May 13, 2008
Stratfor©
Geopolitical Diary:
The Mexican government has arrested five individuals involved in the killing of Edgar Millan Gomez, Mexico’s highest-ranking federal law enforcement official. The five men allegedly operated on the orders of the Sinaloa Cartel. The death of Millan Gomez at his home in Mexico City is the latest example of the escalation of violence in the ongoing war between the Mexican federal government and the cartels that control large swaths of Mexican territory. The assassination of such a high-level target clearly puts increased pressure on the government.

Mexican President Felipe Calderon’s boldest initiative upon taking office 18 months ago was the deployment of thousands of troops to combat Mexican drug cartels. In doing so, he brought the fight to the doorstep of organized crime.

Calderon’s efforts in combating the cartels have been notable, as he is the first Mexican president to challenge cartel control of Mexican territory in a serious way. But his resources are limited. To tackle the threats and challenges facing the government, Calderon has shifted troops from one place to another. But any fundamental ramping up of dedicated troops would strain Mexico’s resources.

The shift of cartel violence into the interior of Mexico, and particularly into Mexico City itself, has been a gradual trend that Stratfor has observed over the past year. Cartel involvement — particularly by the Sinaloa cartel — in the capital appears to have increased noticeably since a failed attack with an improvised explosive device in February. Millan Gomez’s assassination is the latest example of this trend.

Mexico’s continued descent into chaos could have enormous implications for the United States, with the potential to shift considerable U.S. attention to the Western Hemisphere.

The economic importance of Mexico to the United States is difficult to overstate. The potential disruption of trade between the two countries — particularly relevant at a point when the United States is staring down the maw of a recession — would be a massive liability for the United States. U.S.-Mexican trade totaled about $350 billion worth of goods in 2007, making Mexico one of the United States’ largest trading partners.

Now, there is a real danger that Mexico’s crime situation could spin out of control. The cartels need stable supply routes to the United States to secure their drug shipments, while the government is seeking to stem the tide of violence that has wracked Mexico for decades. The law of unintended consequences is in play here, and there is a distinct danger that violence could further spill over into the United States — disrupting trade flows and border security.

Although the United States may be moving forward with policies like the Merida initiative, which will lend aid to Mexico’s war on the cartels, the current efforts are limited. U.S. forces are largely preoccupied in Iraq and Afghanistan. While it would take a great deal to tip the scale toward a U.S. military intervention in Mexico, we may now be at a point where that has to be considered given what is at stake.

The last time the United States meaningfully asserted control over a deteriorating situation in Mexico was in the early 20th century during the Mexican Revolution, when the United States occupied Veracruz for six months to protect U.S. business interests. If violence on the border started hurting the bottom line, the cost of not doing anything would start to approach the cost of military action. The potential for an escalation of violence between the cartels and the government spiraling out of control could tip that balance.

It is unclear what the threshold for U.S. action in Mexico would be. But the stakes are high. If the United States sees trade flows threatened, and the security situation deteriorating, Washington might see fit to intervene. And just because it hasn’t done so in a century doesn’t mean it will not choose to do so in the future.
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SOURCE: Stratfor©
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