Saturday, January 24, 2009

Mexico: The Canary In The Coal Mine?

Continuing with the line of thinking from my earlier post "Re: Was Ayn Rand Right All Along?"...

The global economic/political/social situation looks increasingly bleak.

The Washington Post reports:
The world economy is deteriorating more quickly than leading economists predicted only weeks ago, with Britain yesterday becoming the latest nation to surprise analysts with the depth of its economic pain.

Britain posted its worst quarterly contraction since 1980 on the heels of sharper than expected slowdowns reported from Germany to China to South Korea. The grim data, analysts said, underscores how the burst of the biggest credit bubble in history is seeping into the real economies around the world, silencing construction cranes, bankrupting businesses and throwing millions of people out of work.

Continue reading.

And Joel Kurtzman writes for the Wall Street Journal (via Thomas Barnett):
Mexico is now in the midst of a vicious drug war. Police officers are being bribed and, especially near the United States border, gunned down. Kidnappings and extortion are common place. And, most alarming of all, a new Pentagon study concludes that Mexico is at risk of becoming a failed state. Defense planners liken the situation to that of Pakistan, where wholesale collapse of civil government is possible.

One center of the violence is Tijuana, where last year more than 600 people were killed in drug violence. Many were shot with assault rifles in the streets and left there to die. Some were killed in dance clubs in front of witnesses too scared to talk.

Continue reading.

Barnett comments:
The danger that Latin America once again becomes an active arena for U.S. military involvement (we are always somewhat involved, I'm talking about where the public's sense of intervention is activated by events and magnitude) looms for two reasons: the global downturn eventually reaches there (despite the political bravado down there) and the drug violence is distinctly heating up.

Point being: the auto-pilot quality of the past decade isn't likely to work. Neither subject (pushing more economic inclusiveness with trade agreements and figuring out an alternative path to the dysfunctional (certainly for Mexico) drug war) are ones Obama would gladly tackle in the near-term, and yet, events may force him to do so.

John Robb brings up the highly problematic situation in Mexico in two recent posts that are both highly instructive and disturbing.

Regarding how Mexico's unraveling relates to the problems most other nation states are having, Robb writes:
Diving into military theory (again).

A core dynamic behind the emergence of the nation-state was it's ability to run a successful protection business (aka racket). A system that has been growing since the treaties of Westphalia in the 1600s. The protection business is relatively simple:
1. It is a monopoly. It has exclusive ownership over the use of violence. As a monopoly, it must crush all internal competitors.
2. It defends its monopoly from outside interests -- as in warfare with nation-state and non-state competitors.
3. It charges the customers (individuals and businesses) within its geographical areas of control for this service. This isn't optional. Customers presumably benefit from this protection.


The protection formula broke down in the latter half of the 20th Century as the nation-state became more complex. Key elements of this breakdown include...

Continue reading.

So what should you take away from all this?

First, in the short-term we need to end the drug war ASAP unless we're okay with the strong possibility of having to deal with a failed stated on our southern border within the next several years--to a certain extent we already are, but things could easily get much worse. Second, we need to brace ourselves for a long and wild ride. The world seems set to change radically over the coming decades. We all need to start thinking about what we can do to help ourselves through these difficult times as opposed to just standing around hoping our failing nation-states will save us. Because they won't.

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