40 years ago the US sent Mexico into a financial crisis — and it transformed the narcotics industry

9/15/2015 Business Insider

Immigration_and_Customs_Enforcement_arrestIn this excerpt from A Narco History: How the United States and Mexico Jointly Created the Mexican Drug War, coauthors Carmen Boullosa andMike Wallace explain how the US and Mexico jointly created the Mexican Drug War.

Indeed it is impossible to understand the tremendous changes in the drug business during the combined sexenios of Salinas and Zedillo (1989–2000) without taking into account the massive political, economic, and ideological transformations wrought during that decade and the previous one by the PRI-governed state.

Farmers, unable to sustain themselves due to the removal of subsidies and the arrival of competition from US agri-corporations, found the burgeoning market for marijuana and poppies their only avenue to surviving on the land. The army of the urban unemployed gave the cartels a deep pool from which to recruit foot soldiers, and the miserably paid (and eminently corruptible) police and military provided the muscle with which to protect their interests.

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2 thoughts on “40 years ago the US sent Mexico into a financial crisis — and it transformed the narcotics industry

  1. Ken Shwedel

    The article makes a number of wide general comments that give a misleading picture of what happened in rural Mexico. It says, for example, that corn prices fell by ” around 50 percent after the NAFTA agreement”. Taking the highest real corn price in the 14 years before NAFTA (14 years is the length of the data that I have) with the lowest price, yes it fell by around 50%. However, the average real price fell by “only” 26%. Too much, but not 50%. Since 2010 the average real price for corn is slightly above the pre-NAFTA price.

    Likewise, the article says “Tariffs and quotas on agricultural imports were removed”. That is true, but there was a 15 year phase in. Similarly, it is said that “Subsidies that had supported small-scale farmers were deleted.” Subsidies are still in place.

    The factors explaining what happened in rural Mexico were not corn prices, tariffs, nor subsidies, but rather the changes in institutional arrangements between the state and rural peoples, including the elimination of state agencies and adjustments in co-option of rural players.


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