High on Repression: How Military Involvement Increases Violence and Corruption When Fighting Drug Trafficking

Abstract: 

Today millions of innocent people are caught in the crossfire of the "War on Drugs." This paper looks at different approaches in order to determine which strategies will yield desirable results such as limiting access of drug cartels to state institutions, reducing the violence in the streets, and maintaining a low casualty rate. Countries are fighting against well-armed cartels that produce and distribute narcotics to a profitable and ever-growing drug market. State strategies differ in their effectiveness in minimizing illicit activity. Repressive strategies, such as military intervention, are less effective at reducing criminal behavior than judicial reform and social development. Military involvement in civilian affairs could undermine civil liberties and erode popular support for the armed forces at home. A repressive approach could create more violence as criminal militias retaliate. Instead, an approach that enhances the judicial capacity to target the financial base of the cartels finances, fight money laundering, and protect human rights, will result in less violence and corruption. Using ordinary least squares regression, this paper tests the effectiveness of a military approach versus an approach of social and judicial reform to fight drug cartels. The model seems to suggest that the most effective measures against drug cartels that also reduce casualty rates are those strategies based on targeting the funding mechanism of criminal organizations.

Table of Contents: 

    Introduction

    One would like to assume that when leaders of nations decide to declare a war, that they have given a serious consideration to all the available options, and that they have a high degree of certainty that military action is the only way forward. Today millions of innocent people are caught in the crossfire of the “War on Drugs” against well-armed cartels that produce and distribute narcotics to a profitable drug market with an ever-growing demand. Not only have thousands been killed and traumatized, but also the capacity of the drug cartels to infiltrate vulnerable states undermines the rule of law and democratic institutions, making any hope of economic development and lasting peace an unattainable dream for the people caught in the violence (Global Commission on Drug Policy 2011).

    Former Defense Minister and current president of Colombia, the largest cocaine producing country in the world, said in an interview, “We must be very frank, after 40 years of pedaling and pedaling very hard, sometimes you look to your left, you look to your right and you are almost in the same position…and so you have to ask yourself: Are we doing the correct thing?” (Forero Apr 10 2012). Perhaps this question is long overdue. This could be a good time for policy makers and researchers to seek a more comprehensive concept of social safety, in order to analyze to what degree the illegal drug trade ought to be considered a national security issue and the best strategies to address it.

    The alarming violence that has emerged since using the military to fight drug traffickers in Mexico makes one wonder if this strategy is begging for an alternative. There could be an approach that does not generate so much harm from its enforcement, that avoids a bloody burden on the population of countries where drugs flow northward. The question is then raised: “Does deploying the military to combat drug trafficking increase the level of violent crimes within a country?”

    Literature Review

    Weariness of the use of the military in the civil realm has existed for a very long time. Active military involvement in civilian law enforcement has been legally prohibited in the United States since 1878 when Congress enacted the Posse Comitatus Act, which made it unlawful to employ any part of the United States army for the purpose of executing the laws, including making arrests on behalf of civilian law enforcement authorities (USNORTHCOM). Scholars have argued that armies lack effectiveness to deal with domestic law enforcement issues in general. Lieutenant General Stephen Olmstead, Deputy Secretary of Defense for Drug Policy and Enforcement, warned that military involvement in civilian affairs undermines civil liberties, and erodes popular support for the armed forces at home (Bagley 1991). If General Olmstead is right, and the use of the military to control organized crime could threaten civil rights within a society, then it would be extremely hard to legitimize the rule of law necessary for sustainable peace.

    Jorge Hernández Tinajero (2011) writes that National Human Rights Commission found that, since President Calderón declared war on the drug cartels in Mexico in 2006, there has been a 300% increase in the number of human rights complaints in the territories where the military are on the ground. The legal system has been weakened by practices such as eliminating restrictions on detention while the prosecution gathers evidence, and avoiding civil trials for crimes committed by the military (Tinajero 2011). Efforts involving the use of the military to combat drug trafficking organizations have resulted in a significant increase in killings, torture, and other abuses by security forces. These interventions only make the climate of lawlessness and fear worse in many parts of the region (Human Rights Watch 2012).

    Military personnel might lack the expertise and training necessary to perform law enforcement activities. Schlichter (1993) states that the military is poorly prepared to comply with judicial protocols when it is called upon to act in the law enforcement arena because, unlike civilian forces who emphasize individual rights and a legal process, the military achieves its goals through the use of force and threat. The military is designed and equipped for an effective and quick destruction of the “enemy,” whoever that may be. Military methods are designed to handle the black or white situations of the battlefield and, for this reason, armies are ineffective in dealing with the gray shades that police forces often encounter as, for example, when enforcing drug trafficking laws. Military troops are expected to accomplish their mission when operating within the checks and controls of civil society (Schlichter 1993).

    The argument is often made that deploying the military to battle criminal organizations has produced few results in terms of stemming the flow of drugs, while generating unintended outcomes. For example, by making security forces more independent and contributing to the formation of strategic partnerships between criminal and governmental actors, the military perpetuates instability through corruption (De Danieli 2011). Corti and Swain (2009) explain that the mentality of seeing the threats of drugs as a national security problem for the United States, rather than a public health problem, has resulted in military agreements with other affected countries, a substantial investment in the armed forces of those countries, and the authorization of the U.S. military to intervene in fights against drug production abroad (Corti and Swain 2009).

    Apart from concerns of instability that could come with using the military to combat domestic criminal organizations, one of the most worrisome aspects of a military approach is that it could exponentially increase the amount of bloodshed. Gutiérrez (2011) writes that when security forces killed drug cartel leaders in Mexico, junior cartel members were left to fight for control. Turf wars between new rival organizations developed in a systematic way, which increased the amount of violent crime. Not only was the population exposed to the killings between the security forces and the cartels, but now they also had to witness the violence between narco-traffickers trying to become the new bosses (Gutiérrez 2011). For example, since 2006 when the war against drug cartels was declared in Mexico, killings have been steadily on the rise from 2,120 dead in 2006, to 11,583 in 2010 (Bureau for International Narcotics and Law Enforcement Affairs 2010).

    The Mexican government’s effort to capture trans-national criminal leaders has resulted in multiple fractured organizations that fight over lucrative trade routes and seek to intimidate or control communities by killing and torturing security personnel, journalists, and government officials (Bureau for International Narcotics and Law Enforcement Affairs 2010). Between 2007 and 2011, the number of cartels doubled due to the fragmentation of the six large regional cartels that previously controlled transnational drug trafficking in Mexico (Gutiérrez 2011); thus, the outcome of sending the army to neutralize narco-traffickers actually produced the opposite effect by exponentially increasing violence and corruption. In addition to cartel fragmentation and the increase in the number of deaths, another major trend is the geographic dispersion of violence. This means that killings, shootings, and harassment by criminal organizations have progressively spread throughout Mexican territory since the military was called in to fight (Gutierrez 2011).

    Militarization of drug enforcement has been the preferred approach taken by the United States in the last 40 years of the War on Drugs in Latin America. Coca-producing nations in South America have complained about U.S. insistence that they accept military aid for anti-narcotics initiatives, which they fear could threaten their fragile civilian governments (Marquis 1990). This strategy has enjoyed a lack of serious scrutiny; so far a law enforcement approach has focused almost exclusively on a military offensive against the groups providing the global supply of drugs. Although these large-scale, supply-side measures absorb the bulk of drug control spending in most nations, the evidence supporting the effectiveness of these interventions is weak since they fail to demonstrate any effect on either the supply or the price of drugs in the marketplace (Babor 2011).

    Fish (1994) argues that the popular public perception of the causal model related to drug consumption in the United States is erroneous. He explains that the current causal model perceived by the public is that (1) drug use causes crime and, thus, drugs have been made illegal. (2) Drug dealers have armed themselves to combat law enforcement, and (3) an escalating arms race has ensued. Fish presents an alternative model: (1) Drug prohibition causes a black market, and (2) the black market causes violence and corruption. As a result, (3) drug policy should be aimed at shrinking the black market instead of fighting drug cartels (Fish 1994).

    If Fish’s assumptions are correct, then the countries that will be hurt the most from repressive policies are those that lack the institutional strength to control corruption and violence. The use of military force alone against the drug cartels does not address the lack of judicial competence that is required for long-term stability and peace, especially in drug producer and transit states where cartels have a lot of influence. Because of this, the United Nations Office on Drugs and Crime calls for strategies that will provide the countries of Latin America with expert assistance to help improve the integrity of justice systems, so that they can protect witnesses, fight money laundering, protect human rights, and deal with serious organized crime (United Nations Office on Drugs and Crime 2008). This kind of approach has never been the primary focus of the United States drug policy, despite evidence that military force alone could not deal with complex crimes without a functional prosecutorial and judicial system in place (Buscaglia 2003).

    The cunning ability of the cartels to use their wealth to corrupt all institutions of the state is one factor that makes this war so complicated. Corruption is intimately linked to violent conflict, human insecurity, and oppression, as it impedes government accountability, and can motivate officials and security forces to commit abuses for financial or other forms of gain (Beyerle 2011). Deterrence of criminal activity only works if judicial punishment is consistent, which depends on detection by police, prosecution by attorneys, and deliberation of judges and juries. As long as these three activities are conducted transparently and efficiently, tough sanctions will deter criminal activity; however, if corruption is pervasive, then the efficiency in law enforcement can be very much reduced by cartel members (Kugler and Verdier 2005).

    Buscaglia (2003) found that the danger of infiltration by organized crime into state institutions, a phenomenon they describe as “state capture,” is present even in democratic countries with institutionalized procedures to distribute public goods like justice or security. State capture is perhaps the most dangerous linkage between criminal organizations and political corruption. Drug cartels are able to form close relationships with state security forces, with politicians, and with the judiciary, turning these countries into narco-states in which the institutions in charge of curbing corruption end up being the ones that benefit the most from it. Once this vicious cycle begins, the danger of authoritarian governance mixed with widespread corruption could result in further de-legitimization of authority and the rule of law, perpetuating criminal impunity and poverty (Beyerle 2011).

    The dimension of the financial wealth of the drug cartels cannot be underestimated, since it is their monetary might that allows them to corrupt state representatives and to become well-armed, even to the point of being able to fight against a national army. Collier, Hoeffler, and Rohner (2009) after analyzing a global sample of civil wars from 1965 to 2004, concluded that where civil war is financially feasible, it would occur without reference to motivation (Collier et al. 2009). We know from popular culture that the drug market is well established worldwide, particularly in the United States. Profits to be made in the American drug market create what de Soysa (2000) calls a “honey-pot effect,” in which profit-seeking groups will have a strong incentive to mobilize and engage in criminal violence (de Soysa 2000). Access to huge sums of dollars from willing and able drug consumers in North America has become the ultimate “honey-pot” to drug cartels, and, if Collier et al. and de Soysa are correct, they will fight or infiltrate any army that gets in the way of their fulfillment of that lucrative demand.

    The Sinaloa cartel, for example, can buy a kilo of cocaine in the highlands of Colombia or Peru for around $2,000 and then watch it gather value as it makes its way to markets. In Mexico, that kilo is worth more than $10,000. Once it makes it through the border into the United States, it could sell wholesale for $30,000. (Heroin has been negotiated for up to $55,000 a kilo). If that kilo is then broken down into grams to be distributed in retail, it can sell for upward of $100,000. Sinaloa is both diversified and vertically integrated, producing and exporting marijuana, heroin, and methamphetamine as well (Keefe 2012). To help put these numbers in perspective, the U.S. Customs and Border Protection Agency intersected 2,358,680 kilograms of drugs in 2009 alone (Graham 2010), which could have easily translated into billions of dollars in profits for Mexican cartels.

    If we consider the profit margins in the drug trade, it is not surprising that drug cartels are able to arm themselves in such a military fashion. Joe Stout (2007) points out that these drug cartels will fight using their extensive fighting capacity that is made possible by the significant amounts of cash and weapons imported from the United States (Stout 2007). A report by the U.S. Department of State illustrates that well-armed and trained cartels employ advanced military tactics and weaponry, including rocket-propelled grenades and mortars, in attacks on security personnel (Bureau for International Narcotics and Law Enforcement Affairs 2010). The Mexican navy has even seized cocaine smuggling submarines that are designed and built in the jungles (Jenkins 2011).

    Theory

    An objective look at different approaches could help determine which strategy is going to yield desirable results, including limiting the cartels’ access to state institutions, reducing the violence in the streets, and producing sustainable stability. State strategies differ in their effectiveness in minimizing complex illicit activity. Repressive strategies, such as military intervention, are less effective in reducing criminal violence than judicial reform and social investment.

    When state institutions in charge of promoting law and order are polluted by organized crime, it is easy for governments to panic and call in the army to tame the spread of criminal influence, but intensifying repression by using the military to perform the role of the police could be counterproductive and harmful to society. Revenue from the drug trade is what funds the drug cartels and the proceeds are sufficiently great enough that each cartel can afford to fund an army prepared for war. They are willing to fight. Just by declaring war, the government is creating an atmosphere that is conducive to violence and corruption.

    As explained earlier, drug profits allow cartels to be militarily trained and to incorporate techniques such as communications intercepts, interrogations, trend analysis, military-style tactical operations, GPS, thermal imagery, and military armaments, including fully automatic weapons, hand grenades, and other capabilities normally associated with military organizations (Valdez 2011). Drug cartels are not simply drug smuggling gangs; they are organizations that will react to military attacks from the government by using their wealth to expand their fighting and corruptive capabilities in order to protect themselves from arrest and prosecution (Buscaglia 2008).

    Relying on the national military, even when assuming that it is not weakened by corruption, creates a situation in which the government sends soldiers and police officers to the streets to meet the fire of the cartels’ military. When more soldiers are thrown into the mix, it generates even more violence. Intensified repression against drug cartels will be countered with higher levels of violence with the goal of defeating armed forces and intimidating public officials, thus increasing the bloodshed in the streets.

    Even successful raids by the military, in which drug lords are executed or apprehended, will lead to more violence when rivals try to take over as the new drug boss. Junior cartel members are more willing to become violent in order to fill the hierarchical gap created by the military. We have seen this scenario play out in the recent Mexican drug war where not only security forces and cartel members make up the casualty rate, but also civilians since heavy fighting often occurred in urban areas. From this outlook we have derived the following hypothesis:

    H1: Military strategies to fight drug cartels will increase casualty rates.

    The surest way to stay out of trouble in the drug business is to pour out generous bribes. Drug cartels make regular payments to the federal, state, and municipal authorities that could be considered just operational costs. When the U.S. Drug Enforcement Agency (D.E.A.) conducted an internal survey of its informants and asked them to name the most important factor for running a drug business, they replied overwhelmingly, that is was corruption. At a trial in 2010, a former police official from Juárez, Jesús Fierro Méndez, admitted that he had worked for Sinaloa. “Did the drug cartels have the police on the payroll?” an attorney asked. “All of it,” Fierro Méndez replied (Keefe 2012).

    Drug cartels will also react to repressive measures by re-directing more resources into expanding their infiltration into the armed forces and in political circles as a way of securing protection from those same entities that are in charge of capturing them. Large proceeds from drug sales give cartel leaders an overwhelming corruptive power that is enhanced by the terrifying warnings represented by corpses hanging from bridges featured in the nightly news.

    An example that illustrates to what extent drug cartels will corrupt institutions whenever they feel threatened is the case of Subprocuraduría de Investigación Especializada en Delincuencia Organizada (SIEDO), Mexico’s top organized crime-fighting agency. SIEDO informants, some of whom were receiving more than $450,000 a month, informed the “Cartel del Golfo” of every step that the agency was taking (Stout, 2007). Also, a U.S. diplomatic cable revealed that a Mexican officer assigned to guard President Felipe Calderon was accused of leaking information to drug cartels, training hit men through a private security firm, and supplying military weapons to the cartel group, the Zetas (Webster 2011).

    Calling in the national army to fight drug cartels does not address their corruptive capabilities because, even when military forces make progress against criminals and strategies start to work in one region, it creates a balloon effect in which criminal activity simply reappears in a different region. For example, success of law enforcement in the Caribbean is tainted by the fact that the army did not permanently disrupt, much less halt, drug smuggling into the United States. Instead, traffickers established new routes through Central America and Mexico and neither availability nor prices of drugs were seriously affected (Miller 1989).

    The cartel bribes mayors, prosecutors, governors, state police and federal police, the army, the navy, and a host of senior officials at the national level. In a 2010 speech, Genaro García Luna, Mexico’s secretary of public security, speculated that together, the cartels spend more than a billion dollars each year just to bribe the municipal police. There are also the “falcons,” an army of civilian lookouts who might receive $100 a month just to keep their eyes open and make a phone call if they notice border inspections or a convoy of police. There are even cities in Mexico where virtually every cabdriver is on the payroll (Keefe 2012). It is thanks to large profits from an insatiable drug market in the United States that cartels have the money to fund such extensive operations.

    In this paper, the capacity of cartels to operate is defined by their financial ability to arm themselves and to corrupt public officials and members of the armed forces for the purpose of conducting their business. A militarized approach against organized crime will deliver unintended consequences, like an increase in corruption as cartels try to neutralize law enforcement and try to purchase protection from state institutions. Increased corruption will facilitate the operational capacity of drug cartels in a country, thus giving them more means to arm themselves and become violent. From this literature, we derived the second hypothesis:

    H2: Military strategies to fight drug cartels will increase drug cartels’ capacity to operate.

    The alternative (or perhaps the necessary complement) to a militarized approach is a comprehensive social and judicial strategy in which social development programs and laws that target finances of the cartels become the main strategy against drug trafficking as it will curtail the cartel’s ability to recruit new members and to use their money to corrupt officials and to purchase military weapons.

    Social investment is a long-term strategy to stop the flow of youth into the criminal world in an effort to minimize the presence of criminals in the future, or to prevent youth from becoming drug addicts. This approach is modeled after successful measures that worked for the most violent Brazilian slums. Combating organized crime and simultaneously reducing the levels of violence was possible thanks to the creation of a new military command that, through activities like playing football with the residents and offering classes of martial arts, keeps the dominion of the cartels far from the communities (Coria, 2011).

    Currently, in the violence-ridden Mexican city of Juarez, after a traumatizing six years of heavy fighting between armed forces and drug cartels, the government pledged investment in initiatives that will address the problem of violence at its roots. The measure is called “We are all Juarez,” and in its initial phase, will include the construction high schools, health centers, temporary jobs, microcredit, after-school programs, sports leagues, universal healthcare coverage for 280,000 people, and other activities not typically associated with security (Llana 2010).

    In order prevent a violent backlash from threatened cartel members trying to avoid incarceration or death, a judicial approach should be designed to target criminal assets and to stop money laundering, rather than the eradication of criminals themselves. A judicial approach means a systematic elimination of impunity for criminals to operate outside the law, and targeting the funding mechanisms of the cartels in order to reduce their fighting and corruptive power. A focus by the state on reducing the financial depth of drug cartels will reduce their means to buy military armaments and their ability to train militias. With less ability to fight, the drug cartels’ scope of violence could be reduced to manageable levels by police and prosecutors instead of army soldiers.

    When judicial punishment aimed at the financial resources of cartels is consistent, relying heavily on forfeiture of criminal assets by the police, prosecution by attorneys, and the deliberation of judges and juries, then one could say that a judicial approach is fighting organized crime with minimum use of violence. When policies are not threatening the individuals involved in the drug trade, it suppresses their incentive to take up arms and become violent. Along with judicial reform, crime prevention could prove to be a more effective way to reduce violence than using repressive force against drug cartels. From this literature, we derived the third hypotheses:

    H3: Judicial and social strategies to fight drug cartels will reduce the casualty rates.

    A methodical dis-assembly of the role of criminal organizations in the legal economy is probably the most important aspect of reducing the operational capacity of the cartels. If state resources are concentrated on establishing a competent judiciary and an effective financial intelligence unit aimed at eliminating the influence of drug money in the legal market, rather than the execution of cartel members, then a reduction of the financial muscle of the drug cartels would translate into bringing down the corruptive power that allows them to operate so effectively.

    Money laundering represents the polluting influence of the cartels in the economy. Transportation fleets that transport drugs, arms, and people, and the warehouses where drugs and equipment are stored, are owned by companies in the legal sector that have to be identified and dismantled. The possible social and political costs of money laundering, if left unchecked or dealt with ineffectively, are serious. Organized crime can infiltrate financial institutions, acquire control of large sectors of the economy through investment, or finance electoral campaigns of public officials, which in itself is an extreme menace to the functionality of the state.

    A combination of community based crime prevention, while strengthening the judicial role in reducing the financial magnitude of organized crime, will constitute a comprehensive way to eliminate transnational organized crime. With less money to bribe or to buy weaponry, the feasibility for organized crime to continue to exploit the drug black market will be diminished. Targeting the money laundering aspect of criminal activity and depriving the criminals of their ill-gotten gains will mean hitting them where they are vulnerable. Without a usable profit, the criminal activity will not continue and the incentives to risk fighting security forces will be significantly reduced. A judicial approach that enhances operational coordination among judges, prosecutors, and financial intelligence officers will reduce levels of organized crime and high-level corruption, thus making it harder for cartels to operate. From this literature, we derived the fourth hypothesis:

    H4: Judicial and social strategies will reduce drug cartel’s capacity to operate.

    Research Design

    I tested the effectiveness of using military force as an anti-narcotic strategy compared to a strategy that involved a serious judicial and social approach. Since in recent years there has been an explosion of violence related to drug cartels, particularly in Central America, this paper concentrated on observing each country in Latin America, including the Caribbean nations, from 1996 to 2010. Different effectiveness measures were calculated by examining each strategy’s effect in levels of violence, and the effectiveness of each strategy at reducing the cartel’s capacity to infiltrate institutions.

    In an attempt to isolate a measure of the violence generated from using the military for drug enforcement from other types of violence that would have shown up in the national murder rate, a measure of political assassinations from the Cross-National Time-Series database (Banks and Wilson 2012) was used to get a proxy measure of drug related violence. Since we are observing post conflict, drug producing and transit nations, it is reasonable to think that political assassinations are a good measure of violence from narco-trafficking cartels as they react to state threats. This type of high-level official targeting is only one aspect of the violence that would be associated with retaliation from drug militias. Assassinations serve as a proxy of the multifaceted levels of violence that goes from rival cartels fighting for dominance once the state captures or kills a drug boss to extortion related murders.

    Cartels operational capacity refers to the feasibility for cartels to engage in violence and to corrupt state institutions as means to further facilitate their illegal activities. The illicit nature of access to weaponry and corruption in security forces makes it extremely difficult to measure. The Perceived Corruption Index (Transparency International 2010) was used in this paper to measure the degree of corruption in a given country. The assumption is made that the perceived levels of corruption in society will reflect the degree of corruption in the armed forces, the police, and the judiciary.

    Military strategies refer to policies that focus mainly on the use of military mobilization as the primary means to solve the problems associated with drug trafficking. The militarization of drug enforcement consists of supplying military tools, like hardware and technology, to countries were drugs are produced, so that these armed forces can then go after the organizations that produce or transport narcotics, thus transforming the culture of law enforcement into a battlefield mentality. For decades, the United States has provided the necessary support for militarized counter-narcotics measures in Latin America through strategic plans like the “Andean Strategy,” “Plan Colombia,” or the “Merida Initiative,” all of which had a heavy emphasis on military intervention against drug cartels. Since the position of the United States government has been to encourage countries to militarize their anti-drug operations, a measure of the dollar amount of American military aid to Latin American security forces was used to determine the degree of commitment to a militarized strategy of each country’s counter narcotic efforts.

    This amount was calculated by adding military aid from the State Department’s Bureau for International Narcotics and Law Enforcement Affairs, plus the aid provided by the Department of Defense’s Counter-Drug Assistance program, from the year 1996 to 2010. This data was collected by Justthefacts.org, a project of the Latin America Working Group Education Fund, in cooperation with the Washington Office on Latin America. I argued that, when a country receives a significantly higher amount of military aid from the U.S. to fight organized crime, drug-related violence and political corruption will increase.

    Judicial strategies are policies that are focused on asset confiscation through financial intelligence in an effort to reduce the financial strength that criminal the Financial Crimes Enforcement Network (FinCEN) has the important task of coordinating the enforcement of anti-money laundering rules for banks, credit unions, insurance companies, securities brokers, casinos, mutual funds, and other financial institutions that face the risk of being used by criminals to support enterprises like drug cartels (FinCEN 2012). Without the implementation of judicial reform for a uniform and predictable inter-institutional coordination for the confiscation of illegal money, and for a transparent structure of the justice system, it will be very difficult to win the war against drug cartels, since the judicial branch is the most important set of institutions that can create a sustainable environment of order under the law.

    To determine the degree to which a country adopts a judicial approach to fight drug cartels, we considered the presence of legal mechanism to target cartel assets. We looked at the Financial Action Task Force (FATF); an inter-governmental body that monitors and produces a list of “high-risk and non-cooperative jurisdictions” with countries that have strategic anti-money laundering deficiencies (FATF 2012). Each country was coded based on whether or not they complied with FATF international anti-money laundering recommendations and criteria. We expected to see that countries that were not taking an active approach in limiting dirty money’s influence in the economy would experience more corruption, which would increase the feasibility of criminal organizations to operate and to become violent with full impunity.

    In order to obtain a proxy measure of the degree to which a country shows commitment for social investment, we used UNESCO’s data for each country’s expenditure in education as a percentage of the nation’s gross domestic product. (UNESCO Institute of Statistics 2012). I expected to see that when a country allocated more resources to social investment that violence and corruption would diminish.

    In an attempt to isolate the direct effect of different counter-narcotics strategies in the level of violence and corruption, the World Bank’s unemployment measure was used to account for inequality, which served as a control for grievances among the population that incentivize engaging in illegal activities. Due to a limited timeline and small number of cases in the dataset, we were parsimonious about control variables in order to account for degrees of freedom.

    Results

    An ordinary least squared regression was used in this paper in order to analyze the effect that each variable has in relation to criminal violence and levels of corruption. The results of the analysis of political violence are summarized in Table 1.

    The data shows that there was a positive relationship between the amount of U.S. military aid provided to fight drug cartels in Latin America and the degree of political violence in a given year. This relationship was expected since it suggests that military aid may encourage a counter attack by the drug cartels whenever the state threatens their operations or their lives.

    This relationship between military aid and cartel violence could help explain the gruesome picture of the current global war on drugs pioneered by the United States government. The model seems to support the hypothesis that when the level of state repression against members of organized crime intensifies, we should expect to see a higher casualty rate as a result. Assassinations are one of the types of violence that unfolds when the military is sent to fight drug cartels, but a positive relation seems to indicate that using the national army will not reduce the casualty rate when trying to demobilize criminal organizations. If the government’s goal is to eliminate narco-traffickers while maintaining violence at a minimum, then sending soldiers to the streets alone might not yield desirable results.

    The anti-money laundering measures proved to have an insignificant effect on political violence. Perhaps an increase in military aid for counter narcotics is the strongest incentive to take arms and react violently since military action directly threatens the life of criminals. If a nation decides to enact counter money-laundering laws to target the cartels’ profits, narco-groups might try to counter those measures by using bribes and corruption rather than violence.

    An ordinary least squared regression model was used to try to measure the effect that money laundering laws and military aid have on levels of perceived corruption. The results are summarized in Table 2. The data shows that being on the blacklist of countries with money-laundering deficiencies increases the level of corruption within a nation. This relationship was expected since money laundering is how drug cartels legitimize their profits so that they can then use them to push their criminal agenda. This result could serve as a guide for assessing the steps to follow in order to reduce the cartels influence in society and to reduce their fighting capacity. First, judicial measures that address the presence of criminal proceeds in the economy must be put in place in order to minimize cartels infiltration into both the private and public sector. Only then will criminal organizations lack the necessary funding in order to effectively fight back against law enforcement, and lack the financial strength to engage in corruptive practices.

    The data also shows that when a country’s education spending as percentage of GDP increases, the levels of perceived corruption increase as well. A possible explanation to this unexpected relationship could be that our sample covers too few years to reflect the effects of changes in education investments in political accountability. Another possible explanation is that there is a spurious relationship in which poorer countries with a small GDP and with a big education burden are more vulnerable to corruption, not because of their education spending, but rather because of their low economic performance. Perhaps if there were a better measure of social investment to fight organized crime, we would see a reduction in the levels of corruption.

    Conclusion

    The fight against organized crime has proved through history to be extremely difficult to address since it requires a great deal of institutional discipline and integrity. This is particularly hard to accomplish when dealing with drug trafficking, since many perceive it as a crime that is only hurting those who choose to consume the narcotics. But the matter of fact is that the presence of dirty funds is extremely damaging to society as it creates fertile grounds for systematic corruption and violence.

    Unfortunately, today’s drug cartels are very well organized and sophisticated corporations, with vast proceeds from criminal activities that involve not only cocaine sales, but also arms sales, traffic of humans, and extortion. The drug cartels have been able to inflate their economic infiltration in many countries around the world by behaving like a federation where senior figures and their subsidiaries operate semi autonomously while still employing a common smuggling apparatus. Countries (heavily pressured by the United States) are addressing this difficult situation with a strategy of repression, by sending soldiers and police to the streets who are unfortunately being corrupted. By simply militarizing counter-narcotic operations, governments are not recognizing the thousands of well-established companies validating drug money and giving these cartels their immense power.

    There is little question that any effective comprehensive approach has to include a firm stand against money laundering and other fiscal crimes that affect society very deeply. Another aspect that seems to be clearer now than ever is that, just like in the United States, drug enforcement must be primarily a function of the civilian realm in Latin America. Investigative police along with an independent judiciary, not the military, should adopt the lead role in law enforcement; otherwise, democracy and civilian regimes might irreversibly deteriorate.

    If any drug policy efforts are to be effective in reducing cartel activity in the long run, there must be measures in place to bolster institutional capacity, an enhancing of law enforcement, and social investment in drug producing and transit countries. Perhaps the U.S. and other developed nations could significantly contribute to development programs for judicial institutions and communities as the primary aspect of its overall anti-drug strategy. Broad approaches to fixing these problems, rather than just the narrow military approach, are going to yield desirable and sustainable results. A military approach leads to higher levels of violence while doing nothing to address systemic issues, while institutional corrections seem to reduce corruption and will deter from violence in the long run.

    Along with the need for judicial consistency and transparency, funds must be allocated for a community effort to keep the youth away from the criminal culture, and to treat victims of drug abuse to reduce the global demand for drugs. Drug consumption problems are the moral basis for a militarized strategy against organized crime, despite the erosion of respect for human rights, or other collateral damage like corruption, money laundering, and violence (Tinajero 2011). Ironically, demand reduction measures remain a complementary and minor component of the security strategies. Perhaps it is time to rethink the role of demand reduction measures implemented to minimize the drug consumption that gives cartels their immense profits.

    Currently the most promising approach on the demand-reduction side is called HOPE. It is not generally considered “drug treatment” because is carried out by law officers, and it depends on the enforcement of drug abstinence for people on prohibition or parole. Severe punishments for drug violations make it impossible to hand them out very often. The mild punishments used in HOPE are far less costly to administer which allows every detected violation to be punished. Consistent punishment reduces violation rates to manageable levels in a “virtuous cycle.” As a result, HOPE participants were 80% abstinent at the end of a year, compared to 18% success rate of the best health treatment program available. Heavy (as opposed to casual) drug users are responsible for most of the demand for drugs (Kleiman, 2011). Since this strategy targets users who account for more than half of the U.S. demand for hard drugs, a reduction of this magnitude all across the demand for drugs will have the most devastating effects on the drug cartels’ proceeds, to the operations of their business, and to their capacity to fight and corrupt.

    If a multidisciplinary approach was adopted that included a heavy emphasis on civilian investigative police targeting assets rather than the offenders, financial intelligence to track criminally attained money, political and judicial alliance with consistent sanction for drug trafficking violations, crime prevention in coordination with the community and the smallest entities of local government, and the effective use of evidence-based demand reduction measures, then the international community would probably have its biggest chance of winning the war on drugs and of eliminating the grievances from drug addictions, drug violence, and other forms of collateral damage.

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    Table 1: OLS Regression Analysis of Levels of Political Violence

    Political Assassinations Coef. Std. Err. t P > |t| [95% Conf. Interval]
    U.S. Military Aid 5.26E-09 2.98E-09 1.76 0.079* -6.13E-10 1.11E-08
    Anti-Money Laundering -0.0546068 0.0548321 -1 0.32 -0.1626006 0.053387
    Education Spending -0.0016333 0.0112114 -0.15 0.884 -0.0237146 0.020448
    Unemployment 0.0062872 0.0112736 0.56 0.578 -0.0159166 0.028491
    Constant 0.0020697 0.1547322 0.01 0.989 -0.3026811 0.3068204

    Table 2: OLS Regression Analysis of Levels of Corruption

    Corruption Coef. Std. Err. t P > |t|  [95% Conf.  Interval] 
    Anti-Money Laundering -0.3895399 0.1430706 -2.72 0.007*** -0.6716349 -0.107445
    Military Aid 1.21E-10 4.08E-10 0.3 0.768 -6.83E-10 9.25E-10
    Education Spending 0.086335 0.0500974 1.72 0.086 -0.012443 0.1851129
    Unemployment 0.0003302 0.0158703 0.02 0.983 -0.0309615 0.0316219
    _cons 3.419357 0.3574688 9.57 0 2.714529 4.124185