More arrests in Mexico's war on drug cartels

Two years into Mexico's new antidrug effort, increasingly frequent police crackdowns only seem to be escalating the violence, forcing gangs to use more sophisticated weapons and more spectacular attacks.

The problem was highlighted Wednesday when Mexican police arrested two men carrying high-powered explosives, according to the Australian news outlet News.com.au citing a report in the Mexican newspaper El Universal.

The men, who had six tubes of C4 military explosives, were seized by the army near the western city of Morelia, where assailants threw grenades into a packed crowd on September 15, El Universal daily reported on its website.

The newspaper said they were members of a drug gang called "The Family" [La Familia]. It is one of two groups named by the attorney general this week as suspects in the grenade attack, which marked an escalation in Mexico's drug war.

Also on Wednesday, "a Mexican radio host [was] gunned down while hanging banners to protest a wave of kidnappings across the country," reports the Associated Press.

Yesterday's arrest follows one of the most violent – and as yet unsolved – crimes in Mexico's drug war: a grenade attack two weeks ago in which "assailants threw two grenades into a huge crowd of Independence Day revelers, killing seven and injuring more than 100 in a brazen attack that escalates the war between Mexico's army and drug gangs," APreported.

The New York Times adds that, although drug gangs have distanced themselves from the attack, it signals a dangerous new phase of the violence.

La Familia, a violent drug gang based in Michoacán that the authorities have suggested might be responsible, has gone to extraordinary lengths to distance itself from the unprecedented attack on innocents, which has long been considered ungentlemanly behavior among cartel killers....

But with no note by the killers to go on, the authorities consider the brazen attack to be a sign that all bets in the drug war may be off.

Following the grenade attack, President Felipe Calderón has promised even more crackdowns, according to The Arizona Republic.

In response, Calderón announced bills giving the government more power to seize drug assets and a new reward program for tipsters. He also proposed an easier process for getting search warrants and more investigative powers for police. In at least five speeches following the Morelia attacks, he urged Mexicans to stand strong.

Mexico entered a new phase of its war on drugs two years ago when Mr. Calderón took office and immediately deployed thousands of armed troops across Mexico to battle drug gangs. But "the murder rate has soared since Calderón sent the army to battle the cartels, with daylight shootings now common," Reuters reports. "Bodies and severed heads have piled up as this year's death toll has topped 2,700 and killings turned more brutal."

The Arizona Republic also questions whether Mexicans think the crackdowns are effective.

Instead of subsiding, drug-related murders are rising and becoming more gruesome. Once-quiet border towns have become battlegrounds....

"[I]n Mexico, many people are wondering if the crackdown on cartels is worth the loss of life. Marches and rallies are multiplying as Mexicans vent their frustration at the violence.

"I don't think the government is winning," [Angelica] Bucio said as she lay in a hospital bed surrounded by other victims from the grenade attack. "The violence is getting worse."

A recent BBC World Service poll shows that Mexicans are increasingly worried.

Some 42% of the 1,266 Mexicans polled in seven cities said they felt less safe than they did a year ago. Fewer than 10% felt safer, while the rest felt about the same.

Making matters worse, the violence is taking a serious toll on Mexico's economy, reports the Latin Business Chronicle.

The U.S. economic slowdown isn't the only factor hitting Mexico's economy these days. The violence caused by the country's organized crime has also negatively effected Mexico's GDP growth, shaving off one percentage point of growth, Finance Minister Agustin Carstens told local newspaper Reforma earlier this month. In addition to scaring off many foreign investors, the violence is forcing local companies to spend more on security and hurting domestic competition, he acknowledges.

Foreign investors already in Mexico agree. "The cost of security (insurance, surveillance) is relatively high, reduces competitiveness, and creates uncertainty," says Nicole Reich de Polignac, president and CEO of Scotiabank Mexico. "It is difficult to know at this moment if this is having an impact on investment decisions, but it is presumed so, particularly on foreign investments, but perhaps on domestic as well."

But if violence is increasing inside Mexico, the outcome for the US is dramatically different, The Arizona Republic reports.

The turmoil is in stark contrast to the U.S. side of the border, where Calderón's crackdown looks like a success. The White House has credited Mexico's efforts for a drop in the drug supply. Since 2006, the U.S. has seen an 84 percent jump in methamphetamine prices and a 21 percent increase in cocaine prices. Meth use has dropped 50 percent and cocaine use has decreased 19 percent, according to the Office of National Drug Control Policy.