The fallacy of Mexico as a failing state

Yann Kerevel writes at Allterdestiny;

f anyone has been following headline’s in the U.S. press about Mexico in the last month or two, you might have noticed a lot of alarmist and sensationalist garbage being thrown around suggesting that Mexico is coming close to collapse, is a “failed state” or a “narco state.” Fox news has been spreading this message, along with a number of political commentators on the Sunday morning talk shows, and even Rolling Stone.

The violence in Mexico is worrying, and cause for concern, but the rhetoric seems to lead the uninformed to think Mexico is more like Somalia. It is definitely not.

Further following the above referenced article, we go to an article which appeared in the Wall Street Journal written by Stephen Haber, who is a senior fellow of the Hoover Institution and a professor of political science at Stanford University. The article written by Professor Haber entitled Latin America’s Quiet Revolution states in part,

Mexico — which is most decidedly not a failing state — there has been a quiet but substantial movement toward the creation of societies that are characterized by increased economic opportunity, social mobility and political democracy. This is not to say that Brazilians have achieved the same standard of living as the Dutch, or that the rule of law operates in Mexico as it does in Canada. It is to say, however, that these countries have undertaken a series of economic and political reforms that make them vastly different places than they were two decades ago…..

Mexico provides a similar example. From 1929 to 2000 a single party, the Institutional Revolutionary Party (PRI), monopolized political power. After decades of corruption, economic mismanagement and arbitrary actions against the property rights of citizens — which included the expropriation of the entire banking system — the PRI was finally forced from power in 2000, when voters elected Vicente Fox, the presidential candidate of the center-right National Action Party (PAN). Voters again elected a PAN candidate, Felipe Calderón, in 2006.

Since 2000, PAN governments have enacted reforms that have enhanced the rule of law by establishing the legal principle of innocent until proven guilty, mandated government transparency through a freedom of information act, eased access to credit by increasing competition in financial services and encouraged homeownership via reforms to contract and banking law. Some sense of Mexico’s transformation can be gleaned from one fact: In order to run competitively in the 2006 election, leftist Andres Manuel López Obrador had to jettison most of his left-wing stances during the campaign in order to be competitive with the PAN — and he lost anyway.

Many of Mexico’s reforms are of a variety that only a CPA might find exciting. Not surprisingly, they have gone unnoticed in the foreign press. A 2001 reform allows banks to write mortgage contracts as bilateral trusts, in which the bank is both trustee and beneficiary, instead of as liens on property. This new form of contract means that a mortgagee can no longer default on a loan and prevent repossession for years on end by using the country’s notoriously inefficient bankruptcy courts, because the assets being collateralized are held by the trust and are not part of an individual’s bankruptcy estate. As a result, banks are more likely to make housing loans in the first place. Coupled to additional reforms that created a system of private housing accounts financed by payroll taxes, and that created a federal mortgage society that operates in a manner similar to Fannie Mae, homeownership has been placed within reach of millions of Mexican families.

Recent reforms have also encouraged competition in financial services. As a first step, the government allocated charters to nonbank financial intermediaries that could make housing and automobile loans. As a second step, it granted bank charters to retail giants, including American-owned Wal-Mart, thereby allowing families of modest means to open accounts and obtain credit to finance the purchase of consumer goods. The bottom line: Living standards, as measured by infant mortality rates, life expectancy and years of education, have all improved in Mexico over the past decade.

The Mexican state is weak when compared to the U.S., but incredibly strong when compared to places in Central Asia or Africa that are usually called failing states. There are no foreign troops on Mexican soil. There is no martial law. Garbage is picked up, streets are swept and children go to school. Middle-class couples take weekend getaways, and drive there on highways as good as those in the United States. After falling for a decade, Mexico’s homicide rate increased in 2008, because the Calderón government courageously decided to take on the drug traffickers. If it keeps rising, it may soon be as high as that of…Louisiana.

From the Foreign Policy Blog, we’re seeing similar analysis;

are we now in danger of painting the situation as more dire than it actually is? To be sure, a country that had more than 5,300 citizens killed in drug-related violence last year isn’t in good shape. But from reading recent U.S. commentary and analysis, you’d think Mexico is the next failed state. This isn’t sitting well with Mexican President Felipe Calderon, and his government is pushing back against their country’s erroneous depiction as Pakistan south of the border.

Now, of course the Mexican government is supposed to say that things aren’t as bad as recent U.S. coverage would have us believe, but to some degree they have a point. I’m still horrified and alarmed about what’s going on in Mexico, but here are a few reasons to keep our feet on the ground — for now.

1.The narcogangs still seem to be largely focused on fighting each other, not on bringing down the Mexican state. They have stepped up attacks on Mexican officials, police, and the army, but more out of necessity because Calderon has taken the war to them. As yet, there is no alliance unifying all of the narcogangs into one force that seeks to challenge and topple the Mexican state. Now, this could still happen, and even if it didn’t Mexico could still be fatally compromised, but thus far the gangs are still mostly killing each other.

2. The gangs have no political agenda; their main goal remains selling dope. They are not providing basic services to Mexico’s citizens, nor are they trying to create a parallel system of political order to rival the Mexican state and erode its legitimacy in the eyes of the people. In fact, even if most Mexicans think the gangs are winning, they by all accounts still hate them and what they are doing to the country. In that sense, Mexico’s gangs are not a true insurgency. There are signs — literally, in this sense — that the gangs are beginning to compete for the allegiances of the Mexican people and wage a strategic communications battle against Calderon. This is a troubling development. But for now, these campaigns are not focused on advancing rival forms of gang-led governance; their goal is simply to brand their cartel opponents as illegitimate in the eyes of the Mexican people.

3. Calderon’s government is fighting for its life, but it hasn’t lost (yet). In fact, there is still a chance that the worsening trend of the past few years actually reflects a problem getting worse before it gets better. Calderon may yet break the backs of the gangs, and the recent surge in violence may reflect the increasingly desperate actions of cartels that, for the first time in Mexican history, are now up against an adversary that is not content merely to look the other way, but is instead willing to do what is necessary to reclaim his country. Even if he succeeds, for his troubles, Calderon will likely spend the rest of his life after government in exile from his own country out of fear for his life.

I know the alarmists and fear mongers such as Lou Dobbs, Glenn Beck and others choose to ignore these facts as they don’t align with their agenda, but the state of the union of Mexico, is Good!

Another excellent source for information about Mexico is Latin Intelligence Blog They tackle some of the same issues as we do here and have many of the same concerns.

One article I thought particularly pertinent in view of Secretary Napolitano’s recent announcement to crackdown on weapons smuggling from the US into Mexico for the cartels, and the NRA’s Wayne LaPierre taking the position that they would oppose any effort to stop sales for this purpose, is this one entitled
Why is the United States backing Mexican drug gangs? and An Update on the Previous

This is not new news. The U.S. government recognizes that U.S.-purchased weapons are fueling Mexico’s violence. In fact, ATF acting director Michael Sullivan said last year that investigators have traced 90 to 95 percent of weapons seized in Mexico to the United States. William Hoover, Assistant Director for Field Operations at ATF said in a congressional testimony last year that “It is a major challenge for ATF to adequately identify and disrupt the illegal sources of firearms and ammunition, while participating in the interdiction of shipments firearms and ammunition destined for Mexico.”

What’s impressive is the lackluster response to such a serious problem. About 100 U.S. firearms agents and 35 inspectors patrol the border for gun smugglers, compared to 14,400 Border Patrol agents that patrol northward movements.