Fighter Planes, Robberies in Rio, and Million Dollar Cars

This is number 5/2007. Our Mexico report, entitled "Calderon's Plan for Mexico", is ready. Research on Russian and Iranian influence in Latin America continues, albeit slowly.

In this edition:

Hugo Chavez continues to force forward his revolution. Apart from the 28 May closure of Venezuela's oldest independent media outlet, he has threatened to nationalize the country's banks and largest steel producer, and has accused both of corruption. The steel producer, Sidor, is controlled by Luxembourg-based Ternium SA. One of Chavez's closest supporters, Luis Tascon, accused PDVSA of corruptive practices on 10 May, citing a US$ 70 million dollar contract that was "given" to a Colombian company that neither bid on the contract nor has the financial or engineering resources to complete the job.

Meanwhile, rumors coming out of the Venezuelan's oil sector state that any attempt to stop or slowdown production activities at either Cerro Negro, recently ceded by ExxonMobil, or Petrosuata and Hamaca, soon to be ceded by ConocoPhillips, will be considered as sabotage by the Venezuelan government. Apparently Chavez's forceful takeover and ownership of oil production in Venezuela could very well lead to reduced oil production there. Few are surprised.

What is also not surprising is that sales of Rolls Royce luxury vehicles in Venezuela have soared. The model that costs US$1 million has sold 200 units and counting in 2007. The company thought it would only sell seven.

In Bolivia, there is talk of purchasing a fleet of 12 to 20 AT-29 SuperTucano jet prop fighter/attack plans from Brazilian company Embraer. This is the same model airplane the US would not allow Embraer to sell Venezuela. If allowed to move forward, the 100 million dollar sale would be financed by Brazilian development bank BNDES. Delivery of the planes could be as soon as the end of this year. Some question this sale as Bolivia has not until recently expressed a desire in these aircraft.

Brazilian oil giant, Petrobras, exported at least 12 million liters of ethanol to the United States in May and is considering purchasing holding tanks closer to the point in entry inside the United States. The wholesale price of Brazilian ethanol has dropped by 13.8 percent in recent weeks, in part pushing Petrobras to increase production.

Finally, intelligence coming from the Brazil-Bolivian border indicates a spike in the transfer of cocaine from Bolivia to Brazil in the coming months. A representative from the US State Department warned Rio de Janeiro state governor Sergio Cabral of this eventuality.

Meeting with the US ambassador to Brazil during dinner, Cabral noted that his team was working hard to secure Rio ahead of the upcoming Pan American games. What the ambassador didn't tell Cabral was that one day before their dinner date dozens of employees, who work at the US Consulate in downtown Rio, watched as two men robbed a third during the lunch rush hour. Before they made good their escape, a fourth attacked the gunmen, killing one with his own firearm. He then assaulted the other and detained him until police arrived some 15 minutes later.

Ethanol Gains Traction

This is number 4/2007. I have been on the road for most of the month of April. Work on our Mexico report and the upcoming Iran & Russia report is moving forward slowly but will pick up pace through May. After spending some time in Washington, DC, it's become clear ethanol has gained traction where other ideas and policies out of Latin America have not.

In this edition:

Brazil has breeched the gap with Washington through Ethanol. According to some people I met with in DC, the head US diplomat for Latin America, Tom Shannon, has been pushing the formation of a policy bridge between Brazil and US vis-a-vis ethanol for some time. But it took more than a series of tours to Latin American and hollow agreements.

When Brazilian president Lula visited Bush at Camp David, it marked a clear division between Lula's administration and the Brazilian foreign policy camp, led by Celso Amorim and based in Itamaraty. The follow through and real policy implementation team is now the Inter-American Ethanol Alliance, led by Jeb Bush. What at first looked like a hoax has begun to look more like a win-win ethanol alliance.

Brazil, however, has not stopped with the United States. A memorandum of understanding was signed in mid-April between Petrobras and PetroEcuador. The two countries will work to produce and distribute biofuels and ethanol in Ecuador. A similar project is underway in Peru. On 18 April, the Peruvian Council of Ministers approved legislation that will make the use of biofuels obligatory in Peru. To that end, the Peruvian Agrimisa consortium will begin in June the cultivation of 23,000 hectares of sugarcane in the department of Piura to produce sugar and ethanol. It will be a US$ 80 million investment.

Brazil has also reached out to Japan. On 22 February, Marubeni Corporation, Japan's fifth largest trading company, has invested US$ 40 million in a biodiesel join venture with Brazilian grain trader Agrenco Group.

Mexico, like Venezuela, has pulled away from an ethanol initiative. Both countries are major oil producers, and both compete with Brazil for regional leadership. Venezuela has resumed ethanol imports from Brazil, however, but Mexico has announced that it will not focus on ethanol in the short term.

Rather, president Calderon has chosen to focus on a development initiative, Plan Puebla-Panama, that will incorporate Central America and Colombia. This sub-regional initiative has strong support from Colombian president Uribe, something it didn't have when Calderon's predecessor, Vicente Fox, first announced this plan years ago.

Iranian Embassies, Coca Tea, and a Failed Tour

This is number 3/2007. We are nearly finished with a report on Mexico's drug wars, updating a piece I published on October on the possibility of a Mexican Mega Cartel. A report on Iranian and Russian influence in South America will be the last for some time. We hope to receive your feedback on the usefulness of these reports over the coming weeks.

In this edition:

Upon publishing version 2/2007, where I mentioned the possibilities of heavy crude refineries in China, I received messages from three independent sources, one of them with Brazilian energy company Petrobras, saying this was indeed the case. We should watch closely Chinese maneuvering to buy more Venezuelan oil.

Meanwhile, Iran has announced it will open embassies in Chile, Colombia, Ecuador, and Uruguay with a representative office in Bolivia. At first glance this line may appear troubling. Iran, however, would like to assure you that Latin America holds opportunity for Iranian businesses. Embassies are the first point of contact for any country to tighten ties with another. I wonder about what Iran intends to do in these Latino states once the embassies are established. Stay tuned.

Two coca leaf factories are currently under construction in Bolivia. With Venezuelan funding, these coca factories will begin producing coca leaf products, such as coca tea, by September or October of this year. There is little market for coca leaf products in Venezuela. The United States is the real market for a product like coca tea. But it is the last country that will import legal coca products. The irony is that by de-vilifying the coca leaf, and importing coca tea the US government could bring Bolivia closer, using Venezuelan-funded factories to revolutionize the relationship between Washington and Evo Morales.

Chavez has gone on the offensive since arresting a father and son team in the National Guard for plotting to kill him. The Venezuelan leader will now hunt for possible threats to his life. Chavez benefits from revealing plans to assassinate him however real or fabricated. They play into his strategy of constantly reminding his followers of the struggle associated with the revolution. Yet real attempts on his life are likely to increase in the coming months. Political risk is alive and well in Venezuela.

Finally, the results are in. US President George W Bush's tour of Latin America was a failure. He signed no major deals, made no promises, and was forced to swallow the harsh words of thousands of protestors. His press secretary, former Fox journalist Tony Snow, made no announcement to the press pool traveling with the president until 17 hours before the end of the tour. Even Guatemala, long a client state of the United States, turned the screws on the immigration issue - not at all fearful of a reprisal for bad behavior. Bush's tour served to solidify one fact: Washington lost Latin America under his watch.

Heavy Crude, Countering Chavez, and Plan Afghanistan

This is number 2/2007. Our Mara Salvatrucha report is complete. We are pleased to say we were able to include never before published information gathered from transcripts of witness testimony. We will now begin work on Mexico's drug wars, updating a piece I published on October on the possibility of a Mexican Mega Cartel. Please note, some of you did not receive the 1/2007 edition due to a technical error. Please use the blog link below to review that material.

In this edition:

Venezuela has signed a US$3.5 billion oil deal with Japan. Japanese companies Mitsui and Marubeni have signed a contract with Venezuelan energy company PDVSA to import crude over the next 15 years. It is the largest energy deal with an Asian company that I have seen.

As many are aware, Venezuela's heavy crude is not a market favorite, but I've recently learned that this crude is precisely what the market may consume in the future. According to sources in India, state-run Indian Oil Corp. has begun placing orders for heavy crude, to be refined at an Indian refinery. If India is convinced heavy crude is the wave of the future, then I must wonder about China. Sources in Petrobras here in Brazil tell me China talks of building heavy crude refineries. The potential effect is two-fold. One, the United States will soon be one of three major markets able to refine heavy crude. And two, the price for heavy crude will stay high. This has obvious implications for the future of Chavez's regime in Venezuela, the world's leading source of heavy crude oil.

Meanwhile, there is no Latin American leader well positioned to counter Chavez. His ideas roam free across Latino lands, and while we must wait until the next round of presidential elections to see how the region has taken to his 21st Century Socialism, it's clear to me and many of us down here that Bolivarianism will continue to take root as Washington's influence in this region continues to fade.

This year will be one of engagement, according to Tom Shannon, the State Department's top diplomat for Latin America. His recent visit to Brazil, however, appears to have been derailed by the revelations of the former Brazilian ambassador to the United States who claims Brazilian foreign policy is still very much influenced by old-school Socialists. Too bad the US has identified Brazil as the country to counter Chavez. We'll see what the future holds. I've been told by contacts in the Whitehouse that President Bush is "obsessed" with Iraq. So we'll see just how much the US will engage in Latin America.

Meanwhile, William Wood, the former US ambassador to Colombia, will soon become the US ambassador to Afghanistan. One country is the world's leading supplier of cocaine, the other heroin. I'm very concerned that failed US policy in Colombia will be repeated in Afghanistan. There is widespread concern that the so-called Drug War will have a negative impact on Afghanistan's future.

By most accounts USAID, the US government's agency that disperses development aid and implements development policy is in need of some serious attention. I have documented USAID's dismal work in Bolivia. It's work in Colombia has had limited success. A contact who has returned from a development post in Afghanistan recently wrote:

"At the end of December I finished up 15 months in Gardez, Paktya, in SE Afghanistan, overseeing USAID-funded reconstruction projects. I don't think I went in with any starry-eyed notions about the US-led effort there, but seeing first-hand the degree to which it is misguided and insincere was astounding nonetheless."

He continues: "I think there's a depth of cynicism in many of these efforts that is hard to fathom-- the Drug War is one of the clearest examples, I guess. The facts are arrayed against it so clearly-- it's ruled by an orthodox faith that allows for very little questioning, but more that that there's a tremendous inertia of interests-- the machinery of the Drug War already in place that needs it to survive, the various entities raking in the profits from the government contracts, etc. I really wonder how many people in leadership positions who espouse the Drug War religion are actual believers."

Gang Busters, Unmanned aircraft, and Ruling by Decree

This is number 1/2007. Our Mara Salvatrucha report is nearly complete. We are waiting on a court reporter in Maryland to send over the transcripts of witness testimony that, so far, have not been released to the public. The results for January's monthly survey are in. Once we publish the Mara Salvatrucha report, we will begin work on Mexico's drug wars. You can still find our December report on the FARC's international network here.

In this edition:

The Mara Salvatrucha, the United States' most violent street gang according to the FBI, has received much attention from the press this year. A trend towards greater organization suggests the gang may soon become much more than thugs. And the government's use of racketeering charges to prove organization has for the first time etched in public records evidence of the gang's increased levels of sophistication.

Meanwhile, a continuing resolution passed by the outgoing Congress late last year has catalyzed a hiring freeze at the Drug Enforcement Administration. The DEA has suffered budget cuts, and its operations on the US/Mexico border appear to be on the road towards friction, not cooperation, with the Bureau of Immigration and Customs Enforcement as well as the FBI. These are trying times for the DEA because Washington has put the drug war on hold while it chases after terrorists and democracy in the Middle East.

Mexico, however, has raced forward with its war on drugs. President Felipe Calderon has taken the fight to Mexican organized crime. He's sent troops to Michoacan, Baja California (Tijuana), and other states. Calderon has also begun using extradition to the United States as a tool. Already he's extradited the leader of the Gulf Cartel and as of the last week of January has some 9,000 troops hunting for El Chapo, the leader of the Sinaloa Federation. I'm waiting to see how the criminals fight back...

...Iran will soon open an embassy in Nicaragua. After a three day tour, guided by Venezuelan president Hugo Chavez, Iranian president Mahmoud Ahmadinejad, extended his Latin American contact network to Nicaragua, Ecuador, and Bolivia through meeting the presidents of all three nations. As Iran's presence in Latin America grows, so does unease in Washington.

Chavez will continue to push Washington with rhetoric all year, but an interesting bit of news - beyond the usual Bush-bashing - surfaced recently. The Venezuelan military has quietly said it will work with Iran to develop unmanned aircraft. This announcement could be misinformation; it could also be a test balloon to gauge US response. Either way, closer military ties between Iran and Venezuela do not bode well for Washington. Nor do Venezuela's plans to purchase anti-aircraft missiles from Russia.

We'll certainly hear more from Chavez, who as of 31 January is in position to rule by decree. The region's response to Chavez's constant tinkering (to put it nicely) with Venezuelan democracy is deplorable and indicative of the fact that it is unlikely anyone in the region or Washington can stop him.

The Iran-Venezuela Balance and Ice in Mexico

This is number 16/2006 and is the last publication for 2006. Voting for December's monthly survey will continue through the holidays until the first week of January. Our report on the FARC's international networks is complete. You may download it here. Please feel free to send in any comments or questions that may arise as you review the report.

In this edition:

Hugo Chavez has won another 6 years in power. It is likely he will remain Venezuela's ruler for much longer. And his cloak of democracy ensures continued protection from any unilateral efforts made by the United States to threaten his regime.

There are at least three triggers that would dramatically increase the threat that Chavez poses to the United States. The first two are well established: oil and nuclear weapons. If Chavez cuts off oil or develops a nuclear program, peaceful or otherwise, he will invoke Washington's ire.

The third trigger is a closer relationship with Iran. For now, this relationship appears to be balanced. But this may change if Iran chooses to pursue closer military ties with Chavez to deter America's efforts to undermine Iran's position in the Middle East.

Meanwhile, activity in Mexico indicates a strong government response to ever increasing drug trafficking operations in Mexico's southwestern states. In the middle of December, Mexican authorities seized some 20 tons of chemicals in Michoacan. Much of the chemicals were on their way to methamphetamine super labs in Michoacan that have risen since US government efforts to shut down meth labs in the United States. These efforts have resulted in a serious problem with meth addiction in Mexico. And in Michoacan organized crime has declared a war on anyone who produces, distributes or sells meth in Michoacan. In 2007, this state may become the center of a dramatic increase in violence.

Finally, as the year draws to a close, many journalists and analysts have tabled ideas for what to watch in 2007. Of the various items under consideration for close observation, I would consider Venezuela's relationship with Iran, the growth of Mara Salvatrucha street gangs, the Colombinazation of Guatemala, and Mexico's "cartel wars" to be the most important to regional security.

Lula's Meddling, Chavez's deals, and a Regional Military proposal on the way...

This is number 15/2006. Votes for October's monthly survey have been tallied. The top two topics voted were the Mara Salvatrucha street gangs, which came in second with 27% and the FARC's international network, which came in fist with 33%. Over the next two weeks, we will prepare a detailed report on the FARC's international networks, including interviews, maps, and other graphics. I will announce its publication on the website and via this newsletter. Next week, I will post the new topics for the November survey, including the Mara Salvatrucha street gang topic, as it came in second this month.

In this edition:

Brazilian president Luis Inacio Lula da Silva visited Venezuela the week of 13 November to sign some energy agreements and inaugurate a bridge between the two countries that has recently completed construction. Interestingly, Lula's implicit backing of Hugo Chavez weeks ahead of Venezuela’s presidential elections raised alarm in Brazil over Lula’s apparent "meddling" in Venezuelan affairs. Up until now, Chavez has been the only state leader denounced for meddling in another country's elections.

Lula's timing was planned. He would prefer to see Chavez remain as Venezuela's president, as he knows Chavez's leadership in Venezuela does not threaten Brazil. It also keeps the United State’s presence in South America off balance, another geopolitical factor that works in Lula's favor.

Meanwhile, US President George Bush has quietly waived a long-standing prohibition on International Military Education and Training Program for countries around the world, including numerous Latin American countries. Venezuelan and Chinese military influence in the region likely has Pentagon leaders worried. It will be interesting to see if the US uses these training programs to increase military-military ties in South America in a move to counter-act Chavez's regional military movements.

Brazil has also made an interesting announcement. On 15 November, Brazil's military advisory group, the Nucleus of Strategic Matters began drafting a proposal for the creation of a South American military force, using NATO as a model. Chavez, Morales, and Kirchner will likely sign on to such a proposal, which looks like a play by Brazil to get back on top of the regional geopolitical game. I expect Lula to focus more on seizing regional leadership now that he's past the elections and has washed his hands clean (well mostly) of past corruption scandals.

Meanwhile, Venezuela has signed a memorandum of understanding with Syria and Iran to build a refinery in Syria. Venezuela has also recently signed a bundle of new agreements with China, bringing the two countries closer together.

Finally, Brazil has announced it will resume construction on its Angra 3 nuclear reactor. We're still waiting to see how the international nuclear watch dog, the IAEA, reacts.

Ortega, Maras in Mexico, and Hezbollah in Venezuela

This is number 14/2006. Sandanista Daniel Ortega is likely to become the next president of Nicaragua. Mara gangs are footloose in Mexico. And some Spanish scholars are talking about Hezbollah in Venezuela.

In this edition:

As of 7 October, most major media outlets have recognized Daniel Ortega as the president of Nicaragua. Ortega, however, has remained silent, and his opponents are calling for every single ballot to be recounted. Democracy watchdog, President Jimmy Carter, said the process was cleaner than elections he's witnessed in the United States.

The possibility that Ortega will begin to orbit Venezuela, along with Bolivia, is very real. Chavez is happy to continue his offer of fertilizer, oil, and fuel, and there's little reason to believe Ortega would refuse. There's also little reason to believe Ortega would manipulate Nicaragua's FTA with the United States. Concern in DC over such a possibility is rooted in outdated beliefs of Ortega the Sandanista more than today's reality. Ortega's presidency will be more about himself and his followers than Nicaraguans or becoming another thorn for Washington. Ortega will certainly have a leftist slant, but it's unlikely his politics will hurt the US beyond the State Department's pride. Chavez called Ortega late on 6 November to congratulate him, and I suspect it is the first communication in what promises to be a close relationship between the two men.

Ortega's presidency adds more evidence to the argument that the US State Department simply has no footing in the Americas and will only lose influence and support in the Americas from today's midterm elections through the end of the current presidential term and beyond.

North of Nicaragua, in the Mexican state of Chiapas, Central America's Maras mix with illegal migration. But their influence does not stop in Chiapas. Maras apparently have built a pipeline for human and drug smuggling north from Chiapas, along Mexico's Pacific coast, to the US-Mexican border. Their presence is Mexico is "flotante" or not rooted down, but their influence is only growing. Testimonies from a racketeering case in Maryland have revealed a certain level of vertical, or what I call north-south, organization between Mara leaders in Central America and their lieutenants that run Mara gangs in US cities.

Meanwhile, two Spanish scholars have taken seriously the recently planted bombs in Caracas. They see the bombs as the first act of Venezuela's Hezbollah cell, acting alone and not part of the greater terrorist organization in the Middle East. They call the 23 October bomb attempt a "frustrated" action of Hezbollah in Venezuela. But they argue this group wants to create a South American Hezbollah movement that will build international recognition through bombings in Venezuela. Ultimately they raise the question. Does Hugo Chavez's leadership in Venezuela send the message to international jihadists that Venezuela will tolerate fund raising, recruitment, propaganda, and training for militant Islamic movements?

Busts, Spies, Polls, and Bombs in Bogota

This is number 13/2006. We are four days from the second-round of the Brazilian presidential elections, and Lula has a 22 point lead over Alckmin. People here in Brazil are already celebrating or crying. Daniel Ortegea, the former Sandanista leader in Nicaragua, will likely be the next president of that country. In Venezuela, polls report Hugo Chavez is 35 points ahead of his opponent Manuel Rosales.

In this edition:

The Brazilian National Intelligence Service (ABIN) has begun the internal selection process to send spies to Venezuela and Bolivia. A classified order made by the president initiated this process, and a daily here made it public. The ABIN office confirmed the news. Until now, Brazil had maintained ABIN agents in Washington, Key West, and Buenos Aires. The presence of Brazilian spies in Venezuela and Bolivia may be the first of a series of geopolitical moves made by Brazil to exert its influence over her neighbors.

As Chavez sprints the campaign trail, two unexploded bombs were found outside the US Embassy in Caracas on 23 October. A moto-taxi driver alerted local police after giving a ride to a guy with a large duffle bag. Inside the bag were Hezbollah pamphlets and a student ID card. Local authorities consider the suspect "demented". And that was that. It's unclear if the story was buried or just a non-starter. Once again flimsy evidence has surfaced that Hezbollah is operating in Venezuela. US Southern Command is convinced of the terrorist organization's presence on Margarita Island, just north of Venezuela, but concrete evidence has not yet surfaced in the public domain. Stay tuned...

Meanwhile, eight tons of cocaine were found off the Galapagos Islands in the Pacific Ocean off the Ecuadorian coast. Three Costa Ricans were arrested. This is the second cocaine bust involving Costa Ricans this month. On 9 October a Costa Rican vessel was intercepted with 3.5 tons of cocaine aboard. The eight-ton bust is the largest single seizure I am aware of in Latin America.

At the United Nations, Venezuela has announced it's willing to pass the baton to Bolivia, and Evo Morales has accepted. I don't think Bolivia has a very good chance of winning a non-permanent seat on the UN Security Council, but if it does, I imagine we will soon have more evidence of the deepening ties between Venezuela and Bolivia.

Finally, another bomb exploded in Bogota on 19 October. President Alvaro Uribe immediately blamed the FARC, but it is not clear if the FARC actually planted the bomb. Calling off hostage-exchange talks with the FARC, Uribe said the only way to free the hostages the FARC has been holding for years is with the Colombian military.

As a high-delegation of US officials hold meetings in Bogota today, 25 October, and tomorrow, Colombia's Foreign Minister is holding talks with Ecuador and Venezuela to share intelligence the Colombian government has that high-level FARC operatives are currently in the eastern jungles of Ecuador and the remote border lands between Venezuela and Colombia.

If Chavez remains in office, and Ecuadorian presidential candidate Rafael Correa - a known Chavez sympathizer - becomes Ecuador's next president, Colombia will have two neighbors that are tacit FARC supporters. The harder Uribe squeezes the FARC in Colombia, the more likely they are to displace their presence into Ecuador and Venezuela, not to mention Panama and Brazil.

Chavez's power on the downslide?

Responding to Andres Oppenheimer's recent article on Chavez's apparent downward spiral, I published the below comments on his blog.

They are recorded here:

Rosales has engineered a strong campaign, but he's still 13 points behind Chavez. I doubt Chavez will give up power easily, no matter what Venezuelans decide.

Outside Venezuela, his influence appears to have planed-out. But it's easy to arrive at this conclusion when you only ready major news papers. Talk to the people, visit the capitals, take a hard look at the realities of life down here, and you'll find there's still plenty of room for Chavez's influence to grow.

If he's an astute politician, and if he manages to get past the December elections without sparking a wave of violence in Caracas, Chavez needs to turn a corner to press what I consider to be an advantage in the region.

He needs to govern, to show some leadership, and to show some follow through. If chooses not to focus on the details of being a effective political leader, he runs the risk of wide spread disillusionment that follows in the wake of the hundreds of thousands of hopeful individuals - Latinos, Gringos, Europeos, quien sea - that are watching him, waiting for him to do more than put his money where his mouth is and make something happen. Venezuela is the first place to begin.

There's no reason to belive that Chavez can't work with Garcia, Uribe, Calderon, or other center-right leaders who have problems with poverty, hunger, sickness, etc.

But there's plenty of reason to belive that if Chavez doesn't do something soon, the disillusionment he creates will cause a fall out much worse than the most awful decisions made by the "Washington Consensus".

I'm not for or against Hugo. He has carved out a measure of regional influence for himself. It remains to be seen if he can do something with it.

"Colombianization" of Guatemala?

This is number 12/2006, and has arrived a little later than expected due to the elections here in Brazil. According to the latest polls published on 12 October, Lula is ahead by 11 points over Geraldo Alckmin. In other news, I heard back from many of you who had trouble purchasing The Reality of a Mexican Mega Cartel. The e-book is now available via my website (not Lulu.com). Also, I have installed a monthly survey on my website. The idea is to publish an e-book that reflects the interests of those who visit the website. Have a look, cast your vote, and check out the results. Finally, I will begin placing these newsletters on my blog. Please leave your comments there, thank you.

In this edition:

The first two weeks of October registered record cocaine busts in Central America. During a regional meeting of Defense Ministers in Managua, Nicaragua, authorities there seized 3.1 tones of cocaine off of Nicaragua's Pacific Coast. Days later Costa Rican authorities seized 3.5 tones of cocaine. Both seizures were record interdictions.

The Central American sub-region remains a transit zone. Larger seizures means larger amounts make it through the zone into target ports. The term "Colombianization" has been used to describe how the drug trade has begun to affect security and economy in Mexico. But some observers have begun to talk about the "Colmbianization" of Guatemala, an interesting concept.

Drug traffickers in Guatemala have planted millions of opium poppies in the country's western highlands. Guatemala is Central America's only source country. Colombia, Peru, and Bolivia are South America's source countries. Colombia has the added challenge of a decades' old civil war. Guatemala, however, has a growing problem with Mara Salvatrucha street gangs, which appear to on the road to increased organization and involvement in the drug trade.

Guatemalan president, Oscar Berger, just last week ordered hundreds of soldiers into the streets of Guatemala City to protect public buses. Strikes led by bus drivers, who were protesting the death of five of their colleagues, prompted this heavy-handed response. Street gangs extort bus divers, forcing them to pay a "war tax". Those who don't pay are shot. We're waiting to see what becomes of soldiers protecting bus drivers from street gangs. It seems to be a recipe for more violence.

Meanwhile, these gangs continue to move into the Mexican drug trade. There's little evidence to suggest they are actively linked with one of Mexico's drug smuggling organizations. I have learned, however, that the presence of Central American street gangs in Mexico has spurred a nation-wide copy cat situation. Mexican youths in cities across the country have begun to call themselves "maras", hoping to capitalize on the fear invoked by the term. Have the Mara Salvatrucha grown beyond a street gang into a brand name that represents extreme violence?

Organized Crime, Smuggling, and Operation Twin Oceans

Today's show covers organized crime in the Americas, smuggling in Colombia, Riots in Brazil, and our favorite leader, Hugo Chavez.

My plans to talk about Bolivia’s self-eradication program were put on hold as I got deeper and deeper into the world of smuggling and organized crime in Colombia and Panama. I am currently working on an eight-part series on smuggling in the Americas. The first piece on Buenaventura, Colombia has been published, and I expect to publish a piece on Panama City early next week.

Today I would like to share with you information about Operation Twin Oceans, a Colombian drug trafficker known as Don Pablo, Riots in Brazilian prisons, the arrest of a Tijuana Cartel boss, and a little tidbit about everyone’s favorite topic, Hugo Chavez.

Let’s get started.

Operation Twin Oceans is the tail end of a long series of operations inaugurated in late 2002. The U.S. Drug Enforcement Administration, also known as the DEA, jumped on board with this string of operations when it deemed the target, Pablo Rayo-Montano as a worthy target in October, 2005. Don Pablo was a Colombian drug trafficker who leveraged his land holdings in Panama and private navy to consolidate shipments of cocaine and move multiple tons of packaged cocaine from Colombia to Mexico and other destinations.

Don Pablo got started in Buenaventura, Colombia, the country’s busiest port city in terms of volume. Over time, Don Pablo won more clients for his consolidation and shipping business as the Colombian drug trade fractionalized from large organizations to dozens of baby cartels.

At the height of his business, Don Pablo moved up to 20 tons of cocaine a month, mostly to contacts with either the Sinaloa or Gulf Cartel in Mexico, that county’s two top drug smuggling organizations. Enter Operation Twin Oceans.

The DEA, working with partners in eleven countries, operated an intelligence gathering network that eventually led to Sao Paulo, Brazil. Don Pablo is believed to have fled to Brazil after a previous intelligence operation, dubbed Buenaventura No. 1 came close to dismantling his operation. Operation Buenaventura No. 1 focused on the smuggling links between Panama City and Buenaventura, Colombia. Invariably some members of Don Pablo’s organization were caught in the drag net.

It’s possible some of them gave up information that eventually led authorities to the Panamanian marina services company, Nautipesca, which was one of the country’s top marina services companies as well as Don Pablo’s principle front for a massive money laundering service that he offered to his clients. Call it an added value service.

With enough information to arrest Don Pablo, the DEA came knocking on the door of the Brazilian Federal Police in mid-May this past year. As many of you probably know, the second week of May was not a pleasant time for the Brazilian Federal Police. There were in the middle of a nearly two-week long siege on over 100 prisons. Riots had broken out on May 14 setting ablaze a series of riots in prisons across the state of Sao Paulo. On the streets, members of the First Capital Command, a Brazilian prison gang, were targeting cops at will, killing them on sight. As the mess dragged on into the week, cops retaliated killing dozens of suspects members of the First Capital Command. For Don Pablo, it would have been the perfect environment to hide out and maintain a low profile until things blew over in Panama.

Again, enter Operation Twin Oceans. With information in hand, the DEA made its case to the Brazilian Federal Police. Soon after Brazilian officers braved the extremely dangerous situation on the streets of Sao Paulo to serve an arrest warrant on Don Pablo, who was probably pretty surprised to find the DEA and Brazilian Federal Police knocking on his door in the middle of the prison riots.

Such mega-operations make me think of the DEA’s operations and efforts to take down Colombia’s first mega-drug trafficking organization. The Medellin Cartel, run by Pablo Escobar, feel apart after Escobar took multiple bullets in the chest, but the truth is his power over Colombian drug trafficking had begun to fade long before Escobar’s death.

A group of men who called themselves People Persecuted by Pablo Escobar, or Los Pepes, were secretly helping the DEA and Colombian authorities pull apart Escobar’s network by fighting fire with fire. Los Pepes broke the law. They set off bombs, murdered people, and – generally speaking – used the same terror tactics on Escobar that he used on his enemies. Two members of Los Pepes went on to form the Cali Cartel, another, known as Adolfo Paz, went on to become a notorious paramilitary chieftain, known as one of the first Colombian drug traffickers fully integrate with the country’s paramilitary forces.

The absence of the Medellin Cartel made way for the grand entrance of the Cali Cartel, an organization run by men who learned from Escobar’s mistakes. In a similar fashion, the recent arrest of Javier Arellano-Felix, a ranking member of Mexico’s Tijuana Cartel, may eventually lead to the dismantling of this Mexican drug smuggling dynasty.

But maybe not. Javier was a younger brother of a brood of Arellano-Felix siblings that have run the Tijuana Cartel since the early 80s. At one point, the Tijuana Cartel was the top dog in Mexico with complete control over smuggling routes into California, a principle market for cocaine in the 1980s.

By March, 2002, the tide had turned. Benjamin Arellano Felix, Javier’s older brother entered prison. Another brother, Ramon, was killed that year. Leadership is belived to have fallen into the hands of younger brother Eduardo and sister, Enedina – the former a doctor, the ladder an accountant. Under their leadership, the Tijuana Cartel has become more of a business, not as ruthless as it’s past antics would lead you to belive. Meanwhile, the Gulf and Sinaloa Cartels have increased their size and power significantly. The arrest of Javier Arellano-Felix puts a dent in the Tijuana Cartel’s enforcement arena, and his arraignment on US soil means he’s just as dead as his brother Ramon. It’s highly likely Javier will serve multiple life sentences once the courts and a jury of his peers have had a chance to sift through all the evidence the US Dept of Justice has on that guy.

Which leads me to my point here. The Tijuana Cartel’s days are numbered. Sooner or later the Gulf or Sinaloa Cartel will take over Tijuana. It is a border crossing that is second only to Nuevo Laredo in terms of volume of daily trade. When that happens, the group that holds both Nuevo Laredo or Tijuana, and it could be either the Sinaloa or Gulf Cartel at this point, will have consolidated smuggling operations into the United States from California to eastern Texas – it’s a business that generates tens of billions a year in tax-free dollars. Quite possibly as much as twice what the Mexican government earns from annual oil revenues.

Speaking of oil, let me finish by making mention of Hugo Chavez. As he would have it, the word Chavez has remained constantly in international headlines for weeks. It seems the media can’t get enough of this guy. Venezuelan presidential elections will be held in December, but already there is much activity in Venezuela.

Most importantly, it appears the once fractionalized opposition has managed to rally around one man, Manuel Rosales. He is the former governor of the state of Zulia, and has resolved to beat Chavez at his own game: appeal to the poor.

Many casual observers of Chavez’s Movement for 21 Century Socilialism fail to realize that the socialist movement is rotting at the core. Chavez’s most ardent supporters in 1998 are not asking why he is spending more money on regional and international programs while bridges fall and people remain jobless at home.

Rosales is playing on this growing sentiment to gain a portion of the chavista vote, while hoping he can attract to voting booths the millions of Venezuelans who have continued to abstain from voting in silent protest. It’s certain that in a year of many presidential elections, the Venezuelan election will be the most passionate. The outcome could range from peaceful and cheerful even to downright bloody and a welcome mat to civil war. I guess if that happens, the region’s drug smugglers will have one more option for places to keep a low profile. Don Pablo has certainly learned that Brazil is not an option.

Chavez and His Buddies: Kirchner and Morales

Good afternoon and welcome to Security in South America. I am your host, Sam Logan. For this week’s show, I had planned on sharing information about Operation Twin Oceans, a multi-national sting operation that brought down one of Colombia’s most successful drug trafficking enterprises. Unfortunately, I could not get the US Drug Enforcement Agency to agree to an on the record interview for this podcast.

I did, however, have a very interesting conversation with a colleague in Argentina, parts of which I would like to share with you today.

Julio Cirino is an Argentine journalist and International Analyst that from time to time comments for CNN en espanol. He hosts a radio show in Argentina and writes regularly on politics, security, economy, and energy in South America.

Our conversation covered many topics all over the region, but I’d like to focus on two. First, Venezuelan president Hugo Chavez, a man Julio refers to as “huguito” or “chavito” as is common in the region, has aligned himself closely with Argentine president Nestor Kirchner. But what, if anything do the two men have in common? Julio provides some interesting insight.

Second, what is Chavez doing to spread his military doctrine through the reigon? It is clear that he would like to be in command of a region-wide army, especially after his speech at the last MercoSur summit, held in Cordoba, Argentina, when he said that MercoSur should be a foundation for a region-wide economic union, like the European Union, as well as a region-wide military to oppose any would-be invaders from imperialist countries.

Julio talks about Chavez’s influence in Bolivia, and how he may have brought the Russians to Argentina’s door.

So let’s begin.

Two things that Hugo Chavez and Nestor Kirchner have in common is power. Both men have consolidated power over their country’s legislative and judicial branches, and both rule by decree. Both men also enjoy a deeply divided opposition that, at times, argues more with itself than the man in power. How do these two men compare? When I put this question to Julio, he had a clever answer: Chavez es Peron con Petroleo. That is, Chavez is much like Kirchner, only he has money, while Kirchner does not.

It is clear that Kirchner depends more and more on Chavez, but what about other leaders in the region? Many would argue that Bolivian president Evo Morales is very close to Chavez. I would argue that he puts Bolivia first, and what ever plans Chavez might have for the region second. But an interesting thing occurred last May. Chavez and his defense minister Raul Baudel visited Bolivia where they met with Evo and the leaders of the Bolivian armed forces. Might they have talked about Chavez’s vision for a regional military? Could the recent sacking of some Bolivian military leaders have been a decision Evo and Chavez made together? If Evo does take advice from Chavez, the military realm is one place Evo is most likely to give Chavez his ear. After all, Evo is a farmer, Chavez is the one with a military background.

When I put this question to Julio, he had some interesting comments, included was his concern that Chavez may have brought the Russians to Argentina.

The Brazilian military is indeed worried. Already discussions about Chavez and his military machine are circling in Brazil’s halls of military leadership in Brasilia and Rio de Janeiro. The likelihood of Venezuela’s armed forces joining that of Bolivia is slim, but the implications such a possibility has for regional security are very worrying.

Next week I hope to focus on Bolivia and a manual eradication program there that seems to be taking off. This eradication program is unique because the coca farmers themselves are pulling the plants, not the military or hired citizens. What’s behind this program and it’s chances for wider success outside Bolivia will be discussed.

The full podcast with Julio's comments may be found here.

Dreams of Influence in Nicaragua

Washington remembers the days of the CIA-backed counterinsurgency organized to remove Nicaragua’s Sandinistas from power. Since the end of the Cold War, the region’s political climate has changed. Washington’s desire for influence has not. It is no longer a fight against communism, but against the sway of Venezuelan President Hugo Chavez and what his political presence in Central America means for the eroding authority of the US in Latin America.

In the 1980s, the Sandinista National Liberation Front (FSLN) was a source of pride for many Nicaraguans. Those old enough to remember the Somoza family point out it was the Sandinistas who ended 43 years of its brutal dictatorship in 1979. This US-backed string of dictators began with Anastasio Somoza in 1936; it continued as power was passed from father to son to brother. Nicaragua entered into a new political arena with Daniel Ortega, Herty Lewites and others who took back Nicaragua for the people, staying in power until democracy finally won out in 1990.

Since then, Daniel Ortega has unsuccessfully run for president three times. On 5 November, Ortega will have his fourth chance for victory. To avoid a run-off, he must win 35 percent of the vote, with a 5 percent margin between him and the second-place candidate. The possibility of an Ortega first-round win has significantly increased since the death of former Sandinista and presidential candidate Herty Lewites.

Lewites died of a heart attack on 2 July. At the time, his candidacy split the Sandinista vote, considerably weakening Ortega’s position. With Lewites no longer in the race, many observers believe Ortega could very well be the next president of Nicaragua.

Chavez has made no attempts to hide his support for Ortega and the Sandinistas. In April, Chavez reached an agreement with the FSLN to supply oil at a reduced price to areas of strong Sandinista support. Perhaps more valuable to Nicaraguan farmers is fertilizer. Some 20,000 tonnes, shipped from Venezuela to Nicaragua, are stored and sold by an organization close to the FSLN, according to the Miami Herald. One 110-pound sack costs Nicaraguan farmers US$16, some 20 percent below market prices.

Meanwhile, US Assistant Secretary of State for Western Hemisphere Affairs, Tom Shannon, visited Nicaragua in the first week of July. He made no attempt to hide his support for Ortega’s competition, Harvard-trained technocrat Eduardo Montealegre, formerly the Nicaraguan foreign minister. It is likely that Shannon discussed with Montealegre the future of USAID in Nicaragua as well as continued US support.

Shannon knows that Nicaragua under the Sandinistas remained impoverished. Repression and war reigned, with Ortega on one side and the US government on the other. If Ortega wins, Shannon will work with him, but he will not have as warm a welcome. His message of US-backed policies would not have a happy home.

Beyond personal relationships, there are other items at stake. Nicaragua currently recognizes Taiwan as an independent nation, and is one of the remaining countries that has held fast against the consolidation of China’s presence in the region. The US would like for Nicaragua to maintain its support of Taiwan. Yet under Ortega, Nicaragua may recognize Taiwan as part of China. It would be a small gain for China in terms of practical use, but a win nonetheless in China’s long struggle as the leading Asian influence in the Americas. It would also be a win for Chavez, who tirelessly works to reduce US influence in the region.

Regional support for the installation of another US-military base in Honduras is also at stake. According to the Associated Press, the base would be installed in the northeastern region of Gracias a Dios, near the Nicaraguan border. Both US and Honduran strategists believe this region is currently wide open for the passage of illicit products moving between Colombia and Mexico. The US wants to count on Nicaraguan support.

General Romeo Vasquez told the Honduran daily La Prensa that the area was a “zone where there is conflict and problems,” referring to the narco-trafficking in the region. Over 100 tonnes of cocaine are smuggled through Honduras, according to the US embassy in Guatemala, on its way from Colombia to the US. The base in Honduras is likely the first in a string of outposts the US would like to see from Panama to Honduras. However, Nicaragua under Ortega would likely not play party to a US-led effort to put more boots on the ground in Central America.

The stakes are still low since the election is still months away. Nicaraguan pollsters are on the streets assessing how Lewites’ death has affected the Nicaraguan voting public. In the latest poll released by Nicaraguan marketing firm Borge and Associates, Ortega led the pack with 30.1 percent of the intended vote. Montealegre trailed by just under six points.

The poll, conducted from 20 June to the day of Lewites’ death, 2 July, gave Lewites 17.2 percent of the intended vote. This is the margin that both Montealegre and Ortega seek to gain. Because Lewites is known to be a former Sandinista, most of his votes are likely to migrate to Ortega. If even half of the 17 percent decides to vote for Ortega, the Sandinista would move from 30.1 percent to 38.6 percent - enough to win if Montealegre does not come within five percentage points.

Chavez’s horse, Ortega, is on his fourth run for president, and he has never been closer to winning. Perhaps that is why elections in Nicaragua, usually an event that comes and goes without an international headline, have attracted such attention. In the end, however, Washington and Caracas will have little more than bragging rights. After all, Nicaragua is still a small, poor nation that needs all the help it can get to improve the lives of the people who live there, not stroke the ego of its leaders or those who run the nations that support them.

As usual, you can listen to the podcast here.

Colombia's FARC Moves to Consolidate Control

One of the largest mass-kidnappings in Colombian history turned out to be an exaggeration. The governor of Colombia’s Choco department, claimed the Revolutionary Armed Forces of Colombia, also known as the FARC, had kidnapped 170 rural workers on 13 July. Ten more were reported killed. Colombian president Alvaro Uribe deployed a mobile battalion of the Colombian military, whose commander immediately refuted the reports, claiming that no more than 35 rural workers actually had been kidnapped.

The exaggeration of a very real event may reveal the level of desperation some Colombian governors feel as they await their share of the promised deployment of 40,000 rural police officers. Such an incident in one of Colombia’s most isolated outposts also verifies that security gaps are growing all over Colombia. Slow implementation of political promises and the very real absence of the paramilitaries widen these gaps every day. But that is to be expected.

The FARC has not captured all areas left available by the paramilitaries, but it has moved to take over strategically important areas. Choco is at the top of the list.

The department of Choco has been of strategic importance to both the FARC and the paramilitaries as long as both groups have been involved in the drug trade. Colombia shares some 266 kilometers of a border with Panama, all of which is in the Choco department. This area is also the shortest distance from the Pacific to the Caribbean and is replete with river systems that facilitate transport.

Riosucio is a small town on the Truando River, part of a fluvial system that stretches from the mountains in north-central Choco to the Caribbean. This area is in the center of the current conflict between the 57th FARC Front and a paramilitary unit due to disarm at any time, according to Colombian reports.

The FARC is already moving in. They have taken hostages and even killed those who they thought were paramilitary sympathizers. The events of 13 July point out that the FARC is moving in to take over as much of the northern portion of the Choco department as possible, despite any plans the Colombian government has for increased rural security.

Over the duration of his first administration, President Uribe went on the offensive, seeking out conflict with the FARC. Since 2003, Uribe has installed 84 new rural police substations. He oversaw the development of seven new military brigades and 54 mobile squadrons. He started the so-called “public forces,” empowering citizens to join a sweeping intelligence network. His capstone offensive, called “Plan Patriota,” continues to take the fight to the FARC strongholds in southern Colombia.

Uribe’s next move, his promised 40,000 rural police, will be even more invasive into FARC satellite territory. His government will install 400 new substations, according to the Colombian daily El Tiempo. Half of the rural police, some 20,000 in number, will be agents with anti-guerrilla training. A total of 15 anti-terrorist special forces will be deployed in Colombian cities.

Yet for all the muscle, Uribe has put into his so-called Democratic Security program, the FARC continues to thrive, all but securing a corridor to Ecuador by controlling the departments of Putamayo and Narino. Through this corridor the FARC receives supplies and its members escape into Ecuadorian territory when chased by the Colombian military.

The FARC is currently consolidating control of Aruca, a Colombian department that shares a border with Venezuela. Many analysts believe control of this area will open a significant corridor for export of cocaine through Venezuela, one facilitated by the Venezuelan National Guard.

The Dog’s Head area, where the Colombian department of Vaupes meets the Brazilian Amazon, has been a long-time FARC strong hold. Neither Brazilian nor Colombian authorities have managed to stymie the number of clandestine airstrips in this area, nor the flow of trade between Brazilian organized crime, based in Rio de Janeiro, and the FARC. The packages used to transport 250 kilograms of pure cocaine, interdicted outside Rio de Janeiro, Brazil in mid-July, bore the distinct FARC signature. This bust indicates that the old alliance between the Brazilian Fernando Beira-Mar and the FARC, propagated by transport routes used in the Amazons, is alive and well.

Colombia’s Black River eventually joins with the Amazon River’s upstream network in Brazil. It flows south through the Colombian department of Amazonas to the town of Leticia, into Tabatinga, Brazil. Tabatinga is a known meeting place where FARC operatives hand over cocaine, and Brazilian criminals deliver weapons and ammunition.

By most counts, it appears that Uribe’s security initiatives have worked well to secure the center of Colombia, the core areas where Colombians live and work, yet the rest of the country, the perimeter, in particular, remains ungoverned. Uribe may have succeeded in delivering security to many Colombians, but he has done very little to actually put a dent in the FARC’s wide spectrum of illicit activity.

It is quite possible that in the next year the FARC will have taken complete control of trafficking corridors through Panama, Ecuador, Venezuela and Brazil. If the United Self-Defense Forces of Colombia (AUC) continue to disarm, as planned, there will be relatively little resistance, by way of irregular security units, in Colombia’s perimeter areas.

The recent incident in Choco is just one more bullet point on a long list of upcoming conflicts.

Uribe’s plan to install another 40,000 rural police around the country is a great idea. It has raised the hopes of governors. But one, in particular, seems to have become a bit more nervous. His outcry of 170 kidnap victims got the world’s attention. Yet there was little anyone could do. The FARC made its presence known, and the addition of one rural police substation in Riosucio would not have made a difference...

You will find the audio link here.

Sam Logan is an investigative journalist who has reported on security, energy, politics, economics, organized crime, terrorism, and black markets in Latin America since 1999. He is currently completing his work on “Nice Guys Die First,” a forthcoming non-fiction narrative about organized crime in Brazil.

Post-World Cup Regional Roundup

As always, you may listen to this podcast here.

For today’s show I would like to share with you a basket of developments around the region from Mexico to Argentina, starting north and working my way south.

We are into the second week after Mexico’s July 2 elections and still presidential candidate Andres Manuel Lopez Obrador contests the results. He trailed Mexican president-elect Felipe Calderon by one-half point in the first count of votes. Obredor has stated publicly that Mexicans will take to the streets unless he’s satisfied with a recount.

Today, the 12^th of July, Mexicans have already taken to the streets, focusing on Mexico City’s central square. It could be the beginning of a nation-wide protest. And still I wonder, why are Mexican politicians not paying closer attention to the power of organized crime there?

Further to the south, in Nicaragua, one presidential candidate has died, which is likely to hand votes to former president and Sandista leader, Daniel Ortega. If Ortega wins, expect Nicaragua to take a sharp turn from a pro-United States posture. Venezuelan president, Hugo Chavez has been sowing seeds of support in both Nicaragua and Mexico. As president of Nicaragua, Ortega would likely begin to close ties between the Central American country and Venezuela, starting with more oil.

Meanwhile, Colombia and Venezuela started construction on a gas pipeline between the two countries on the 9^th of July. This is the first segment of a gas pipeline Chavez would like to extend to Panama.

With a terminal for Venezuelan gas in Panama, Chavez would likely begin selling more to China and his Central American counterparts. China, by the way, has upped their crude oil purchases from Venezuela from 168,000 barrels a day to 300,000 – a 45 percent increase. Between now and 2012, PDVSA expects to increase output by two million barrels a day. There are indications that much of this oil would go to China, but the East coast of the United States remains Venezuela’s top destination of oil products.

In Bolivia, president Evo Morales has realized the limitations of his power. The results of the vote to elect members to Bolivia’s upcoming Constituent Assembly did not give Morales’ political party the majority needed to enshrine its ideology into Bolivia’s new constitution. Morales’ party, MAS, won some 53% percent of the vote, while Jorge Quiroga’s party, Podemos, won some 23%. This means Morales will need to negotiate with Quiroga to reach consensus. This fact stifles any opportunity Morales may think he has to enact sweeping change in Bolivia.

Next door in Brazil, we are coming close to elections, scheduled for October, 6. Brazilian president Luis Inacio da Silva, better known as simply Lula, still holds the lead in polls over Alckmin. In the latest poll released, on Tuesday, the 12^th of July, the race has tightened. Lula’s lead has slipped from 22.4 percentage points to 16.9 points. Still, if the election were held today, Lula would win with 44.1% percent of the vote, while his top competition, Geraldo Alckmin, Sao Paulo’s former governor, would take some 27.2 percent of the vote. Yet 50% of Brazilian voters are still undecided.

A factor that may hurt Alckmin in the future is the continued violence in his home state of Sao Paulo. When Alckmin began campaigning some months ago, he stood on two pillars – increased security and economic improvement. Under Alckmin, Sao Paulo saw both. He claims he can do the same for the nation. Yet as many of you probably know, Sao Paulo has had some trouble with prison riots, gang members attacking police stations, and cops retaliating with brutal force, sometimes excessive if you ask human rights advocates.

On the 11t^h of July, a third round of attacks, 38 in all, targeted police stations, buses, and empty banks. These attacks, organized by the First Capital Command, known as PCC in Portuguese continue to erode away at Alckmin’s security record. I have to wonder if that will translate to votes. If Lula wins what can he do to improve security in Sao Paulo? Not much.

As we’ve seen today, Lula has again offered federal help, but that help must be accepted by the governor of Sao Paulo. So far is hasn’t, and as long as the governor of Sao Paulo does not support the president, there will be a power struggle. The same is true for the state of Rio de Janeiro. I wonder if this is part of the reason why both of these states have a serious problem with organized crime.

In the Southern Cone, Argentina has seen a rise in crack use. It has doubled between 2001 and 2005. One dose of one gram costs one peso, or 32 cents. It’s hard to think of something that’s as cheap as 32 cents. You can’t even buy one can of coke for that amount anymore. The development that has led to this rise in crack use is cocaine cooking in Argentina. Argentine drug dealers years ago began to purchase coca paste from Bolivian connections so they could cook the cocaine in houses closer to the major market in Buenos Aires.

Cooking the cocaine yourself removes a handful of middle men. Past is less risky to transport, and once the cocaine is cooked, high purity levels ensure good sales. The side effect, of course, is also a constant supply of crack. To my knowledge, Argentine president Nestor Kirchner has not made a public statement concerning his country’s security challenges or rise in drug use.