ON THE BORDER, A CRISIS ESCALATES

Mexican Cartels Wage a War of Unprecedented Violence That's Spreading
into the USA

VILLA AHUMADA, Mexico -- It was 3 a.m. when Griselda Munoz says she
got the first terrifying phone call: "Mom, there are people all over,
and they're shooting!"

A convoy of gunmen had invaded the ranch where her son, Jorge
Marrufo, 32, was working. As shots crackled in the background, he
told her he was running into the desert to hide in the sagebrush.

Before dawn, another call: "If anything happens to me, tell my kids I
love them."

Later that day, Munoz found her son at a morgue with his skull caved
in and four bullet holes in his chest. He was among 21 people killed
Feb. 10 in this town near the U.S. border after drug gangs abducted
several men, then fought a massive running gunbattle with the Mexican
army -- one of the bloodiest episodes yet in Mexico's war on drugs.

Prosecutors say they are still trying to determine whether Munoz's
son was an innocent bystander or involved with the gangs. Either way,
Munoz attributes his death to the unprecedented combination of
drug-related violence and economic misery that is ravaging northern
Mexico -- and showing signs of spreading into the United States.

"He never caused any trouble for anybody. But in this town, you never
know who's going to decide you're a problem," Munoz said. "This is a
town without laws."

That's literally true -- the entire police force of Villa Ahumada, a
community of 10,000 people 80 miles south of El Paso, deserted its
posts last May after drug gangs executed the police chief and two
officers. The crime wave, plus the crippling recession that has
rippled here from the U.S., has caused the town's export factories --
possibly the only source of reputable, steady employment -- to slash
production.

"It's just one thing after another," says Villa Ahumada's mayor,
Fidel Chavez. "First the economy, and now this."

The story is similar across much of Mexico's 2,000-mile-long northern
border: a wave of beheadings, grenade attacks and shootouts as drug
cartels battle each other for supremacy and lash out against Mexican
President Felipe Calderon's drive to destroy their smuggling
operations. The death toll from drug-related violence in Mexico last
year surpassed 6,000, more than double the previous year, raising
questions about whether Calderon's government can prevail against a
brutal and often better-armed enemy without additional help from the
U.S. government.

"People are scared and they have reason to be," says Michael Shifter,
a Latin America specialist at Inter-American Dialogue, a Washington
think tank. "The economic crisis is just going to aggravate the
situation. It's very hard to imagine how things will get better in
the short term."

That's bad news in broad swaths of the United States, where Mexican
drug gangs have extended their operations to at least 230 cities from
Texas to Alaska, according to a recent Justice Department report.
Police in Atlanta and Phoenix, both major drug transit points, have
blamed a wave of kidnappings on the spreading turf war among the
cartels. Drug-related violence has become ever more brazen and
frequent, including a rise in attacks on Border Patrol agents.

In both Mexico and the United States, most of the victims have been
linked to the cartels. Nevertheless, several travel agencies,
colleges (including the nearby University of Texas-El Paso) and even
the U.S. military have discouraged travel to Mexico's border areas as
spring break approaches -- resulting in a loss of crucial tourism
dollars that could make the Mexican economic crisis even worse.

More than 329,000 jobs have been lost in Mexico since June, the
government says; that translates to as many as 30% of Mexican adults
who are now unable to find full-time work.

Rene Jimenez Ornelas, an expert on crime at the National Autonomous
University of Mexico, is among those who believe that unemployment
could push more Mexicans into the ranks of the narcos. The gangster
lifestyle has been glamorized by television shows and songs called
narcocorridos, and it is a powerful temptation for many youths.

"What organized crime mostly has on the front lines are people who
need to eat," Jimenez Ornelas said. So the cartels "have an 'army'
available -- not all of them, of course, but enough to have a
good-sized force at their service."

The violence is devastating towns and families. Three days after the
gunbattle that claimed Jorge Marrufo, his mother sobbed as
pallbearers lowered his casket into the ground.

The family set up a huge cluster of palm fronds and flowers, and
erected a simple wooden cross. There was a rattle as the first
shovelfuls of sand and pebbles hit the casket -- after that, nothing
but the sound of weeping and shifting sand.

Three days later, tragedy struck again -- Jorge's cousin, Alfonso
Marrufo, was found dead, his body pumped full of AK-47 and 9mm
bullets, outside a house in town.

At first glance, it's not clear what's worth fighting for in Villa
Ahumada. There's not much here besides a few water towers, a railroad
track and several roadside burrito stands. A street sweeper machine
roams the few paved streets, fighting a losing battle against the
sand that collects in drifts along the curb. The only landmark is a
small clock tower, which is stuck at 8:39.

Look at a map, though, and the town's importance becomes more
apparent. Villa Ahumada sits astride Highway 45, a spur of the Pan
American Highway and a straight shot to Guatemala, Panama and other
points south.

To the west, dirt roads snake through the desert, providing a way
around the military checkpoints on the highway. To the east, another
web of trails leads to the desolate, and lightly patrolled, scrubland
of West Texas.

This is prime smuggling territory.

Enrique Torres, a spokesman for the Mexican army, says that two of
Mexico's most powerful gangs -- the Sinaloa and Juarez cartels -- are
battling for control of Villa Ahumada. "It's considered a key
location," he says.

In a microcosm of the struggle being played out across Mexico, the
fight for Villa Ahumada has intensified after the Juarez cartel's No.
3 leader, Pedro Sanchez Arras, was arrested last May. The Sinaloa
gang, based on Mexico's Pacific coast, have been vying for their
rivals' turf ever since, leading to incidents such as those that
killed the Marrufos, Torres says.

In an effort to stop the violence, Calderon has deployed 46,000
troops and federal police throughout Mexico -- an unprecedented law
enforcement commitment that surpasses the U.S. military presence in
Afghanistan.

Despite their numbers, the army has no investigative powers to probe
drug gangs' activities and root out kingpins. Federal agents are
spread thin, and there have been numerous incidents in which local
Mexican police have been co-opted by the cartels.

On a recent morning, a USA TODAY reporter came across the aftermath
of a gunbattle in the desert north of Villa Ahumada. Three bodies lay
in the sand. Army Humvees and helicopters combed the desert for
anyone who may have gotten away.

Hours earlier, an army patrol had come across a Toyota SUV picking
its way through the wilderness, Maj. Gerardo Arce said. Suddenly, the
doors popped open and gunmen opened fire with AK-47s. The troops
returned fire, killing all three.

Inside the SUV was an arsenal worthy of any commando unit: hand
grenades, a .50-caliber sniper rifle, helmets, bulletproof vests,
combat fatigues and radios.

Such firepower illustrates why townspeople see only one real
authority. "The gangs know everything. They're always watching," says
Sandra Munoz, Jorge Marrufo's niece. "They'll even mark your house,
as a warning."

Shifter says the recurring pattern of Mexico's drug war -- one cartel
is weakened, only to be replaced by another -- shows the need for
President Obama to seek solutions beyond the $400 million in mostly
military aid the U.S. gave Mexico last year.

Options include more drug prevention and treatment programs to try to
curb demand for illegal drugs in the U.S., and cracking down on the
flow of arms from the USA into Mexico. "It's hard to call the drug
policy a successful policy," Shifter said.

Gen. Barry McCaffrey, the former anti-drug czar in the Clinton
administration, warned last month that Calderon's government was in
danger of losing control of some areas and that millions of Mexicans
could seek refuge from the violence in the USA. Recently departed CIA
director Michael Hayden has said Mexico ranked alongside Iran as a
top security risk to the U.S.

Calderon has rejected such talk, saying his government is firmly in
charge and casting Mexico's drug war as a "historic challenge of
truly becoming a country of law and order."

The U.S. Drug Enforcement Agency has credited his actions with a
steep reduction of cocaine supply in many U.S. cities. Calderon says
the vast majority of those killed have been drug gang members, and
his approval rating remains high at about 60% -- a broad enough
mandate to keep pursuing the cartels for now, Shifter says.

The unknown factor, though, is just how bad the economy will get --
and how that could change Calderon's plans.

The border region has been particularly hard hit by plummeting
manufacturing demand from the United States, which receives 90% of
Mexico's exports. At a plant run by Quality Coils S.A., which makes
components for Delphi auto parts and Motorola cellphones, the payroll
has dropped from 240 a year ago to 180 workers today -- and they work
only three days a week, says personnel manager Florentino Flores.

The situation is similar across town at the Lear Corp. plant, where
workers sew seats for Ford Fusion cars. In November the plant began
cutting workers, then workdays.

"There's just no work for us, I guess," says employee Juan de la
Torre, whose hours were cut.

Nationwide, Mexico's exports to the United States fell 15% in
December compared with the year before. Money sent home by migrants
living in the USA, a crucial income source for poorer families, also
fell 3.6% last year -- the first annual decline in a decade. Overall,
the Mexican economy could shrink by 1.5% this year, according to
Morgan Stanley bank, breaking a string of years of moderate growth.

"Markets are just now beginning to think through the costs associated
with this rise in organized crime," says Gray Newman, Morgan
Stanley's chief economist for Latin America.

The mix of violence and recession means bad business for everybody.
On Highway 45 just outside town, Javier Ramirez sits under the
corrugated metal roof of his taco stand, waiting -- in vain -- for customers.

"Everyone is afraid to stop here now," Ramirez says. "Villa Ahumada,
the town with no law. We've become famous."

Even the dead here aren't allowed to rest in peace.

Days after Jorge Marrufo was buried, the lock on the cemetery gate
was smashed. Someone drove back and forth over Marrufo's grave,
splitting the wooden cross in two and scattering the flowers.

Then they tossed an empty beer can on the wreckage.

Later that morning, Griselda Munoz, his mother, came to the cemetery
with other relatives to mend the cross and collect as many undamaged
flowers as they could. They shoveled the sand back into a mound,
moistened it with water, and put the flowers back.

Munoz believes the army killed her son after mistaking him for one of
the traffickers. She says that just before he was killed, Marrufo
called her and said that soldiers were coming down the highway. "I'm
all right," she says he told her. That was the last time she heard
from him alive.

The federal attorney general's office originally listed Marrufo as
one of the gunmen. But on Wednesday a spokesman for the federal
attorney general's office, Angel Torres, said investigators were not
sure of his role that night and had not determined how he died.
Forensic experts were still examining weapons to determine who killed
Marrufo, Torres said.

Chavez, the mayor, says he believes Marrufo was killed by drug gang
members dressed in fatigues. The soldiers wear face masks to protect
their identities, and traffickers often wear fatigues, so they are
hard to tell apart, he said.

"There's no one to go for help around here," Munoz said. "You can't
trust anybody to protect you."

Whoever killed Marrufo, many here fear their business in Villa
Ahumada isn't finished. As Marrufo's family prepared to leave the
gravesite, an unfamiliar SUV rolled slowly into the cemetery and
parked behind some tombs.

Munoz shot a worried glance at the SUV and hurried to her car. The
family drove out together, for safety, and left the broken flowers in
a heap next to Marrufo's grave.

[sidebar Page 2A]

A TIMELINE OF GORY, WORSENING DRUG-WAR VIOLENCE

President Felipe Calderon's crackdown on Mexican drug traffickers,
launched in December 2006, has become more violent in recent months.
Notable incidents:

Aug. 16, 2008 -- Gunmen attack a party in the northern city of Creel,
killing 14 people, including a 16-month-old toddler who was in his
father's arms. The Chihuahua state prosecutor calls it a "settling of
accounts" by drug traffickers.

Aug. 28 -- Police find 11 headless bodies near Merida, on Mexico's
Yucatan Peninsula. All the corpses were handcuffed. One was nude and
showed signs of torture.

Sept. 12 -- Police find 24 bodies, 15 of them decapitated and many
with signs of torture, in a forest west of Mexico City. Most have
gunshots to the head.

Sept. 15 -- Attackers throw grenades into the crowd at an
Independence Day celebration in the central city of Morelia, hometown
of President Calderon. The blasts kill seven people and wound 103.

Oct. 1 -- Eight bodies with gunshots to the head are dumped next to
an elementary school in Tijuana. A note, apparently directed to a
rival drug gang, says: "Here are your people, 'Bricklayer.' Come get them!"

Dec. 21 -- The heads of eight soldiers and a former state police
commander are found next to a Sam's Club in the western city of
Chilpancingo. A note says, "For each one of mine you kill, I'll kill
10 soldiers."

Dec. 29 -- Sixteen bodies are dumped in vacant lots in Tijuana, 12 in
one lot and four in another.

Jan. 24, 2009 -- Police in Tijuana arrest Santiago Meza Lopez, who
state prosecutors say disposed of more than 300 bodies for drug
traffickers by dissolving them in caustic soda. Mexican newspapers
dub him "The Stewmaker."

Feb. 3 -- A newly retired army general and his two bodyguards are
tortured, killed and dumped near the resort city of Cancun. He is the
highest-ranking soldier killed since Calderon's offensive began.

Feb. 10 -- A drug gang's attack on the northern town of Villa Ahumada
and an ensuing battle with soldiers kills 21 people.

[sidebar Page 2A by The Associated Press]

Tourism alert

The State Department issued a new travel warning for Mexico on
Friday, urging Americans to use caution not just in border areas but
also in tourist resorts because of increasing violence.

The department's statement said millions of Americans visit Mexico
safely each year, but that robberies, homicides, petty thefts and
carjackings are rising.

Dozens of U.S. citizens have been kidnapped in recent years, the
statement said, and many of the cases remain "unresolved."

Some Americans have been trapped temporarily in border cities during
battles between the Mexican military and well-armed drug gangs that
"have resembled small-unit combat," the department said.

The report identified crime hot spots including Ciudad Juarez;
Tijuana, across the border from San Diego; Matamoros, across from
Brownsville, Texas; and Nogales, across the border from Nogales, Ariz.