Guerrero on Extortion

Over at InSight, I have a comment on and a partial translation of Eduardo Guerrero's new Nexos piece on extortion. It's easily the most detailed look at the application of extortion in Mexico and why it is different from other crimes. (His piece, I mean, not mine.) From my comment:

There are a few of elements of extortion that distinguish it from drug trafficking. One is that it necessarily includes the periodic employment of violence. A successful drug shipment is moved without any bloodshed; the violence that the characterizes the industry isn’t a product of the criminal act in and of itself, but rather the smugglers’ reaction to things that get in their way. While it is true that in Mexico all of the known drug gangs are highly violent, other nations’ experiences show that it is possible to run a successful drug trafficking enterprise without relying too heavily on murder.

In contrast, extortion gangs can’t make money without a fearsome reputation based on a credible threat of punishment for those business owners who refuse to pay. Therefore, from time to time, successful extortion gangs will be obligated to demonstrate their willingness to burn the businesses or take the lives of those who don’t comply. The fire that killed 52 people in a Monterrey casino last month is just the most recent illustration, but there’s been an abundant supply of less deadly examples over the past several years.

Violence stemming from extortion also targets civilians (though not exclusively) rather than just members of opposing criminal groups. As a result, extortion presents a more direct threat to citizen security than drug trafficking alone. It also has a multiplier effect that makes extortion more harmful to the society at large, beyond the direct victims, than most other common crimes. Insofar as it targets the wealthy, extortion disincentives success and acts as an illegal tax on prosperity. Consequently, extortion is a burden on free commerce to a degree that most crimes are not.

Extortion thrives against a backdrop of lawlessness; if the victims of extortion schemes had confidence that the authorities could protect them, far fewer protection payments would be made. As a result of the generalized breakdown, smaller extortion gangs (as well as gangs specializing in bank robbery, kidnapping, et cetera) can proliferate and flourish. The rise of extortion is not just the product of the biggest illegal organizations in Mexico seeking new revenue, but also demonstrates the organic growth of a new criminal industry.