Legal U.S. Pot Won’t Bring Peace to Mexico

Jan. 21 (Bloomberg) -- Since Jan. 1, Colorado has had alegal marijuana market. The same will soon be true in WashingtonState, once retail licenses are issued. Other states, such asCalifornia and Oregon, will likely follow suit over the nextthree years.

So does this creeping legalization of marijuana in the U.S.spell doom for the Mexican drug cartels? Not quite. The illegalmarijuana trade provides Mexican organized crime with about $1.5billion to $2 billion a year. That’s not chump change, butaccording to a number of estimates, it represents no more than athird of gross drug export revenue. Cocaine is still thecartels’ biggest money-maker and the revenue accruing fromheroin and methamphetamine aren’t trivial. Moreover, Mexicangangs also obtain income from extortion, kidnapping, theft andvarious other types of illegal trafficking. Losing the marijuanatrade would be a blow to their finances, but it certainlywouldn’t put them out of business.