Mexico's Path To A Failed State

1. 05/05/18 1

2. The Texas Department of Public
Safety
Topics
•What We Monitor
•Why
•Geography of Mexico
•Popular Perceptions of Mexico
•Economy of Mexico and the U. S.
•Specific Threats and Targets
•Immediate and Longer Term Futures
05/05/18 Michael Lauderdale 2

3. Immediate and Longer Term Safety
Threats
• Unsafe Vehicles
• Contraband on highways and via foot
• Spillover violence from cities like Reynosa,
Juarez
• Foot traffic along the border
• Safety of trade with Mexico
• Spread of cartels into Texas
• Large scale attempts to cross the border
05/05/18 Michael Lauderdale 3

4. 05/05/18 Michael Lauderdale 4
Images and Memories of Mexico

5. 05/05/18 Michael Lauderdale 5

6. 05/05/18 Michael Lauderdale 6

7. 05/05/18 Michael Lauderdale 7

8. 05/05/18 Michael Lauderdale 8

9. 05/05/18 Michael Lauderdale 9

10. 05/05/18 Michael Lauderdale 10

11. 05/05/18 Michael Lauderdale 11

12. Nuevo Laredo
05/05/18 Michael Lauderdale 12

13. Demography of North America
Country Population Median Age % Below Poverty Line
Costa Rica 5,000,000 30 21.7
El Salvador 6,000,000 26 34.9
Honduras 9,000,000 22 29.6
Guatemala 17,000,000 21 59.3
Belize 300,000 22 41.1
Mexico 130,000,000 27.5 46.2
US 326,000,000 37.6 15.1
Canada 37,000,000 40.7 9.4
05/05/18 Michael Lauderdale 13
Source: CIA Factbook

14. Major Mexican Economic Engines
1. Tourism and Services More than 65 Percent
of Employment is in this category
2. Temporary Workers in U.S. 10 to 30 Million
3. Assembly Manufacturing (Maquilas)
4. Export of Crude Oil Primarily from the Bay of
Campeche
5. Drugs, Human Trafficking and Extortion
05/05/18 Michael Lauderdale 14

15. Maquila Manufacturing
• The most radical change in the Mexican
economy in the past 40 years has been
partnerships with foreign companies building
assembly plants in Mexico to tap lower cost
labor for products to be exported to the
United States.
• The result has been rapid growth of Mexican
cities near the U.S. border with Texas being
the most significant.
05/05/18 Michael Lauderdale 15

16. Example: Auto Manufacturing
• Mexico is quickly becoming the fastest export
hub in terms of vehicle production virtually
anywhere in the planet,
• Mexico is on pace to build 3.15 million
vehicles this year, which represents 19
percent of all cars and trucks made in North
America
• A combination of low costs, a perfect location
and free trade agreements make it
advantageous to build and ship in Mexico.05/05/18 Michael Lauderdale 16

17. Demographic and Cultural Impact
• People left rural areas moving to the border then to
areas with good connections to the U.S.-Monterrey
• Most of the employees are women, a radical change
in Mexican culture
05/05/18 Michael Lauderdale 17

18. Demographic and Cultural Impact
• People have regular cash earnings from jobs
• However most jobs are labor intensive and
vulnerable to automation
05/05/18 Michael Lauderdale 18

19. Economic Impact for Texas
• Texas is the leading state in the nation in world
exports
• Mexico is the largest customer
• Over 2 million jobs in Texas are generated from
exports with 1 million tied to Mexican trade
• Its border with Mexico is one of the busiest in the
world with Laredo-Nuevo Laredo, often the busiest
land port.
05/05/18 Michael Lauderdale 19

20. Major Dependencies of Each Nation
United States
• Cheap Labor
• Flexible Labor
• Petroleum
• Tropical Food Imports
Mexico
• Surplus Labor Seeking Jobs
• Food Imports
• Education
• Research and Development
05/05/18 Michael Lauderdale 20

21. Probable Profits From Major Engines
Five sectors provide the core of the Mexican economy with tourism being the
largest source of jobs. Narcotics estimates may be much greater.
Sector
1. Manufacture and Assembly
2. Tourism-30 million jobs
3. Immigrants Remittances 20
Million Individuals
4. Petroleum
5. Narcotics
Amount Profit
• $130 billion 10% $13 B
• $185 billion 8% $12 B
• $30 billion 80% $24 B
• $100 billion 15% $15 B
• $100 billion 80% $80 B
05/05/18 Michael Lauderdale 21

22. Threats To Texas
Specific Targets Mainly Originating From Mexico
Drugs and Human Trafficking
Cartel Violence
Economic Decline
Immigration

23. Criminal Activities
• Since Prohibition criminal activities have moved between
Mexico and Texas. Probably the oldest cartel, the Gulf, had its
beginnings moving alcohol from 1920 during Prohibition from
the State of Tamaulipas to Texas.
• Smuggling increased by the 1960’s with marijuana and
cocaine added and by 2000, crime groups had enlarged and
established territories along each American border city with
Mexico.
• Those activities challenge public safety in Mexico, border
cities and along roads and railways in Texas. Contraband
includes drugs, people, motor fuels and firearms.
05/05/18 Michael Lauderdale 23

24. 05/05/18 Michael Lauderdale 24

25. 05/05/18 Michael Lauderdale 25

26. 05/05/18 Michael Lauderdale 26

27. 05/05/18 Michael Lauderdale 27

28. How Organized Crime Is Changing
Mexico
• Cartels and American Gangs
• Militarization of Policing.
• Highly public violence.
• Serving To Threaten Police and Citizenry
• And Corrupt-Plata o Plomo?
05/05/18 Michael Lauderdale 28

29. 05/05/18 Michael Lauderdale 29

30. “La Barbie” former Laredo High School Football Player
05/05/18 Michael Lauderdale 30

31. 05/05/18 Michael Lauderdale 31
Bodies Near A Grade School in the State
of Tamaulipas

32. Michocan 2009
05/05/18 Michael Lauderdale 32

33. 05/05/18 Michael Lauderdale 33
Bodies of Central American Immigrants Probably Headed for the Rio Grande Valley

34. 05/05/18 Michael Lauderdale 34
Airport in Tamaulipas with seized drugs

35. 05/05/18 Michael Lauderdale 35
Requisite Security In A Bank

36. Mexico 2017
• Highest number of homicides in the country’s history.
Estimated at more than 29,000.
• Murders of local officials such as mayors, police chiefs are
very high with 21 mayors murdered since 2012 and more
than 100 local officials in the last 3 years.
• Mexico now has high levels of violence in all 33 states.
• Eleven current or recent governors are charged with or
sentenced for corruption crimes.
05/05/18 Michael Lauderdale 36

37. 05/05/18 Michael Lauderdale 37
Requisite Security In A Bank

38. 05/05/18 Michael Lauderdale 38

39. Mexico 2018
• Highest number of homicides in the country’s history. In the
first quarter of 2018 exceeds that time period in 2017.
• 29,000 were murdered in 2017. 30,000 are projected for
2018.
• Violence is recurring in border cities including Juarez, Nuevo
Laredo and Reynosa-Matamoros.
• Mexico is the most dangerous country in the world for Roman
Catholic priests. Twenty four have been killed during the
current PRI administration.
• The murders seem to send a message that if we can kill a
priest, we can kill anyone.
05/05/18 Michael Lauderdale 39

40. The Last Resort
• When times become very difficult people will move to new
locations. Much of the 20th
Century saw Americans leave rural
areas seeking better lives and opportunities in the city.
• The Great Depression and the Dust Bowl saw millions migrate
from Texas, Oklahoma and Kansas to California.
• Since the 1990’s Texas and especially Austin have
experienced Americans moving to Texas for similar reasons to
the migration from rural areas.
• A similar process is accelerating between countries. Poverty,
crime, and a search for a better life is causing sharp increases
to immigrate to the United States.
05/05/18 Michael Lauderdale 40

41. The Last Resort-1930’s
Migrants Headed Toward California and a soup line
05/05/18 Michael Lauderdale 41

42. The Last Resort
• Since the 1990’s Texas and especially Austin has experienced
Americans moving to Texas. A similar process is accelerating
between countries. Poverty, crime, and a search for a better
life is causing sharp increases to immigrate to the United
States.
05/05/18 Michael Lauderdale 42

43. 05/05/18 Michael Lauderdale 43
Venezuelans crossing
Simon Bolivar bridge
into Columbia

44. Venezuela-Worst Crisis in Latin
American History
• Ninety Percent Say They Do Not Have The Money For
Food
– Inflation is more than 2600 percent
– More than a tenth of the population have fled to the United States,
Columbia and Brazil
– Yet has the world’s greatest oil reserves
• Caused by Hugo Chavez, who sought a Cuban-style
socialist state
• Extended by his hand picked successor, Nicholas
Madura
05/05/18 Michael Lauderdale 44

45. Is Venezuela-Mexico’s Path
• Mexico has endemic corruption for years as did Venezuela
• Since 2000 has seen increased violence across the nation
• Will elect a new President in July of 2018
• Leading candidate with almost 50% is Lopez Abrador
• Leads a new party with an avowed socialist platform
• Has challenged the wealthy such as ending construction of
the new Mexico City airport
• A co-founder of the political party called for appropriation of
any companies that do not cooperate with the new
government
05/05/18 Michael Lauderdale 45

46. Markers of a Failed State
• Citizens Lose Respect for the State
– Inability to maintain civic order
– Failure to protect citizens
– Little trust in state’s institutions including police,
courts and currency
• Inability To Maintain Geographical Integrity
• People And Capital Migrate Out
05/05/18 Michael Lauderdale 46

47. Reprieve
World economy rebounds. Oil prices rise to $200 a barrel, Mexico permits foreign investments and spins off PEMEX which
modernizes engineering, refining and exploration. Oil discoveries increase as does production. Corruption is curtailed and profits
soar. With job growth fewer young men are lured into the cartels. Situation stabilizes to a significant degree.
Collapse in Progress
Oil plays out in Mexico’s top producing fields, Mexico cedes control over the south and north of the country as the capital is
consumed with providing services and order to the 25 million in Mexico City, and 20 million refugees head to the northern cities
and the United States. Millions will come to Texas alone. Mexico is a failed state with guerilla bands controlling much of the
countryside and several of the larger low-income neighborhoods in Mexico City. Cartels use tactics like narcobloqueos of stealing
18 wheelers and stopping them on streets to create traffic jams and undermine civic trust. Staged attacks on American border
cities occur with regular frequency and local police are overwhelmed facing cartels that are better organized, funded and
equipped. American border cities are inundated with refugees and violent gangs. Residents in all Texas cities as well as Kansas
City, Atlanta, Chicago and most southern Californian cities now like Mexico City fear kidnapping and ransom.
American Protectorate
Cartels use hit squads (Mexican sicarios) to attack American law enforcement in border cities on both sides. The United States
intervenes with military forces as it has done in Haiti and creates a protectorate for the Mexican Federal government south to
Monterrey, Saltillo and Durango. The traditional northern antipathy toward the chilangos of Mexico City grows and a process of
tying the northern Mexican states closely to the American Southwest accelerates. Many in northern Mexico openly call for the U.
S. to annex them with Monterrey as the capital of the Mexican states seeking admission to the Union. Leftist and nationalistic
mobs burn and sack the American Embassy in Mexico City.
Revival of Pax Americana
American economy revives and joint American and Mexican efforts suppress cartel activity with attendant boosts in tourism,
maquilas and domestic growth. America sharply reduces illegal drug consumption. Mexico increases its historical ties with Central
America and opens the region to the south to economic growth and channels American technological knowhow through all of Latin
America. Mexican migration returns to Mexico and both Mexicans and Americans increase investment and ties throughout Latin
America.
05/05/18 Michael Lauderdale 47

48. 05/05/18 Michael Lauderdale 48
Historical Immigration Patterns

49. 05/05/18 Michael Lauderdale 49
Border Patrol Apprehensions
From FY 13