The American Spectator

Special Report

There are two cities called Nogales: One is north of the border between the United States and Mexico, the other south of the border. The two communities are separated by a wall made of various materials, including war surplus airfield metal landing strips. The only thing that keeps the ten times larger Mexican municipality from disintegrating into chaos is the Army soldiers and Federales (federal police) on regular patrols in their armored personnel vehicles.

The residents know that without the presence of troops and federal police open warfare between the several drug and human smuggling franchises would explode. As it is, each week there is some form of shootout between rival factions. This is followed by a chase by police and another deadly exchange of fire, usually resulting in the killing or capture of the heavily armed bad guys. Unfortunately the police have losses also. The locals take the activity in stride. They hate it, but they have become inured to it.

According to Immigration and Customs Enforcement (ICE) sources, the entire state of Sonora that stretches on the other side of the border with Arizona is under the control of the Sinaloa cartel (Mexico's oldest drug cartel). They franchise out the drug and human smuggling operations that, in turn, subcontract to smaller groups. It's on the level of the franchises and subcontractors that most of the deadly violence occurs.

The current leader of the Sinaloa cartel is Joaquin Guzman. He escaped from a Mexican federal prison in 2001 and since then has been a fugitive. One of the top Sinaloan adjutants, Alfredo Beltran, was arrested in January of this year, a major coup for the Mexican police. The three other cartels with which Sinaloa competes for distribution rights are: Gulf, Juarez, and Tijuana. Most of the drugs emanating from South and Central America are reported to come in sea borne via Acapulco.

Each month of 2007 over two hundred drug-related murders occurred. According to the Arizona Republic, there were 2,680 through August 2008 that, if continued at the same rate, would put this year's final count considerably ahead of last year. The victims in addition to the criminals include federal troops, local police, journalists, government officials and innocent civilians.

The figure most used to account for illegal entries of immigrants annually into Arizona is 500,000. This figure would include the multiple entries by individuals who were turned back and who tried again, sometimes two and three times. About half of the "illegals" have no intention of remaining, but are merely seeking temporary employment. The difficulty now faced in illegally crossing from Sonora into southern California has resulted in most of the traffic coming through the unfenced mountainous and desert areas of Arizona.

FOR THOSE ILLEGAL IMMIGRANTS attempting the dangerous trek across the Arizona desert after a clandestine border crossing, it is estimated that they will spend from 1-3 days actually making the walk. These are often very desperate people assisted by franchise subcontractors who provide guides called coyotes. They often resist arrest. There were 987 assaults on U.S. Border Agents in fiscal 2007 according to Roger San Martin, the Border Patrol chief in Tucson.

The Internet often contains rival postings of recent executions of gang members. Such grisly publication follows the gruesome torture and mutilation of the victims. The competing franchises appear to revel in the brutality and then the publishing of their deadly accomplishments.

The transport of immigrants from Mexico entering the United States illegally has become a subset of the multi-billion dollar criminal traffic in drugs. The illicit commerce in narcotics has now grown so large that the contractors operate human smuggling as a sideline. The size of this secondary business is quite impressive.

For about two thousand plus dollars down, arrangements can be made for a clandestine crossing of the border. What often happens, however, is that the migrant is held captive upon arrival in the U.S. in a so-called "drop house" until arrangements are made for an additional couple of thousand dollars to be wired by relatives -- often currently living in the U.S. Others are just left to fend for themselves in the Arizona desert.

Simple math involving several thousand dollars multiplied even by 100,000 illegal crossings shows the profits for the contracting gangs to be well worth the risks. And this is the cartel's "secondary business."

The obvious question at this point is what happens to all that money from human and drug smuggling. The answer is complicated. According to hard-boiled Mexican officials of Nogales, the economy of that entire city of 200,000-400,000 people (depending whether the near suburbs are counted) is impacted by some aspect of the smuggling business.

Sonoran officials firmly believe that the endemic violence stems less from warring cartels, as the Sinaloa have that well in hand. These Mexican officials believe the maiming and murder are disciplinary actions on the lower level of the rival franchises and subcontractors involving turf invasions, spoils division, countering perceived informant activity, and other operational disagreements.

A QUICK TRIP into the mountainous area of the Sierra Occidental southwest of Nogales brings one to the thriving city of Caborca. There the economy appears to be booming with new and larger homes displaying expensive fast cars ostentatiously parked on unfinished driveways. Reports abound that this nice little metropolis of 50,000 souls is the staging area for the various forms of illegal trafficking.

Of course, the cartel rakes a substantial portion off the top of the income from the "business" which is then hidden from tax authorities through all types of devices and payoffs. Protecting this income continues to be hundreds of politicians, officials, police and army "on the take" both regionally and in the federal government. It's perhaps the Mexican version of "trickle down" economics. On the cartel level they much prefer to pay off than eliminate; it's less troublesome. But make no mistake, the Sinaloa do not shy away from "executive action" if necessary.

After all the required expenditures there are still fortunes to distribute to safe havens around the world -- including in the United States. Like everyone else, the Sinaloa put a great deal of money in Arizona and California development projects in past years and are now suffering with all the other investors.

Arizona police sources have their suspicions about all the investment finance that has flowed in since 2000, but rarely can pin it down. They just say that some of the empty multi-million dollar homes owned by obscure trusts and corporations are now going for unexpectedly low prices these days. Cash flow problems seem to affect everyone.

The fact that the Sinaloa cartel can continue to operate effectively even though their paramount leader is on the run and one of his principal adjutants was arrested in the beginning of the year is a testament to their strength. Sinaloa controls the Mexican side of the border with Arizona. They will be the people with whom we will have to deal, one way or another, if we want to cut down illegal immigration and drug smuggling in that area.

Will the new Washington administration be prepared to take on that opponent? Obviously the Mexican Government needs help.

topics:
Economics, Business, Immigration, Oil