151 comments on Mexico: A Collapse Update
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151 comments on Mexico: A Collapse Update
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Thanks for spending some of your weekend on this update Jeff.
So if you are right, and I expect your are, what does it directly mean for US (and via ripple effect ROW?). I know people in Texas are already afraid. I've heard that the ammo shortages in Southwest (which also have ripple effect) are due to mexican gang members coming across border and taking large hoards back to Mexico. If the nation state does collapse, what does that do to GOM production, Texas production ,etc? Does this ripple south of Mexico as well? Into Costa Rica and other LA countries?
Is there any truth at all to Amero? How, if at all can US help Mexico at this point? We have our own problems.
The whole system has become so complex that it is impossible to predict what/if might be Archduke Ferdinand type event - (almost exactly 100 years later).
P.s. my essay yesterday referred to individuals, but if a trend in decline of nation-states is underway, then one could argue that those that decline first might eventually have an advantage, being forced to learn/adapt, while fossil fuels and resources are still available and ROW is at peace. Hard to say.
Nate,
I think, globally, one of the key ripple effects of collapse in mexico will be a growing bifurcation of the role of the "state." By "Collapse," I don't mean that there will be no Meican state, but rather that it will cede effective sovereignty over much of the country and much of day-to-day life (which will be absorbed by cartels, or other "providers"). What I think the state will continue to do is act as a storefront for Mexican natural resources, leveraging its remaining ability to to protect discrete points (e.g. oil fields) as opposed to the entire contryside, and focus its reduced ability to monopolize violence on those areas that best allow it to funnel wealth... what Philip Bobbitt would call the "Market State."
That's a long way of approaching your question about the Amero and GOM oil production. I think the "Amero" and related projects (everything from very concrete infrastructure projects to the wide array of conspiracy theories about the North American Union, some true, some fantasy) will serve mainly to facilitate this ongoing access to Mexico's natural resources by multinationals (and possibly also fortified, concentrated "manufacturing zones" such as already exist in the periphery of Mexico City).
I think the nominal collapse of the Mexican state (or, perhaps more accurately, its retreat from 90% of the countryside and from its social obligations) will pave the way for increased outside investmet and ownership in Mexican natural resources--including onshore and offshore Gulf oilfields. The ability to actually attract this investment will, I think, be determined by the Mexican state's ability to cordon off certain geographic areas and legal relationships to make these investments secure and stable in the eyes of foreigners. The real threat here is not the ability of the elite to sell of shares in KMZ, for example, but their ability to protect the export infrastructure to make these investments secure. In general, I think we'll see the cartels continue to challenge this consolidated state by targeting infrastructure (as we see in Nigeria, Iraq, Colombia, etc.) in a form of protection racket. Offshore fields may be more viable here, at least until the cartels gain a more sophisticated reach (as the Tamil Tigers have in Sri Lanka). It will be an interesting game of cat-and-mouse, as the value of this protection racket to the cartels (who will lack the sophistication for some time to control something like KMZ directly, and who would surely face a US military intervention if they tried) requires the general viability of these exports.
However, from a net-export perspective, a Mexican collapse could actually decrease domestic consumption (Westexas-any thoughts on this?)
Maybe this is too obvious, how do the cartels finance themselves, drugs. So take away their source of energy (money) and power, which is cash, by decriminalizing the drugs. No illicit drugs, no huge returns for contraband, and most of the cartel members are back to serving frozen Martgueritas by the poolside.
Overly simplistic, aside from the net oil export problem? I don't know. You see, the US "War on Drugs" is spilling over into Canada also. The rash of gang killings in Vancouver is not a local problem, it's a continental problem. The drugs go to the US, and the guns and ammo come back to Canada. Ten years ago, there might have been a half dozen shootings a year in a city area of 2 million (maybe I exaggerate a bit), but now we are getting over 10 a month. And, most of the weapons used are not sold in Canada.
I put it back to the US, you've got to get your collective heads around this. The emperor has no clothes and all the vain and facile posturing against drugs is not going to stop it. This is certainly a case of the law of unintended consequences (or is it? Hmmm...). We better start dealing with the true nature of the problem. If you cut off one of Hydra's heads and two grow back, then cut off the legs.
If you examine the size of the global narcotics industry (in dollars) and you read the list of the Forbes richest humans, you will note an interesting dichotomy. This gigantic industry apparently only produces street level hoodlums and has no political influence or ability to control USA politicians. How likely is this?
The influence can be either direct (JFK), indirect (numerous politicians stumping on fighting drugs), or the opposite (Robert Kennedy, Nixon). The drug card is a significant influence whether street level or big Pharma. Does big Pharma want the decriminalization of street drugs? Certainly not when one can take care of nausea from cancer treatments with $10 of marijuana instead of their $300/mo anti-nausea prescription drug (Zofran). We had a business in the US assisting Americans with their prescription drug purchases from Canada and I saw the bills. And don't buy into the "research and development" propaganda either, some of the recent innovative drugs have come from France (highly socialized) and the Netherlands (i.e. Spiriva).
The whole situation can be summed up by the quote from Upton Sinclair.
Most of these drugs are heinous, I'm not defending their abuse. But so long as we keep trying to wish the problem away, the mode of consumption will be abuse - because illegality leads to binging - and not to intelligent and controlled use. Just ask any seasoned police officer or fireman.
My dad is a retired fireman that spent the better part of his career in downtown Vancouver. He picked his fair share of dead junkies off the sidewalks. All the first responders working downtown hated "Welfare Wednesday" because it inevitably resulted in terminal Thursday and forensic Friday. He, and other colleagues of similar tenure advocate the decriminalization as they feel most of the real street level problems would go away.
Note I've been using "decriminalization" and not legalization. One stipulates a controlled distribution without fear of penal action, while the other denotes images of a drug frenzied free for all.
I'd call it an alignment of self-interest. Politicians get to grandstand and act like they're protecting the children. Drug lords makes lots of money because the black market keeps prices and legitimate business competitors out.
I agree with you that we could take a lot of wind out of the sails of the drug cartels by legalizing drugs. I think this is one of many examples of the right policy move but one that has no chance in hell of working. Kind of like the right policy in the war on terror is to recognize that we caused the problem by repeatedly screwing the people of the Middle East (both dirctly and more frequently through oppressive proxy governments that supported our economic needs) and then stop. Not going to happen either...
Tragically, I think that the most likely political outcome of these problems is for states to further crack-down on the problem, thereby adding fuel to the fire. We'll fund narcotics enforcement in the US, and we'll give money and training to the Mexican state to do the same there, all of which will play into the hands of the drug cartels...
I have to sadly agree. As much as I would like to see the sensible policy, we know in our hearts the outcome will be as you have outlined. There's too much money in play for all sides. Sometimes I don't know whether I should be clicking my heels three times, chasing after the white rabbit, or calling the Ministry (Brazil).
BTW Jeff, I came across your writing a few years back with the Theory of Power and have appreciated your recondite analysis. (It surprises a few that are caught in the typical military stereotype to see the honest and thoughtful analysis that is coming from US military members).
Thanks, BC_EE. For the record, though, I'm no longer employed by the Federal Government or a member of the US Military. That said, it's my opinion that there is a great deal of "independent thought" in the military--it's primarily the structure of our political-military complex that drives outcomes...
Taleb in The Black Swan came to the same conclusion. He has the highest regard for U.S. military planners.
I think this is blindingly obvious. Once Prohibition was repealed the lucrative profits from bootlegging/speakeasies/etc vanished, and so did the likes of Al Capone, Baby Face Nelson, Pretty Boy Floyd, and the rest. 'The Mob' did not disappear, but retreated into the more benign background of gambling/numbers/casinos, protection rackets, an so forth. Think about it: the U.S. had carloads of mobsters driving around making hits on people with Tommy guns. There was a running gun battle between the Feds and the Mob.
Decriminalize drugs, and the profit motive for the cocanistas and all the other drug lords goes poof in a heartbeat. It is just that simple.
I really don't want to hear any moralizing from the self-appointed guardians of America decency out there about this. Plain old cigarettes have killed over 400,000 people per year for decades and no one says boo hoo to any of that. In fact, plenty of people (some who I personally know) and politicians go to great lengths defending the 'right' of God-fearing patriot American tobacco farmers to grow their poison and profit from it. Plenty of beer-soaked bubbas would start a revolution if we tried (again) to crack down on alcohol, the abuse of which aslo kills many people each year. These apologists always invoke personal responsibility and personal liberties when they defend the legality of these substances...but draw their own arbitrary line at invoking the same philosophy about currently banned substances. Hypocrisy much, anyone? I have never taken any illegal drugs, nor have I ever smoked, save for one tentative puff when I was 12 (it tasted disgusting). I drink a beer or a glass of wine once per month, maybe. My wife and my almost adult children are the same. Even though tobacco and alcohol are legal and available to us, we choose not to use the former and my wife and I barely imbibe the other very infrequently. There is your personal liberty, personal morality, and personal choice. BTW, I do support the right for government buildings and restaurants, libraries, stores, etc. to ban these things...second-hand smoke is NOT a choice for those who are breathing it and harmed by it. Do what you want in your home. For those who would talk about driving/working under the influence of drugs: There are laws and there should be very stiff penalties for that. This still does not obviate the right to ingest substances on your land/in your home.
Of course these ideas will never fly here, not in small part due to the the huge business that is the American Prison Industry. I've said this before here and I'll say it again: The US Government obtains many things from prison (slave) labor...office furniture (UNICOR, formerly Federal Prison Industries, with each desk having a slip of paper that is the 'Escape-Proof Guarantee), military uniforms, and much more. I would speculate that there are plenty of bribes being paid out to government officials in various 'law enforcement' and 'Dept of Justice' and legislative bodies to keep the co-dependent drug cartel BAU system rolling right along unhindered.
The little old ladies and other moralizers are supporting a paradigm that is rotting us from the inside out. If you can't stop people from doing it, legalize it, tax it, and educate against it.
What is truly sickening is seeing how the drug lord/drug trade has been and still is glorified in many American movies and TV shows. Another industry that would suffer if the current paradigm is broken. How many movies could be made about someone buying weed from Wal Mart?
Rant Off/
I went out to a night club in Bogota, Colombia last Friday night and thanks to a recent new law, no smoking was allowed.
It was so nice.
By the way, drug use is legal in Colombia:
I've often wondered what had more to do with the polestar of drug trafficing moving from Colombia to Mexico, this or Uribe's application of the mano duro.
My view is that all drugs should be decriminalized, and that they can be freely brought from a hospital pharmacy.
All consumers of said drugs must be enrolled in a treatment program.
Treat it with education/health initiatives rather than a criminal issue.
Of course the criminal issue would stay if you drove whilst under the influence etc - much like most places treat alcohol and driving.
Pretty sure that this concept won't fly - but the current paradigm is hardly working either.
Don't do drugs - but have been the victim of a burglaries by drug addicts looking to fleece stolen goods to fund their habit.
Your plan is just another form of criminalization. It completely ignores the real problems of recreational use and addiction.
Disclaimer: Haven't; never will.
Cheers
For the *vast* majority, there is no problem of recreational use, unless you have moral problems with people getting wasted.. In which, case, mind your own business.
The taxes raised from drug sales would have to be ring fenced for addiction treatment, but the casting of drug use as a problem in its own right is very much a political act.
There is more to it than just recreational use. I started that way, and then became fascinated with a different view of reality, the stepping out and back in, adds a remarkable clarity to thought. Doing some Sandoz acid back in the 60's led me to some truly inspiring places. It is a large part of who I am today and why I live how and where I do. I am at peace in the woods. I have the stars at night and the wind in the trees. I chased that for a few years after, and lost count after I dropped acid for the 500th time.
I actually ended up doing public service when the locals had a really bad tripper, the cops would show up and I would get to go into the cell and talk them down. Not really down but guide them to a different place.
Once my first child was born I stopped all use of illegal drugs, not something you can do if you are responsible for a child, but yes I still drink and sometimes smoke. Roll my own, especially when I have a touch of Jim Beam.
The places and experiences I had I now go to in a different way, meditation, working with the chi, and physical labor. I do credit the acid with showing me the way the first time and I might never have known otherwise.
Mankind has spent generations altering his reality, prayer, fasting, flagellation. The interior of a mosque or church are desinged to take you from your reality. I was lucky enough to actually experience an Indian peyote ceremony. Read "Varieties of Religious Experience" by James if you will.
This is a story as long as mankinds story, with many, many chapters. Quantum physics is only just starting to explain or even admit some of these effects are there. Point you specfically to the non-local effect.
http://www.quantumconsciousness.org/penrose-hameroff/orchOR.html
Peace
Don in Maine
I would greatly prefer to be utilizing a joint right now instead of vodka to relax...ethanol has way too many calories...
I agree that the obvious solution is just not implementable in the current environment...
It is a shame that a country so adamant about a free market is so ignorant to basic truths...
Sigh...
In a related question, does anyone know what happens to the demand for narcotics when the economy tanks? On the one hand people don't have as much money to spend, so you might think it would go down. On the other hand lots of people are stressed and depressed, and that would suggest that demand might go up.
Alcohol is recession prof. Consumption goes up in hard times. I would expect the same to be true of recreational drugs.
I agree completely.
But Mexico already tried to legalize some drugs. And guess who raised such a fuss that then president Vicente Fox vetoed it?
That's right, Mexico's benighted and uncaring neighbor to the north:
Power (money) corrupts all the way to the top. Say one thing in public, be on the take in private.
Very True. The Mexican government is corrupt, and will not last another year.
A new government will emerge, maybe like Venezuela, the iron fist of Chavez.
At this moment the drug lords have more power than the govt in Mexico.
I´d say that its more like in the next 5 +/- 3 years that the people of Mexico will be seriously invited to contemplate revolution. I think 1 is too early. I had kind of thought maybe something would happen when Fox got replaced by Calderon, or when the new oil legislation got debated, but now I think it will take a bit longer.
Hopefully it will be a moderate, cheerful revolution like Venezuela's. (compared to other revolutions...not to BAU)
I think there are two big questions. One is if the various regions of Mexico will work together, or separately. The other is if the people will be working towards a goal, or reacting against a situation.
PS, if you go to google images and search APPO or Atenco or EZLN you can find lots of images. I had wanted to include one of the ones showing the masses barricading the streets against the police/army, but i don't know how to add images to these posts. I had hoped to illustrate that in Mexico its not only the drug cartels that have more power than the government, the people do to. (Although the government has some nasty people on their side)
It's obvious alright - to those of us in touch with reality. Our fearless leaders, on the other hand truly believe (or, at least must claim to believe if they want to qualify for elected office) that tracking down, arresting, processing, convicting and jailing people for possession or use of various forbidden shrubbery is not only acceptable but vital for a healthy and moral community. These people are delusional. And if we continue to let these nutters run the show we're just as bad.
Prohibition is a de-facto government subsidy to organized crime. The only way to take these gangs down, whether they're in Mexico, Columbia or the streets of Vancouver, is to remove the black market that funds them. This can not be done by force. When you take down a big dealer or network, supply is removed and demand holds - prices rise, and this funds a gang war between the half-dozen or so smaller entities underneath them to determine who gets to fill in the gap left in the black market. The bigger the gap, the more prices rise, and the more incentive to fight over it. In other words, these PR-friendly crackdowns always lead to nothing more than increased body count and a re-organization of the black market with the most aggressive and violent elements tending to prevail.
The utterly transparent fiction that drug laws have anything to do with public health is made a complete mockery by the medical and social effects of the two currently legal recreational drugs - Alcohol and Tobacco. Anyone who tries to tell you drugs are illegal because they're bad for you is either massively misinformed(most of the public) or lying to you(cops – see below).
The biggest impediment to drug law reform is law enforcement itself, since next to organized crime, they are the group with the most to lose should prohibition end. Drug enforcement is a huge component of police budgets, and no self-respecting police chief is going to kiss that amount of his budget goodbye without a fight. Not every cop is on board with the prohibitionist fiction, and there are voices in the darkness (http://www.leap.cc), but the ones high up the police ranks (and their overlords in the US DEA especially)know the true stakes and are staunchly supportive of further crackdowns and rabidly against any liberalization of drug laws in order to safeguard the interests of the law enforcement community. Needless to say, when you find that the cops and the gangsters are on the same side of a political issue, it's a red flag that something very rotten is going on.
Legalize it!
Wow...Bravo...well-said!
Economic collapse--especically combined with government collapse, e.g., the Soviet Union--can be a double edged sword, resulting in both falling consumption and an even faster rate of decline in production.
Mexico's most recent production decline was about -10%/year. At this decline rate, if they wanted to maintain flat net exports of about one mbpd, they would have to cut their consumption in half over the next five years.
Volumetrically, it appears that the combined VenMex net export decline last year was about 650,000 bpd, a one year decline that was close to two-thirds of total Canadian net oil exports.
Hi Jeff
One of the main drivers of the obsolescence of the Nation State (according to your academic paper) is globalization. This has contracted sharply recently and will do so to a much greater degree as PO impacts human activity. The world seems set for another bout of nationalism; and as the pressure on resources grows, surely we can expect more war as an outward expression of the nation-state?
I fear you are right and hope you are wrong. Of course, this is a matter of political ideology. Nationalism's reputation really didn't fare too well the last time it motivated really big events (WWII). Hopefully people remember that.
I don't think they will; a lot of people never learned or understood the lesson in the first place.
Between "Love it or leave it" and "We grew here you flew here" it's a really nasty streak in human nature that makes me very angry to see.
It's the under 30s that count, especially if we give weight to 'street politics'. In my experience a lot of these people generally feel a disconnect between themselves and what happened to others, elsewhere, seventy years ago. All they focus on is their own nation's overseas involvement past and present, and feel a patriotic militaristic pride about that.
Societal memory is fairly short--my post a little later in this thread puts a couple of back of the envelope numbers on it.
I think this is a very good point--right now I think we're actually seeing a retrenchment of the Nation-State, at least in those states that remain relatively solvent ("relative" is debatable). I think JaggedBen is right--we'll see a resurgence of nationalism, and this could be very dangrous, at least in those states where it remains a viable means of mobilization. In the long-run, I think the fate of Nation-States in general (beyond those obvious constructs of colonial cartography that seem destined to fail) depends on how humanity reacts to peaking energy supplies. If people re-localize, return to primary loyalties, while simultaneously migrate and establish global networks, then the Nation-State as a construct is finished. To some extent (and this has been fairly leveled at me as a criticism elsewhere), I see this as the prefered outcome in a post-peak world and therefore I am most likely guilty of confirmation bias in looking for why the Nation-State will fail. The alternative--which I see as much worse--seems to be the kind of resurgent nationalism, increased authoritarianism and oppression, and renewed conflicts to secure our "rightful" share of a shrinking pie. That path might keep some Natio-States intact, but I think it's far worse for humanity in general...