Why are there no large drug cartels in the U.S.? The short answer is because it has lots of small ones. A longer answer might be that there are large drug cartels: they are called prison gangs.
These organizations maintain a tight grip on street gangs, which are the primary retail distributors of drugs in the United States. Prison gangs provide crucial protection for jailed members of these groups, and recruit from their ranks. They also negotiate the relationship between major Mexican drug cartels and street gangs.
The “loosely-coupled” street gangs, and the prison gangs who control them, fill the place of Mexican-style cartels north of the border. California provides a microcosm of this structure: Southern California is generally controlled by the Mexican Mafia, known as La Eme, and its affiliated Sureño street gangs, a loose federation of gangs stretching down through Central America that includes the Mara Salvatrucha 13 (MS-13). La Eme’s rival, the northern California-based Nuestra Familia, and its affiliated Norteño street gangs largely control California north of Bakersfield.
In reality, however, the geographic demarcations are more blurred, and cities in northern and southern California have members and cells of each street and prison gang. Further, there are race-based prison gangs like the Black Guerrilla Family and the Aryan Brotherhood that control their own street gangs and outlaw motorcycle gangs. There are also a significant number of independent actors who deal directly with Mexican drug cartels, according to the National Drug Intelligence Center’s 2009 National Gang Threat Assessment.
Through repeated business dealings, Mexican drug cartels have reportedly developed a relationship of trust with some Californian prison gangs, such as Nuestra Familia and its associated northern California street gangs. This trust has meant that U.S. groups increasingly take delivery of drugs from their Mexican partners on consignment, instead of paying with cash up-front, allowing the gangs to sell more drugs, more rapidly, with less internal conflict, according to a report from the Oakland Tribune.
The structure of the drug trade in the U.S. domestic market is distinct from the largely transit and production-based models seen in Mexico, Central America, and Colombia. According to scholars like Marcelo Bergman of Mexican think tank CIDE, distribution markets are inherently different from production and trafficking markets in terms of the numbers of organizations and individuals involved. Like production, distribution can be manpower-intensive and may require large numbers of employees to deal the drugs. However, the situation in the U.S. is not conducive to large cartels because big structures are vulnerable to being detected and broken up by law enforcement, which is more effective and well-funded than, for example, Mexico's law enforcement. Highly compartmentalized organizations, like the decentralized network of street and prison gangs, are better suited to the U.S., as a large number of small groups draws less attention from the authorities than one big organization.
There is a lot of money involved (some $29.5 billion*), with the vast majority of profits from the drug trade concentrated in the consumption market, according to the United Nation’s 2010 World Drug Report. The chart (left) gives the estimated percentages of profits at different stages of the drug business in the North American cocaine market and shows how much profit street and prison gangs stand to earn from the business.
The United States doesn’t have large drug cartels because it has vast decentralized networks of street and prison gangs and effective law enforcement institutions that keep these networks compartmentalized through arrest. However, as these gangs learn from their Mexican contacts, and given the vast sums of money at stake, it is possible that U.S. gangs could take on new forms.
* The $29.5 billion figure is derived by adding estimates of "U.S. wholesalers to U.S. mid-level dealers” and “U.S. mid-level dealers to U.S. consumers."
*Nathan Jones is a Post-Doctoral Fellow at the Baker Institute of Public Policy focusing on drug policy.