On May 30th, 2010, former Mexican Attorney General Eduardo Mora Medina declared the drug cartel La Familia Michoacana, known simply as “La Familia,” to be the most dangerous in all of Mexico (Grayson, 2010). Though some better-known drug trafficking organizations (DTOs) such as the Sinaloa Cartel and the Gulf Cartel have operated across vast territories of the country for decades, La Familia started making headlines approximately five years ago when they rolled several severed heads into a nightclub. The cartel has continued to grow in power and has since given birth to the splinter group Knights Templar. The rise of La Familia, its bizarre ideology and indoctrination of members, and the lower-class following it has received have separated it from other DTOs in Mexico.
Though some government officials contend that citizens are threatened and forced into paying taxes to the drug cartel in exchange for protection (Cano, 2010), the observable widespread support for La Familia is not compatible with this claim. From organized marches to popular narcocorridos (drug ballads) lauding La Familia as a type of Robin Hood group, michoacanos certainly appear to endorse the drug cartel (Padgett & Grillo, 2010). In fact, in December 2010, hundreds of michoacanos openly demonstrated their support for the drug cartel after La Familia leader Nazario Moreno González was found dead. Three hundred people took to the streets of Apatzingán in what they called a “March for Peace,” holding signs such as “Long live La Familia Michoacana” and “La Familia is more than a state” (Ferrer & Martínez, 2010).
The present essay is divided into two major sections. The first part describes La Familia’s origins, ostensible religious ideology, and presence in the state of Michoacán. The second section addresses the factors leading to the void that La Familia Michoacana has filled civilly, politically, and economically. Specifically, the impact of structural adjustment reforms that have weakened state and local institutions and withdrawn support from the agriculture sector, which is the main livelihood for most michoacanos, is examined. In this context La Familia has been able to surpass the Michoacán government in strength and power not only by profiting from their illegal activities, but also by winning over local people through social services that the state may not adequately provide.
La Familia Michoacana: Drug Traffickers with Morals?
The origins of La Familia are unclear. Some reports claim that a sector of Los Zetas separated to form La Familia in 2006 (“Mexico’s drug gangs,” 2009), while others contend that it was formed in the 1980s as “an anticrime vigilante group” (Padgett & Grillo, 2010). Gibbs (2009), on the other hand, describes La Familia’s beginnings as a “loose self-protecting coalition between marijuana and opium farmers in the state of Michoacán.” Grayson (2010) provides yet another account, detailing the convoluted relationships between the first major established cartel in Michoacán known as El Milenio, Los Zetas, and La Empresa, which eventually became La Familia Michoacana.
One of the most distinctive features of La Familia Michoacana is its alleged religious ideology. Before his death in December 2010, leader Nazario Moreno González, known as “El Chayo” or “El Más Loco,” published his own bible titled Pensamientos. In it he described himself and fellow cartel members as “valiant men” who protected Michoacán (Gibbs, 2009; Padgett & Grillo, 2010). Additionally, the supposed Christian-fundamentalist cartel prohibits its members from consuming drugs or alcohol, and in its early days the DTO reportedly forbade the selling of drugs locally, though this has likely changed (Gibbs, 2009). Cartel members also consider their killings as “divine justice” in protecting society from rapists, adulterers, and other delinquents (Gibbs, 2009).
Despite its disputed origins or religious authenticity, there is no question regarding the role that La Familia has played civilly, economically, and politically in Michoacán and the surrounding region. The quasi-religious group has funded a variety of social projects, including the building and renovation of schools and churches, and the development of drainage systems (Gibbs, 2009). The drug cartel has successfully created a base of social support through various programs and projects as well, such as providing assistance to abused women and, ironically, directing youth centers focused on drug use prevention (Cano, 2010; “Mexico’s drug war,” 2009). La Familia even extends its presence in everyday life to recreation and leisure; the group has regulated nightlife by establishing bar and club hours in place of the local and state governments (Cano, 2010).
In regards to economic power, some reports state that La Familia controls around 30% of the state’s formal commerce (Padgett & Grillo, 2010), while others speculate that up to 85% of legitimate businesses are connected to the gang (Gibbs, 2009). Besides methamphetamine, marijuana, and cocaine, La Familia is involved in various other illicit markets, from smuggling people to the United States to selling pirated DVDs (“Mexico’s drug gangs,” 2009). Additionally, the organized criminals operate a debt-collecting service in which they keep 20% of the outstanding payment and sometimes kidnap noncompliant defaulters (Cano, 2010; “Mexico’s drug gangs,” 2009). The cartel also extorts taxes and provides loans to local farmers, businesses, schools, and churches (Padgett & Grillo, 2010; “Mexico’s drug gangs,” 2009).
La Familia’s presence in politics has also grown. In May 2009, 10 mayors and 20 other Michoacán officials were arrested for having sold favors to, or collaborated with, La Familia (Gibbs, 2009; “Mexico’s drug war,” 2009). If officials do not cooperate with the cartel, the consequences can be deadly; as of July 2009, the drug cartel was thought to have murdered at least 20 municipal officials (“Mexico’s drug gangs,” 2009). In one particular example of political bribery, a former cartel member gave $167,000 USD to a victorious mayoral candidate, and in return the public figure updated La Familia on army and police activity, ordered rivals of the cartel to be arrested, and guarded drug shipments (Padgett & Grillo, 2010). In this manner, according to one Michoacán investigator, the cartel has become a political structure in and of itself (Padgett & Grillo, 2010). Some would take this argument a step further, asserting that La Familia has emerged as a parallel state (Cano, 2010).
Structural Adjustment and the State of Michoacán
The rise and success of illicit markets and DTOs such as La Familia involve numerous domestic and international factors. The high demand for drugs and weak gun regulations in the United States have played a central role in creating and sustaining such markets (Freeman, 2006; Youngers & Rosin, 2004). Domestically, corruption within the police force and government has also supported DTOs in becoming as powerful as they have. The present study focuses on two other major domestic factors that have particularly affected the state of Michoacán: historically weak institutions and the decline of the agricultural sector. First, decentralization promoted by structural adjustment policies has not empowered municipal or state governments, but has actually weakened state and municipal institutions. Additionally, federal and state governments have withdrawn investment and social safety nets for small and medium agricultural producers. The decline of this sector has intensified the poverty and contributed to high migration rates in Michoacán. Examining these factors provides insight into the conditions in which La Familia was able to establish itself and gain the local support of michoacanos.
Institutional Change: Decentralization and La Familia
Strong federal institutions have characterized Mexican governance for most of the country’s history. Consequently, the more recent attempts at transitioning toward trade liberalization, privatization, and decentralization have proved difficult for the country, especially in terms of empowering municipal and state governments. Instead of strengthening the authority of state and local institutions which decentralization should theoretically achieve, the “shocks” created by structural adjustment reforms in state and local governments have resulted in institutional gaps that may be filled by non-state actors such as La Familia (Snyder, 2001).
North (1989) details Latin America’s historically strong tradition of state intervention and subsequent failure at decentralization post-independence. In the initial stages of political and economic development in the New World, North (1989) states that the “governance structure then became a large and elaborate bureaucracy and there were endless efforts by the Crown to control its far-flung agents” (p. 1329). He continues by describing how the Crown continued controlling the New World through bureaucracy that “detailed political and economic policy” (North, 1989, p. 1329). Independence did not bring about much change. Creoles were not necessarily pursuing the interests of all members in the New World society, but rather aimed to “take over the bureaucracy in order to pursue their own interests” (North, 1989, p. 1329).
Despite attempts at borrowing constitutional ideas from other countries (an ineffective tactic according to North), Latin America has not experienced the strong autonomy of localities and states such as the United States. In the case of Mexico, the country remained highly centralized throughout the 19th century and most of the 20th century under control of the Institutional Revolutionary Party (Partido Revolucionario Institucional; PRI). It was not until the 1980s amidst the deep recession and financial crises most Latin American countries were experiencing that the major push for structural adjustment began. International and domestic policymakers began emphasizing open trade, private sector growth, and, of concern to this essay, the devolution of power and finances to the state and local level in attempts to reduce government spending.
Sharply shifting decision-making authority from federal to state and local institutions is quite complicated as institutions in and of themselves are complex entities. In fact, North (2003) critiques the aforementioned neoclassical economic theory on the grounds that it naively takes for granted the role of institutions in society. According to North (2003), proponents of structural adjustment mistakenly believe that “all you have to do is get the prices right” to experience economic growth, when in actuality there must be a consideration of the formal and informal practices of society and its institutions (p. 8). In the same vein, Snyder (2001) points out that the belief that structural adjustment policies result in laissez-faire markets is a fallacy. Instead, neoliberal policies “trigger the construction of the new institutions for market governance” which are often politically motivated (Snyder, 2001, p. 3, 6).
North (2003) states that of the three characteristics of institutions (formal rules, informal constraints, and their enforcement characteristics), only formal rules can be altered. Institutional change is not automatic; thus, simply setting prices, liberalizing trade, and decentralizing decision-making to the state or local levels will not necessarily result in a difference in people’s conduct of exchanges or a strong enforcement of the new formal rules by the state. As local and state institutions have been historically weak in Mexico, it was never plausible that the structural adjustment tenet of decentralization would easily convert these institutions into strong governing bodies that could enforce the desired changes of these policies.
Nickson (2003) provides further explanation into the challenges of implementing state-reform policies involving fiscal balance, privatization, and decentralization in Latin America. One of the principle issues is that policymakers have not developed feasible implementation of their policies. In addition, Nickson (2003) argues that policy implementation has failed because most Latin American cultures lack informal networks of shared professional culture and common ethical standards. Such networks are needed to create more flexible administrative structures, facilitate a smooth transfer of power between political parties at the federal, state, and municipal levels, and promote cooperation between the three branches of government that decentralization requires (Nickson, 2003). In contrast, Latin American countries are plagued by nepotism, deep-rooted political loyalty of high-level administrators to organizational bosses, little job security, and the lack of horizontal mobility that works against the coordination, flexibility, and inter-organizational trust that these reforms require (Nickson, 2003).
In the case of Mexico, a major reason decentralization has not resulted in local and state institutions that can effectively address the issues facing their citizens is because most power still rests with federal institutions. As Montero (2001) suggests, the PRI’s attempt to decentralize in the 1980s and 1990s resulted in little more than “dependent sovereignties” politically and economically reliant on the strong, centralized powers of the presidency. Though social spending has been decentralized to state governments, the federal government often continues to dictate the earmarking of these funds (Montero, 2001). Snyder’s (2001) analysis of the deregulation of the coffee sector in the states of Chiapas, Guerrero, Oaxaca, and Puebla supports this argument. According to him, “the federal government’s tight control over public revenues and the president’s discretionary power to appoint and dismiss state governments significantly weakened subnational governments” (Snyder, 2001, p. 208).
Snyder (2001) is careful to point out that structural adjustment policies do not result in a “uniform system of politics” at the state and local levels (p. 208). Decentralization has resulted in distinct political regimes and reregulation processes across regions and states (Snyder, 2001). Michoacán’s experience might fall under the category that Snyder (2001) describes as occurring when “societal actors mobilize in order to manage economic activities disavowed by the state” following a reduction in state intervention (p. 201). Though in other contexts these societal actors may include non-governmental organizations, unions, or other community organizations, the non-state actor that has wielded its influences in response to the institutional vacuum in the Michoacán region has been La Familia.
The weakened state and local institutions in Michoacán have not been strong in combating the DTO either. North’s (1989) theory can potentially explain the state’s lack of action in response to the drug cartel. As he explains, “bad performance arises from institutions that are inherited from the past and constrain our behaviour, or from a polity that does not work well and has in place people with a vested interest in perpetuating inefficient rules of the game” (North, 1989, p. 5). For instance, corruption has continually plagued institutions in Mexico, and this inheritance from the past has not changed with decentralization. In this way, politicians or police may have a vested interest in not enforcing the “rules of the game.” Especially if salaries are low, accepting bribes or working secretly with La Familia can certainly be profitable for those in public servant positions.
In this way, decentralization and the reduction of state intervention have failed to empower and strengthen state and local institutions. Whether lack of sufficient funding, decision-making authority, or even incentive prohibits the state from acting more forcefully in response to the cartel, La Familia has been able to establish itself in this context. Traffickers are the only real authority in the region, creating employment and buying off local and state officials who in reality have less power than true neoliberals would ideally envision them having.
The Decline of the Agricultural Sector and Increased Migration
Weakened state institutions and withdrawal of government intervention has resulted in the decline of the agriculture sector. A poor, rural state, Michoacán has traditionally relied on agricultural and animal farming as its principal livelihoods, from avocado and cantaloupe cultivation, to pig and dairy farming. Following the ratification of the North American Free Trade Agreement (NAFTA), the Mexican government abandoned investment in small and medium-scale agriculture, devastating the state and leaving most peasant farmers without a feasible means of financial support (Dawson, 2006). As migration to the United States becomes increasingly difficult, La Familia has emerged as a viable option for the poor and unemployed.
Structural adjustment policies have focused heavily on developing industry and exports (Dawson, 2006), thus affecting different regions of the country in very distinct ways. Mexico’s northern regions have benefitted from their proximity to the United States and the expansion of maquiladoras, though this has certainly brought about negative impacts in its own right. Investment in manufacturing has also strengthened metropolitan areas such as the state of Mexico and Mexico City (Dawson, 2006). Even certain regions of agricultural states that cultivate essential export crops like sugar or coffee, such as Veracruz, may have experienced some economic growth.
Although Michoacán may provide some crops for export as well, the nature of agricultural production in the region has typically been on a much smaller-scale; thus Michoacán has not benefitted in the same manner as other states from structural adjustment reforms. A major blow early on to small and medium farmers came in 1982 when the government ceased to provide federal subsidies for crops (Quittre, 2010). Later in the 1990s the Carlos Salinas de Gotari administration largely ignored the modernization of the agricultural sector while outlining the NAFTA agreement, as it was “not perceived as a core sector in the technocratic project of export-led development and economic integration with the United States” (Gledhill, 1995, pp. 27-28). Instead, Gledhill (1995) explains that Mexican officials “opted for strong trade liberalization and reduced protection for national producers without waiting for reciprocal concessions from the country’s metropolitan trading partners” (p. 2). In fact, the Mexican government essentially denied support for small-scale domestic producers while subsidizing U.S. and Canadian agricultural goods flooding the Mexican market (Dawson, 2006).
Stanford (1994) details this experience in the cantaloupe industry of the Tierra Caliente region of Michoacán. A semi-arid lowland valley in the southwest of the state (Malkin, 2001), Tierra Caliente experienced state involvement from 1970 to 1980 that was considerably paternalistic (Stanford, 1994). Interventionist policies guaranteed farmers’ access to the export agricultural industry, and the National Rural Credit Bank (Banco Nacional de Crédito Rural) offered subsidized credit to small and medium producers (Stanford, 1994).
In the late 1980s the government modified their approach to export production significantly: the state withdrew financial support and deregulated the sector by banning permit requirements (Stanford, 1994). These actions caused a deterioration of the region’s exports. While some experts argue that regulation and bureaucracy from earlier state intervention burdened the agricultural sector, Stanford (1994) clearly demonstrates that freeing the state of this supposed burden did not result in a new, better-functioning system in the Tierra Caliente region of Michoacán.
Malkin (2001) confirms that the government has continued to privatize ejidal lands in rural Mexico and has decreased its involvement in state-sponsored agricultural production, in his case study of the town Mayapan in the Tierra Caliente region. Agricultural necessities like seed, fertilizer, credit, and irrigation have become extremely difficult for domestic producers to access since NAFTA’s passing (Dawson, 2006). By withdrawing the little support that may have been left over from reforms in the late 1980s, small agriculture producers have continued to suffer (Malkin, 2001). Unsurprisingly, Mexican farmers in Tierra Caliente and the greater Michoacán region cannot compete internationally.
Furthermore, according to Quittre’s (2010) case studies, opening trade to the international market, subsidizing imports, and not subsidizing domestic agriculture not only damaged small Michoacán farmers, but has in turn affected merchants as well. As wages and consumption decrease, stores sell smaller amounts of products that are cheaper and of worse quality than before (Quittre, 2010). Gledhill (1995) points out that structural adjustment policies also affected public sector jobs, which were a common off-farm employment option for the poor. He specifically cites the example of the small town of Ciénega de Chapala in Michoacán. By the mid-1990s, public sector jobs involving manual work that had previously comprised the most significant form of off-farm employment for landless married men at the start of the 1980s had disappeared. Michoacanos reported that other jobs outside the agricultural sector were “too temporary and poorly paid” for rural men (Malkin, 2001).
With a declining agricultural sector, migration has become more attractive for desperate farmers and others that have lost their primary means of financial support. In fact, the state of Michoacán has consistently been one of the largest “sending” states of Mexico in regards to United States migrants in the past 20 years. In 1992 Michoacán became the first state to establish an office offering legal and administrative services to migrant workers, and in 1995 the state had sent more migrants to the United States than all other states (LaFranchi, 1995). Migration from the state has continued to be one of the highest in Mexico over the years. In 2000, Michoacán ranked second after Zacatecas in percentage of households with very high or high migration (approximately 55% and 40%, respectively; Gobierno del Estado de Michoacán, 2011b).
Likewise, remittances comprise a large portion of the state’s gross domestic product (GDP). In 2004 remittances accounted for 16.1% of Michoacán’s GDP, while the national figure was just 2.7%. Remittances sent back to Michoacán families more than quadrupled from 1995 to 2005, rising from $5.97 million USD to roughly $2.6 billion USD. This figure was significantly higher than all other states in Mexico for the year; Guanajuato, the second highest state, reported $1.7 billion USD in remittances (Gobierno del Estado de Michoacán, 2011b).
The considerable migration and dependence on remittances reflects the poverty of Michoacán. Migration to the United States today is slowly declining due to the economic crisis and the increasingly dangerous journey, as demonstrated by case studies of two small towns in Michoacán (Quittre, 2010). More and more michoacanos support La Familia, whether through cultivation of drugs or through other types of employment with the DTO.
Other Factors
This essay has demonstrated how structural adjustment policies have weakened state and local institutions and led to a decline in the agricultural sector, thereby creating the structure for a group like La Familia to emerge. However, there are certainly other factors specific to the state of Michoacán to consider.
Michoacán’s location and cultivation potential is particularly attractive for DTOs. During the 1990s, law enforcement was able to gain more control and regulation of drug routes through the Yucatán and the Gulf states, leading to an increase in transport through Pacific states such as Michoacán (Malkin, 2001). As a coastal state, the port of Lázaro Cárdenas provides an access point to import drugs, particularly cocaine (Gibbs, 2009). Additionally, Michoacán’s favorable climate and an abundance of land allows for crops to be grown or produced within the state.
In addition to its geographical appeal, perhaps one of the most significant factors is that La Familia has been able to establish itself as more than just a drug cartel. As Malkin (2001) explains, DTOs may emerge under certain structural conditions, but “to ensure their success they will have to consolidate themselves as a social group” (p. 121). La Familia has indubitably succeeded at this, as evidenced by the DTO’s aforementioned civil, political, and economic involvement in the region.
Finally, public support for La Familia stemming from few employment opportunities outside of the cartel may be related to the low educational attainment in Michoacán. In 2005, 34% of Michoacán’s population 15 years and older had not completed primary education. This placed Michoacán as the fourth worst state in Mexico for this category (Gobierno del Estado de Michoacán, 2011a). The lack of basic education for over one-third of the population is worth noting; with little formal education michoacanos may be more vulnerable, desperate, and willing to support a DTO that provides them with job opportunities if migration is not a feasible option.
Conclusion
In conclusion, a variety of factors must converge to create an environment in which DTOs form and rise to power. Most significantly, the international demand for illegal substances provides a market for the drugs, and strengthening regulation has only increased the profitability and incentive for new DTOs to become involved, and for established DTOs to continue their operations. Though these elements are key to the drug trade on a macro-level, by examining the state of Michoacán, this essay has demonstrated the importance of two domestic factors in a particular region. Structural adjustment policies emphasizing decentralization and reduced government intervention have essentially exacerbated the poverty in which many michoacanos live. This is largely due to the lack of strong institutional development and the plummeting of the agricultural sector for small and medium producers.
La Familia Michoacana has acted as a parallel state in this context by providing employment, but also by implementing various social projects and services for the people. Michoacanos may back La Familia for a number of regions, including its professed religiosity, the economic opportunities and social services the DTO affords to its followers, or out of frustration towards inept state and local governments. Regardless of the reason, La Familia has certainly made a name for itself in the region, and it appears that public support for the DTO will not wane any time in the near future.
References
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Ferrer, E., & Martínez, E. (2010, December 13). Marcha por la paz en Apatzingán deviene en muestras de “apoyo” a líderes de La Familia. La Jornada. Retrieved from http://www.jornada.unam.mx/2010/12/13/index.php?section=politica&article=009n1pol.
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Padgett, T. & Grillo, I. (2010, June 28). Mexico’s meth warriors. Time Magazine. Retrieved from http://www.time.com/time/magazine/article/0,9171,1997449,00.html.
Quittre, A. (2010). La crisis y sus consecuencias en Michoacán: Migración, narcotráfico y clientelismo. New Cultural Frontiers, 1(1), 27-42.
Snyder, R. (2001). Politics after neoliberalism: Reregulation in Mexico. New York: Cambridge University Press.
Stanford, L. (1994). Ejidal organizations and the Mexican state: Confrontation and crisis in Michoacán. Urban Anthropology & Studies of Cultural Systems & World Economic Development, 23(2), 171-208.
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Written by: Shaye Worthman
Written at: Josef Korbel School of International Studies, University of Denver
Written for: Dr. Lynn Holland
Date written: March 2011
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