The Failing War on Drugs

Network Model of Drug Flow from Mexico to the U.S.

LCDR Ben CipperleyCPT Kevin Larrabee

11 JUN 2012

Agenda

• Problem Statement• Drug War Background• Modeling• Producer/ Consumer Model• Demand Flow Model• Conclusions• Questions

Problem Statement• 65% of narcotics in the U.S. flow from Mexico

– $45 billion annually in producer/distributor profits– 99% of all flow from Mexico is overland (U.S. DOJ)

• Understand the overland flow of drugs network from Mexico into the U.S.– How do narcotics flow across the border?– What motivates flow?

• How to best attack the network– Attack Demand– Attack Distribution– Attack Supply

War on Drugs

• U.S. War on Drugs– Roots formed during Prohibition (1920’s)– DEA created (1973)– CIA and military involvement (1982)

• Demand topped $60 billion in 2012

• $15 billion on drug enforcement in 2010– ~$500 per second– Interdiction budget $3.9 billion

Front Lines

• U.S. Customs and Border Patrol– 21,444 Agents– 18,506 on the SW border (86.3%)

• Apprehensions– 96% of all CBP apprehensions

occur on the southwest US Border

• Military Planning Model– Info and Intel driven response

A Typical Border Crossing

• Different capacities by location– San Ysidro, CA = 24 lanes – Laredo, TX = 20 lanes– Naco, AZ = 2 lanes

• 2.7 million loaded container trucks entered the U.S. through the SW border in 2009

• An estimated 30% of all narcotics shipments are seized at the border

De La Vega Background

• Don Diego de la Vega is the new drug lord of the Zetas Cartel and is focused on pushing cocaine into the U.S.

• Zetas cartel struck new deal to combine resources with Sinaloa Federation and the Cartel Pacifico Sur

• Cocaine Manufacturing facilities emerge in 8 Mexican cities

Real Life ScenarioThe Drug Lord- Don Diego De La Vega

Objectives

• Understand how to best attack the network by measuring the amount of profit gained

• Red Team (De La Vega) – Maximize profit through minimum cost flow– Maximize narcotics flow into the U.S.

• Blue Team (U.S. Border Patrol)– Maximize the cost of production/distribution– Reduce the amount of narcotics flow– Improve interdiction capability

Model

Model

Model with Network Overlay

Ciudad Victoria

END

START

Modeling the Network

• Assumptions– Omniscient and omnipotent Drug Lord– Shipments occur overland using legal U.S. border

crossings• Both the U.S. and de la Vega act optimally• Flow starts from Mexico (no domestic production)• Simultaneous attacks• Limitations– Only modeled legal border crossings– No political effects considered– Blue Force interdiction cost not calculated

Model Evolution

• Shortest Path– How does cocaine flow across the border?

• Producer/Consumer– Basic supply/demand model– Interdiction lowers capacity to zero– Not accurate for how drugs move (NOT Wal-mart!)

• Demand Flow– Profit motivates flow– Every crossing evaluated for “efficiency”– Interdiction lowers efficiency to zero– Demand vs. Supply Interdiction– Reduction in efficiency through training

Producer/ Consumer

Producer/Consumer

• Supply of 9,500 kilos produced across nine facilities in Mexico

• Demand of 9,500 kilos in the U.S.• Costs to use a road are based upon price of fuel

per gallon and distance to destination• Costs to move flow through a border crossing are

bribe amounts as a function of number of arrests• Interdictions reduce the flow capacity to zero by

making the cost equal infinity

Producer/ Consumer ModelSUPPLY

Ciudad Victoria -500Saltillo -1000Torreon -500Monterrey -2000Reynosa -600Matamoros -900Chihuahua -2500Hermosillo -1500

DEMANDBakersfield 215San Diego 794Los Angeles 3289Phoenix 1075Tucson 252Austin 440Dallas 1634Houston 1525San Antonio 549

• Supply is a function of projected production facilities

• Demand is a function of population percentage of the Southwest

Additional ParametersPRODUCTION COSTS

Ciudad Victoria 12000Saltillo 15500Torreon 12500Monterrey 15000Reynosa 13000Matamoros 13500Chihuahua 12000Hermosillo 11000

BRIBESSanYsidro 1295 Fort Hancock 1490OtayMesa 1295 Presidio 1490

Tecate 1295 DelRio 1490Calexico 1295 EaglePass 1490Andrade 1295 Laredo 1490SanLuis 3763 FalconHeights 1490

Lukeville 3763 Roma 1490Sasabe 3763 RioGrandeCity 1808

Nogales 3763 LosEbanos 1808Naco 1780 Mission 1808

Douglas 1780 Hidalgo 1808Antelope Wells 1230 Pharr 1808

Columbus 1230 Progreso 1808SantaTeresa 1230 LosIndios 1808

ElPaso 1315 Brownsville 1808Fabens 1231

Operator Resilience Curves

Bribes Constant• Same results as shortest

path• At ten interdictions, only

decrease profit by $6000

Bribes vary by location• At three interdictions,

cannot move through NM• At ten, lost of $2 Million in

profits

Cannot use NM

Cannot use San Diego

cc

Bribes Vary by Location

Compound Strategy• Find a way to increase production cost and increase

distribution cost – Seize product– Force higher labor costs– Force him to develop innovative hiding and storage– Decrease of $20 Million Dollars in Profit

Demand Flow Model

Demand Flow Model

• Profit motivates flow • Realistic price-driven distribution• Delivery limited by capacity• Efficiency

– Demand profit per kilo • $19,000 (Austin)-$29,000(Dallas)

– Production cost per kilo• $10,000(Ciudad Obregon) - $15,500 (Saltillo)

• De la Vega limits flow through a border to 1000 kilos• Interdictions reduce flow on an arc to zero

Ciudad Victoria

END

START

MIDDLE

Demand vs. Supply Interdiction

Essentially no effect!

Stop Production in Saltillo

Reduce Production in Monterrey

MAXIMUM EFFECTS!

Border Interdictions

Supply Interdiction

What We Can Do?

• Account for randomness in the model– 20 model runs to find the expected value

• Influence De La Vega to forgo 2800 kilos in production capacity• Reduce amount delivered by 2700 kilos• Reduce profits by more than $15,000,000 with no additional resources

applied

IMPROVE CAPABILITY TO REDUCE EFFICIENCY!

Conclusion

Conclusions• Understand the network

– How do narcotics flow across the border?• Through every possible avenue by means of lowest cost

– What motivates flow?• Profit!

• How to best attack the network– Attack Demand

• Education, deterrence– Attack Distribution

• Best non-kinetic solution• Training (any improvement shows effect)• Improve border interdiction capability

– Attack Supply• Best kinetic solution• Cut the head off the snake

Further Analysis

• Consider Blue Force costs• Incorporate open desert crossing• Consider political/economic consequences

QUESTIONS?