The Economist reports that Mexican business leaders envy Brazil. Mexicrats must have been miffed when Goldman Sachs anointed the ‘BRIC’ without including a ‘M’. At the time (2001) there was reason to protest. In the previous half decade Mexico’s GDP growth more than doubled Brazil’s: 4.5% versus 1.9%. Mexico had just joined Chile as the only Latin American nations with an investment-grade credit rating. Furthermore, each nation had a tumultuous past, riddled with debt and currency crises, Brazil more recently than Mexico. And Mexico seemed locked-in to stable growth thanks to preferential trade ties with the US via NAFTA.

Fast forward to 2009. Brazil is the first Latin American nation to exit recession. Mexico is still under water, and likely won’t gasp its first breath of recession-free air until mid-2010. Strangely, according to key indicators, not so much changed between 2001 and the “Great Recession.” GDP growth between 2002 and 2007 was about the same for Brazil and Mexico. Each nation enjoyed low inflation, both nurtured formidable MNCs, and both continue to struggle with corruption and drug-related violence on a grand scale.

What’s going on? Currency provides great insight into the shifting fate of each nation.

Currency strength reflects current macroeconomic health and outlook. The Brazilian real now sits near pre-recession levels, about 1.75 reais to the dollar. Despite a recent rally the Mexican peso is far from recovering its pre-recession valuation, down over 20% vis-à-vis the dollar.

Beneath the data sets of recent years, Brazil’s economy has been driven by demand for its commodities from China, India, and elsewhere. Additionally, Brazil has distinguished itself in emerging niche markets, such as aircraft production and biofuels. Dynamic trade buoys the real. Meanwhile, Mexico has kept to traditional strengths: oil, tourism, and manufactures for the American market. Oil is down 50% since last year, tourism has dropped off a cliff, and cheaper Chinese goods fill Wal-Mart, pushing out Mexican trinkets. Reliant upon consumption in America and lacking innovation, Mexico just doesn’t offer the prospects of Brazil.

An elaborate resting place. A celebration of perspective. Two years ago the National Museum of Death opened in Aguascalientes to chronicle cultural approaches to the end of life. “Mexicans have death imprinted all over their art and culture.” So says Jose Antonio Padilla, the museum’s director. It is the moribund product of Octavio Bajenero Gil, who had too many skeletons in his closet after 50 years of collecting macabre figurines, posters, and the like, and the Autonomous University of Aguascalientes, which was looking to open a museum with a twist. Gil’s collection now forms the backbone of the museum.

The museum’s first historical epoch explores pre-Columbian civilizations. The Aztec are a natural focal point. Known for their warrior culture and brutal imperialism, the civilization was preoccupied not only with ritual human sacrifice to satisfy gods, but also the need to absorb life forces. Hence, the Aztec’s fervid belief in cannibalism.

Other exhibits include diamond-encrusted skulls gnarling at visitors and a dining table of skeletons toasting their own demise. In one room the grim reaper faces a case full of blood-drenched crucifixes. In another, a small quartz crystal skull sits on prominent display. Three have been found in Mexico, 13 are rumored to exist, each with paranormal strengths. Claimed to be of Mesoamerican provenance, new age movements and quack archeology have churned a rumor mill that the skulls reunification is necessary to forestall a cataclysm, perhaps the Mayan doomsday prophecy.

Several dozen paintings depict death on canvas. Calaveras, skeleton cartoons, are perhaps the most ubiquitous depiction of the dead in Mexico. Mexican newspapers regularly carry calaveras, usually accompanying them with satirical poetry. Calaveritas, tiny clay skeletons, are ubiquitous in the museum, and in Mexico in general. Coupled with marigolds and skull-shaped candies, calaveritas adorn the altars made by Mexicans during the Day of the Dead festival. On the night of November 1 and 2, Mexicans remember dead family members with graveside vigils, where they present their altars. Many towns have come to incorporate music and dancing into the Day of the Dead.

Catholicism pervades modern depictions of death. “Saint Death,” known to gringos as the grim reaper, is worshipped in shrines throughout many poor barrios in Mexico. It isn’t uncommon for patrons to leave offerings in front of a museum display. Juan Manuel Vizcaino, assistant director of exhibits, says, “Sometimes we have to remind them that it’s a museum, not a place of worship.”

Reaction to the museum has been mixed. Padilla notes, “some people from (border cities) in the north will say, ‘Why do you want to celebrate something I am trying to avoid every day?” No doubt, the persistence of drug violence makes many wary, but Padilla insists the museum celebrates a distinct artistic tradition. Too bad this tradition has such a rich canvas in present-day Mexico.

With federal resources aimed at drug traffickers and local police more often a part of the problem than a part of the solution, vigilantes are stepping into the void. Suspected criminals who run afoul of these vigilantes endure the brunt of a skewed version of justice that enjoys a groundswell of support. In the southern state of Guerrero and crime-wracked Juarez vigilante corps have taken shape, acting as shadowy militias.

Vigilantes focus retribution on suspected burglars, petty thieves and muggers. Such crime is rife in Mexico, and its perpetrators pose a distinctly different threat than the type presented by drug thugs. Many of the alleged criminals are teenagers. Their persecutors are typically older community members, sometimes including the aggrieved parties.

Vigilante justice typically involves harassment, beating and humiliation. The prey are left in public, tied to light posts or the like, and badly beaten. Recently, an example was made of boys suspected of robbery in Tepic, in the state of Nayarit. A video of their punishment was posted on Youtube: “Little Rats of Tepic” showed the boys being forced to kiss, among other indignities. (The video was quickly removed as unsuitable content.)

Support exists for even the most severe form of punishment. In February a retired general shot a 30-year-old man trying to break into his house. Newspaper headlines read “Dead Rat” and “Military Justice.” Public sentiment was strongly in favor of the killing.

The gaping hole in President Calderón’s push to reform Mexico is local governance. Absent effective local police and bureaucracy, problems like vigilantism emerge. Persistent drug violence demands Calderón’s attention in the short-term. Meanwhile, anarchic strife in Mexico’s villages is sure to continue. At some point the Mexican reformer will have to reaffix his gaze.

Reliant upon consumption in the US, Mexico’s economy has suffered mightily this year. The pillars of state revenue—oil, remittances, and tourism—have been shellacked, thanks not only to recession in the US but the outbreak of H1N1. First quarter projections had the Mexican economy on track to contract by 20%! More recent forecasts expect GDP to shrink by 6%-7% for 2009, still heinous by industrialized nation standards. Despite these setbacks, I would like to point out two examples of how Mexico is helping its neighbor to the north.

Rising unemployment in the US is slowing the trend of northward migration. While fewer Mexicans are seeking work in the US, the ones that have already crossed the border aren’t returning home en masse either. Given the risks of associated with returning, to say nothing of the exponentially higher wages if one can land even intermittent work, most undocumented Mexicans in the US are staying put. And drawing on family support to stay afloat.

Immigrants’ families are now sending money to their loved ones in the US, reversing the trend of remittance payments. “This was something that was never seen before,” says Demetrio Sotamayor of the Chihuahua state tourism department. Mexico’s Interior Ministry has not released any numbers on the amount of money being sent to migrants in the US, but evidence of the trend is increasingly apparent throughout Mexico. The monies being sent are most likely the immigrants’ own savings, so the reverse remittance pattern isn’t mere filial charity. Other factors, such as the proliferation of pawnshops in Mexico, are also being drawn on as a source of easy cash.

Meanwhile, Mexico is proving to be a recession-defiant market for American business, remarkable given Mexico’s boom-bust heritage. (Prior to the recession, Jim Cramer referred to stocks of Latin American companies as “always a trade.”) Foreign investment in, say, the 1970s yielded high returns for the next several years. Investment in 1981 would have been worth less in 1990. The particular industry that is excelling is even more surprising: banking. Banamex, Mexico’s second-largest bank, made $750 million in the first half of ’09, a handsome sum amidst the recession’s nadir. And at just the right time for Citi, which owns some 34% of Banamex. Varying estimates suggests that Banamex accounts for between 15-17% of Citi’s profits. Problem is, Mexican law prevents foreign governments from operating banks in Mexico and because Uncle Sam has a sizable stake in Citi at the moment, on the surface the association runs afoul of Mexican law.

If Citi is forced to sale, Banamex could fetch $20 billion. A divorce would surely benefit Banamex. Unlike many banks in emerging markets, Citi doesn’t much help Banamex with lower funding costs. Also, in shearing the Citi chord Banamex would be well situated to attract previously reluctant customers. The benefits approach nil for Citi. Exposure to toxic assets ensure Shiti will not be making money in the US for years to come, so reliance on foreign markets like Mexico is really the only reason the lumbering lout of American banking does not have to go hat in hand back to Washington to ask for more money.

These anecdotes do not add up to the conclusion that Mexico is going to boost America’s recovery. The Mexican economy ($1.3 trillion) is just too small compared to America’s ($14 trillion). But the well-steeped notion north of the Rio Grande that Mexico is a general nuisance is ignorant. Mexico aids America’s development. In good times, when the US economy is growing and unemployment is low, Mexicans seek low-wage jobs in the US, thereby keeping inflation down. In bad times it seems Mexico is also lending a hand.

The Olive Ridley sea turtle was nearly hunted into extinction two decades ago. Oaxaca’s beaches were a slaughter ground where the turtles—large, slow on land, and unable to retract their heads into their shells—were targeted for their eggs (hailed as an aphrodisiac), meat, and fat. Prior to 1950, 10 million Olive Ridley nested on Mexico’s beaches, but that number dwindled to an estimated 40,000 by 1988. Today, the species is enjoying a comeback thanks to the protective hand of the Mexican government.

Olive Ridley’s nest in large numbers on just a handful of beaches, primarily in Costa Rica, India, and Mexico. In 1990 Mexico banned the killing of sea turtles, including the harvest of turtle eggs. And now the Mexican navy patrols the shores of Oaxaca’s beaches to ensure safe nesting. Though still classified as “endangered” an estimated one million Olive Ridley’s nest on Mexico’s shores each year.

I highlight this story for two reasons. First, Mexico has been lambasted in the past, with some reason, for its environmental track record. Anachronistically, Americans widely view Mexico as the land that fancies catching dolphin in tuna nets. Mexico deserves credit for having turned a corner. Second, What is the Mexican navy doing? Among Latin American militaries, Mexico’s navy is extremely small and outdated.

Overdue reform was swiftly executed last Saturday night when federal troops descended on Luz y Fuerza del Centro, a state-owned electric company serving central Mexico. The plant was closed, operations were handed over to a larger state-run utility, and 44,000 workers were jobless come Sunday morning. The president’s decree cited inefficiency and ongoing operating losses that required large transfers—$16 billion between 2003 and 2008—from the government.

Severance packages are on the whole generous; the average employee will receive more than 2.5 years of salary. Still, the decision is generating widespread protests, and thousands have balked at the offer. Some critics claim the tactics were a throwback to the authoritarian days of PRI rule, while others say the decision was retribution for the utility’s support of opposition candidates.

This was an audacious move by President Calderón, but not because of the terms. Sure, firing 44,000 without notice may seem harsh, but with such hefty pay offs, the terms would make most Detroit line workers salivate. Rather the timing is suspect. Mexico is in the midst of its worst recession since the “lost decade” of the 1980s, and, unlike Brazil, it isn’t clear the end of the recession is at hand. No matter the size of the severance package, such a move is brashly pro-cyclical. The government should mark time, or even hire more workers to help address Mexico’s unemployment. Inefficient industries should be targeted once the economy is growing again. Keynesianism is enjoying a revival elsewhere, why not in Mexico?

I have been strongly supportive of Calderón’s past reforms. Recent news warrants serious circumspection. Laying off state employees in times of recession requires gumption or lunacy. Or maybe this was just a sage political maneuver. Having lost Congress to the PRI in July’s election, Calderón can now spread the blame if Mexico’s recovery is retarded or tepid. Mr. Calderón is right to pursue economic modernization, but does he have to do so right now?

According to History Channel lore, the Mayan calendar ends on December 21, 2012. Indeed the Long Count calendar, one of several used by the Maya, reaches the end of a 394-year cycle, known as a Baktun, at about that time. The Long Count calendar begins in 3114 BCE; hence, 2012 AD will mark the end of the 13^th Baktun.

Popular consciousness has conflated “Mayan calendar” and “end of cycle, 2012,” interpreted ‘cycle’ to mean ‘existence’, and spawned a rumor mill that the world is on the brink of destruction. Turns out, global demise is at hand, rife with meteors, tidal waves, “pole shifts”, nuclear annihilation, etc. I, for one, was unaware until last semester. While returning mid-term exams, a student quipped that his grade didn’t matter because everyone is going to die in three years anyway. Normally a quiet bunch, I found myself among a chorus of doomsdayers. The speculation seems unlikely to abate—next month the apocalyptic thriller “2012” will debut in theatres.

Unlike other doomsday prophecies, this one contains a germ of archeological and astronomical truth. Along a rural path in southern Mexico, a tablet known as Monument Six was discovered in the 1960s. Inscriptions on the ruin note the year 2012 and speak of something happening with Bolon Yokte, a Mayan god associated with war and creation. One section of Monument Six roughly translates as, “He will descend from the sky.” A little eerie perhaps, but nothing too damning when put in context. David Stuart, an expert on Mayan epigraphy at the University of Texas, states, “The Maya never said the world was going to end, never said anything bad was going to happen necessarily, they are just recording this future anniversary on Monument Six.” The Maya also plausibly cited 2012 because they were astronomical prodigies. Upon the 2012 winter solstice the sun will line up with the center of our Milky Way, an occasion that only comes around every 25,800 years.

But the idea of the clock “running out” in 2012 is a Western invention. The Maya in fact celebrated the end of cycles, so the transition from the 13^th Baktun to the 14^th should be greeted, if anything, with revelry. And the Maya noted dates beyond 2012. Guillermo Bernal of Mexico’s National Autonomous University points out inscriptions at various Mayan sites reference future dates as far away as 4772. Part of the misinterpretation emerges from the Mayan practice of pre-recording important dates.

Still, experts are getting rather frustrated with the hubbub surrounding the Mayan calendar. Apolinario Chile Pixtin, a Mayan elder, is annoyed: “I came back from England last year, and man, they had me fed up with this stuff.” Sandra Noble, executive director of the Foundation for the Advancement of Mesoamerican Studies, calls the doomsday scenario “a complete fabrication and a chance for a lot of people to cash in.” Academics and Maya elders instead believe Earth in 2012 will be hit by a “meteor shower of new age philosophy” and pop astronomy, no doubt teased by TV specials.

Ruminating on doomsday in three years may be engrossing, but it’s a luxury many Maya don’t have. A drought-stricken 2009 is proving quite harsh. According to one Yucatan archeologist, if you went to Maya Yucatan communities and said the world might end in 2012, “They wouldn’t believe you. We have real concerns these days, like rain.”

Two seizures last week resulted in the largest meth-related interdiction in Mexican history. Seventeen tons of 2-phenylacetaminde were seized entering Mexico from the customs point at Nuevo Laredo. Twenty tons of sodium phenylacetate were uncovered at the Pacific Ocean port of Manzanillo. Both ingredients are integral to the manufacture of methamphetamine and could have been used to make as much as 25 tons of crystal meth.

It is likely that the chemicals intercepted at Manzanillo, Mexico’s busiest port, were bound for a laboratory operated by La Familia, headquartered in the neighboring state of Michoacán. La Familia is an infamous drug cartel known for its control of the crystal meth market. President Calderón has moved aggressively to dismantle La Familia this year; so far, more than 100 of its leaders have been arrested, and more than 40 meth labs have been closed. The outfit’s political cover has also been under attack. In a well-publicized round up of venal officials in May, ten mayors in Michoacán were arrested for suspected ties to La Familia. An arrest warrant was recently issued for Julio César Godoy, the governor’s brother, for suspected ties to the cartel.

La Familia isn’t folding. As opposed to many of the other major cartels in Mexico, La Familia operates a public relations campaign that endears community support—it is known to fund the paving of roads, is widely believed to be a major contributor to the Catholic Church, and even circulates literature that mixes pop-culture with Biblical teachings. Defeating the cartel might be the tallest order of the government’s drug war.

Linkages are being drawn to Mexico’s drug decriminalization announced last month. No doubt some believe this is proof-positive that the government is more freed up to focus on the big fish, the cartels. I doubt there is much in the way of causality in this latest bit of news. Large seizures at ports and customs points indicate better inspection. Large seizures at makeshift factories would indicate better intelligence. The latter are needed to affect aggregate supply in Mexico. A litany of large raids in the coming weeks and months would assuage my skepticism. Eviscerating La Familia would prove the government is making irreversible strides in the right direction.

The never-ending year lurches on in Mexico. Verano becomes otoño, drug violence headlines become H1N1 headlines. Good news is Mexico has a track record of ably handling the pandemic. Bad news is upwards of 5 million in Mexico are expected to contract the infamous strand of influenza this winter. Perhaps 2,000 could die as a result. Already this month there have been as many as 483 diagnosed in one day, eclipsing April’s peak.

With such a scale, Mexico may face challenges it did not have in April. Last week 3,000 schools closed as a result of H1N1. That number quickly dropped to just over 100, and Education Secretary Alonso Lujambio recently told senators that the government is working out criteria for future school closings. Government officials are hinting that mass closings are unlikely, and given past management of the crisis their word should be taken. Solace comes from preparation and what the CDC terms a “lucky break.” Flu shots are not expected until October, but so far the virus shows no signs of mutating, meaning the antidote should match the poison. Will rural hospitals get their hands on ample stocks? This time around distribution, not diagnosis, is likely to be the measuring stick by which the Mexican government’s response is judged.

Gold plated AK-47s. Marble columned mansions with caged panthers in the foyer. Caches of jewel-encrusted gold crucifixes affixed to heavy chains. Lots of bling is how you live when “investing for retirement” refers to your grave setting. And so it has been in Mexico among the drug gangs, spawning a pop culture infused with reverence for violence mixed with epicurean delights: narcocultura.

Narcocultura has a certain “pull yourself up by the bootstraps” appeal among poor boys who lack educational and job opportunities. “You’ve got these mythological figures, and if you take a 12-year-old who is living on a dirt road, no electricity, some very high poverty setting and they see these people, it’s a fantasy to be able to live like that. To have all that power and to be able to be so powerful even the government is afraid of you and they can be corrupted by you,” says Mark Edburg, a cultural anthropologist at The George Washington University. It is also laden with sex appeal. Young girls frequent beauty salons and mimic trends to try and catch a life of immediate luxury with a “narco prince.”

Mexican gangster raps, better known as narcocorridos, are rhythmically distinct from the American variety, but similarly contain vivid depictions of life in the fast lane. The lyrics can be quite profound, reassessing history, shootouts, and the justice system from the subaltern perspective. The natural beauty of mountains are a common theme. References to grandeur seem moored by a psyche that never can quite overlook a sunset, because tomorrow truly isn’t promised.

Much about narcocultura is now fading away. The government’s war on the cartels has made many of the more ostentatious trappings a thing of the past. Nowadays drug chieftains are rather more dapper, or rather more plain, blending into the social scene rather than sticking out. Their image, like their dress, is now muddled, “narco love” is met with “narco hate.”