembly) industry in Mexico, as well as to ensure efficient and regular supply of fruits, vegetables, and other food products to the United States.
There are huge subsidies for US and other corporations that operate along the US-Mexico border, and so the US requires Mexico’s cooperation on these crossings.
With regards to port and border posts, “the U.S. Government funded the development of licensing officer training; provided end-use/end-user and risk analysis training and enforcement training; developed an internal compliance program for private industry; and provided targeted donations of radiological and chemical detection and identification equipment in collaboration with the U.S. Department of Energy’s Megaports program and the Mérida Initiative.”[101]

Possibly the highest profile beneficiaries of the drug war are large banks. As mentioned previously, the United Nations Office on Drugs and Crime reported in 2010 that 85 percent of the gross profits from the $35 billion US cocaine market are generated in the United States.[102] This is where the big banks in the United States cash in on the drug trade, their complicity, when discovered, going nearly unpunished. HSBC was found guilty in late 2012 of having laundered over $880 million for the Sinaloa Cartel and Colombian drug traffickers, among others. According to a report in
The Guardian,
“In order to handle the ‘staggering amounts of cash’, the bank even widened the windows at some branches to allow tellers to accept larger boxes of money.”[103] HSBC was let off with a $1.9 billion fine—about five weeks of income for the bank—and none of its executives faced criminal charges for their role in facilitating the drug trade.[104] According to Antonio Maria Costa, head of the UN Office on Drugs and Crime, cash from organized crime essentially rescued banks during the market meltdown in 2008. “Inter-bank loans were funded by money that originated from the drugs trade and other illegal activities.… There were signs that some banks were rescued that way.”[105]