Drug gangs appear to be moving people and operations to the Mexico City area. The January 22 arrests of 22 men working for a drug gang was a major indicator. The men were probably in the pay of the Sinaloa cartel. Crime families have a long history in Mexico City. Police and governmental corruption made it an easy place to do business. Mexico City citizens are worried that their town will become like "Bogota" (like the capital of Colombia) if gangs start shooting it out with the police in the streets. The fact the Colombian capital is mentioned illustrates the fear of a "Colombianization" of Mexico. Gangs and political guerrillas in Colombia teamed up to wage a very dirty war against the government. The people were caught in the crossfire.
But it isn't just the drug war, though the cartels make it all much worse. An inept Mexican government contributes by screwing up their economy. We are doing our part, too:
The perfect storm for social upheaval is now brewing in Mexico— and in particular Mexico's northern states along the U.S. border.
The first storm front is to the east at a place called Cantarell. Long a blessing, Cantarell is Mexico's largest oil field— and largest source of government funds. Output from Cantarell is down more than 15 percent from last year and many believe the field is now in irreversible decline. Thus, government budgets are being strained.
The second front is to the north. As the U.S. economy has slowed so have remittances from the United States to Mexico. The housing crunch has disproportionately affected Mexican labor (both legal and illegal). As U.S. construction, landscaping, remodeling, and other housing-related jobs have evaporated so has a vital source of income to Mexico.
The third storm front is food. America's well-intentioned but misguided emphasis on ethanol has caused food prices to rise beyond the poor's income. Corn prices have tripled and tortilla prices have soared. Food riots and protests are now common throughout Mexico and confidence in the government is eroding.
The result is this: income flows to Mexico are falling while social unrest is rising.
Predictably, this storm is now manifesting in violence in Mexico's northern states and it is becoming apparent that Mexico is having difficulties maintaining stability. Meanwhile, drug cartels are having no such monetary problems.
In an effort to be green and to reduce our oil consumption some trivial amount, we turn corn into fuel for our cars. And a revolution south of the border gets a little bit closer because of that.
