MEXICAN DRUG CARTELS MOVE NORTH

U.S. Effort to Battle Groups Is Flawed, GAO Report Says

MEXICO CITY -- Mexican drug cartels now operate in almost every
region of the United States and bring in as much as $23 billion a
year in revenue, according to a Government Accountability Office
report that will be released Thursday.

U.S. assistance has helped Mexico combat cartels, the report says,
but those efforts have been hampered by Mexican government corruption
and by the failure of key players in the United States, including the
White House Office of National Drug Control Policy, to coordinate
better with Mexican law enforcement. The White House drug policy
office, the report says, has prepared a counter-narcotics plan but
has not discussed portions of the initiative that require Mexican
cooperation with authorities in Mexico.

"The Office of National Drug Control Policy has to stop dropping the
ball and doing sloppy work," Sen. Charles E. Grassley (R-Iowa), who
requested the report, said in an e-mail Wednesday. "They had plenty
of time to forge a working relationship with the Mexican government,
but it appears that nothing has been accomplished."

The agency, Grassley added, "needs to realize that we're in this
fight together, and it's foolish to think we can implement an
effective plan to stop the flow of drugs from Mexico on our own."

Patrick Ward, assistant deputy director of the White House drug
office, said in an interview Wednesday that his office has had
extensive contact with Mexican authorities about counter-narcotics
plans since the GAO conducted its probe.

"Our cooperation with the Mexican government, especially in the last
eight to 10 months since President [Felipe] Calder?n took office, has
been absolutely phenomenal," Ward said.

The report, an advance copy of which was obtained by The Washington
Post, is the starkest evidence yet of Mexico's emergence as the main
conduit of illegal drugs into the United States. The share of cocaine
arriving in the United States through Mexico, for instance, leapt
from 66 percent in 2000 to 90 percent in 2005. Other transshipment
points include Haiti, the Dominican Republic and Central America.

Combined, Mexican drug cartels generate more revenue than at least 40
percent of Fortune 500 companies, and the U.S. government's highest
estimate of cartel revenue tops that of Merck, Deere and Halliburton.

Congressional aides said the report may lead to increased cooperation
between the two countries and give more impetus to already
well-advanced talks aimed at developing a massive U.S. aid package to
fight drug trafficking in Mexico.

The report paints a troubling picture of bureaucratic tangles that
impede drug control efforts: Operation Halcon, a successful,
helicopter-based border surveillance program, was canceled in
November 2006 because the United States and Mexico could not resolve
accident liability issues. Failure to reach an accord allowing U.S.
law enforcement officers to board suspicious Mexican-flagged ships
has allowed drug traffickers to evade capture by dumping their loads at sea.

Even as drug production soars in Mexico, "a relatively small
percentage of the estimated supply" of drugs is seized, the report
says. Marijuana production, for instance, rose sharply from 7,000
metric tons in 2000 to 13,500 in 2003, before leveling off at about
10,000 metric tons in 2004 and 2005. But seizures changed little
during that period.

Despite the disturbing trend lines, GAO investigators also saw
positive signs. They praised Mexico for extraditing a record number
of drug suspects to the United States in 2006 and said President
Calderon, in office since December, has demonstrated "a new level of
commitment to combating drug traffickers." The report praises
Calderon for deploying 27,000 troops and police officers to fight
cartels in eight Mexican states and for persuading his country's
Congress to approve a 24 percent increase in the national security budget.

Mexico and the United States have made advances in joint efforts to
crack down on money laundering, the report says, and technical
support from the United States is helping Mexico develop plans for a
more transparent criminal justice system with trials that involve
oral arguments and are open to the public. The report says Mexican
courts now primarily use a "Napoleonic inquisitorial model" -- in
which judges review only written material -- that "has been
vulnerable to the corrupting influences of powerful interests."

The amount of drugs flowing through Mexico is growing rapidly,
spurred by growing demand in the United States, where 35 million
people abuse illegal drugs, the report says. Methamphetamines appear
to be the fastest-growing drug crossing the border. Though no one is
sure how much methamphetamine reaches the United States, seizures
along the border rose from 500 kilograms in 2000 to 2,700 in 2006,
indicating "a dramatic rise in supply," the report says.

A climate of "impunity" for drug traffickers in Mexico has
contributed to the trends. Mexican cartels are more violent and
sophisticated than ever, taking advantage of advances in cellular and
satellite technology to evade law enforcement, the report says.

Since 2000, Mexico has been taking steps to clean up corruption
within the ranks of law enforcement, including firing more than 950
federal officers in 2006 and forming the Federal Investigative
Agency, whose agents have to undergo background checks, the report notes.

Along with the well-known Tijuana, Gulf and Juarez cartels, the
report identifies a lesser-known Mexican drug organization called
"the Federation." The Federation, the report says, is an alliance of
drug traffickers based in Sinaloa state near the city of Culiacan and
has "the most extensive geographic reach in Mexico." "The
Federation's influence in Sinaloa is so pervasive that Mexico seldom
mounts counternarcotics operations in the interior of that state,"
the report says, citing U.S. and Mexican officials.