The Brookings Institute on Mexico: Lower Taxes and Make (Better) War to End Violence

The Brookings Institution released a report titled “Peña Nieto’s Piñata: The Promise and Pitfalls of Mexico’s New Security Policy against Organized Crime” in February of this year.

Below, a few reflections on the document.

The author, Vanda Felbab-Brown, writes “The Mexican public is exhausted by the bewildering intensity and violence of crime as well as by the state’s blunt assault on the drug trafficking groups. It expects the new president to deliver greater public safety, including from abuses committed by the Mexican military, which Mexico’s previous president, Felipe Calderón, deployed to the streets to tackle the drug cartels” (page 1).

Felbab-Brown says reducing violence in Mexico is the right strategy and one that the US should support, in large part in order to “allow economic activity to return” (p. 3). Hers is a popular refrain, by which reducing crime and violence can stimulate a legal economy which “might start generating taxes and accountability and perhaps even legal jobs so that young men are no longer easily seduced by the lure of vast crime profits amidst a paucity of legal alternatives” (3).

This view is one that is oft repeated in the US media, but it ignores the fact that as the drug war drags on, Mexico continues to pass measures to make the country more competitive.

Competitiveness, which aims to boost economic growth and foreign investment, is a priority of the current (and outgoing) Mexican administration, does not necessarily lead to the creation of decent jobs (or the availability of quality education) that could undermine the appeal of the so called “informal” economy. Take the recently passed labour law reform which introduces an hourly minimum wage. According to OECD data, real hourly minimum wage in Mexico fell from 76¢ in 2000 to 58¢ in 2011, over the same time the number of unemployed people has more than doubled. Though the 2013 budget is Mexico’s largest ever and includes some increases in social spending, it also sees an increase in security spending. At the same time, various states are carrying out state-level austerity programmes. Also, think about this: people in the US (who can make more than Mexico’s minimum daily wage in one hour of minimum wage work) are still drawn to the drug trade. All to say that I think it is a false argument that fostering a larger and more competitive economy will reduce “man power” available to the drug trade.

Felbab-Brown states “The vast majority of the dead have been members of drug trafficking organizations or youth gangs increasingly hired by the DTOs to conduct hits or control drug-distribution plazas” (3). She does not provide a source for this claim, which is something I would be interested in seeing, because as a general in a country where impunity rates hover between 95 and 99 per cent, the activities of victims as well as the motives of their killers go un-investigated. Later in the report, she writes “In fact, the reason the Calderón administration stopped reporting its count of cartel killings in 2012 was that it could not objectively determine the cause of many deaths, given that less than 10 percent of crimes in the country were investigated” (19). Still, Felbab-Brown goes ahead and speculates on who the victims are.

The author rightly states that the idea that Peña Nieto’s PRI can make pacts or negotiate with DTOs is difficult to fathom. “Political power in Mexico is now far more fractured and devolved to various layers of the government. Equally, the DTOs are too splintered and unstable to be able to commit to a grand bargain and struggle even to uphold any negotiated deals among themselves” (5). Obviously in many places in Mexico agreements or arrangements between state officials and drug traffickers exist, but they exist in clandestine forms. It has long been clear that there will be no public agreements between government and drug trafficking groups.

One of the new security strategies espoused by Peña Nieto is the creation of a 10,000 member gendarmerie, headed by former Colombian police chief Oscar Naranjo (who the author calls, along with Leyzaola a “supercop”). Felbab-Brown describes the gendarmerie as “A para-military force with heftier defense capacities than regular police [which] can better withstand attacks by criminal groups and possibly even deter brazen violence.” The idea that better trained and armed police deter violence strikes me as absurd. Especially when federal (regular) police already look like this:

She writes “Although the roles and missions of the to-be-established gendarmerie have not yet been defined and specified, the gendarmerie could also be deployed to Mexico’s rural areas (like in Italy, for example) where state law enforcement presence is frequently lacking and municipal police forces often function as militias of local drug gangs or politicians” (7).

To my mind, the creation of a militarized rural police force that could move from state to state is instead offers little chance of combating drug trafficking and is instead a kind of guarantee to the mining sector and other industries that operate in remote areas whose activities could benefit from the presence of state troops (at the expense of local population).

Peña Nieto has already begun to shuffle up the structure of policing in Mexico. “Having now abolished the [Secretariat of Public Security], Peña Nieto has rolled the Federal Police (which had tripled in size during the Calderón years and improved its technical capacities) back under the control of the Ministry of Interior (Secretaría de Gobernación or SEGOB). The federal penitentiary system also now falls under SEGOB” (11).

Velbab-Brown talks about the lack of coordination between different police units, so “Deployed in the fight against the drug trafficking groups, the navy and the army bitterly compete with each other; and the Federal Police gets into regular shootouts with the municipal police, while state police forces float loosely and lost between them.”

She weighs the significance of the Tres Marias shooting of CIA agents by federal police in August, 2012, saying the act “showed that even the law enforcement institution that has received the most training, vetting, and focus from the Mexican government—and greatest U.S. assistance—continues to be pervaded by the drug trafficking groups” (10).

It what has become a regular media meme, Velbab-Brown refers to community police in Guerrero state as both a “militia” and a “citizens vigilante group,” proffering her view that such forces should not be tolerated, offering instead the general advice that “Mexico should more systematically and robustly incorporate citizens’ concerns and priorities into the design of anti-crime and rule of law policies” (16).

Then there is the claim that “one potentially quick way to reduce violence in Mexico is to switch interdiction operations away from short-term hits against the highest capos, as President Peña Nieto has indicated he wants to do, and toward targeting the middle layer of DTOs” (14). It is not clear here how the “middle layer” is determined. This section reads like a treatise on making war (better) to end violence. It also depends on police intelligence, which I think any adult realizes is a bit of an oxymoron, but one which EPN’s government is committed to through the new National Intelligence Centre.

To her credit, Felbab-Brown reiterates that reducing violence is an important policy goal for the US in Mexico. But this stays generally within the realm of wishful thinking. She presents Central America as a region where the US is supposedly focused “not only on disrupting the movement of criminals and contraband and supporting the development of strong, capable, and accountable governments in Central America, but also on creating safe streets for the citizens in Central America and fostering the rule of law” (16). Honestly, anyone who has spent time in Guatemala, Honduras, or elsewhere knows what a steaming pile of horse manure this is. The army patrols the streets in Guatemala, the entire region has among the highest murder rates in the hemisphere, Honduras has an illegitimate post-military-coup government. I could go on.

Felbab-Brown is critical of Peña Nieto’s proposal to divide Mexico into regions (Northwest, Northeast, West, Central, and Southeast), each with its own security command. Instead, she suggests, Mexico should “selectively concentrate on the most violent group or groups in a particular locale” (17). It is unclear how this proposal would avoid the phenomenon of splintering these groups and creating even more informal armies in Mexico. She suggests that militarily targeting less violent groups may also be an option. Again, make (better) war to achieve peace is the message.

Felbab-Brown also mentions the transition “away from the old Spanish inquisitorial system to an oral trial-based accusatorial system” noting that it “has proceeded unevenly and with little effective guidance and oversight from Mexico City” (20). She fails to point out that the legal changes were spearheaded by the US and the transition funded by USAID, but notes “By January 2013, the majority of Mexico’s states have passed reform laws, but only less than half have implemented the new codes” (20).

On Juarez, the report goes back to the well worn cartel war discourse that violence diminished because Sinaloa won the plaza, something I counter here. She praises Todos Somos Juárez, Calderón’s PR campaign to make the world’s murder capital seem like a better place (which, by the way, was cancelled in December 2012).

Felbab-Brown ends on a bang, stating “one of the most praise-worthy elements of Calderón’s strategy was to ultimately recognize— with critical prodding from the United States—that crime grew in Mexico because many of its citizens have lacked adequate legal job opportunities.” Thank you, Uncle Sam.

The final part of the report is crucial in understanding Brookings’ positioning vis à vis Mexico (24):

Generating legal alternative livelihoods in urban spaces, as in rural spaces, requires that the economic development strategy addresses all the structural drivers of illegal economic production. Be- yond providing for security and the rule of law, such a comprehensive approach requires that stable property rights be established, access to microcredit developed, access to education and health care expanded, and infrastructure deficiencies be redressed. Generating sustainable legal jobs in urban slums or enabling the slum residents to access legal jobs elsewhere is always the hardest aspect of any urban development revival policy. Critically, it is dependent on the larger structural setup of the overall economy of the country. If the existing taxation system favors capital-intensive growth especially at the big-firm level and labor is taxed heavily, there may be real limits to what kinds of economic development will be feasible in the urban slums.

So basically, a longer term strategy for creating “alternative livelihoods” is to lower taxes. How innovative. 

The report ends on a phrase that is sort of indicative of the circular logic employed within: “By supporting a strategy to reduce violence in Mexico while weakening the power of Mexico’s criminal groups, the United States can do much to help southern neighbor” (25).

Quick note on the Brookings Institution, it claims to be one of the most influential think tanks in the US, nay, in the world. Brookings is funded by large foundations, defence contractors, the US government, foreign governments, and sundry rich people (Donors listed in 2012 Annual Report, p. 35).

This story was originally published as a blog entry on Dawn Paley’s blog, Unembedded. Dawn is a journalist and researcher who regularly contributes to Upside Down World.