Across the border from McAllen, Texas, a war has been raging in affluent Mexican neighborhoods, main streets and shopping areas as cartels openly fire rocket-propelled grenade launchers and assault rifles at law enforcement authorities.

No one is safe – not even young children as they walk to school.

"We heard a lot of gunshots," cried one child as he escaped Felipe Carrillo Puerto Primary School holding his father's hand Tuesday morning.

The street wars between police and gangs shut down parts of Reynosa, Mexico, as Mexican media estimated the death toll at 20 with dozens injured, the McAllen Monitor reported.

U.S. authorities think Hector Sauceda Gamboa, the suspected regional leader of the Gulf Cartel, was among five gunmen who were shot.

A U.S. federal official told the Monitor that Gamboa, known as "El Karis," was killed in his upscale neighborhood on one of the busiest streets in the city.

The gunmen fired a variety of military-grade weapons, including grenades, a 60 mm mortar and assorted small-arms ammunition.

The Mexican state of Chihuahua has declared "YA BASTA!" to the Gringos, President Felipe Calderon and to the USA funded "Plan Mexico."

Sick and tired of the violence and ever increasing killings of Mexican citizens in Chihuahua and throughout Mexico, the city of Parral took to the streets to give a strong message that they have had enough. The citizens of Parral carried signs that said "Asi comenzo la Revolucion." The number of Mexicans killed by elements fighting for control of the lucrative "drug trade", which includes the CIA and high level President Calderon operatives, now exceed the number of USA casualties in Iraq.

The situation has been most serious in Ciudad Juarez which borders the USA. Ciudad Juarez and El Paso, Texas is historically known as "El Paso del Norte" and is a primary passage for tons of cocaine and other drugs to supply the huge appetite of Gringo addicts. The city has seen a huge number of "narco" killings including some gruesome "decapitations."

Mexico has pretty much always been a rough-and-tumble place. In recent years, however, the security environment has deteriorated rapidly, and parts of the country have become incredibly violent. It is now common to see military weaponry such as fragmentation grenades and assault rifles used almost daily in attacks.

In fact, just last week we noted two separate strings of grenade attacks directed against police in Durango and Michoacan states. In the Michoacan incident, police in Uruapan and Lazaro Cardenas were targeted by three grenade attacks during a 12-hour period. Then on Feb. 17, a major firefight occurred just across the border from the United States in Reynosa, when Mexican authorities attempted to apprehend several armed men seen riding in a vehicle. The men fled to a nearby residence and engaged the pursuing police with gunfire, hand grenades and rocket-propelled grenades (RPGs). After the incident, in which five cartel gunmen were killed and several gunmen, cops, soldiers and civilians were wounded, authorities recovered a 60 mm mortar, five RPG rounds and two fragmentation grenades.

Make no mistake, considering the military weapons now being used in Mexico and the number of deaths involved, the country is in the middle of a war. In fact, there are actually three concurrent wars being waged in Mexico involving the Mexican drug cartels. The first is the battle being waged among the various Mexican drug cartels seeking control over lucrative smuggling corridors, called plazas. One such battleground is Ciudad Juarez, which provides access to the Interstate 10, Interstate 20 and Interstate 25 corridors inside the United States. The second battle is being fought between the various cartels and the Mexican government forces who are seeking to interrupt smuggling operations, curb violence and bring the cartel members to justice.

Then there is a third war being waged in Mexico, though because of its nature it is a bit more subdued. It does not get the same degree of international media attention generated by the running gun battles and grenade and RPG attacks. However, it is no less real, and in many ways it is more dangerous to innocent civilians (as well as foreign tourists and business travelers) than the pitched battles between the cartels and the Mexican government. This third war is the war being waged on the Mexican population by criminals who may or may not be involved with the cartels. Unlike the other battles, where cartel members or government forces are the primary targets and civilians are only killed as collateral damage, on this battlefront, civilians are squarely in the cross hairs.

There are many different shapes and sizes of criminal gangs in Mexico. While many of them are in some way related to the drug cartels, others have various types of connections to law enforcement — indeed, some criminal groups are composed of active and retired cops. These various types of criminal gangs target civilians in a number of ways, including, robbery, burglary, carjacking, extortion, fraud and counterfeiting. But of all the crimes committed by these gangs, perhaps the one that creates the most widespread psychological and emotional damage is kidnapping, which also is one of the most under reported crimes. There is no accurate figure for the number of kidnappings that occur in Mexico each year. All of the data regarding kidnapping is based on partial crime statistics and anecdotal accounts and, in the end, can produce only best-guess estimates. Despite this lack of hard data, however, there is little doubt — based even on the low end of these estimates & #8212; that Mexico has become the kidnapping capital of the world.

One of the difficult things about studying kidnapping in Mexico is that the crime not only is widespread, affecting almost every corner of the country, but also is executed by a wide range of actors who possess varying levels of professionalism — and very different motives. At one end of the spectrum are the high-end kidnapping gangs that abduct high-net-worth individuals and demand ransoms in the millions of dollars. Such groups employ teams of operatives who carry out specialized tasks such as collecting intelligence, conducting surveillance, snatching the target, negotiating with the victim’s family and establishing and guarding the safe houses.

At the other end of the spectrum are gangs that roam the streets and randomly kidnap targets of opportunity. These gangs are generally less professional than the high-end gangs and often will hold a victim for only a short time. In many instances, these groups hold the victim just long enough to use the victim’s ATM card to drain his or her checking account, or to receive a small ransom of perhaps several hundred or a few thousand dollars from the family. This type of opportunistic kidnapping is often referred to as an “express kidnapping”. Sometimes express kidnapping victims are held in the trunk of a car for the duration of their ordeal, which can sometimes last for days if the victim has a large amount in a checking account and a small daily ATM withdrawal limit. Other times, if an express kidnapping gang dis covers it has grabbed a high-value target by accident, the gang will hold the victim longer and demand a much higher ransom. Occasionally, these express kidnapping groups will even “sell” a high-value victim to a more professional kidnapping gang.

Between these extremes there is a wide range of groups that fall somewhere in the middle. These are the groups that might target a bank vice president or branch manager rather than the bank’s CEO, or that might kidnap the owner of a restaurant or other small business rather than a wealthy industrialist. The presence of such a broad spectrum of kidnapping groups ensures that almost no segment of the population is immune from the kidnapping threat. In recent years, the sheer magnitude of the threat in Mexico and the fear it generates has led to a crime called virtual kidnapping. In a virtual kidnapping, the victim is not really kidnapped. Instead, the criminals seek to convince a target’s family that a kidnapping has occurred, and then use threats and psychological pressure to force the family to pay a quick ransom. Although virtual kidnapping has been around for several years, unwitting families continue to fall for the scam, which is a source of easy money. Some virtual kidnappings have even been conducted by criminals using telephones inside prisons.

As noted above, the motives for kidnapping vary. Many of the kidnappings that occur in Mexico are not conducted for ransom. Often the drug cartels will kidnap members of rival gangs or government officials in order to torture and execute them. This torture is conducted to extract information, intimidate rivals and, apparently in some cases, just to have a little fun. The bodies of such victims are frequently found beheaded or otherwise mutilated. Other times, cartel gunmen will kidnap drug dealers who are tardy in payments or who refuse to pay the “tax” required to operate in the cartel’s area of control.

Of course, cartel gunmen do not kidnap only their rivals or cops. As the cartel wars have heated up, and as drug revenues have dropped due to interference from rival cartels or the government, many cartels have resorted to kidnapping for ransom to supplement their cash flow. Perhaps the most widely known group that is engaging in this is the Arellano Felix Organization (AFO), also known as the Tijuana Cartel. The AFO has been reduced to a shadow of its former self, its smuggling operations dramatically impacted by the efforts of the U.S. and Mexican governments, as well as by attacks from other cartels and from an internal power struggle. Because of a steep decrease in smuggling revenues, the group has turned to kidnapping and extortion in order to raise the funds necessary to keep itself alive and to return to prominence as a smuggling organization.

There is very little chance the Mexican government will be able to establish integrity in its law enforcement agencies, or bring law and order to large portions of the country, any time soon. Official corruption and ineptitude are endemic in Mexico, which means that Mexican citizens and visiting foreigners will have to face the threat of kidnapping for the foreseeable future. We believe that for civilians and visiting foreigners, the threat of kidnapping exceeds the threat of being hit by a stray bullet from a cartel firefight. Indeed, things are deteriorating so badly that even professional kidnapping negotiators, once seen as the key to a guaranteed payout, are now being kidnapped themselves. In an even more incredible twist of irony, anti-kidnapping authorities are being abducted and executed.

This environment — and the concerns it has sparked — has provided huge financial opportunities for the private security industry in Mexico. Armored car sales have gone through the roof, as have the number of uniformed guards and executive protection personnel. In fact, the demand for personnel is so acute that security companies are scrambling to find candidates. Such a scramble presents a host of obvious problems, ranging from lack of qualifications to insufficient vetting. In addition to old-fashioned security services, new security-technology companies are also cashing in on the environment of fear, but even high-tech tracking devices can have significant drawbacks and shortcomings.

For many people, armored cars and armed bodyguards can provide a false sense of security, and technology can become a deadly crutch that promotes complacency and actually increases vulnerability. Physical security measures are not enough. The presence of armed bodyguards — or armed guards combined with armored vehicles — does not provide absolute security. This is especially true in Mexico, where large teams of gunmen regularly conduct crimes using military ordnance. Frankly, there are very few executive protection details in the world that have the training and armament to withstand an assault by dozens of attackers armed with assault rifles and RPGs. Private security guards are frequently overwhelmed by Mexican criminals and either killed or forced to flee for their own safety. As we noted in May 2008 after the assassination of Edgar Millan Gomez, acting head of the Mexican Federal Police and the highest-ranking federal cop in Mexico, physical security measures must be supplemented by situational awareness, counter surveillance and protective intelligence.

Criminals look for and exploit vulnerabilities. Their chances for success increase greatly if they are allowed to conduct surveillance at will and are given the opportunity to thoroughly assess the protective security program. We have seen several cases in Mexico in which the criminals even chose to attack despite security measures. In such cases, criminals attack with adequate resources to overcome existing security. For example, if there are protective agents, the attackers will plan to neutralize them first. If there is an armored vehicle, they will find ways to defeat the armor or grab the target when he or she is outside the vehicle. Because of this, criminals must not be allowed to conduct surveillance at will.

Like many crimes, kidnapping is a process. There are certain steps that must be taken to conduct a kidnapping and certain times during the process when those executing it are vulnerable to detection. While these steps may be condensed and accomplished quite quickly in an ad hoc express kidnapping, they are nonetheless followed. In fact, because of the particular steps involved in conducting a kidnapping, the process is not unlike that followed to execute a terrorist attack. The common steps are target selection, planning, deployment, attack, escape and exploitation.

Like the perpetrators of a terrorist attack, those conducting a kidnapping are most vulnerable to detection when they are conducting surveillance — before they are ready to deploy and conduct their attack. As we’ve noted several times in past analyses, one of the secrets of counter surveillance is that most criminals are not very good at conducting surveillance. The primary reason they succeed is that no one is looking for them.

Of course, kidnappers are also very obvious once they launch their attack, pull their weapons and perhaps even begin to shoot. By this time, however, it might very well be too late to escape their attack. They will have selected their attack site and employed the forces they believe they need to complete the operation. While the kidnappers could botch their operation and the target could escape unscathed, it is simply not practical to pin one’s hopes on that possibility. It is clearly better to spot the kidnappers early and avoid their trap before it is sprung and the guns come out.

We have seen many instances of people in Mexico with armed security being kidnapped, and we believe we will likely see more cases of this in the coming months. This trend is due not only to the presence of highly armed and aggressive criminals and the low quality of some security personnel, but also to people placing their trust solely in reactive physical security. Ignoring the very real value of critical, proactive measures such as situational awareness, counter surveillance and protective intelligence can be a fatal mistake.

WASHINGTON — Mexican drug cartels are shipping more than massive quantities of drugs north of the border. Increasingly, they're also exporting bloody mayhem.

Seeking to stem the growing influence of the Sinaloa cartel within the United States, federal agents arrested more than 50 suspects in raids Tuesday night and Wednesday morning at different ends of the country. The raids capped a 21-month operation by the Drug Enforcement Administration that rounded up 755 suspects and seized more than $59 million in criminal proceeds.

"These cartels will be destroyed," Attorney General Eric Holder said Wednesday at a press conference announcing the arrests.

The overnight roundup by DEA and state and local police included arrests in California, Minnesota and the Maryland suburbs of Washington.

Holder called the cartels a threat to national security, adding, "They are lucrative, they are violent, and they are operated with stunning planning and precision."

The attorney general also suggested that re-instituting a U.S. ban on the sale of assault weapons would help reduce the bloodshed in Mexico, where last year 6,000 people were killed in drug-related violence.

Increasingly, U.S. law enforcement officials see cartel violence spill into the United States, often as far away as Phoenix and Atlanta.

As he discussed the problem, Holder spoke briefly in Spanish, pledging continued cooperation with Mexican authorities who have increasingly come under direct fire from the heavily armed drug gangs.

U.S. officials have a responsibility to make sure Mexican police "are not fighting substantial numbers of weapons, or fighting against AK-47s or other similar kinds of weapons that have been flowing to Mexico," Holder said.

DEA Acting Administrator Michele Leonhart said the raid showed the tentacles of the crime syndicate had spread far across the U.S. — not just to major cities like Washington and Los Angeles, but to quiet, smaller communities like Stowe, Iowa, which the cartel allegedly used as a conduit to funnel drugs around the country.

Leonhart said the Sinaloa cartel has become one of the largest organized crime operations in the world.

"They've been hit hard, and their ability to spread death and destruction has been diminished" by the arrests, Leonhart said.

Last year, a sweeping corruption probe led to the arrest of a dozen high-ranking Mexican officials accused of collaborating with the Sinaloa group or its one-time ally, the Beltran Leyva gang. Those arrested include former drug czar Noe Ramirez, who is accused of taking $450,000 from Sinaloa.

The U.S. government has praised President Felipe Calderon's government for rooting out corruption at the top.

Yet over the many months the DEA's investigation proceeded, cartel violence on both sides of the border increased substantially.

The State Department issued a travel warning Friday, urging U.S. citizens traveling to Mexico to be aware of the increased threat of violence and kidnapping, especially along the border. The situation in Ciudad Juarez, which lies across the border from El Paso, is of special concern, the State Department cautioned.

Notice the propaganda about gun control....ban assault rifles and it will curb the violence...yeah right!

Bazooka's aren't legal in the US the last time I checked and they are being used against law enforcement and military. Also most of the newscasts show automatic weapon fire...those aren't legal either unless you have a Class 3 permit...very rare. So does the argument Just another excuse to disarm the law abiding citizens and let the lawbreakers run all over them.

MEXICO CITY (Reuters) - Battling with spiraling drug murders and an economic crisis, Mexico's Felipe Calderon will urge U.S. President-elect Barack Obama on Monday to support his drug war and stick to the NAFTA trade deal.

Their meeting in Washington, days before Obama takes office, comes after years of complaints of neglect from Mexico and much of Latin America as President George W. Bush's foreign policy focused on the Middle East and the war on terror.

With Mexico's drug violence exploding and fears that Obama could tamper with the North American Free Trade Agreement to protect U.S. workers, Calderon will try to persuade the Democrat to give Mexico some attention.

The three-way battles between the Sinaloan Cartel, the Gulf Cartel, and the Mexican Government intensified this year. The Mexican military deployed 26,000 troops to engage in counterinsurgency operations.

The criminal gangs are waging what can be called a “criminal insurgency.” Unlike classic nationalist insurgency, they do not aim to overthrow the ruling government and establish their own. Instead, they hollow out the state and create a vacuum of power. This protects their black markets and creates micro-states within states.

This kills thousands a year. The local police are outgunned or bribed off. Corruption weakened law & order in a number of Mexican states.

The black market in Mexico produces over $30 billion a year. About $20 billion comes from drug smuggling. The rest varies. Kidnapping and ransoming is widespread; each victim is ransomed for ~$20,000. There are protection rackets, robbery of banks and casinos, prostitution, fake merchandise, arms smuggling, gems smuggling and human trafficking.

This is not a “Drug War” and it never was about drugs. If it was a drug war, the solution would be very simple. Legalize the drugs and eliminate the source of income for insurgents and criminals. In reality, everything is much more complex. Whatever utility would come from legalizing drugs, it would not “solve” the wars in Mexico or Colombia.

The gangs are developing political motivations and proto-socialist ideas. The big losers may actually be the drug smugglers

Here’s how it works:

The Sinaloan Cartel is centered in the Sinaloan state on the Pacific Coast. The Gulf Cartel operates in the west. They each have their ’sphere of influence’ where they control local crime. They push each other out of major towns and smuggling trade routes through intimidation and murder. Some towns like Nuevo Laredo became warzones.

The black market makes them wealthy enough to grow into larger and more complex networks than gangs seen in the United States. These gangs connect with FARC and MS-13 other transnational criminal and insurgent organizations to get heavier weaponry. Basically, Northern Mexico has gangbangers with AK-47s.

The Cartels developed paramilitary forces. The Gulf Cartel uses the “Zetas” who are ex-soldiers turned mercenaries.

Corrupt local police are not much help. Many work for the Cartels while the honest ones are frightened into submission. Where they attempt to fight crime, the Cartels can retaliate and overrun a town with gunmen and massacre the cops.

The Mexican Army is in poor shape and may not be up to the task. The Army has a desertion rate of 8% per year. The government recently increased pay by almost 50% but it won’t stop such a high desertion rate. High desertion rates, corruption, and tons of drug money fuel the growth of the paramilitary forces.

What was thrown at the problem...

In his first month in office, Mexican President Felipe Calderon hit the ground running in his war on drugs. As Commander in Chief of the Mexican military, Calderon first sent the military, along with federal police from both the PFP (Preventative Federal Police) and the AFI (Federal Investigation Agency), into cartel-infested Michoacan.

Now Calderon has launched a new operation in violent Tijuana on the U.S. border, a major thoroughfare for drug smuggling. The office of the PGR (Mexican Attorney General) has just released a report showing the extent to which Tijuana and Mexicali have been penetrated by narcos that points out the importance of combating this problem. And the United States has just offered to sell Mexico military hardware including ships, vehicles, weapons, ammunition, uniforms, transports, aircraft, electronic equipment, and office equipment at a 10 to 50 percent discount to confront terrorism and the drug war. (After all, in Mexico the drug traffickers are terrorists.)

The results...

Nuevo Laredo has become a stage where Mexican organized crime demonstrates its immense power to corrupt, kill, and make money. Despite every attempt by both Mexican and US authorities to control smuggling and violent death, Mexican organized crime continues to take advantage of the largest inland trade zone to smuggle hundreds of tons of cocaine north into the US and thousands of automatic rifles south into Mexico. Two factions of Mexican organized crime continue to wage a war for control of access to Laredo, Texas. It is a direct route to a demand market in the US worth billions of dollars year after year.

Over 10,000 cargo trucks pass through Nuevo Laredo on their way to Interstate 35 and cities throughout the US. Another 10,000 vehicles cross the border daily, totaling over 20,000 vehicle-crossings a day. At such high volumes, it is impossible for US customs to stop, search, and process every vehicle. It is inevitable that drugs, humans, guns, and other contraband cross the border daily. At the same time, it is economically destructive to close the border crossing even for a day. The Nuevo Laredo-Laredo border crossing is a smuggler's paradise.

The turf battle between El Chapo Guzman and his jailed rival Osiel Cardenas Guillen has resulted in the death of US citizens, Mexican journalists, and dozens of Mexican policemen, criminals, and innocent civilians. Murder rates are inconclusive, but according to conservative estimates, Nuevo Laredo saw some 80 drug-related murders in both 2003 and 2004. In 2005, there were 182 drug-related murders. As of April this year, there have been over 80 drug-related murders there.

Other estimates claim that some 1,500 people died in organized crime-related violence in Mexico from early 2003 to June 2005.

I certainly didn't catch much of that in the MSM over the past couple of years...

EL PASO -- Mexico is one of two countries that "bear consideration for a rapid and sudden collapse," according to a report by the U.S. Joint Forces Command on worldwide security threats.

The command's "Joint Operating Environment (JOE 2008)" report, which contains projections of global threats and potential next wars, puts Pakistan on the same level as Mexico. "In terms of worse-case scenarios for the Joint Force and indeed the world, two large and important states bear consideration for a rapid and sudden collapse: Pakistan and Mexico.

"The Mexican possibility may seem less likely, but the government, its politicians, police and judicial infrastructure are all under sustained assault and pressure by criminal gangs and drug cartels. How that internal conflict turns out over the next several years will have a major impact on the stability of the Mexican state. Any descent by Mexico into chaos would demand an American response based on the serious implications for homeland security alone."

The report offers "a Polaroid snapshot," and conditions in Mexico and elsewhere are in a state of flux, said Brig. Gen. José Riojas, executive director of the National Center for Border Security and Immigration at the University of Texas at El Paso. "I'm not sure Mexico looks today like it did nine months ago," Riojas said.

The report is the latest focusing on Mexico's security problems, which stem mostly from drug violence and corruption. Recently, the Department of Homeland Security and former U.S. drug czar Barry McCaffrey issued similar assessments.

The Report

Now risen to the level of an insurgent war, the battle between the falling Kleptocratic Mexican government and supra-wealthy organized crime groups who now control much of Mexico’s land areas, police forces, and even some of its military has hit a new milestone.

Exasperating political climates, the violence, bloodshed, and hatred for Americans South of the border, coupled with rising injustices and racism against and by US citizens, compounded by an incompetent federal government North of the border, are propagating the fires of civil discontent on both sides and about to strip-away the last veneers of civility.

Along the borders, many patriotic Americans are often working side by side to prop up a greatly understaffed Border Patrol, as well as aid what many pundits claim is an incompetent, bureaucratically quagmired Department of Homeland Security. Such private groups, uncensored by government regulations, are now reporting that aggressive actions by both armed and unarmed Mexican citizens, coupled with high tensions on both sides of the border, are threatening to erupt into full-scale war–a war that neither government will be able to quell once ignited, they suggest.

Characterized as ” very dangerous”…”potentially deadly” by Rob Daniels of Border Patrol, Mexican gunmen stormed an armed National Guard unit in Arizona between Lukeville and Nogales showing their disdain for the US and its security measures.

The soaring level of violence in Mexico resulting from the drug wars there has led the United States to develop plans for a “surge” of civilian and perhaps even military law enforcement should the bloodshed spread across the border, Homeland Security Secretary Michael Chertoff said Wednesday.

Mr. Chertoff said the criminal activity in Mexico, which has caused more than 5,300 deaths in the last year, had long troubled American authorities. But it reached a point last summer, he said, where he ordered specific plans to confront in this country the kind of shootouts and other mayhem that in Mexico have killed members of warring drug cartels, law enforcement officials and bystanders, often not far from the border.

“We completed a contingency plan for border violence, so if we did get a significant spillover, we have a surge — if I may use that word — capability to bring in not only our own assets but even to work with” the Defense Department, Mr. Chertoff said in a telephone interview.

By comparison, the US has lost 4,230 soldiors in Iraq since the war began in 2003 of which 3,406 died in combat

What does it ultimately take to fight a war? Funding. Where is Mexico getting its funding to fight the war against "drugs"? Oil. How is oil doing these days?

Consider this: In December 2005, Mexico sent the U.S. 1.7 million barrels of oil per day (bpd). This past December, Mexico only exported 1.2 million bpd to the U.S.

Why is Mexico sending less oil? Because it's producing less oil. Total oil output fell to just below 3 million bpd in December 2006. That's down from nearly 3.4 million barrels at the start of the year, and Mexico's lowest rate of oil output in seven years.

There's a single force at work here — production is falling at Cantarell, Mexico's biggest oil field (and the second-largest producing field in the world). Accounting for more than half of Mexican oil production, Cantarell lies deep under the waters of the Gulf of Mexico. Water and gas are encroaching on the oil, and that's lowering output.

Cantarell's output tumbled by half a million bpd last year, according to figures released by the Mexican government. That is much, much faster than estimates from Mexico's state-run oil company, Petroleos Mexicanos (Pemex). If this decline rate continues, Cantarell's production will be cut in half by 2010.

And Pemex has another problem — it simply doesn't have the money to develop its other resources.

More than half of the company's revenues were taken by taxes last year, so you can see why. (In 2005, it faced an even bigger tax bite!)

In terms of exploration and production, Pemex invested $14 million in 2006 and plans to invest $16 billion in 2007. But that's not enough. Last November, Pemex said it needed to invest $18-$20 billion a year. What's more, the company has $5.5 billion in debt coming due in 2007.

Why not bring in outside investors? You'd have to change Mexican law to do that. So …

Things Could Get Worse: The Collapse Scenario

David Shields is an oil industry consultant in Mexico City, and he's been warning about Cantarell's collapse for the past two years. He's told the press that Cantarell's output will likely keep dropping like a stone. In fact, Shields expects Cantarell's production to fall to just 500,000 barrels per day within three years.

According to some experts, there's only 825 feet between the gas cap covering the oil in Cantarell and the water, which is pushing in at a rate approaching 300 feet per year. If the water rises enough, it could cut off the flow of oil quite suddenly.

At present, Pemex only discovers one new barrel of oil for every 14 it extracts. It's trying to change that by developing new fields. Let's look at two of the big ones …

Ku-Maloob-Zaap sounds like a punk rock band, but it's an offshore project holding 13% of Mexico's known oil reserves. It is already producing 400,000 bpd, and new production will be added in the short term. It could reach 680,000 bpd by the end of this year, perhaps exceeding 700,000 bpd within two or three years, thanks to new works projects.

Chicontepec is a huge onshore oil field that contains 40% of Pemex's known reserves. That's the good news. The bad news is that Chicontepec consists of small pockets of oil tucked into fractured rock. Pemex doesn't have the drilling technology it takes to exploit this field.

Because Chicontepec and Ku-Maloob-Zaap are more technically challenging than Cantarell, Pemex's production costs are set to rise from $4.17 a barrel in 2006 to more than $5 a barrel in the years ahead. The end result is a pinch on revenues.

In addition, developing these projects takes money and time, and as I've already shown you, Mexico doesn't have much of either.

Pemex predicts that Cantarell's production will drop 212,000 bpd this year. But remember, it tends to underestimate these things. If Cantarell's production ends up falling another 400,000 barrels this year, Pemex simply won't be able to keep up.

And that's when this problem becomes a geopolitical powder keg …

An Oil Decline Would Set Off a Domino Effect in Mexico

I already told you that 55% of Pemex's sales went right into government coffers last year. On top of that, Mexico relies on oil exports for about 40% of its revenue. So Cantarell's decline is a big problem for Mexico's President Felipe Calderon, who won a narrow victory in last year's election.

Any major decline in oil revenues will force Calderon to cut government spending. That's a big problem since he's already having a hard time containing popular discontent!

For example, tens of thousands of angry Mexicans marched through Mexico City recently to protest rising corn prices (due to demand for corn-based ethanol). More than 25% of Mexico's rural population (and 11% of the urban population) lives in extreme poverty. For these people, cheap corn tortillas are the difference between eating and going hungry.

Calderon has vowed to raise spending on social programs, but that will be hard to do with less oil money coming in. If Cantarell's production collapses, Pemex's revenues will dry up, and a huge chunk of the Mexican government's budget will vaporize. Social spending won't go up — it will go down.

Charles Bowden: The Mexican oil fields are in severe decline. They’re nationalized and run by one of the most corrupt mechanisms in Mexico – Petroleos Mexicanos, also known as Pemex. Mexico makes more money from drugs than they do from oil, tourism, and the remittances sent back by illegal Mexicans working here. They earn at least $50 billion a year now from selling drugs. They simply can’t live without it. You have to understand the Mexican economy is 4% the size of the United States' economy. Fifty billion dollars is big money in an economy of that size.

Charles Bowden: All I can say is, if they really cracked down on drugs in Mexico, the economy and the Mexican government would collapse. Millions of people would stream north to survive. Given that choice, successive American presidents have put on a kind of theatrical war on drugs, but let the business continue because the consequences of ending the business are worse than letting the business continue. Mexico needs the money.

BuzzFlash: What was the torture murder of DEA agent Enrique Camereno in Mexico all about?

Charles Bowden: He was kidnapped by members of the Guadalajara cartel and tortured for two days. They taped the torture, and they were asking him questions. Those tapes have never been made public - the DEA and the CIA have the tapes. What they were trying to find out is how much he knew about the connections between the cartel leaders and the heads of the Mexican government. That’s it. I happen to know the guy who led the investigation of the murder of Camereno. Almost every human being that was in the house in Guadalajara where they tortured Camereno had been trained by the CIA and was an asset. They had trained them to be an anti-drug force in Mexico, but they went over to the other side. That’s why the case was "buried."

Charles Bowden: Everybody that gets into the drug industry becomes corrupted. It doesn’t matter if you’re a cop or a robber. There’s just too much money. All you have to do is blink and you can get paid. You’re standing there waving cars through at the border. You’re a U.S. official. You wave cars through all day. All you have to do is wave one more through and you can make $50-100,000 in the blink of an eye.

I’ll give you an example. They busted a drug ring in 1989. This ring had moved 900 consecutive loads of cocaine into the United States through one crossing in El Paso – one bridge – without ever being detected. That's mathematically impossible unless you buy people.

Currently having a little hindsight since that article was written consider that oil prices have fallen more than 70%. Where is the funding to continue the war? Who do you think is going to win? What will the impact be on the border states? How is California going to fare since it also is financially insolvent?

NEW YORK — Oil prices slid 12 percent on Wednesday, the largest percentage drop in seven years, after a US government report showed crude inventories rose much more than expected in the world's top energy consumer.

The criteria by which I separate Mexico and Pakistan is that Mexico has no nuclear weapons. Had they fissile packages in their possession, I would rank Mexico as a higher risk than Pakistan.

The US is on the edge of a Pakistan, Iraq or Lebanon on its borders. My curiosity has shifted beyond when and what level to such topics as what scale of communications intercept are the US and cartels (who can buy the best) practicing against one another and to what tactical result; what level of commando teams are already operating in-country at a recon level; and what will our response be to captured US forces by the cartels.

Think Hezbollah with billions of dollars and less scruples. Ugly.

A year ago, police started patrolling 56 camps at the request of Mennonite leaders worried about crime, and plans are under way to open a drug rehabilitation center.

U.S. Customs agents last year arrested three people with Germanic last names from Cuauhtemoc. Each was caught smuggling more than 100 pounds of marijuana into Texas. All three are believed to be Mennonites, although Customs does not ask the religion of those it arrests.

Manuel Caracosa Alvarado, who runs a drug and rehabilitation center in Cuauhtemoc, says he treats an average of 100 Mennonites a year, many for addictions to hard drugs like crack cocaine and heroin.

Santiago Meza Lopez, known as El Pozolero (the Stew Maker), says he stuffed bodies into barrels of lye for drug cartels. He may be a good source of information about missing loved ones.

For the hundreds, perhaps thousands, of families of people who have vanished amid Baja California's drug wars, the search for justice has been lonely and fruitless. But their hopes have been buoyed recently by the Jan. 22 arrest of a man Mexican authorities believe is behind the gruesome disposal of bodies in vats of industrial chemicals.

Santiago Meza Lopez, a stocky 45-year-old taken into custody after a raid near Ensenada, was identified as the pozolero who liquefied the bodies of victims for lieutenants of the Arellano Felix drug cartel. Authorities say he laid claim to stuffing 300 bodies into barrels of lye, then dumping some of the liquefied remains in a pit in a hillside compound in eastern Tijuana.

His capture riveted Mexico with sickening details behind drug violence that has left more than 8,000 dead in two years. For the families of the disappeared, however, it was a chance to revive cases that seemed long forgotten.,0,2537684.story

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"The recent departure of New York Stock Exchange Chairman Richard Grasso makes this article, first published in 2001, very prescient, especially in the light of Mr. Grasso's trip to Colombia where he met FARC commanders responsible for providing security for narco-traffickers. Was Grasso making an in person sales call to negotiate with the drug cartel which was threatening to pull their investments from the stock exchange?
That might be worth a $140 million pay package."
– Uri Dowbenko

A government under siege, plagued by corruption.

Criminal gangs using military style weapons.

Third party countries supplying bad actors for their own aims.

Kidnapping running rampant.

Innocent civilians caught in the cross fire.

It all sounds like an episode of 24 , the Fox channel thriller starring Kiefer Sutherland, where the good guys are buffeted by international conspiracies, incompetent bureaucrats, rogue agents, and a ticking clock.

But, unfortunately it’s real and it’s happening in our backyard.

As previously reported, the security situation on the US-Mexico border is seriously deteriorating. Events yesterday brought more news, good and bad.

EL PASO -- A chorus of current and former U.S. officials are sounding alarms about Mexico, warning the war-zone conditions in cities like Juárez could lead to the government's downfall.

These voices include the Joint Forces Command, ex-CIA Director Michael Hayden, former Homeland Security chief Michael Chertoff, as well as ex-U.S. drug czar Barry McCaffrey. Last Tuesday, Navy Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, also said he was concerned about escalating border violence.

Early in January, an obscure organization -- the Movimiento Armado del Norte (Northern Armed Movement) -- sent an alarming communique on the Internet calling on the Mexican people to revolt against the government.

But, in a letter to the El Paso Times, Arturo Sarukhan, Mexico's ambassador to the United States in Washington, denies his country is on the verge of collapse.

A new serious problem has developed in Mexico recently as the powerful drug cartels have been able turn out demonstrations and support among the populations in the border towns near the U.S. border. With popular support among much of the border population who are loyal to these powerful drug cartels, weak police forces have faced significant opposition and even the government of Mexico has had significant difficulty combating the influence of these powerful drug cartels and their citizen supporters. This situation has now grown so serious that some foreign policy analysts actually believe that the government of Mexico could conceivably even collapse at some point, with powerful drug cartels taking control of the nation.

Mexican authorities have discovered the remains of dozens of people in clandestine graves and are conducting DNA tests to identify them, but many families are reluctant to contact them out of fear or distrust of the officials who are supposed to be enforcing the law.

MEXICO CITY - Indiscriminate kidnappings. Nearly daily beheadings. Gangs that mock and kill government agents. This isn't Iraq or Pakistan. It's Mexico, which the U.S. government and a growing number of experts say is becoming one of the world's biggest security risks.

The ebbing stretch of Rio Grande that divides the Texas city of El Paso from the Mexican city of Juarez may soon become one of the world's most militarized borders. This week, as Texas Governor Rick Perry went to El Paso to announce that has asked Washington for 1,000 more "boots on the ground" to enforce the border, Mexico's government ordered 5,000 extra soldiers to Juarez. The armies massing on both sides of the border are marching against a common foe — drug cartels — and the coming months will be a crucial test as to whether they can effectively work together to fight it.

The Rio Grande "surge" comes amid a growing wave of drug-related bloodshed across Mexico that has visited some of its worst violence on Juarez. The sprawling industrial border city of 1.6 million became Mexico's murder capital in 2008, with more than 1,600 drug related killings, and this year's toll looks set to be even higher, with 250 killings in February alone. Mexican authorities were particularly shaken by a Sunday ambush against local state governor Jose Reyes Baeza's three-car convoy that killed one of his bodyguards. On Wednesday, President Felipe Calderon flew to Juarez for an emergency security meeting, which was plagued by three bomb scares. The following day, the army announced it would send 5,000 troops to back up the 2,000 soldiers already patrolling the streets of Juarez to fight the gangsters. A Baghdad-style surge, the Mexican government hopes, will quell the slaughter.,8599,1882363,00.html

Mike Church. ... a Conservative Talk Radio host on Sirius Sate. has just this morning said.... The Constitution has been made null and void and there's no peaceful means left to resolve this!!

It cannot be overemphasized...American leadership have taken their hands off the Constitutional rudder, leaving our nation floundering. It's up to "the people" to assume control of the rudder, to right the ship.... God help us do the right thing.

Harry Riley