THE U.S. AT ODDS WITH ITSELF ON MEXICO

Mexican government officials weren't the only ones caught by surprise by the
recent announcement of a massive sting operation ("Casablanca") against
Mexican bank officials for money laundering. Most of the American
government, at the highest levels, also was in the dark about the operation.

Janet Reno, Madeleine Albright, drug policy coordinator Barry McCaffrey and
Treasury Secretary Robert Rubin rushed to make apologies and clarifications
to the Mexicans. Coordination has never been a strong point of U.S. foreign
policy, but in the case of Mexico, we have reached the point at which
semi-autonomous law enforcement agencies such as U.S. Customs and the Drug
Enforcement Agency are in the pilot's seat.

Frustrated by slow progress, DEA agents and the agency's administrator,
Thomas Constantine, point the finger at Mexican corruption during the annual
drug certification season, in an effort to incite Congress to decertify
Mexico. Sensitive to Mexico's historical fear of American intervention and
anxious to keep the complex bilateral agenda between Mexico and the United
States moving forward, the State Department fears that drugs have become the
tail that wags the dog. To the cops, overly solicitous U.S. officials sound
like cheerleaders for the Mexicans.

The lesson of Casablanca is that when American foreign policy toward Mexico
is dictated by law enforcement, the consequences cascade throughout the
whole bilateral relationship in a dangerously accidental way. For example,
the Casablanca announcement occurred at a delicate moment in President
Ernesto Zedillo's negotiations with the Mexican Congress over several key
pieces of financial legislation, including the bank rescue, opening the
banking sector to more foreign investment, legislating the autonomy of the
central bank and strengthening the Mexican bank regulatory agency. Was it
the intention of the Treasury Department to throw a monkey wrench into those
negotiations?

Moreover, the operation resulted in opposition party calls for the
resignation or impeachment of, among others, Mexican Attorney General Jorge
Madrazo and central bank governor Guillermo Ortiz. Was it the intention of
U.S. policy to precipitate calls for the resignation of senior Mexican
government officers?

The market capitalization of Mexican banks plunged by more than $800 million
after Reno's press conference panicked investors by suggesting that the U.S.
government lacked confidence in the Mexican financial system. Did the U.S.
Federal Reserve bail out Mexico and its financial system after the 1995
devaluation so that Customs could undermine it once again? I think not.

Conspiratorially minded Mexicans can be forgiven if they try to read devious
intentions into the destructive chaos of American foreign policy. It may not
be the job of U.S. law enforcement officials to give a damn about the
political or economic fallout of their unilateral operations, but it is the
job of their superiors to ensure that operations are conducted with at least
minimal respect for signed agreements and rules of bilateral cooperation. I
would like to meet the U.S. senator who graciously would accept the
undercover police of a foreign nation operating on American soil without
permission.

It is worrisome that some of the more frustrated elements of the U.S. law
enforcement community seem to be courting a crisis in bilateral antidrug
cooperation. Rumors are afoot that the DEA is prepared to withdraw all
agents over issues such as their right to bear arms in Mexico and be
accorded diplomatic immunity.

Thus the scene is set for another confrontation in the 1999 certification,
in which the DEA likely is to manipulate the terms of the congressional
debate and the diplomats will scramble to prevent the United States from
blundering toward the Armageddon of a possible Senate decertification.

What a victory for Janet Reno and Customs. They have proven that if U.S.
undercover agents wave $30 million at the bank branch managers of a poor
country, they can succeed in corrupting them as easily as do the drug
traffickers. For this brilliant revelation we put U.S.-Mexican relations at
risk?

The writer is director of the Mexico Project of the Center for Strategic and
International Studies.

Checked-by: Melodi Cornett