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MEXICO
AN UNTOLD TALE

 

 

 

PROLOGUE

 

 

 Mexico, America's neighbor on the South is known for their beautiful women, sand beaches, tropical climate, fabled resorts and corruption.  We are talking here about world class corruption in which government officials have no fear because they have been historically protected by the successor. Then again, what else could happen with a one-part political system? This is then is the story of economic bungling and collapse and the reason that it has happened before and sometime in the not to distant future it will happen again.

 

THE TAIL

 

After two tragic collapses in a short span of years, Mexico won a fresh start, thanks to two big bailouts and some aggressive legislation passed by their loyal neighbors in the United States Congress, NAFTA, which bestowed upon Canada and Mexico preferred trade treatment.  The legislation ran the gambit, from soup to nuts, in a potpourri of largesse so generous that it almost caused a civil war in the States. The political logic evidenced by the legislators was indisputable, they felt that it would be politically less expensive to bale Mexico out with continuing special treatment than ponying up $40 billion or more a pop each time they went down the tube.

 

Don't get the impression that it is a one way street.

 

In order to return the favor, Mexico’s drug lords supply two-thirds of the total amount cocaine consumed in the United States. The situation had become so invasive within the system, the United States Government planted their own agents in Mexican banks to keep track of money laundering and eventually used the ruse of holding a symposium for laundering of drug money to lure the guilty parities into the United States so that they could be arrested.

 

This was not a particularly far ranging operation, only 12 of the 19 largest banks in Mexico had officials that were actively involved in money laundering and the total number arrested was well above 100. The fact the banks were up to the eyeballs in the laundering mess came at a particularly bad time for them. The Mexican Congress was whisking along a bill that would have had the national government absorb the entire hickey caused by the 1995 bailout of their banking system (Fobaproa), which would have left the banks off the hook entirely.

 

The populace was already crazed over what they considered an attempt by the government to cram down a taxpayer bailout of the rich bankers, many of whom were already in jail for stealing money from depositors. Many well situated American's held the view that officials wanted to bail out the banks so that the Mexican Government could grease the wheels of the drug rings sending cocaine into the United States. Not the best deal the US ever made.  

 

The importance of the sting, code-named, Casablanca, can be visualized by the fact that it was conducted by units of the U. S. Treasury, the Customers Service, the Justice Department, and the Federal Reserve. Publicly, Mexico applauded the action but behind the scenes, notes were being exchanged at very high government levels complaining that the undercover sting had taken place on Mexican territory without the knowledge of Government Officials.

 

High ranking American’s involved in the covert operation knew that if one word of these activities was ever leaked, the entire operation would have been jeopardized. Recognizing the fact that almost the entire Mexican bureaucratic structure was so riddled by highly paid informants of the drug cartels, not only would the operation have collapsed but many of the Americans involved probably would have lost their lives. As it was best put by Jorge Castaneda, “It’s obvious the Americans don’t trust the Mexicans. They were never going to share something like this with.”

 

As the thought of what had happened penetrated the Mexican rank and file, a hue and cry went up that Mexican sovereignty had bad impugned. Thus, things then went from bad to worse; Mexico has advised the United States that it will criminally prosecute all of those involved from the Mexican informers to the American customs agents.  Mexico’s foreign secretary even went as far as presenting the American Secretary of State, Albright, a list of particulars relative to the laws that had been broken which included money-laundering and entrapment.

 

The U. S. "front" company that ran the sting for the American Government, Emerald Empire Corporation, lured Mexican suspects into the United States to be arrested. According to Mexican Law, this type of entrapment is illegal. Secretary of State Albright took the "high road" and told her Mexican counterpart that she had never been informed about the operation either. This may explain the American Secretary of State’s history of absurd statements about Mexican cooperation relative to their drug trafficking. 

 

No sooner had the Mexican’s indicated that they were going to go after the people that participated in the American drug sting that it was sheepishly announced that maybe, just maybe they were informed in advance. The Mexican Attorney General’s office (PGR) announced that in reality they were put on notice very early in the scenario.

 

“On January 16, 1996, Mexico’s then deputy prosecutor for judicial and international affair, Rafael Estrada Samano, received a visit from two U. S. customs officials...to inform him of the operation later named Casablanca.” 

 

Furthermore, the PGR stated that:

 

“U. S. Justice and Treasury Department officials contacted Mexico’s Finance and foreign ministries as well as the PGR.”

 

Estrada when interviewed indicated that he had also informed then-attorney General Antonia Lozano Garcia and the head of the Attorney General’s office in Baja. This operation seems to have left out only a number of high level Mexican officials and Secretary of State Madeline Albright relative to being informed. I guess you never can tell whom to trust these days but the success of the sting we believe speaks for itself.  Internationally, poor Ms. Albright always seems to be left out when something important is happening. However, then again she is only Secretary of State. Alternatively, maybe her memory conveniently failed her, after all she totally forgot her Jewish roots when it was convenient.

 

In spite of the facts, Mexican President Zedillo, wanting to prove that he was macho, continued to berate the United States and was able to transfer the blame in one masterpiece of eloquence, “An overwhelming proportion of world (drug) demand comes from countries with the highest economic capacity, it is our men and women who first die combating drug trafficking, our communities are the first to suffer from violence and our institutions are the first undermined by corruption.”

 

Wow! Holy Molly! You just can’t fight that kind of logic and he really stuck it to the U.S. What eloquence! I think that pretty well closes the book on that subject. Upon hearing Zedillo’s speech, the U. S. Congress passed a non-binding resolution approving the drug sting by the surprisingly close margin of 404 to 3. In throwing even more oil on the fire, U. S. Government Officials indicated that they would issue no guarantee not to run a similar operation in Mexico in the future, should the facts warrant it.   

 

 

 

Come Vacation in Mexico, We Offer Beautiful Women, Sandy Beaches, Wonderful Weather and....

 

American’s losing their lives in Mexico is another story. So many tourists and business men have been murdered in the formerly peaceful, South of the Border tourist Mecca that the US State Department has issued a bulletin stating that the crime rate has spiraled out of control and that taxis, ATMs, nightclubs and bars should either be avoided or are to be frequented with caution. In Mexico City alone, almost 200 violent crimes and 3 murders a day occur that are noted but these impressive statistics are meaningless when you consider that the great majority of crimes in that country go unreported.

 

Pigging Out and Paying The Price

 

Moreover, if you aren't murdered or kidnapped, robbed or beaten, Mexico has other much more sophisticated ways of ending your stay in this beautiful country South of the American border. In a land of interesting statistics, one of the most interesting is the fact that every single day of the year, two-thirds of the entire population, that means men, women and children eat their food at a street vendor’s stand. This means that 60 million meals a day are served under the brightly colored umbrellas that display the vendor’s wares. Whether it be a taco, a tortilla or a tomalley, it is nothing less than a tradition to go out for lunch and have something to eat under the umbrella while taking in the beautiful weather and talking to one’s friends. Sounds idyllic, does it not?

 

There is an independent consumer group in Mexico that goes by the name of “The Mexican Association of Studies for the Defense of the Consumer” (Amedec).  For whatever reason this spoilsports are out to ruin our fun and they say that there were 192 million illnesses last year in Mexico caused directly by these vendors and their use of unsanitary conditions in the preparation and serving of the luscious delicacies. Although my math is not so hot, I think that this comes to over three illnesses per person eating the food during a given year. Worse yet, Amedec states that these are not just any old little illnesses, these are in a league with the big enchilada, we are talking here about dysentery, hepatitis and cholera among others.

 

Well you say, “What’s a little dysentery among friends”? Well Bunkie, 60,000 people a year are carted off and given the last rights because of the food that they get from the lovely stands with the brightly colored umbrellas. “Why doesn’t the government do something about cleaning these folks up, you know, make them more sanitary?”  American officials in charge of this type of fiasco would be boiled in oil and that would only be for starters.

 

Bunkie, let me tell you something else, these people have been cooking food and serving it this way long before Columbus discovered America, and one out of every four Mexicans makes his living serving up this brand of poison. Do you think that Zedillo and his crew are about to legislate these folks out existence when every politician in the country needs the bloc of votes to be elected? .

 

The fact that the medical treatment alone for those that get sick eating this stuff is cost a fortune and when you add to that the almost $2 billion in income lost to the country in productivity, you are starting to talk about real money. One Mexican we knew said he had a solution to all of Mexico’s problems, make the politicians and drug dealers eat three meals a day at any outdoor stand of their choice and Mexico would have the highest standard of living in the world in 12 years. I am not sure about his statistics but they would certainly be a lot better off than they are now.          

 

Americans are still under the impression that Mexico is a tourist’s delight, but the State Department is well aware that if the kidnappers, robbers and murderers don’t get you, the food probably will. The old saw that it’s the drinking water has been played too many time and when American’s get back and become sicker than dogs, they talk about the bottled water the had but they forgot to make sure the ice cubes were out of a bottle as well. The best-kept secret in the world is the fact that Mexico doesn’t anyone policing the health habits of vendors and that is ultimately how you are done in.

 

In one breath, American’s say that the Mexican Government is doing a good job keeping the lid on a difficult situation and yet congress has authorized and experimental bill that would literally turn the Mexican-US border into an armed camp in order to stop the drug flow. I can understand that you don’t think that this is very neighborly and there must be another way that this problem can be addressed. I suggest you determine what the best course of action would be after reading about some of Mexico’s most important citizens and how they just happen to go so wrong.

 

HOW CAN YOU FAULT ME FOR WANTING A SMALL RETURN ON MY INVESTMENT?

 

Mexico's problems stemmed from the fact that most government officials bought their way into office and for the most part were only given a short period of time (one term) to steal as much as they could comfortably fit into their knapsacks. A tacit agreement has historically existed between the incumbent and his predecessor, that if the former office holder doesn't tell everyone how easy it is to loot money from the national treasury and how it is done, the incumbent won't have the former official arrested for theft. In spite of the hue and cry arising from the United States as well as every do-gooder in the rest of the world, Mexico has only learned to hide their tracks better.  Since the 1930’s, all eleven presidents’ of Mexico have named their own successors in what is called in local parlance, Dedazo, The Big Finger. When someone anoints you, he is hardly a person that you would throw in jail for criminal conduct while in office.

 

Well, not much has changed in Mexico since then. Officials continue to steal money from the treasury, but because of the massive privatizations, which have brought in additional billions of dollars into the Mexican coffers, this has only allowed the amount of money taken by government bureaucrats to significantly increase.  Because officials of the Mexican Government are able to learn the art so well from their predecessors in office, we are not particularly sanguine about the future of this country. 

 

CRIME GREASES THE WHEELS

 

In Mexico, nearly everyone is sacrosanct, unless of course you happen to be a pheasant. The untouchables are leaders of the government, the army, and the police. Each seems to operate independently with only one common thread, invincibility. There is no crime substantial enough to bring these people to the bar of justice. The general that was acting as anti-drug czar was in reality working for drug lords and had placed his troops at their disposal. ([1])

 

An interesting example of this was the recent case of police torture in Mexico City. The bodies had been so badly mauled by police brutality that the local newspapers went on a crusade. It turns out that unknown to everyone; the police unit in question was independent even from other police units and operated in vigilante style. In a most unusual move, three senior police officers were arrested for their attempted cover up of unspeakable brutality. The unit rebelled; police officers were not arrested in Mexico and especially not those of an elite unit, no matter what the crime. The police have barricaded themselves in as the army and the rest of the Mexico City police department readied for an old style wild west shootout. Ultimately the internecine warfare died down, but the status quo remains and the citizens of Mexico are the losers.

 

 

School for Rogues

 

One has to look no further than then the Mexican Police Academy’s for the answers. According to Gerlind Younts of NBC in his report of May 19, 1998,

 

“Because of years of allegations of police corruption and collaboration with criminals, a Mexican University decided to put some students undercover to investigate the training of police recruits at a Mexican police academy. After the two-year probe, the results were discouraging. Many of the young recruits had little or no education, and were selected by family members who were already on the police force. Students were encouraged to pay money for better grades in the school. Moreover, during some of the courtyard breaks, students bonded with each other by smoking pot. Some police instructors at the academy were teaching students how to rob from citizens. “Rob with professionalism,” a police academy instructor was quoted as saying. “ You don’t have to ask for money, just wait, people are going to give it to you automatically, you don’t have to say anything.” 

 

According to Ogara Hess & Eisenhardt Co. De Mexico, a company that is in the business deomographizing Mexico City crime, they estimate that. “The city last year had, one million muggings, 70,000 car thefts and 21,000 truck thefts.” ([2]) The Wall Street Journal put those numbers into perspective, “The bigger problem, of course, is that the cops and the criminals are sometimes one and the same. The government has fired a long list of corrupt police, but it turns out there are lots more where those came from. Worse, the fired cops now have all day to spend on the streets. Crime is not only pervasive, it has a business like efficiency to it....” ([3])

 

On June 2, 1998, the Mexican Government charged ten police officers and public servants with corruption after they allegedly accepted $2.4 million in cash to let a suspected Colombian drug trafficker go free.  When they officials grabbed the police culprits in the State of Sinaloa, they were able to confiscate almost $2 million in cash along with pesos and cars. Sadly, in Mexico are not passive extortionists and at times they can get rather aggressive when trying to make a buck.

 

We Have Our Judicial System, Don't We?

 

Judges are also either on the take or afraid to make tough decision when their lives may be at stake. An interesting view of the Mexican Judicial system can be garnered when analyzing the arrest of Luis and Jesus Amezcua, known as the “kings of methamphetamines” (Speed). The brothers organization, the “Colima Cartel” is known as Mexico’s fourth largest drugs gang. American DEA chief Thomas Constantine in analyzing the situation stated that, “The Amezcua brothers run the largest methamphetamine and chemical trafficking organization identified by U. S. law enforcement, and the arrest and removal of these two key leaders should significantly disrupt the established methamphetamine trade.”

 

Mexico annouced the collaring of the two with great pride and indicated that it was a "major blow against the Colima Cartel." In spite of their being caught red handed,  and support for a conviction from the Central Government, unbelivably, a judge could not be found for some time willing to hear the case in the state of Jalisco, Mexico that was willing press charges against the brothers. After a number of calls, a judge was finally found to that was willing to sit in the matter.  Therefore, in Mexico, we find that the army, the police, the bureaucrats and the judiciary tend to be either corrupt or easily intimidated and it is as though it was the Wild West all over again. 

 

Nevertheless, that wasn’t the end of the story by a long shot. The judge in Guadalajara, Mexico’s second largest city that was pressed into service did not require a lot of thought before clearing both of them almost immediately sending into oblivion any hopes of a quick change to Mexico’s arrest and release syndrome. Although the two still face charges on a lesser charge of money laundering, that shouldn’t present much of a problem to their attorney because the law didn’t even exist when the crime they are accused of took place. Well, at least it will give the Mexican Government the opportunity of saying that it did its best in spite of two bits at the apple.

 

Now the only thing that these lovable characters have to fear is extradition to the United States, but with the current climate between the nations growing colder by the minute, this seems about as likely as finding a judge that would have convicted them in the first place.

 

THE TRUTH IS, I DON’T HAVE A CLUE HOW THAT STUFF GOT INTO THE CAR

 

In Mexico, Kidnapping is the norm rather than the exception. It is so common that most regions have a special police brigade aptly labeled the anti-kidnap police just to deal with the numerous instances of holding people hostage in exchange for substantial sums of money. The heads of these specialized units are well trained, incorruptible professionals, dedicated to the eradication of this blemish on Mexico’s reputation. Furthermore, even senior politicians are afraid of moving around their districts unescorted because even they are “marks” for vicious gangs looking for their next victim.

 

Mexico has the distinction of achieving the number two spot behind Columbia in this dubious art form through substantial effort. Although everything in Mexico has become bizarre, the situation has become so strange it even defies the written word. In Mexico we have officers of the law engaged in the act of kidnapping and shaking down citizens, heads of police departments being kidnapped and held for ransom and criminals, who after first disguising themselves as policemen and they then go out and kidnap people. Almost none of the kidnappers are apprehended and of the infinitely small number that are, for the most part the are found innocent by Mexican Trial Judges because of “lack of evidence” against them.  In effect, the more police the system turns out, the more kidnapping that occurs because, the more police officers there are in the field to accept bribes. One of the most unusual vicious circles in crime history. Authoritative mathematicians have estimated that if the police departments all over Mexico were disbanded, mathematically at least, kidnapping would drop so substantially, that it no longer would be considered a problem. 

 

AND DANIEL, WHAT DID YOU DECIDE TO BE WHEN YOU GREW UP?

 

Highly regarding, Daniel Arizmendi Lopez is easily ranked at the top of Mexican kidnappers and he brings a touch of class to an otherwise straightforward occupation. By employing only the most trusted of his own relatives and using contract criminals for carrying out his orders, he has been able to keep a distance between himself and the law for many years.  His operation is both extensive and sophisticated and his results are unparalleled. Early in his career, Arizmendi learned that cutting off various body parts of victims and having them hand-delivered to hysterical relatives was very effective in causing a speedup in often slow moving negotiations. 

 

Arizmendi also has created one of the best networks of “friends in high places” neither through his sterling personality nor through his good looks but paying out a substantial part of his revenues in bribes to key officials. Only after Arizmendi became recognized as the leading kidnapper in Mexico did the hue and cry cause President Zedilo to do anything about him. When government forces finally got the message, they acted in almost overwhelming fashion by grabbing seven safe houses in Cuernavaca and Mexico City, arresting not only his wife, but his son, daughter and daughter-in-law and grabbing a spare $5 million in cash that just happened to laying around one of the apartments. Shockingly, no one knew how the money had gotten there.

 

Arizmendi’s specialty is breaking into armored cars, summarily dispensing with objecting bodyguards and immediately removing victims ears to make them for flexible. In one action quoted by the New York Times (Sunday, May 31, 1998), a victim stated, “They throw you on the floor with your eyes blindfolded, One of them jumps on top of you, and you think it’s your last hour. It’s a relief when you realize it’s only a mutilation.”  Arizmendi has indicated that he chose this gory profession because it has offers substantial payoff with little downside and almost no one is every arrested for kidnapping in Mexico. So far, investigators have arrested a Federal prosecutor and a federal police agent as well as the former chief of the Morelos State police anti-kidnapping unit in this affair.  

 

To give you an idea of how bad this dude really is, Luis Reynoso, Roman Catholic Bishop of Morelos State who has been a harsh critic of any capital punishment in Mexico indicated that his charity did not extend to Lopez and that in his case an exception ought to be made. Mexican President Zedillo called him despicable and the usually docile people of Morelos suggested that his family's body parts be severed one by one until he turned himself in. Mexican’s all of the country are using this case as a rallying point for bringing back the death penalty which was eliminated in Mexico in the 1920’s.    

 

MEXICO’S FINEST

 

Armando Martinez Salgado was the chief of one of the finest anti-kidnap squads in the country. His reputation as a no nonsense officer of the law was legendary and his knowledge of the field made him a constant source of information for other less informed heads of comparable squads. That is, until, a highway patrol squad picked him up with the mutilated body of 17 year old Jorge Nava Avila, five ski-masks, adhesive tape and blood-soaked bandages in his car.

 

When asked to explain his action, Armando informed the arresting officers that he was on a secret mission the details of which he was not allowed to divulge to anyone. In an attempt to ferret out what had occurred, police officials began an investigation of the entire anti-kidnapping squad. The unit had thirty-eight members and by the time fifteen had been questioned, the remaining twenty-three had left town and were in hiding. Specifically, by this time, Armando had been fingered by several witnesses who declared him their abductor. Ultimately, as the people sheepishly came forward to testify in the investigation, witnesses have implicated him in almost forty kidnapping cases in Morelos.

 

They have confirmed that anti-kidnapping czar was the recipient of substantial amounts of cash paid by hysterical relatives for the return of their loved ones. Martinez, not wanting to swing for this all by himself has named people up to and including the Governor of the State of Morelos, Jorge Carrillo Olea, as his co-conspirators. For some strange reason, we don’t really doubt the man. The whole story is so bizarre that it must be true. 

 

Mexican Presidents have a great deal of power over State Governors and with good reason,  President Ernest Zedillo was extremely embarrassed over the entire situation down in Morelos.  The way that Governors are removed in Mexico is usually through a simple call by the President to the offending politician, stating that he should pack his bags and be out of his respective state house, now! “That certainly is something that doesn’t happen every day you say”? “Wrong Bunkie!” During the Salinas years, he averaged removing almost 3 governors per year or 16 during his six-year term and Zedillo seems to be picking up the pace.  During his stay in office, five governors have resigned or have been dispatched. When is the last time you can ever remember a governor in one of the fifty states resigning because the president was annoyed at him.

 

Setting The Scene

 

Picture Bill Clinton calling up George Pataki and telling him his term as Governor of New York State is at an end.

 

“Hello: George, this is Bill Clinton, you know, the President of the United States calling, how are you today.?”

 

“Bill, I’m doing just fine and I want to take this opportunity to tell you that what I said about you and Hillary was just political talk and you shouldn’t take it too seriously, we’re still friends, aren’t we?”

 

“George, I’ve been around politics too long not to understand what you are saying and we are from different political parties, but what is great about America is the fact that when the day is over, we can put aside our differences and go about our business without any hard feelings. And, by the way George, don’t take this personally, but I think that you should resign as governor."

 

“Bill, I know where you are coming from and you have as much chance of seeing me resign as you have of getting your wife to shut up.”

 

“George, I must tell you that unless you pack your bags today, I will call in the army.”

 

“Bill, call in the army but remember that we have the best National Guard in the United States and I will instruct them to fight to the last man to save our sovereign soil.”

 

“George, you are talking about civil war, come to your senses man, just leave quietly and we can still be friends.”

 

“Bill, you know what you can do with you resignation crap.” Stick it!”    

 

In Mexico, the old axiom, ‘with police officers like Armando, we don’t need any criminals” obviously still holds true, and this is certainly an incentive to plan your next vacation around the balmy breezes of the Mexican State of Morales. Since Martinez was arrested, Mexican police have made a rather attractive haul, Carlos Peredo Merlo, Attorney General for the State of Morelos, the former state police chief Jesus Miyazawa Alvarez, his top deputy along with the chief of detectives and two other senior police officers have been accused of giving Commander Armando the assignment to dispose of the body of Nava Aviles. The national Attorney General explained the arrests with the following statement, The house arrest was motivated by the alleged participation in the acts that gave rise to the investigation into the crimes of torture, murder and illegally disposing of a body.”  Merlo and Alvarez are now comfortably ensconced in Almoloya maximum –security prison charged with torture and murder.

 

A TURN OF THE SCREW

 

In a turnabout, both the chief and deputy chief of the Mexico City police's highly regarded anti-kidnapping section not only have been kidnapped, but have not been heard from since the event occurred. Senior officials in Mexico are not sanguine about the recovery of either officer and believe that it was an action done in revenge for the activities of that unit. Residents of Mexico City that were afraid to venture from their homes are now nearly hysterical. Comments such as "if the police can't even take care of themselves, how are they going to take care of us", have become common. In an equally remarkable story, the son of the Mayor of Mexico City would have us believe that his car was stolen by armed bandits while his bodyguard was at the wheel.  What about the time when a police unit in the resort city of Acapulco got into a dispute with a cab driver, tied him into his vehicle,  doused him with gasoline, and set him on fire for his attitude, burning him to death. Well actually, maybe you can't blame them for that one, I'm from New York and I know that cab drivers can be awfully obnoxious. ([4])

 

People became so afraid of kidnappers that travelers where warned by their governments to seek police protection at the slightest hint of trouble. A group of Australian women, aware of the problem and when traveling near the resort town of Guadalajara they witnessed an automobile accident in which the participants and the crowd started to become unruly. Without hesitation, they asked the local police on the scene for protection. Well, it turns out that this was a big mistake, the five women had not found the police, they had run right into the arms of a kidnapping gang disguised with the uniforms of local officials. As you might well expect, these women have never been seen again, making the old Mexican axiom, the police are the worst place to go if you have a problem, true again.

 

Even America’s, Don King, in Mexico City for a boxing match found out what life is like in the world’s most populated city. While on his way from the airport to his hotel, his car was pulled by four men who put guns to the heads of King and his companions. King got away lucky as they only took his watch which he stated is valued at over $100,000. King, although shaken up indicated that he was “grateful to god” for escaping alive.     

 

THE GOOD START OF THE YEAR AWARD

 

So Mexico City got a new Mayor who ran on a ticket of law and order; the people believed he would make the city safe for them after so many years of rampant crimes of terrorism. In 1987 alone almost one hundred banks have been robbed, almost one thousand crimes a day were recorded and scores of wealthy people had been kidnapped, many never seen again. Cuauhtemoc Cardenas, the first opposition Mayor since the 1920s  didn't get a lot of time to savor his victory. Stepping into the one of the most contaminated political systems was not the worst problem facing the new mayor, Mexico City with a population of 18 million is also the world’s most polluted city by almost any standard.

 

At an elevation of substantially  over a mile, yet totally surrounded by mountains the air on many days does not seem to move at all. Combining this with “gas guzzling” ancient machinery and endless traffic jams have raised the sulfur dioxide and nitric dioxide particulate matter in the air to critical levels. In spite of the fact that the infant mortality rate, which is among the world’s highest and catching, a breath of fresh air can require a trip of over one hundred miles. Pollution is not the new mayor’s problem.

 

While he ran on a virtual anti-military ticket, his first appointee to the police department was an Air Force Lieutenant colonel who got the top slot . One of the Colonel's first moves was the appointment of a former military man as his top aid, thirty-seven year old Jesus Carrola Gutierrez, who was immediately met with charges that he had ties to drug traffickers, had been involved in killing, brutalizing and torturing suspects and extorting prisoners.

 

The new mayor followed up this success by eliminating Christmas bonuses for government officials just before the holiday while capping municipal salaries at $100,000 per year in a country where the average worker is paid about $3 per day. Then, his chief of staff no less, Jesus Gonzalez Schmal, who with great fanfare and in an effort to attack the Zedillo faction released a list of 2,500 hundred names purportedly on phantom payrolls. The newspapers soon made chopped liver out of Schmal when it turned out that the names on the list for the most part had died and that those that remained had legitimately resigned from their positions.

 

Undaunted by this succession of disasters, he followed it up by accusing Mexico City’s ruling party political leader of espionage without furnishing a shred of evidence against him. Gratefully for Cardenas, Schmal resigned giving the reason that he would be defending himself against intimidation and defamation by unknown political enemies. Hey, at least Cardenas is giving it his all, and we award him our “Good Start of the Year Award” for the substantial efforts he has already put out. We know that we will be hearing from the Mayor in other of his endeavors in the near future.  

 

The Mexico City Chamber of Commerce (Canaco) "What foreign investors are very worried about is the lack of personal safety." They indicated that an mind-boggling one-third of all  stores in the city were robbed or broken into just during the third quarter of 1998. Even more telling was the Canaco follow up report which stated that forty percent of those victimized did not even both to call the police because they considered them too corrupt to bother with. In official statisitcs, there were over a quarter of a million reported crimes in the city alone and less then one-percent of the criminals were arrested. Contrayr to the campaign promises of Cardenas, crime has not only not gone down but is rising sharply since he took office.

 

We salute Cardenas, but just as we were about to award him the "Good Start of the Year" award, we were informed about another foul up. It seems that an American businessman, Peter Zarate, a Cushman and Wakefield, real estate executive, was kidnapped and then allegedly murdered by a gang of five men, known as “El Chucky” and his gang,  who confessed to the crime. The Mexico City Judge, Maria Claudia Campuzano, called El Chucky, Guillermo Rojas Hernandez, a fugitive from justice wanted for robbery, battery, homicide, kidnapping and 50 taxi holdups, a modern "Robin Hood", as she signed their papers of release.

 

Her mystifying  statement seemed to stem from the fact, that while El Chucky  admitted to police that he had taken $100 from the victim, but he also confessed to disbursing $101 to his partners in crime. Obviously, this made so little sense to the judge that she determined that the confession was coerced. Once out in the street, Robin Hood's Merrymen wasted little time in finding a Venezuelan tourist to beat and rob. What makes this case even more confusing is the fact that the Judge was not even in the city  when the release order was signed, but was on holiday some distance from Mexico City.

 

The American State Department upon hearing this grotesque example of Mexican justice determined that a line must be drawn and requested Mexican Officials to conduct an investigation into the matter. Authorities have been at a loss to explain the judges actions while the judge herself seems to be able to shed little light on her glorification of common criminals. She has given no indication of any logical reason for her strange behavior. But in spite of stirring up an international incident, when the case was remanded to Supreme Tribunal, they outlandishly took the justice to task for comparing El Chucky to Robin Hood, but as they saw it, her judicial decision was correct. They were not overwhelmed it seems with Mr. El Chucky’s generosity to his gang, but as they saw it, the police probably were a tad too enthusiastic in questioning gang members who still had the marks left over from the interrogation. This and other similar experiences have caused the U. S. embassy to issue a high level warning to tourists, they have notified them that Mexico City’s green and yellow Volkswagen taxi cabs could pose a major risk to visiting American’s health.

 

Ultimately justice triumphed, or more realistically, gringo pressures. The judge who compared Mr. El Chucky to Robin Hood was suspended without pay for committing no less than five procedural errors in determining the outcome of the case. The case was remanded to another Judge for rehiring while Judge Campuzano cooled her heels under a suspension. The State Department was ecstatic and were convinced that Judge Hernandez  would see that justice would finally be done, but to their surprise he seemed afflicted by the same insect that bit his predecessor and  Mr. Chucky will walked again. 

 

Making Do

 

Because of folks like Mr. Chucky and merrymen, Mexico City is not a very safe place for anyone, that is, other than the “North Jail” which is reverently spoken of as the only place in the city where you do not have to worry about being mugged. There are many creature comforts available its shielded walls and well-connected inmates can partake of drugs, liquor, women and restaurant deliveries while being incarcerated. Furthermore certain of the prisoners can enjoy Jacuzzis, attended gardens,  a maid with her own bedroom,  private gymnasiums and even a children’s playroom.

 

The people of Mexico City did not really understand why powerful criminals had literally no fear of jail until Francisco Wesson Munoz, a senior drug dealer was sequestered in the prison. A local newspaper, Reforma did a piece on his terrible prison ordeal in which they pointed out that he was able to control drug smuggling within all of the jails in Mexico City and in his spare time, joint venture projects  with drug operatives in Medellin and Cali Cartels.  Besides enjoying all of  the amenities outlined above, the story reported that Munoz not only charged the other inmates rent in the prison but along with that he had a menu disturbed to his fellow incarceraties that provided a list of available amenities and the charge for having them provided. Apparently, this was not such a secret outside of the country as the both the Washington Post in 1997, and Reuters, on 3/2/98 ran stories about this home away from home for criminals who need to get away for a time. 

        

 

WHY DON’T WE AUDIT THE BOOKS

 

Cardenas, having made one mistake after another, determined to set the record straight and did the one thing he knew would get his constituents attention. He audited the cities books. He found that the previous administration stole $625 million in 1995 alone. We are talking something very serious here; according to knowledgeable Mexican sources, for stealing that kind of money, you can be banned from public service or in extreme cases be ordered to pay back the stolen funds.

 

It can be expected that as long as the clowns running Mexico both condone and participate in graft on a world class scale, there is no hope for the country and we would wager that as long as these thugs stay in office, the nation  will be  "taking the gas pipe" approximately once every decade.  Thus, in the near future it is inevitable that we will see yet another collapse of the Mexican peso; but this time spurring a national revolution in which there is an ousting of the government in its present form. Thus, in spite of NAFTA's ongoing cost, Uncle Sam will be forced to again dig even deeper into his bag of goodies and provide Mexico with yet another shot in the arm.

 

LIKE EVERYBODY IN MEXICO HE HAD A LONG TUNNEL UNDER HIS HOUSE FOR QUICK GETAWAYS

 

Knowing that America's temper was getting a little short, Mexico determined to show the world that they knew how to handle financial criminals. Jorge Lankenau ran a banking operation called the Abaco Group in Monterrey. Being a smart lad, and aware of the country does not prosecute financial crimes, Jorge in one uninterrupted motion sold the bank to Citibank, raised substantial additional funds and dipped his fingers into the whole ball of wax and walked into the sunset with about $200 million dollars of shareholders money in his jeans.

 

He had created a company called Scottie Holding Corporation which was registered in Montevideo, Uruguay, Investors were told that Scottie would buy high yielding bonds but in reality the Montevideo company took most of the money and allegedly purchased real estate in Atlanta. Alas, as with so many Mexican transaction, once the money has been invested it become so hard to locate the assets that were purchased. In this case, search as they will, no one in either Mexico or Atlanta has been able to find the missing assets.  Poor Jorge, he didn't know that the country was looking for a scapegoat and because he was in the wrong place at the wrong time, he was going to be it. He offered officials the usual retainers and to his shock, they refused. Not believing that he had heard correctly, Jorge made another offer, an even greater amount, only to be turned down again.

 

The police and prosecuting attorney told Jorge that they were really going to be tough with him for stealing so much of the bank's money. Thus, Jorge was incarcerated within his mansion in suburban Monterrey and told not to leave the general vicinity. Jorge though was a step ahead, he had been tipped off by the locals that he was going to be the fall guy for all that the countless others that had stolen and walked away.   Jorge was able to devise a plan that would work to his advantage no matter what officials did.

 

Sometime between August 29, 1997 which was the date of his incarceration and October 26, 1997 when authorities went to Jorge's house to see if he was being a good boy, they discovered that he had disappeared. Our industrious felon had dug a tunnel, albeit, at his bank's expense that ran from his basement to freedom. Jorge did not even leave a note. He just left with all of his money. Mexican Officials were sanguine about the affair stating that; "well at least we tried to put someone under house arrest, that will certainly show the rest of the world how serious we are about corruption!"

 

The story does not end there. Incredibly, Jorge was caught and returned to Mexico. The police and prosecutors in Monterrey, who were concerned that the local administration was too lenient on murders and bank thieves, dragged him forcibly in front of a tough Mexico City Judge. Unbeknownst to them, though, Jorge had many of the best friends money could buy in Mexico City. The judge indicated that he didn't know what everyone was so riled up about, after all, Jorge's bank, Confia, which, after Jorge sent most of the bank's assets and records to Uruguay, was estimated only going to cost taxpayers a tad over $1 billion, and that was just to reconstruct the records. What was everyone doing getting so riled up about a small sum like this?

 

A JUDGE IN NEED IS A JUDGE INDEED

 

The judge for the most part indicated that he felt an injustice was being done to poor Jorge and remanded him back to his mansion in Monterrey, where Jorge real friends lived. Arguments by the prosecutor, that Jorge would attempt to join his money and records in Uruguay, which has no extradition, fell on deaf ears. But the game wasn't over yet, the family of Fernando Canales Clariond, Governor of the state of Neuvo Leon weren't exactly jumping for joy over the $30 million his family invested with the errant banker and indicated that he and his relatives would strongly  prefer that Jorge rot in jail or if possible someplace worse.

 

In order to bail out the problem, the American giant, Citibank bought the bank from the Mexican Government in spite of all of its problems. This could have had something to do with the fact that  Citibank has been under investigation for more than a year for money laundering at the behest of Salinas, Mexico's former president. The Mexican people were incensed, a foreign bank coming into Mexico and stealing the king's jewels. In spite of the cost to Citibank of $400 million or more before the dust clears the Mexican people will also have contributed in excess of $1 billion.

 

Mexican Banking is Good For The Bankers and Bad for Everyone Else

 

So why should the citizens  contribute to a Mexican bailout where the beneficiary is an American Gringo Bank? Well pardner let me tell you the facts; in the 1990s, 18 banks were sold to Mexican buyers that had to be liquidated by the government, of that number, only eight remain in business today. Selling to Mexican Citizens has resulted in a double hit to them, the first when the government aids or subsidizes the acquiror and the second time when the acquiror goes belly up. They should know by now that a bailout isn't a bailout when the indigenous population buys it, it is a best a tax lose. 

 

Well, it doesn't matter much on a global scale whether Jorge is allowed to steal out of the country in the darkness of the night or even under the day's transparent rays because it looks like we are going to go through the Mexican bailout scenario all over again. This time though we are at least getting a modicum of warning from the powers that be; after setting up a $2.5 billion dollar credit facility the finance ministry said, "With this operation, the federal government succeeded in reducing the risk in financing its debt, obtained protection against international volatility, reduced the risk of external shocks on Mexico and maintained orderly access to international capital markets." Sounds like someone is battening down the hatches for one hell of a storm.

 

After the U.S. bailout of Mexican banks, they became a license to steal and everyone with light fingers  that had that inclination got into banking and fulfilled their dreams. Carlos Cabal Peniche, a $14 million donator to Zedillo's election campaign in 1994, ([5]) seems to have made off with almost $1 billion by looting Banca Union and Banca Cremi, a bank that he was literally handed by Guillermo Ortiz, Zedillo's Finance Minister and now the head of Banco de Mexico. . When he had finished plundering the banks he had the money transferred offshore and that was the last anyone has ever seen of him until he turned up in Austraila..  Cabal who was also responsible for laundering a substantial amount of Raul Salinas's drug funds, went underground and has been on the run until recently with his wife and four children.

 

Jorge Lankenau who bought Confia cost the Government over a billion and Angel Rodriguez, “El Divino” has just been shipped back to Mexico from a Spanish Dungeon after lengthy extradition hearings.  It seems that the “Divine One” acquired  Asemex-Banpais banking group and used it as his personal piggy bank  by having the bank lend to companies he owned.  A little over a billion dollars latter a was found by authorities on his yacht, Moon Dance off of the resort of Ibiza.

 

Maybe We Should Make Bank Robbery a Crime

 

The Mexican laws do not really look at bank robbery or for that matter any other white-collar crime as something that can be satisfactorily prosecuted[6]. Thus, instead of putting the handsome thief in jail, he usually winds up hanging out in the lap of luxury in a Mexican mansion. It seems like a very strange form of justice when a man literally breaks the bank for his own purposes, flees the country, winds up in a Spanish Jail and then is released to return to the scene of his crime in luxury. His crimes of embezzlement and breaking of federal banking regulations are iffy at best.  In effect, that is what has occurred and the Divine One has of this writing been set free and not punished for ruining the lives of countless citizens.

 

At best, Mexico is still a very strange place. One look at the El Divino’s defense against Mexican charges should be enough to send prosecutors fleeing for cover. He stated that even if he stole hundreds of millions of dollars, that would only amount to a miniscule percentage of the $65 billion that it cost Mexico to bail out its banking system. How could anyone think of prosecuting anyone whose share was so small, he asks? He casually shifts the blame for his problems onto Fobaproa (the deposit guarantee fund used for the bailout) executives saying that while he only is responsible for a small percentage of the fund’s losses while their incompetence and corruption are responsible for infinitely more. “I believe I am being made a scapegoat to hide the negligence and incompetence of the people who were doing what they say was their best to manage Fobaproa and they say the best they could do was leave us with a debt of $65 billion.”

 

El Divino is particularly annoyed a Fobaproa’s chief, Eduardo Fernandez, who he said took over a perfectly healthy bank and wrecked it. Fernandez responded that El Divino sometimes distorts the truth and stated the he is a “financial delinquent devoid of moral qualities”. Among the more bizarre charges in this case is the one in which El Divino is charged with taking out a loan at his bank to buy a plane that did not exist in the name of a company that was imaginary. El But wait before you condemn the Divine One, he has submitted a picture of the non-existent plane but can’t seem to come up with the company that borrowed the money. He it certainly sounds like an iron clad defense to me.  For Mexican justice this sounds like an unbeatable defense to me.

 

 Variations On the Theme

 

Just so you won’t become convinced that strange deals only take place in Mexico City we take you to Jalisco State where they have had a long term governor by the of Flavio Romero de Velasco. Velasco was known for running a safe and peaceful state for its electorate to live. On the other hand, unbeknownst to the citizenry, Romero was in bed with the major drug traffickers in the country and traveled throughout most of the world in their company. The former governor, now 75 years of age was running a banking business on the side which consisted of laundering the money that his travel companions would collect on their trips. ([7])  Romero also was trafficking in major government positions as well by making substantive cash payments to the powers that be in the central government.  The scam came to an screeching halt when Raul Carranca, an attorney, was charged $60, 000 to be installed as Mexico’s Attorney General and never appointed. Although, Romero explained to Carranca that a minor oversight had been committed, and he would straighten it out, Carranca had become a very unhappy camper and turned in the highly traveled banker.

 

I Thought You Said That You Were Only Going to Take The Bribe

 

And then we have the strange case of Fernando Antonio Gastelum, a heavy duty guy from Baja California Sur, who in addition to other titles was the chief of the State Judicial Police. Fernando was known in the region as a stickler for law and order and if anything was believed to be too tough on those that were imprisoned within his domain. Imagine the people’s shock when he was arrested for masterminding the delivery of over 10 tons, count them, over ten tons of cocaine into his district for local use. According to the Attorney General’s office in La Paz where he is now cooling his feet in a jail cell, Fernando was in charge of all of the delivery’s details including the arranging, preparing and directing how and where the contraband would be brought in and distributed.

 

Or better yet, take the case of Rafael Munoz Talavera, a world class drug dealers who set the American record of having 21.4 tons of cocaine confiscated in one raid in California in 1989. Ultimately, Munoz was arrested by police in a hotel room that had been rented by the police department a week earlier. ([8]) He was hauled off to a jail cell that was so elaborate that it contained an entirely stocked bar containing the drug leaders favorite brands.  Mexican authorities did Munoz a favor by trying him there, while their American counterparts were crying for extradition.

 

A Strange Turn of Events

 

U. S. Government Authorities, somewhat palliated by what appeared to be a real trial in which the prosecutors were asking the judge to send Munoz away for 60 years, the American’s were lulled into complacency. In a bizarre twist, Munoz received an amparo, a writ that allows the holder  to avoid jail under any circumstances, (similar to diplomatic immunity) and was declared innocent of all charges. The American’s awoke and ultimately found out that both the prosecutors, the police and the judge had all been well taken care of by Munoz. The American’s wanted justice and they got it in a second trial that handed Munoz, 20 years in the slammer. While the Americans were out celebrating, the judge’s verdict was overturned and Munoz walked again. As we write this story, Munoz is happily ensconced in his home in Ciuddad Juarez doing what he has always done, deal in drugs. The judges that heard his case, the police that made the arrests and prosecutors who could never win a case against him are now for the most part, gone from office but all much wealthier for having know him.   

 

In referring to the problems of police and judges acceptance of payoffs as well as a general participation in the importation of drugs, Celia Toro head of international studies at Colegio de Mexico said that, “The cost for Mexico has been the near total destruction or dismantling of our police and judicial systems.” This is certainly a change from the historic Mexican attitude that bribery payments had helped to augment low salaries for high echelon police and judicial officials and represented a substantial inducement for them to compromise God and Country for the better life.  By eliminating their ability to engage in criminal activities, some wags have suggested, that qualified people may no longer be interested in these types of positions. As this type of argument is not assailable, we will not comment on it any further.

 

Maybe they should start dismantling operation in the office of Sergio Mejia Sanchez, a former crackerjack deputy attorney-general who gained a fearsome reputation as a persecutor when working with the Mexican Federal Judicial Police ([9]).  Sergio, who came from a poor family always prided himself on his roots and indicated that although he could barely get along on the pay in the prosecutors office. He told the people that the good he was doing for them,  made up for his financial shortfall and he was happy he could be contributing something back to the country that had given him so much..

 

Sergio was also frugal with his money and in spite of low wages during a ten year period was able to open a bank account containing 42.8 million pesos or $6 million. Not only that he had acquired 28 properties and had countess other bank accountants. This massive accumulation of assets by a person whose income al of his life was just above poverty levels drew the government's attention. Wags suggested that instead of prosecuting Sergio, prosecutors should ask him to handle the Mexican Treasury and see if he can help balance the budget.

 

 

THE ARMY CUT ITSELF IN FOR A SLICE AS WELL

 

Some in Mexico, because of its critical geographical location between the drug growing regions in Central and South America and the world largest market in the United States, found the opportunity to good to pass up. Soon, Mexico became an important growing and way station for the transport of the product with savvy drug dealers also were able to create a substantial market for their products in Mexico as well. 

 

The United States became furious with the blatant drug dealing and transportation and raised the threat to Mexico of pulling their “certification” as an ally in the fight against drugs. Mexico’s President, Zedillo, became alarmed and personally appointed a national hero, General Jesus Gutierrez Rebollo who soon received commendations and international awards for his no nonsense cleanup efforts. His immediate commander, General McCaffrey described him as a soldier “of absolute, unquestioned integrity.”

 

The bald headed General did have some character flaws though, and upon appointment made the small mistake of moving into Mexican Drug Lord, Carillo Fuentes’ ([10]), luxury Mexico City apartment. As If that wasn't enough, it was brought to light that he had a bizarre fondness for collecting armaments, no matter whom they belonged to. He seemed to believe that everything within his purview was his and proceeded to strip the Mexican Fifth Military Division in the State of Jalisco of as many of the weapons in their arsenal as he could cart off to his office. Once solidly ensconced behind this substantial armory he went into business with Carrillo Fuentes, a Mexican drug lord who was the head of the Juarez cartel in Northern Mexico. Fuentes ([11]) being well aware of the arsenal that the general had available was thrilled to give a fat slice of the take to his friend for protection or whatever else the general choose to call it. 

 

When word of this unholy relationship along Rebollo’s arsenal reached Officials in Mexico City, the anti-drug agency, the INCD, was disbanded and the General, his army officer assistant, Javier Garcia Hernandez and five other generals were thrown in jail. While experts have estimated that the generals facilitated the transshipment of billions of dollars of drugs at street prices, U. S. Secretary of State, Madeleine Albright indicated that Mexico should remain certified because of its “strong cooperation” with the American Government.

 

Well maybe Mexico is cooperating, but the military sure isn’t. ([12])  The armed forces themselves have prosecuted more than half a dozen generals on drug-related charges in the past year and during the same time frame, 30 high ranking military personnel have been placed under arrest. Worse yet, American officials have indicated that at a meeting that was set up by lawyers on President Zedillo’s military staff between Eduardo Ganzalex Quirarte, second in command of the Fuentes Drug Cartel, and four Mexican Generals, bribes of substantial amounts, over $60 million were openly discussed. ([13])

 

Ultimately, Rebollo got himself a lawyer who as part of his defense tactics, accused other Mexican General’s and relatives of the President Zedillo of partaking in the drug payoffs. Tomas Arturo Gonzalez Velazquez, Rebollo’s lawyer who had come with this bizarre defense ploy predictably died a natural death a short time later in spite of the fact that his body had been riddled with high caliber bullets. Some put the exact time of Arturo's demise almost simultaneously with his statement in open court that President Zedillo’s brother-in-law “had formed ties with a major methamphetamine trafficker”.([14]) Although the Mexican’s that were named by Arturo, went ballistic over the charges and a report was forwarded to U.S. Attorney General Janet Reno whose associates are rumored to have given the information substantial acceptance. Even before he was shot, Arturo should have seen the handwriting on the wall when he was arrested by military police and accused him of being behind an attack that occurred on a witness scheduled to testify in Rebollo’s trial.   

 

MEXICO’S GOOD GUYS

 

Some military officers are good guys (not to many) and some aren’t. Brigadier General Jose Francisco Gallardo Rodriguez is a good guy and being a good guy, he  wrote an article for a Mexican magazine in 1993, in which he accused the army of rescinding the civil rights of both soldiers and civilians. Naturally, the general was thrown into jail for defaming the military.

 

This action caused the Inter-American Human Rights Commission, an affiliate of the Organization of American States  to became so outraged that they issued a report that the military had committed an “Abuse of power” by it actions regarding the general. So much pressure enveloped the military over the matter that these early charges were pushed aside and new ones submitted. It seems that the General was in charge of the horse stables and as such was selling  government horse feed to private industry. If that wasn’t enough to have him incarcerated for five years, prosecutors then contended that he had burned the government records that would have been incriminating. Essentially, the Government's case consisted of the fact that the reason that they had no evidence against him was the fact that he had destroyed it.  That certainly sounds to me like enough to send the poor sole to jail for life.

 

The government brought in scores of witnesses that had observed or were aware of the general’s illicit activities. Among the extraordinary testimony in the case was that of a colonel testifying on behalf of the prosecution who indicated that it was a former Mexican Defense Minister who had given orders to send the government horsefeed to his own private ranch, not Jose as the Government was charging.

 

With evidence of this kind, naturally Gallardo was convicted on these charges and sentenced to an additional 14 years and 8 months in jail for misuse of public funds. It did not end there, two months later, the general was sentenced to 14 more years in jail for illegal enrichment. The moral of this story is that 14 is a lucky number in Mexico apparently for everyone but Gallardo. Amnesty International indicated that the general had received a bad rap and that all he had done was to defend human rights. The went on to say that, “The Mexican government should immediately and unconditionally free General Jose Francisco Gallardo who has been jailed in an arbitrary manner just for expressing his ideas about the need to set up a people’s defender in the armed forces to investigate accusations of human rights abuses. We consider him a prisoner of conscience and therefore demand his release”.

 

Now wait a minute, these do gooders have overlooked a major thing, in Mexico, arguing against public policy by a government official is considered an act of treason and it can be punishable by as much as life in prison. By getting all of these people all riled up, who knows, the general could get life or even the firing squad for his offense. Maybe Amnesty International ought to fold its tent before something really serious happens to this poor guy.           

 

 

I'M GOING TO BE FAIR AND THROW THE MONEY IN THE AIR, WHAT COMES DOWN I KEEP AND WHAT STAYS UP BELONGS TO GOD

 

Carlos Salinas was the previous president of Mexico and as such, just before leaving office he arranged with his loyal brother to back up his truck into the country's treasury and then stuffed aboard everything in sight..  He left on the next plane to Ireland where he lives like a monarch and has not been back to the country of his birth since.

 

Brother Raul Salinas, preferred the Mexican climate and was certain that the lenient rules governing dictators raiding the treasury would also apply to dictator's brothers. Wrong, Mr. Salinas; an aggressive young prosecutor had him convicted of murder and investigations are continuing over his alleged shakedown of drug leaders while his brother was in office. While Raul denies the accusations, evidence has shown that his valet, Justo Ceja accumulated an estate of over $3 million in just the last few months of Carlos Salinas’s rule as Mexican President.  As an interesting addendum to Justo’s incredible good fortune in earning so much money, a Mexican magazine, Proceso was running a front-page picture of Justo and Francisco Arellano Felix, Mexico’s notorious drug lord having drinks together.

 

Raul was sent up the river after being convicted during a fair trail, although his jail cell looks more like the Taj Mahal than it does your standard Mexican fare. Lo and behold, the prosecutor who had made the miscalculation of going after a crime committed by a member of the family in power was arrested, convicted and sent to jail for fabricating evidence against Salinas. The young prosecutor though has a standard type cell, which he shares with a substantial number of other criminals along with an assortment of  rats and bugs. In a cry for justice, Lozano Gracia, a former Mexican Attorney general has stated publicly that the only thing the prosecutor was  guilty of was "solving a case that was too sensitive for Mexico's society".

 

We would side with Salinas who seems to have gotten a rotten deal if it wasn't for his wife's interference. It seems that the Raul's delicate wife was busy shaking down witnesses while he was being tried for murder and then committed perjury when called on the carpet by officials to explain her actions. Patricia Paulina Castanon, Raul Salinas’s wife, along with her secretary Ofelia Calvo attempted to coerce a former employee into falsely testifying that calls from Munoz Rocha to Raul Salinas were just a figment of his imagination. Now the reason that this stirred up such a fuss is the fact that you see, it was Mr. Rocha who hired the confessed assassin. She fled Mexico and was soon arrested in Switzerland for using a phony passport in an aborted attempt to illegally make a small withdrawal from the Swiss Bank where Raul kept a portion of his retirement funds. The withdrawal notice which read $84 million received attention at the bank and when the lovely lady was asked to confirm her identity, she produced a forgery that was so amateurish, the fastidious Swiss were literally forced to arrest her on the spot. 

 

Now mind you, Raul never held a job other than as his brother's assistant. This just goes to show you the power of compound interest and a solid Christian work ethic. Mrs. Salinas was able to get a court order, which protected her against arrest in the matter and is not expected to face any jail time for her Swiss oriented problem, on the other hand, Pat has recently, really been kicking up a storm about her husband having his television taken away. she has totally infuriated everyone in Mexico, because, naturally, no one was supposed to know that he had his on TV in jail to begin with. She furthermore did not seem to know anything about social customs in Mexico and that it is totally verboten to grumble about treatment in a Mexican jail, you could lose your caviar privileges. We have to give thumbs up to the little lady for being able to twice defy justice when starring jail terms in two countries dead in the face. Thumbs up Mrs. Salinas, even if they stick you in the pokey for perjury, you are a stand up wife !

 

Although Raul Salinas never had a day job, he was kept very busy with affairs of state, primarily those of the sovereign state of Columbia with their ad hoc capital in Cali.  But Salinas was not one to make the playing field unleveled for anyone with a buck; the Mexican Gulf Cartel headed by Jose Rodriguez Gach also utilized Raul’s services.  Miguel Rodrigeuz Orejuela’s personal accountant, Guillermo Pallamari turned himself into American DEA Officials and has become a protected guest of the United States Government. As such, he has provided an interesting insight into Raul’s operations.

 

It seems that Mr. Salinas’s job description included release of seized drug busts and free passage for air shipments of contraband material of any kind. On one occasion, he was able to recover 3,000 kilograms of cocaine that had been confiscated by Government Authorities for his associates.  Aside from the tens of millions of dollars of cash which he was paid, laundered courtesy of City Bank, ([15])  Mr. Salinas also received recompense in the form of “watches, paintings and diamond jewels for his wife.” ([16]) Don’t get the opinion that Mr. Salinas was pushy in his demands but he was refereed to by the Cali drug lords as Chupa Sangre,  Bloodsucker”. 

 

But Raul Salinas was the sort of guy that could handle more than one job at a time and because he was so talented he was even able to take on work from out- of -towners. Among other illustrious clients were the Cali Drug Cartel people from neighboring Columbia. Some Mexican’s believe that Salinas only took on the assignment as a good will gesture on behalf of his brother the President. The $80 million in bribes that has been substantiated by the former Cali accountant who is spilling his guts out in Switzerland, is illustrative of what hard work can result in. Here was a person that was doing a good deed for no apparent gain at all and low and behold, those marvelous Cali folks were so grateful to him that they coughed up 80 big ones. It just shows you that if you do favors for people even though it may put you out a bit, in the long run you will be rewarded.  

 

The Swiss, having opened the Salinas situation determined that there should be a trial, albeit in absensia under the terribly Swiss theory that if they find money that is earned in dishonest ways, on deposit in their bank's, in theory after a kangaroo court case they can seize the money and forever include it in the coffurs. Thus, they seized somewhat in excess of $100 million out of Raul's various accounts housed in Switzerland. Although Salinas is residing in a Mexican prison, he has only been charged with graft and homicide in the 1994 murder of Jos'e Francisco Ruiz Massieu. ghnever been charged of anything, thus the Swiss report of these set in motion a world wide search for what he pilfered while his brother was in office. The New York Times ran a blub by Julia Preston on what the Mexican authories came across while looking in the matter:

 

"Federal prosecutors disclosed today that they are investigating 289 bank accounts in Mexico, the United States and Europe controlled by Mr. Salilnas or his accountants, with deposits totalilng $119 million. Those funds are separate from the Swiss accoutsn, the investigators said.

           

"The Mexican Government had also earlier seized an account in Britain holding $23.5 million. In addition, investigations have turned ujp 123 properties that authorities say belonged to Mr. Salinas, from homes to horse ranches, including 37 outside of Mexico.   

           

"...In a swecret, unreleased 369 page report on their inquiry, parts of which became available last month, the Swiss police investigators asserted that "a cautious estimate" of the money Rau'l Salinas obtained from drug traffickers during the 10 years before his arrest would be "a total fo at least $500 million."

 

Reuters gives us a more in depth look at the Swiss Report:

 

"Once Carlos Salinas was elected president of Mexico in 1988, officials say, his borther Raul took control of practically all drug shipments transiting Mexico. He bribed members of the police and the army, thus making sure the booming drug business was facilitated or rather, protected,"

 

"For instance, on very specific days -- known as green-light dayhs --loads of drugs from Colombia were allowed to be carried to and across Mexico without being checked by the police and army. Raul Salinas even provided trucks and railroad freight cars of state-owned business enterprises,"[17]

 

Although the Mexican Government annouced that they wanted their share of the money from Switzerland, officials took great offense at the report labeling Mexico as a "Narco State".

 

 

A Fun Loving People

 

The Mexican people are basically fun loving just as people are in America and this whole Salinas episode became more of a joke than a sad story about how the people had been ripped off by their senior government officials and their families. This stuff was really old had but Salinas had stolen the peoples money a particular panache. Almost as a monument to his theft, Mexican merchants created rubber caricature masks of the former president and these have been sold in Mexico City and throughout the remainder of the country as satiric humor. This form of humor and protest is similar in many ways as it is in American where  masks have been made of Richard Nixon along with other American Presidents. 

 

Licensed merchants in the open-air market in central Mexico City seeing the Salinas thing start to become old news had a mask of the current Mexican President,  Ernesto Zedillo made and put it on sale in the square along side of the formerly popular Salinas caricature. This did not seem to amuse the President and suddenly, 30, count them 30 federal police ascended on the square with their rifles cocked and ready to fire on these pathetic soles barley scrounging out a living should they make a move to flee. I mean, these poor souls couldn’t fight their combined way out of a paper bag and it seemed as though the entire Mexican Army had descended upon them. I guess the moral of this story is don’t make masks in the image of guys that have no sense of humor and run a country. Boy would I hate to be a stand up political humorist in this country, you’d have a life expectancy of about 5 minutes.

 

Having dispensed with these vendors that offered a monumental threat to Mexican society as they know it, Zedillo went about some other less consequential house cleaning chores. The fact that most people working in Mexican organizations that are charged with fighting crime usually wind up in league with the thieves has caused this “law and order” president no end of grief.  Although, an issue not nearly as important as street vendors selling masks of presidents’. This is one top notch administrator and to illustrate this fact , you only have to read the statement that stunned people all over Mexico for its insight: “Many state prosecutor offices, including the federal attorney general’s office, have been penetrated by elements that not only don’t fight crime, but help crime and participate directly in crimes. The enemy is in our own home. Violent crime is rising three times fast than the population growth rate in Mexico.”  It seems to me that at the rate crime is growing in Mexico, there will be more crimes than people to criminalize within just a short number of years, which would throw more people out of work. The Mexican President is right to want to get his house in order now, before the situation becomes serious.

 

HAVING YOUR VERY OWN BANK

 

If you are in the drug business, one of the best things to have is a bank where you can launder your ill gotten gains and that is exactly what Amado Carillo Fuentes, “The Lord of the Skies”, the most powerful drug dealer in Mexico had in mind when he acquired troubled Group Financiero Anahuac in 1996. The always alert Mexican Government discovered this by accident when police came upon one of the bank’s cars in a drug safe house that was being raided during a bust. It soon became that the bank's car had been loaned to Vincente, Carillo’s son.

 

But it wasn't the fact that the bank's cars were being used in drug deals that concerned officials, it was another incident, also brilliantly uncovered by officials that caused the bank problems. It was when Mexican National Securities and Banking authorities found that Carillo was not only its largest shareholder but also the largest depositor that authorities became concerned. What this genius had created was the greatest money laundering scheme in global history. Having your own bank. Officials went ballistic, and promised that countless heads would roll over this monumental screw up. People knew without question that banking commissioners, regulators and bureaucrats would soon be thrown in the clink.  But in typical Mexican fashion, officials have arrested only one person, Juan Alberto Zepeda Novelo, a senior officer of Bufete Industrial SA, the second largest construction company in Mexico.

 

The attorney general has identified Juan as the a “money launderer for the Juarez Cartel” ([18]) while the incarcerated Mr. Novelo, in his defense has indicated that he only opened up an account for his son at the bank and $20,000 worth of shares had been purchased in the son’s name. It seems typically Mexican when you have people like “President Ernesto Zedillo’s brother, the son ([19]) and nephew of former Mexican President Miguel de la Madrid and a former presidential candidate of the opposition National Action Party” ([20]) all had strong connections to the bank hierarchy during this period and they have picked on this poor soul who at the very worst has a criminal for a son while the big fish walk. 

 

I Know, Let's Form Another Organization

 

So the Mexico United Against Crime organization, made up of almost 50 civic Mexican organizations, took roots and their spokesman, Guillermo Velasco stated the obvious, “Society can no longer keep waiting, actions must be immediate.” He went on to say that crime “is a cancer of political dimensions because at this point people don’t trust the police, this is the beginning of social chaos.” I guess when you have a country made of people to frightened to go  outside and travelers unwilling to visit the country, you are talking about social chaos; if it quakes like a duck and flies like a duck and looks like a duck, I guess it must be a duck. 

 

The United Nations stepped into the breach with an extensive report whose allegations won praises from most Mexican civil rights groups. The report detailed allegations of routine torture and beatings by both the Mexican police and army. “The most frequent methods of torture are indiscriminate beatings, attempts at suffocation by placing the victim’s head in a plastic bag or submerging it in water, forcing large quantities of liquid into the mouth and nose, or hanging by the neck or extremities in order to apply electric shocks.” When asked about his views on the report, the Mexican President Zedillo indicated that were in no rush to address the charges.

 

A report, purportedly hand delivered to President Zedillo and written by the military’s “Center for Anti-Narcotics Intelligence (CIAN)” , indicated that a handful of sitting and former governors, “the son of a former Mexican President, Miguel de la Madrid, well-known businessmen and two former heads of the federal police force” ([21]), were in the employ of the drug cartels and were actually threatening the power of the national government.  This report, has been sitting in the hands of high level Mexican Officials for almost three years without any attempt to verify its statements. The fact that two-thirds of all cocaine entering the United States comes in by-way Mexico and senior Mexican Officials have for almost twenty years had their tentacles into drug dealers camps and vice versa, yet the amount of Government output to put a stop to these relationships have been Lilliputian at best.    

 

But the Mexican's have one card to play that we have not addressed. Luckily, for our neighbors South of the Border,  they have the equivalent of the American FBI in an elite group that they call the Federal Judicial Police. These people are fearless and incorruptible and the department has an unblemished record. Adrian Carrera Fuentes ran this elite Mexican force for a substantial period of time and won great public acclaim for the work he did.

 

SOUTH OF THE BORDER DOWN MEXICO WAY

 

In Tijuana, Mexico, just across the border from San Diego, there resides a fearless drug trafficking group called the Arellano Felix brothers not only at the top of Mexico’s most wanted list but its members are wanted by the United States Federal Bureau of Investigation as well. These people have considered human life about as important as an American Turkey around Thanksgiving time. Wanted in both countries for murder, drugs and  kidnapping among other crimes, these are not the kind of people you would want to invite to your lawn party. That is, unless your name was Adrian Carrera Fuentes, former chief of Mexico’s most highly regarded federal police agency, who reportedly thought the gang had all of the right social amenities and joined their team while being gainfully employed to stamp them out. Well, it may well be that someone isn’t doing the right thing in Mexican Government, I mean having all these talented people choosing the wrong friends and all or could it be that they are just taking a page out of the book that the presidents write.

 

Ultimately Adrian got caught and attempted to cope a plea by giving testimony linking former first brother, Raul Salinas to the laundering of over $132 million dollars for his friends in the major Mexican drug cartels, Juan Garcia  Abrego of the Gulf Cartel, now serving his time in a Texas prison and Amado Carrillo who has since passed away. The Mexican newspaper El Universal indicated in a story on 4/24,1998 that Adrian had “received more than $100 million in bribes.” The paper went on to say the Raul Salinas’ lovely wife had admitted to authorities that her husband’s money came from bribes by the various drug cartels.

 

It seems in this case though, that Mexico’s then first brother stands accused of  masterminded the assassination of Jose Francisco Ruiz Massieu in 1994. The then number two official in the Institutional Revolutionary Party, the party in power. In one of the strangest twists known to man, Fuentes was convicted of helping Mario Ruiz Massieu, Jose Francisco Ruiz Massieu’s brother, cover up his murder. Now why on earth would a guy’s brother want to allow the perpetrator of such an act go free. Well in Mexico this is does not necessarily require brain surgery. According to the Mexican Government, everyone seemed to be in on the bribes coming from the drug cartel, both Fuentes, Massieu and Salinas were not interested in having that get out and it was much simpler letting the actual perpetrator slip through the cracks.

 

Massieu took a large briefcase filled with money and crossed the border into the U.S. and today is happily residing there as American officials have turned down extradition requests from the Mexican Government on numerous occasions. The fact that this was a drug related cover-up had little to do with the conviction as the case's political overtones were what made the case of interest. Salinas, the ex-president is still enjoying Irish hospitality while his  brother remains a guest of the State awaiting a murder hearing. This affair is just almost too much to believe.   

 

We Just Have To Do Something About This Situation Before It Get Out of Hand

 

The announcement of the latest arrest of a high ranking Mexican Law Enforcement official came similtaniouly with a nationwide protest against crime. Many ideas were exchanged as to how best to address a situation while the U. S. State Department is busily advising visitors to Mexico City not to take taxi cabs. When the dust had cleared and the speeches had ended, Rodolfo Debernardi, Chief of Police of Mexico City said it best, “I think the person who could end the crime problem has yet to be born.”  Yet human rights groups gave the Zedillo Government credit for some improvement, the say, “Since 1995 only somewhat more than 100 human rights activists have received death threats, been physically intimidated, threatened with disappearance, abduction or rape. Since Zedillo took power in 1994, 11 journalists have been murdered and more than 125 have been physically assaulted” ([22]) You can certainly empathize with Zedillo about journalists, they tend to get so pushy and about things that they shouldn’t. I mean you really can't blame a man that is trying to run a country and all these folks are always getting in his way. 

 

It Seems As Though Someone Is In The Cookie Jar

 

That is especially true with folks like Ariel Maldonado Leza around. You see, Ariel was a high level official of the Attorney General’s office (PGR), whose particular title was director general of Interagency Coordination. In English that means, he was responsible for making sure that the various police agencies investigating a kidnapping were coordinated in their efforts to root out the perpetrators. Ariel was so well placed and his job so critical to a government whose credibility had shrunk to near zero in combating this type of crime, that he was awarded two chauffeurs.

 

It seems Ariel and his two chauffeurs commandeered an agency Ram Charger vehicle and along with six other good friends disguised themselves as federal police. They pulled over a Mexican businessman, yanked him out of the car and drove him off in the Ram Charger. Soon, a ransom note  appeared, but the jolly group had not counted on thing, the victim’s cousin saw the entire event, wrote down the vehicle’s license number and was able to identify the director general as the leader of the plot. It just goes to show you that if you can’t trust a director general, who can you trust.   

 

A Strange Corporate Culture

 

And yet many were applauding what was going, those private businesses that were supposed to insure people’s safety. Many of the crimes in Mexico, especially kidnapping go unreported because of the fact that major corporations would like to have their negotiations go as quietly as possible and then leave the incident behind them. Mexican Law Enforcement Officials tend to muck things up when they are called in. When the things get too mucked, people can get killed and that is not what the game is all about.

 

Talk about growth industries, armor plated cars is now the in thing in Mexico City.  Evasion courses for drivers are privately offered in almost every big city or better yet, rather then go to school and learn how to be a driver that can successfully evade kidnappers, hire one. Although having a driver that knows the ropes is probably the most intelligent way of avoiding being taken captive, everyone that is anyone in Mexico now has a bodyguard. Among the elite, these people can be easily spotted wearing their mirrored sunglasses in even the darkest of nights. Now that every Mexican that is anybody has one of these people, signs have sprung up such as, “ A sign at one upscale cinema at the Santa Fe shopping mall reminds patrons that bodyguards must have their own tickets. At the Edron International school in southwestern Mexico City, parents received a circular warning that bodyguards were banned from entering school grounds when dropping off the kids. “ ([23])

 

People Do Have a Tendency of Disappearing Here.

 

“Policemen and soldiers are increasingly involved in the disappearance of detainees in Mexico, the human rights organization Amnesty International said in a report issued today. “In most cases there is strong, or even incontrovertible, evidence of official participation in carrying out ‘disappearance’, yet those responsible continue to shamelessly benefit from impunity,’ the London-based group’s report said. ([24]) The report goes on to say that in spite of the enormous increase in disappearances, the government takes the line that almost all of these cases are solved and what is to be concerned about. This non problem is a little is like Harvey the rabbit, he doesn’t exist but he keeps popping up at the most inconvenient times. The only time, it seems, the victims ever have a chance of reappearing is when a hew and cry goes up from the people in a loud enough fashion to frighten the bureaucrats. For some strange reason, the few folks that  suddenly and mysteriously reappear and for the most part seem dazed and to a man, complain of extreme torture.

 

 

 

Another Hostage

 

A logical question at this point may be, “why in a freely elected democratic society do not the people rise up and throw out these folks?” Well not everyone in Mexico knows what is going on. Important Mexican newspapers are dependent on government their advertising for their very survival and if the indigenous papers don’t play ball, they find that their revenue stream has just dried up. The Government also can let it be known that it does not want particular subjects discussed in the Mexican media. An interesting example of this was the recent UNESCO sponsored, “International Conference on Freedom of the Press, held in Mexico City. Not only were reporters told definitively not to cover the conference, but prominent Mexican’s that were scheduled to speak abruptly canceled without reason. 

 

Freedom of speech or in the alternative, of reporting is not a right enjoyed within Mexico proper. Another example of the controled press is the rescent devasting explosion of a fireworks plant in Tultepec. Although the Red Cross did a body count and individual indentified the countless victims, the Governmor of the state of Mexico, Camacho, who arrived substantially after the explosion had run its course plucked a substantially lower number out of the air and that became the office toll.

 

Reuters did a piece on October 14, 1998 on the subject which bears looking at:

 

"Last month aukthorieis in southern Chiapas state denied an internal government report obtained by Reuters saying more than 400 people died in severe flooding. They siad the death toll was around 200 and the report did "not correspond to reality."

 

The Red Cross estimated that hurricane Pauline killed 400 people when it battered Mexico's Pacific coastline in 1997, bu the government again gave a lower death count, of 173."

 

In 1992, eitght mies of gas pipe blew up under the streets of Mexico's second City, Guadalajara. The government said 208 died, but local media put the figure far higher."

 

Survivors of Tlatelolco -- Mexico's equivalent of China's Tiananmen Square bloodbath -- and foreign correspondents said up to 300 people were killed after security forces opened fire on a plaza packed with students 30 years ago. The government estimate was just 32 and has still not been changed".

 

The Fact That You Have Lived Here Forever Does Not Make It Early Enough

 

Another trick to keep prying eyes away from what the Mexican’s may consider to be unsightly linen, is amplified by their action in the ongoing war between the government and the Indians in the State of Chiapas. The Institutional Revolutionary Party (PRI) thinks that the Indians did not arrive early enough in Mexico to have any say as to what goes on and therefore should be treated as 3rd class citizens. Part of being third class in Mexico means that you could not only disappear at a moments notice, never to be heard from again or even more definitive, you could be killed. The PRI has been using both techniques with central government acquiescence to a fair-the-well. Naturally, do-gooders from around the world have attempted to see first hand what is going on and although most countries would appreciate the increase in tourism, Mexico has determined that the traveler’s safety is at extreme risk and banned them from the area.  

 

 

 

Why Can't We Have Fun Like Everyone Else?

 

But before we start casting stones at the police and their incompetence, consider what life would be like without them. Mmmm No more murders, kidnapping and drug dealing you say. C’mon, it really not that bad, these are fun guys just out for a good time and everyone gets down on them. Like the time in early April, 98, when a few of the police near  Acapulco went got drunk and went for a little ride close to town, these fun guys spotted an army convoy full of soldiers and couldn’t think of anything that would be more fun than shooting it up. These terrific fellas started firing their automatics into the convoy and were really enjoying it when the soldiers started firing back to protect themselves. The army made short work of the policemen and really turned a good time into a bummer. This is exactly why police turn to corruption. Every time they want to enjoy themselves in the same way other people do, someone is always getting in the way.  We hope those army guys really get disciplined for firing back and killing those fun loving policemen.

 

So we have seen that Mexico does not seem to prosecute many crimes and one would think that their jails would be empty. After all, with kidnappers, there are no witnesses, with drug dealers there are corrupt judges, with politicians, there is precedent and with bank robbers there is always Spain, Switzerland or Ireland. Who then winds up in the jail if everyone has a deal?. 

 

A Horse of a Different Color

 

Recently, the Mexico City’s Attorney General’s Office issued arrest warrants for three IBM Officials who supplied to the city a $27 million dollar computer system that wouldn’t work. What made matters really sticky for the guys from IBM was the fact that the contract was for the upgrading of the computer system which surprisingly is involved in the city’s criminal investigations. Not a small job, it amounted to 10 percent of the Attorney General’s budget, was designed to tie together over 2000 computers linking 70 offices and was to provide a database for the investigation of criminal activity.

 

It seems that there are two charges involved here, the first is that the contract should not have been awarded without competitive biding but that doesn't seem to impact IBM.  It would seem more likely that one or more of the city fathers should be questioned on that score. The next charge seems to be that it isn’t functioning properly, to which IBM responded that not only did the computer work but that the price was fair. Something certainly seems strange here when murderers, drug dealers and kidnappers walk and IBM constructs a computer system that they consider meets or surpasses the criteria and at a price that is fair. What aren’t they telling us?

 

Well it seems that although past presidents and politicians are exempt from their crimes while in office, the people that worked for them may not be. The attorney general was appointed by the man most likely to be running for president of Mexico on the opposition ticket and who is currently given a great chance of winning, Cuauhtemoc Cardenas. He is currently, Mexico City's first elected Mayor this century and won his post on a campaign of combating graft and ferreting out those that were corrupt in the previous administration.

 

Along with the IBM personnel arrested, 19 former city officials were also handed arrest warrants and the story now begins to make some sense. Elections are around the corner and by taking on both IBM and the former administration, Cardenas is obviously hoping to build up big brownie points with the voters and if a few executives from one of the biggest companies in the evil empire north of the border have to rot in a Mexico City prison to achieve that end, well, who is to say?                

 

 

MEXICO'S HOT TAMALE

IF YOU DON’T GET IT RIGHT THE FIRST TIME, OR THE SECOND OR THE

 

Privatization is usually the act of selling something that the Government owns and operates, to private industry, for a price, hoping that better management will bring in tax revenues. There is not much that governments haven’t tried to pawn off on investors but when Mexico came up with a plan to sell something that didn’t exist at all, it seemed to the originators to be a most wondrous idea. 

 

Mexico was faced with a number of problems in the 1980s. They were just recovering from the largest financial collapse of a government in economic history and their infrastructure lay in ruins. The government had no money to finance the necessary public works projects that were necessary. The transportation system in the country was already untenable and with only inferior roads to begin with; lack of funds to fix what little infrastructure existed was causing a downward spiral that seemed almost bottomless. To make matters even worse, the nation’s construction companies were in chaos, with most of them close to bankruptcy. This was a problem that required a universal solution, and the dazzling bureaucrats who had been responsible for the devastating economic predicament that the country was in, got together and came up with a one of the most bizarre solutions the civilized world had not seen since Marie Antoinette’s answer to French starvation.

 

Mexico would auction off the right to build toll-roads throughout the country and let the builders determine what the tariff would be for their use. Thus, with one fell swoop, the transportation infrastructure would be modernized, the construction industry would be revitalized and , the government would receive tax revenues. The plan was quickly approved and the bidding for the opportunity to own the highway system seemed like a great idea to everyone. Those that it appealed to most were the very industries that were in so much trouble to begin with, the construction companies and the banks. These deep thinking economists determined that they would bid for the right to build the roads, construct them themselves, pay back the money by securitizing the future value of toll collection and walk away with a big score.

 

DO WE HAVE A DEAL FOR YOU, THIS BRIDGE IS LOCATED ON THE EAST RIVER BETWEEN MANHATTAN AND BROOKLYN AND AS YOUR AGENT I CAN SECURE FOR YOU AT AN UNBELIVABLE PRICE.

 

Wrong!  Many of the roads that were built started literally nowhere and did not go anywhere from there. Others had tolls that charged so much for their use that no one could afford to travel on them. Some were casualties of criminally inferior analysis, where usage predictions had no relationship to reality at all. The construction companies and the banks went along with the most ill-conceived construction project since the building of the Chernobyl Atomic facility, did not bode well for the economy as a whole. It became obvious that great thinkers such as these would find some other way to destroy what was left standing of the countries fragile economic infrastructure as well.

 

With talent like this available, it was not hard to predict that the Country’s collapse was imminent. That was unquestionably a given, but its severity, in monetary terms, even exceeded the world record it had set earlier. The disastrous toll-road problem took a back seat to an entire nation in economic ruin. Not wanting to have a neighbor in such straits, the United States promptly wrote the check and induced the IMF and the World bank to do the same, but that is another story for another time.

 

Having sufficiently recovered to address some of the corpses still littering the landscape, the Mexican Government has now come up with a novel solution to the problem. They will buy back the roads from private industry, by issuing their own debt in exchange for that of the construction companies and that of the banks. The government would take control of the toll-roads and make them profitable by reducing the tolls to make the roads more affordable. 

 

BAILOUT SMAILOUT, WHATEVER IT IS YOU HAVE TO LOOK AFTER YOUR OWN

 

This awesome reasoning seems to parallel the previous government’s logic in its convolution. It does not take a high IQ to make the leap of faith that if reducing the fees would have made the highways economical, the private owners of the roads would have done it. No, this will not work; it is pure and simply a standard Mexican bailout. It was best put by William F. Foote, who did an analysis of the Mexican infrastructure for the Institute of Current World Affairs, “With this bailout, the Mexican public is being told to pay tolls as taxpayers that they wouldn’t pay as motorists.”  

 

The estimate of this “small” fiasco, by Mexican standards, where catastrophes seem to cost more than anywhere else, is estimated by authorities to be a staggering $7 billion. Bureaucrats indicate that this number could be higher, as they plan to install improved management into the system. With management being supplied by Mexican authorities, we may be looking at the start of World War III.

 

I Want To Be In Pictures

 

Because of boondoggles like the  highways that lead nowhere, street cleaners in the state of Tabasco were fired for lack of money, and given literally no severance pay.  They determined to show their ire at national officials by parading in front of a stunned legislature, turning their backs and dropping their shorts.  This was only a prelude, a few weeks later they invaded Congress and began throwing potted plants at the guards while their comrades maintained a hunger strike on the front steps.

 

The Tobasco street cleaners were not alone in their unhappiness with the government.,  a group of people employed in the Mexican sugar refining industry who did not feel that  they had made the proper impact by camping in front of congress for two months also stormed congress and beat up an number of the guards as they stripped down to their trousers in front of the stunned legislators. Close on the heels of the street cleaners and refiners were the teachers from Baja California Sur state who attempted mayhem on the Finance Minister, Guillermo Ortiz shortly after he had constructed what they considered to be an unacceptable budget. Some at the scene indicated that if were not for the bodyguards positioned strategically in the area, that came to his rescue, the finance minister would have been turned into "chopped liver" by the rampaging females.

 

The chamber has been known for its physical approach to politics for many years as those with opposing political views often use their fists instead of oratory in attempting to get their points across. But then again, this is Mexico, a land of hot tempers and beautiful women. Many of the most beautiful of the Mexican Women are offered jobs in congress to dress up in mini skirts and work the building aiding the legislator's in whatever way the can. It has now turned out that some of the services that this corps had been providing to elected officials had gone far beyond the their job descriptions.  They too felt that working conditions were not what they should be. 

 

OUR LAWS ARE EXCELLENT, THAT IS FOR SOME OF US

 

There are national laws, and international laws and civil laws and Mexican Laws. The former are all based on a great deal of logic and later is off the wall. The fact that no one much cares about what the law is or is not in this country is why the legislators have some much time on their hands to run after the pretty women with whom they share the legislature. In 1973, then Mexican President, Luis Echeverria determined that 38 pheasants that owned a squalid piece of land in Hermosillo should have the land impounded and they should be moved off the property. Luis, after this audacious act, turned the barren parcel over to Grupo Mexico, who within a short period of time made the amazing discovery that the land contained copper. Not just copper mind you, but the largest copper find in all of Mexico, fully 50% of the country’s production in a country noted for its mines. Since that time, Grupo has taken out billions of dollars of copper, built an enormous smelter and has a payroll of over 4,000 people.

 

The peasants went to court over 20 years ago to protest what they believed to be the theft of their lands and ultimately, the court determined that they indeed were right and ordered Grupo to “remove all installations from the communal land” in thirty days. Anywhere but in Mexico this would have been devastating considering that fully 50% of Grupo’s earnings come from this copper deposit and they are in the process of an enormous equity raise in the United States. But then again, this is Mexico, Mr. Garcia de Quevedo, a senior executive with Grupo stated, “The ruling will have no effect on the operations of the mining group. It has no importance whatsoever.” As to the lawsuits fallout on their American financing, Garcia was again rather sanguine, “This is an inconvenience; it ties up our lawyers.”

 

A Fire and A Half

 

As if God did not like what he was seeing in Mexico, a fire started, not just a fire mind you but as Saddam Hussein would say, the Mother of all Fires. It started in typical fashion, slashing and burning of the jungles to make way for agriculture the same way the pheasants had been doing it for centuries except  this year was  a little different, they had not counted on the effects of El Nino’. The world’s jungles are usually moist enough that any fires are not a serious matter, except of course when natural events have created a dry season like non other seen on the content in hundreds of years.

 

So the fire started and it raged and raged. Its smoke clouds choked inhabitants as far away as Chicago and Miami and health alarms were sounded all over the State of Texas. This fire made the Indonesian nightmare that wrecked havoc on tourism in the entire Pacific Rim look like a boy scoot campfire. Three thousand firefighters were brought in and aid was forthcoming from many of the adjoining country and yet it still raged.  So far, the toll stands at 12,627 fires since the beginning of 1998 with 144 being of the major variety along with 60 dead.  Mexico just can’t catch a break.   

 

Prologue

 

As we fondly bid goodbye to beautiful Mexico, the land of beautiful women, extraordinarily corrupt politicians, the world’s second richest drug lords, generals who make alliances with the devil and worse and kidnappers sometime looking for only enough for their next meal, we can leave with a better understanding of why so many Mexican’s attempt to elude American border police on their way into the United States. Just as Germany is about to conquer Europe economically through the Euro when the couldn’t take it by military power, the Mexican’s are retaking the American West in a cross border invasion that has no precident. These people are attempting to make a living in a country where the playing field isn’t tilted at a 90% degree angle.

 

THE FACT THAT YOU WERE HERE FIRST DOES NOT MEAN ANYTHING HERE

 

While the natives head north or the border, the real Mexican’s, the Indians of which there are 9 million seem to be headed for extinction faster than you can blink an eye. Indiana rights groups have charged that the Mexican Government is encouraging paramilitary gangs to kill Indian leaders the are becoming too uppity. As the Indians stand up more and more for their rights, their leaders vanish and others  are killed. Many of the Indians living in the village of Acteal were killed as blood thirsty paramilitary bands rushed through the streets shooting everything that moved. They were not even slowed down in their slaughter by local soldiers who stood ideally by as genocide was committed.

 

As the heat rises, more and more international rights groups have been taking an interest in what is going on. The foreign interlopers are dealt with harshly by the Mexican Government and Jeff Conant who was sent home said, “We have been deported not for the reasons stated but for witnessing an act of war by the Mexican government against its own people,”  The Mexican State of Chiapas has become an almost armed camp and the fighting is expected to intensify as the days become hotter.

 

Our point in all of this is to illustrate the fact that those in power are equally opportunity hate mongers, who seem to take the villains side in whatever happens in the country. Drug dealers, kidnappers, wayward police chiefs, defrocked generals, crooked judges and tarnished ex-presidents seem to find immunity in their impunity in this Alice and Wonderland world where wrong becomes right because it is backed by muscle. Rosario Green, Mexico’s Foreign Minister became defensive when the entire civilized world began to criticize the country’s repressive actions and stated; “What we as a government are doing, and I much regret that you take it as an act of xenophobia, I see it as an act in defense of national sovereignty.”  Sovereignty, my hearing aid, this government anoints thugs with the right to massacre a population that has lived in Mexico for over three thousand years and defends it by stating that it is in the national interests.

 

With all of these problems, one would think that there were no bright areas to dot the Mexican Landscape, but the one organization that all Mexicans proclaim as pure as the driven snow is the Mexican, Red Cross. Always there in a time of need, the organization record has been spotless, at least until now. Eleven of the twenty seven members making up the Red Cross National Council of Mexico recently resigned accusing their three time President, Jose Barroso with corruption and abuse of power. Although only early returns have come in, and Barroso has dug in his heels, it seems that some aid shipments from countries such as the United States have not quite arrived and others, while supposedly donated have apparently been paid for as well. The man on the street can only shake has head and mutter, "if we can't trust the head of the Red Cross, who can we trust? Certainly not the Mexican Government."  Barroso, for his part indicates that the who thing is over the fact that he wouldn't endorse the use of condoms for prevention of AIDS. Sure Jose, and if I buy that one, what are you going to try to sell me next?  

 

With all of this, its stern neighbor to the North, turns the other way and has allowed a world class dictatorship to evolve next door. The United States invaded Haiti, Granada and Panama  for a lot less. While everyone holds their breath waiting for the United States to tell Mexico that it has had enough, the years have stretched into decades. The next depression in Mexico, never too far away will bring with it massive revolution and change. Once set to boil, the caldron can not easily be set on another course.       

 



[1] New York Times, International, Thursday, February 12, 1998

[2] Wall Street Journal, February 25, 1998

[3] Wall Street Journal , February 28, 1998

[4] New York Times, Julia Preston, November 30, 1997

[5] New York Times, Julia Preston, November 11, 1998

[6] In Mexico City during the first 6 months of 1998 there almost the same number of Bank Robberies that there were in the entire year of 1998, 81 in six months and 100 last year.  Reuters, 6/23/98

[7] “Mexico’s government has been plagued with ties to drug lords within its ranks, with five army generals arrested in the past 12 months on drug charges.” Reuters 1/25/98

[8] New York Times International, 4/15/1998

[9] The equivalent to the Federal Bureau of Investigation in the United States

[10] The man was known as “Lord of the Skies” because he always seemed to be shipping drugs to the United States in reconverted Boeing Jets.

[11] Fuentes considered himself a national hero because, as he said, he never sold drugs in Mexico and whenever he sold a planeload of drugs in the United States, he brought back a planeload of money to reinvest in Mexico. Thus, he strongly felt that he was helping the economy and indirectly, the people. 

[12] Reuters, 3/3/98

[13] New York Times International, Thursday March 26, 1998

[14] New York Times Thursday, April 23, 1998

[15] Wall Street Journal, March 13, 1998

[16] Wall Street Journal March 13, 1998

[17] Reuters, 10/20/98

[18] The Wall Street Journal International, March 24, 1998

[19] A vice president of the bank

[20] The Wall Street Journal International, March 24, 1998

[21] Reuters, 5/17/98

[22] All Rights for All Reuters 3/31/98  This is an umbrella group for 49 rights organizations

[23] Reuters 3/31/98

[24] New York Times, 5/7/98

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