U.S.-Mexico Relations Today

Wednesday, November 10, 2010

Ambassadors Carlos Pascual and Arturo Sarukhan discuss U.S.-Mexico economic and political relations, immigration policies, and the need to overcome negative media portrayals of Mexico.

This session was part of a CFR symposium,200 Years of U.S.-Mexico Relations: Challenges for the 21st Century,which was made possible through generous support from the Consulate General of Mexico in New York, the Mexican Cultural Institute of New York, and CFR's Civil Society, Markets, and Democracy Initiative.

RAY SUAREZ: Welcome to what promises to be a series of challenging, informative and provocative conversations on "200 Years of U.S.-Mexico Relations: Challenges for the 21st Century."

I'm Ray Suarez. I'm senior correspondent for the "NewsHour" on PBS -- which I trust you see from time to time. If you don't, you owe it to yourself. (Laughs, laughter.)

We begin with a conversation on "U.S.-Mexico Relations Today." And on behalf of the council, I'd like to thank the consul general of Mexico in New York, the Mexican Cultural Institute of New York, as well as the council's Civil Society, Markets and Democracy Initiative, for their support of this symposium.

I'd like to note that the event is being held on the occasion of the bicentennial of Mexican independence and, in the same year, the centennial of the Mexican Revolution.

Please -- I'll ask nicely -- do not set your various communications devices to "quiet" mode or "vibrate" or any -- they really have to be really off, or else one of the ugliest noises known to man comes over the wireless microphone system. And we won't know who you are, but you will. So please, turn off your BlackBerrys, your pagers, your telephones, your -- whatever you got.

I'd like to remind all involved that this session is on the record. And let me begin by pointing out that this is, I'm sure, by common consent, one of the most important bilateral relationships on planet Earth for both countries. When you share a 1,400-mile land border, millions of citizens, tremendously promising, and significant today, trade relations, you're bound to have to talk to each other seriously, both as peers and, one hopes, as friends. How far from God Mexico is, is really up to Mexicans, but they have no choice at this point about being close to the United States; which is going to be the state of play, one assumes, in perpetuity.

So let me welcome our guests: Mexico's ambassador to the United States, Arturo Sarukhan; and our own ambassador, the U.S. ambassador to Mexico, Carlos Pascual.

And gentlemen, there's so much to talk about, in the security realm, in the trade realm, immigration, cultural exchanges, it's -- you know, we could sit here and talk all day; we won't. But let me get your --

MR. : (Inaudible.)

SUAREZ: (Laughs.) Let me get your view, if I needed a thumbnail description from a diplomat, of today's state of play, November 2010, this relationship between our countries. Ambassador?

AMBASSADOR ARTURO SARUKHAN: Well, I think I'd probably, given that you started with the old -- whether it was -- whether it's attributed to Porfirio Diaz, also of (General Ortega ?) -- these are historians that challenged who was responsible for that saying of "Poor Mexico, so close to the United States, so far away from God." I'd remind the audience that a good Israeli -- a good friend of mine, an Israeli ambassador in Mexico, when he had just arrived as ambassador, picked up the phone -- and as both Carlos and I do when we arrive in a new place; we seek to touch base with individuals in the government. And the Israeli ambassador called me and said: Can we have a chat? And I said: Delighted.

We started talking about Mexico's policy towards the Middle East, but we very quickly segued into the U.S.-Mexico bilateral relationship.

And he said: Look. Ever since I arrived here, I'm always surprised by -- when I hear this, of poor Mexico so close to the United States and so far away from God, because actually it should be the other way around. For Israel, it should be poor Israel, so close to God and so far away from the United States. (Laughter.)

And I start with this because I think that the thumbnail description of this relationship is a huge opportunity to fulfill the strategic parameters that this relationship provides to both countries. And the border is certainly a 3,000-kilometer region which does provide for huge challenges, some of them -- some of them that we are facing together as we speak, but it certainly also opens up huge opportunities for both countries to change fundamentally the nature of the game between both countries. I don't think that we have seen the commitment on both sides of the Rio Grande, both in Washington, D.C., and Mexico City, that we have seen today in terms of ensuring that this relationship regains a strategic footing since the days of NAFTA.

SUAREZ: Ambassador, and if you could, perhaps reflect on the same question in light of last Tuesday's elections.

AMBASSADOR CARLOS PASCUAL: I think, regardless of what the electoral outcome might have been, but including taking into account the change of position in the House, one of the things that I think the United States has to recognize is how important Mexico is to us.

I think sometimes there's a perception in the United States that the United States is doing for Mexico, that we're helping them with their security, that we're helping them get their problems under control.

We forget that Mexico is our number-two trading partner in the world. We forget that we export to Mexico more than we do to China, more than to the newly industrialized countries of Asia combined, second only to Canada.

As I've worked over the past year and a bit in Mexico and have met with every single major company, whether it's Ford or GM or Chrysler or Caterpillar or General Electric or Intel or Cisco, what I have been phenomenally impressed with is the extent to which the integration that they have had on design and production -- not just production, but also design -- has lowered their cost structures and increased their competitiveness and has increased their capacity to export and to produce for the U.S. market products that would not have been competitive globally otherwise.

And so part of the reality of Mexico today is that we are working together in this global market, and in that global marketplace, we are helping one another. And one of the things, I think, for a new Congress to develop an appreciation for -- because too many of the stereotypes are either the issues related to security or the issues related to immigration, with a perspective that Mexico can be a problem -- I think one of the first lessons is that Mexico is a partner, and that partnership has actually made both of us better off, and we need to appreciate that and strengthen that aspect of the relationship.

There are obviously security issues that are pressing to both countries. And in those security issues, I think we have to keep a very clear perspective that there are zones of extreme violence. And Ciudad Juarez, for example, with a homicide rate of 191 per 100,000 per year, is the most violent place in the Western Hemisphere. But as a country, Mexico has a homicide rate of 14 per 100,000, which is less than Brazil's of 25 per 100,000, which I think would probably surprise most of you in the audience.

And on immigration issues, these are difficult questions for both sides. And we need to find a way to be able to work through them, talk about them and develop an understanding of the human perspective behind immigration, because otherwise it can become an issue which very quickly becomes very volatile and very political without understanding the benefits that both countries can have to having some form of a normalized immigration system.

Those are, I think, the key issues I would put on the table to start.

SUAREZ: Ambassador Sarukhan, you see American media. You follow it. You see what Americans -- rank-and-file Americans are given from which to create an impression of the state of life in Mexico. Is that a portrait from which you can build a reasonable understanding of day-to-day life in your country? Is there too much concentration on the Juarezes and not enough on the places in the country that have been either less touched or hardly touched at all by what's going on?

SARUKHAN: Well, I addressed this issue just a few days ago in Washington, D.C. And I want to be very clear about this. As someone from my generation in Mexico that saw a very different Mexico from the one that we live in today where the challenges that the press faced were not from organized crime but from a government that was trying to shut them down and to, for example, control what they printed, in terms of their access to print, to be able to produce the papers, to the situation that we have today where we have an empathic free press. There's a huge seismic shift.

But one of the challenges that I think that we face, especially when it comes to international media, is that unfortunately you do see the dynamic of "it it bleeds, it leads." There is a narrative which is dominated by those Ciudad Juarezes of Mexico. And where sometimes it is a big challenge to provide either a contextualized understanding of Mexico or a broader vision of what else is going on in the country and a nuanced understanding that despite the challenges -- and I'm not going to sugarcoat the issue of violence and I'm not going to put it under the carpet -- there is a huge challenge that Mexico faces today in terms of violence being unleashed by drugs and -- (inaudible) -- organized crime in general.

But to infer from that that there is a brush fire from the Rio Grande to the Guatemalan border and it affects everyone indiscriminately is off the -- is off the mark. And I think that we have seen some important efforts by some media outlets in the United States to provide a broader picture, but this continues to be a challenge.

SUAREZ: Well, these things that we hear about on this side of the border seem to be one-upping each other week by week in their lurid, crazy violence, their Gothic nature -- the mass killings, the sort of bizarrely creative ways to make people suffer. That has to have some impression on this side of the border. Is it making -- how is it making your job, explaining Mexico to Americans, different?

SARUKHAN: Well, it's certainly not easy, again, because some of these images and some of these stories, for obvious reasons, because they're heinous enough and they're tragic enough to be a story in and of itself, do dominate perceptions of Americans of all walks of life as they look towards Mexico. But I think the challenge as an ambassador, as our consular network through the United States, in our interactions with everyone from civil society to the private sector to media, is to provide a nuanced, balanced understanding of what is going on in Mexico.

And there are some stories which are critically important for Mexico's future development. For example, I think you and I have talked about this in your show. There's a fundamentally important success story taking place in Mexico today which may not be as sexy as some of the stories that you see in the media but which is fundamentally transforming the face of Mexico, which is the expansion of the middle classes.

And this expansion that is happening in the middle classes in Mexico is a direct result, A, of Mexico's mooring into the international economy via NAFTA, the success story of NAFTA, which we have to continue to underscore; and, B, a sustained macroeconomic -- responsible macroeconomic policies over the last decade, at least since the 1994 economic crisis -- which was the last one of our making; this one was yours -- but certainly 1994, which was the last time that Mexico mishandled -- badly mishandled its finances. Since then, sustained macroeconomic policies, the fact that Mexico moored itself to the international economy, that exports grew this expansion of the middle classes, is profoundly changing the face of Mexico.

And it is -- you could probably say, well, and why is this relevant in the fight against drugs? Well, because, if we are going to be able to defang and detour and push back transnational organized crime, civil society is going to have to play a key role in a co-stakeholdership model with the government. If we can't convince civil society in Mexico that this fight isn't just against drugs and drug traffickers, but it's seeking to enhance and ensure the rule of the law and the empire of liberty, and that is the most important challenge for Mexico's democratic future, we won't be able to take on organized crime.

So this is why this facet that plays critically into the hands of how we understand the next steps and the next phases in Mexico's struggle to ensure the rule of law, this is why the story's so important. You've barely seen stories on these types of issues in the press.

SUAREZ: Was the sigh of relief louder in his embassy or your embassy when California voted not to legalize marijuana? (Laughter.)

PASCUAL: (Chuckles.) Who knows? (Laughter.) It -- I --

SUAREZ: But it would have complicated matters, wouldn't it?

PASCUAL: Sure. It obviously would have complicated matters. And it probably would have complicated -- in terms of my day-to-day life, maybe it might have complicated it more, because I would have been on the front lines of trying to explain it in the Mexican public and to Mexican officials, and the headlines the following day would have been, "America acknowledges co-responsibility, legalizes marijuana." It would not have been a simple public-relations issue to work through.

But I want to go back to the security issue for a minute, if we could, because I think that one of the issues is that we're constantly trying to understand what the nature of security problems are and how they've evolved. And I think it's important to understand them in order to come up with solutions that make sense. And one of the things that -- I think a slight trek back in history is useful for a second. In the 18 -- 1980s and the 1990s, the Colombian cartels dominated the drug trade in the Western Hemisphere. In the 1990s, the U.S. cut off the maritime lanes and essentially pushed the drug trade on land. And what you eventually got in Mexico by the end of the 1990s were essentially about four major cartels that controlled the movement of drugs on land.

In '97, stepping aside for a second, Colombia legalizes extradition to the United States and starts to utilize it. A couple of years later it begins Plan Colombia. Uribe is elected in 2002; much more intensive implementation of Plan Colombia, much more aggressive use of extraditions. And suddenly Colombian kingpins who used to be able to even run their organizations from prisons are finding themselves in jail in the United States and starting to cooperate.

What happens? The Mexican cartels move to Colombia and become the kingpins of the trade in the Western Hemisphere. And this part, we're still working on documenting what the amounts are, but the value of this market for the Mexican cartels goes from here to here. Well, I mean, those of you from this town, what happens when that -- when that occurs in a -- in a market in a legal economy? You get new entrants, you get mergers and acquisitions, and you get hostile takeovers.

What begins to happen in Mexico in 2002, 2003 is a radical increase in the levels of violence that begin as you get breakups and splits among the cartels. The challenges between the Tijuana cartel and the Sinaloa cartel; the challenges between Sinaloa and the Gulf cartel when Osiel Cardenas, the head of it, is arrested in 2003; the split of Arturo Beltran Leyva from the Sinaloa cartel and how that influences violence in Ciudad Juarez. And one can go through and name these splits over the period of time and essentially track what the escalation or the movement of violence has been.

If one goes through that story, the -- there are a couple of lessons to be taken out of that. The violence that Mexico is facing today is largely explained by the nature of the changes that happened in the drug market in the Western Hemisphere. And I think President Calderon at times is wrongly blamed for initiating a cycle of violence that took place as a result of standing up to these cartels. I would propose that if President Calderon had not stood up to the cartels, that this violence would have, in fact, largely occurred anyway, and that historically he will eventually get credit for taking the decision of eventually standing up to the cartels.

I think the second thing that comes out of this is for those who have argued, you know, can't we go back to the way it was, you know, before? It's like saying can't we go back to the 1990s market, right? It's a different world; it's a -- it's a different set of factors. And you can't go to that. And the idea that there can be some accommodation in the context of what were, in the past, transit cartels in Mexico is just unrealistic. It can't happen.

But then I think what it reinforces is, you know, what lessons do you take from that for the future? Well, one is what Arturo just said, is the importance of reinforcing the rule of law, because part of the reason that these cartels continued to be violent with one another is that Mexico did not have the inheritance of a civil justice system, because it essentially had one political party that dominated issues from the top to the bottom, and issues were decided by politics. And so the civil justice system at a state and municipal level didn't exist. And so creating that capacity now, with the federal police, the hugely important debate that's going on, on how to strengthen state and municipal police, how to work with the judiciary, is key.

And then there's the even tougher issue of what do you in the short term, because all of those other things take time to build up. And this then becomes a very critical part of the relationship between the two countries and what we do together, for example, on working on intelligence sharing, so that you can move from a strategy of patrolling the streets to in fact identifying where you have safe houses and bases and weapons stashes and vehicles, so you can destroy capacity; or the importance of better understanding the movement of money and how it gets invested, so that you can then block off more of the funds that are being laundered; or, in the United States, better mechanisms to build cases on arms trafficking, so that we can prosecute them in the United States.

And so I think that when we look at these issues of violence and the escalation of violence, we've got to appreciate that part of this was occurring anyway. Some of it may have become more acute in the last two years as President Calderon and the government has taken actions and as our cooperation in the Merida Initiative have become sharper. And it's not surprising to see the cartels react, but the interesting thing is that what I think they are pushing for is -- they're the ones who are pushing for a return to the past. They're the ones who are pushing for a return to that period of impunity when there was no consequence to their -- to the violence.

And so I think it forces us to continue to challenge ourselves, is -- how do we work on these issues in a way that can have an impact and in the end take us from us from violence to creating a prospect of really having a more secure environment with the rule of law. But we kid ourselves if we think that it was the confrontation with violence that brought on the violence. This was something that is rooted in something deeper.

SUAREZ: The way Ambassador Pascual gives our chronology sounds very logical, very defensible, but there's a sizable portion of the Mexican public that's not so sure that militarizing the conflict was the right move on the part of the president, and he's suffered in his support for that policy as there's been an escalation in this confrontation.

Seeing the army on the streets of Mexican cities is hard for a lot of Mexicans, isn't it?

SARUKHAN: Ray, if you look at the polls today in Mexico, support for the president's decision to deploy the armed forces is pretty high, and it -- and it's -- and it has maintained more or less at the same level when -- than -- when the president decided to use the armed forces as a stopgap measure.

The question that I would ask those who question the use of the armed forces and their being a blunt weapon in the fight against organized crime is, what other option was there? There was no other institution in Mexico when the president decided to push back against organized crime that could have borne the brunt of the operational capabilities that were needed to start breaking down the command, control and intelligence capabilities in the drug syndicates.

Do I philosophically or ideologically like seeing military being used in law enforcement? Of course not. There's a reason why the United States has something called the Posse Comitatus Act, which prohibits the armed forces of the United States being used in law enforcement. But in terms what the president was facing, the only instrument that could have been used to effectively push back against organized crime was the armed forces.

The challenge is how quickly we can proceed, as we rebuild civilian institutions in the federal police forces and retrain agents, to substitute the armed forces with the new vetted jointly trained units that are being put on line. And that process, whoever thinks it's going to happen from one day to the next is smoking too much of what we're seizing in Mexico. (Laughter.) It's going to take time.

SUAREZ: Having said that, President Calderon has another two years in his term -- he's term-limited to a single six-year term -- and hands on this policy to a predecessor (sic) who may be of his party and of his point of view, or not. How much is -- how important is continuity in this regard when you're in the -- in the midst of such a big, sustained conflict?

SARUKHAN: The only way that this decision will see us through with the results we all want to see is sustained efforts on both sides of the border. It will not only be that the next Mexican administration continues to rebuild civilian institutions, to strengthen the judiciary, to bring in civil society, to provide watchdog capabilities to what is being done, how you build (straighter ?) social cohesion, but it will also force the United States and Mexico to remain committed, because if we can't fundamentally -- and look, I know -- you know, I know the lay -- the political lay of the land in this country, but if we can't fundamentally, within what's in the books today, modify the current flow of weapons and bulk cash which are coming from the United States into Mexico and which provide the drug syndicates with their firepower and their ability to corrupt, it will be a very taxing challenge.

And we need sustained U.S. commitment with a long-term strategy to change what will be a generational challenge for both countries. And the thing that has to be told very clearly, Ray, to citizens on both sides of the border is, we will succeed or we will fail together.

PASCUAL: And -- but let me pick up on -- it's sort of interesting on the flip side of this, on the Mexican side of the politics of this issue. And it's -- you know, ironically, it's easier for him to comment on the U.S. politics of it and probably me for -- to comment on the Mexican part of the politics.

But one of the phenomena that I think has occurred in Mexico over the last year and a half is that organized crime has touched the lives of more and more people, and in particular as the drug cartels have diversified their business into extortion and robbery and kidnapping and trafficking in persons, but particularly the kidnapping. And here, you know, it makes sense that they -- with kidnapping, you follow the money. Where's the money? It's in Monterrey, it's in Mexico City, it's in Guadalajara. And by definition, it touches a different class of people who are wealthier and have political access.

And what this has done is that it -- it's heightened the politics of the importance of confronting organized crime because it's touching a class of people that have political influence. If you look at the polls today, even though -- if you ask people whether President Calderon's efforts have been effective, the vast majority will tell you no. The -- if you ask them, should he -- should you continue to support or confront organized crime, depending on the poll, between 65 (percent) to 80 percent will say yes.

And I guarantee you, the National Action Party is not the only political party who reads polls. And so -- you know, part of my job is to talk to the political leaders of every single party, and I can tell you in the PRI that every single major political leader, whether it's the front-runner in 2012, Enrique Pena Nieto, or Beatriz Paredes or Manlio Fabio Beltrones or a whole series of others, they will now tell you that these issues of security are issues of the state, not issues of a political party. And even the PRD, while it doesn't have as much of a base, will actually have that general line.

And there will be differences in tactics, but I think that the days when there was a perception that if once -- that once President Calderon was gone, that there will be a throwback to a bygone era, I just don't see that happening in Mexican politics. I think the politics of this issue have so radically and fundamentally changed because of the way they have touched people that I just don't see it happening.

SUAREZ: Lest security and the war on drugs cover the entire session, I want to move on because there are other pressing issues, and --

PASCUAL: (Inaudible) -- on economics.

SUAREZ: Well, yes, absolutely, absolutely. One of -- one of the most interesting parts of our recently concluded midterm elections was seeing how, even though there was no bill on the floor, nothing being marked up or debated in our national legislature, candidates kept running ads about immigration, which usually featured big automobiles filled with big, scary Mexicans -- shot in the dark, fences, people clearing fences, or even in Louisiana, where you don't -- you don't border Mexico in Louisiana -- David Vitter's campaign had wild, xenophobic ads about some Mexican onslaught.

Immigration lay just below the surface. All you had to do was scratch a little bit and it was there. What does that tell you, Ambassador? Even though we aren't in the middle of a debate about how to proceed from now, there isn't a legislative proposal; and yet, there it was, marking out politics. Especially -- as you moved further west, it got worse and worse.

SARUKHAN: First, that it reflects what I have said all along, that there's no more important issue for the future of the bilateral relationship than getting immigration right. And it'll have to be done on both sides of the border: Mexico will have to do things that it hasn't been able to or has been willing to do in the past. And on this side of the border, at some point you're going to need some sensible immigration reform that solves a lot of the Gordian knots of why it doesn't work today.

Immigration -- if you look back at the last three or four electoral cycles, immigration typically -- since the issue reared its head in terms of public consciousness in the United States, which it hadn't probably until the Bush administration -- has become a recurrent leitmotif of the midterms; but usually, in the presidential cycle its profile and its importance diminishes. What we saw again in these midterms is what happened in 2006: The issue did not play itself out in the presidentials; it was there in the midterm. And it has happened just all over again.

I think -- I think, despite the fact that, as you can imagine, as the Mexican ambassador in the United States, and the son of migrants in Mexico -- I'm first-generation Mexico on both sides -- so being the son of migrants in my country, this is an issue that is -- that I care for deeply. So you can imagine some of my reactions to some of the things that were said or some of the things that were shown on TV. But what I think we have to understand is that in a slow economy, with the great, profound changes that are occurring in this society with most Americans feeling -- whether it's perception or whether it's real -- that their kids will not be better off tomorrow than they were today, the issue of immigration has fallen on the floor with a big thud.

It is very divisive. It is very polarizing. It has triggered a narrative, especially on both sides of the border, sort of a Dickensian narrative of "A Tale of Two Cities." For most Americans, the issue of unauthorized immigrants in the United States is all about the rule of law, that people break the law to come into the United States without papers. For most Mexicans, it's not about the rule of law; it's about, A, do Americans recognize the importance of these labor flows to the future prosperity of both countries and, B, are Mexican immigrants getting a fair share because of their contributions to the economic vitality and well-being of America?

As long as we have these two very disparate visions of what immigration is about on both sides of the border, it's going to be very hard to have a more rational discourse across the border on the issue of immigration. But obviously, this is one issue that we will need objectivity, we will need leadership on both ends of Pennsylvania Avenue. Because at the end of the day, labor mobility and the ability of Mexico and the United States to complement each other's economy -- yours, capital abundant; ours, labor abundant -- over the next 20, 25 years, especially when Mexico's demographics are changing profoundly and we are going to become much more like you are in 20, 25 years -- you've got a birth rate of 2.4, I think we've got 2.2, so we are becoming a much older society. So even if, 20, 25 years from now, some of the TV pundits go on their knees to the Virgin of Guadeloupe Shrine in Mexico City to ask for excess labor to come up to Napa Valley, it won't be there, because our demographics will have fundamentally shifted.

So the big challenge is how do we build a bridge between now and when these demographic changes kick in which will -- regardless of whether we want to hash out an immigration deal, won't allow us to, because the situation on the ground will have been dramatically changed.

SUAREZ: During this same time, during our run-up to the midterms, a million people, mostly Mexican, took themselves home. Successful crossings were down. Deportations were up. You would never know any of these things from the tone of the debate in the United States. What's going on?

PASCUAL: Politics. (Laughter.) Look, based on the FBI's statistics, the four safest cities in the United States last year with a population of over 500,000 were San Diego, Phoenix, El Paso and Austin. And last time I checked, they were on the border.

SARUKHAN: San Antonio. San Antonio is the fourth one.

PASCUAL: Was it San Antonio?


PASCUAL: I think Austin was actually close behind. So there you go.

The point here is that there's a reality that we've seen on the U.S. side of the border that we've taken policies that I think make sense and have worked, and those policies have been based on investing in more people, in more intensive inspection, working with Mexican counterparts in building capabilities as they develop the Mexican customs service.

We now have 26,000 CBP and ICE agents on the border. During the Bush administration, the average was between 15(,000) and 17,000. And they're inspecting in both directions now, which had not been the case in the past. We've invested more in law enforcement, and part of what was important with the $600 million supplemental for border security that recently passed was actually to allow for more law enforcement activity on the border.

And so one of the things this demonstrates to us, and it's ironically part of the reflection of the solution that we need to build toward in Mexico, is that law enforcement works. Having the capacity to have law enforcement officers to investigate, to have contact with populations, to be close to communities, is an effective strategy in keeping our communities much more secure.

And so I think part of what we have to try to do is educate people that we do have a strategy for law enforcement that can keep our population safe; that we have to strip away some of the myth about insecurity which somehow gets shrouded around or placed around the whole immigration debate.

And then we have to help people understand the benefits to both countries of a normalization of those labor flows. I think Arturo's exactly right that in an economy with the biggest economic recession we've had in a hundred years, with unemployment still at about 9.8 percent, there is inevitably fear, fear that someone else might take your job, or if you don't have a job, that someone else might get to a job before you do. And if we can't provide legal transparency to how our labor markets are going to work, that fear is going to be worse.

And it's clear that -- I would think -- that the reason why there has been as much -- have been as many undocumented immigrants coming into the United States is because there's a demand for that labor. You can have a supply-side push, but believe me, if nobody's hiring, I mean nobody's giving them jobs, this is not going to start -- not going to continue going for a long period of time.

And if we can provide greater clarity and the legal parameters for that labor, then that gives everyone the ability to be able to look at those markets and understand where those labor flows might go and what the conditions are, and, for those who are undocumented now, what the conditions are for them to have a path to legality, whether that's learning English or paying a fine or paying back taxes. If you put those things together, then I think we have the capacity to actually move forward and have a better substantive solution.

But the problem today is that there is not the grassroots and political understanding of this. And there just simply aren't the numbers in either the House or the Senate right now to pass legislation. And so -- and this has been interesting for me, and a huge political lesson. There have been those who have told the president, look, you know, just take this immigration issue off the table for a while. It's hot, there are too many other things out there. And he's basically said no, because it is too important; it's too important morally and it's too important economically.

And he has said that unless we work on building a grassroots understanding about the importance of regularizing immigration flows and creating a legal framework around it, we are not going to be able to achieve success. And the only way to make that change is to keep the issue on the table, to promote discussion and dialogue, to help it occur at the grassroots, and to create the political base over time that's going to allow this kind of legislation to pass.

SUAREZ: We've talked about it in the technical, nuts-and-bolts policy terms: immigrant flows, remittances, labor hunger on this side of the border. But do we have to also find another language for talking to the two publics about the role immigration plays in our societies, has played in our history?

Ambassador Sarukhan mentioned that he is of immigrant stock from two different countries. Ambassador Pascual is also an immigrant to the United States. So this is something that's shaped who you are as 21st-century men. You understand it, but do your publics?

Are they ready to have a different kind of discussion about immigration from the one that we've had, and really isn't working so great for the United States, frankly?

PASCUAL: Well, you know, I mean, one of the things that's ironic is that in the polls in the United States you'll get a response that says 70 percent support comprehensive immigration reform, and yet 50 (percent), 55 (percent), 60 percent support legislation similar to SB-1070 in Arizona. And those are two fundamentally contradictory responses. And it demonstrates, on the one hand, what I think Arturo and I are both saying, that there is a degree of fear there, and that fear factor is what's leading people in an environment of uncertainty to reach out and look for something, anything, that gives them a sense of certainty and protection about what immigration might be, even if it's what I would think is the wrong answer.

And yet at the same time, there is this instinct that there needs to be some comprehensive reform of the system. This has not been translated back into a consistent set of public policies that the population can support. And here, I think, in the United States, one of the things that's going to be important for us is to develop an understanding among politicans and to be able to go back to a bipartisan base that we were able to have for a period time in the middle of this decade, but the constituencies that one could put together before, even with the same actors right now, you can't put them together.

SUAREZ: Right.

PASCUAL: And so I want to believe that some of those individuals have not fundamentally changed in their character and nature. But I think we have to change the political calculation. And right now, the political calculus is that immigration is a bad thing, it's seen only in the context of the recession, and it is going to take a phenomenal job of public education and consistency to be able to change that.

SARUKHAN: I would concur. I'd just probably provide a footnote. Carlos mentioned that around 70 percent of the American public support comprehensive immigration reform. I would probably clarify that. They support the principles that underpin comprehensive immigration reform. But the phrase "comprehensive immigration reform" has become a bad word just like "amnesty."

If you flesh out what comprehensive immigration reform entails -- that is, how to secure future flows of workers that can come into United States in a transparent, legal, orderly fashion; that you bring people who've been living in the shadows out of the shadows, but it's not a free ride, it's not a free ticket; they pay a fine, they go to the end of the queue, they demonstrate that they can speak English, they don't have a criminal record. If you flesh it out, people then give you 70 percent.

But what I'm trying to get at here is the challenge that we face, and which you addressed, Ray, is that the narrative which has been built around getting immigration reform is what is not flying today in the face of the deep economic recession. And our challenge is, as public officials, as media, as policymakers, as think tanks, is how do we create a new narrative as to why this issue is critically important for the future wellbeing of both countries by avoiding precisely the landmines of amnesty or comprehensive immigration reform, which are what dynamited this in 2005, 2006, and for the last time in 2007.

SUAREZ: Part of your problem, the way I see it as a frequent visitor in Mexico, is that the economy can't deliver for a large number of young people. I was in a tiny, tiny town in the mountains of central Mexico doing a story about Oportunidades, the attempt to lift up the poorest of the poor and keep more kids in school for more years. Tremendously successful in the number of secondary educated new young Mexicans that there are.

But I was hanging out with a lot of guys, 16, 17, 19 years old, whose fathers had third-grade educations and second-grade educations, and the only jobs these young fellows could get with their secondary qualification was the same jobs their fathers had with almost no education. And those are the "let's take a chance and try to cross the border" crossers of tomorrow, those young fellows.

SARUKHAN: Undoubtedly. That's why I started my remarks on immigration reform that there were two sides to the same coin, that Mexico had to achieve or attempt to achieve things that had been untenable or they had been unwilling to do, previous governments in the past. Number one is to anchor those jobs in Mexico, create enough well-paid jobs so that 200,000, 300,000 women and men don't have to cross the border into the United States because they're seeking a better-paid job.

SUAREZ: And, Ambassador, if I may, when you say "well-paid," they don't have to be as well-paid as the jobs people would find in Denver or Phoenix. They just have to be well-paid enough that it looks like a better shot to stay with your own parents and friends and the town you know and --

SARUKHAN: So we have to anchor those jobs, because, quite bluntly, our loss is the gain of the U.S. economy. These people are bold, entrepreneurial and some of them talented. And by losing them, we are losing Mexico's ability to reinvest its human capital and to trigger that type of growth and anchor those jobs in Mexico.

The second fundamental equation of this is that Mexico needs to ensure, at the end of the day, that every Mexican that crosses the border into the United States does so legally and, B, through a designated port of entry.

And this has been for many generations, for many governments in Mexico, a very tough nut to swallow. Because the question obviously is, well, are you willing to do something to prevent people from actually crossing portions of the border where they shouldn't be crossing? And that is one of the challenges that Mexico will have to look into. How -- A, how do we destroy and eliminate the organized crime syndicates that are now, because of the squeeze that has put -- (being/been ?) put on their ability to generate revenue from drugs, are now muscling their way into human trafficking, for example? So how do we break down these operations?

And the Mexican and U.S. government have been working together in a very successful program called Oasis for the past several years, which is precisely targeting human-trafficking organizations working on both sides of the border; but also, B, how to ensure what the Mexican constitution also says, which is that every Mexican coming into or leaving the country has to do so through a designated port of entry.

PASCUAL: I have to interject on one thing, because this is, like, too good for a commercial announcement. Today at 5:30 there's a film that will be shown. It's called "Los que se quedan." The director of that film, Carlos Hagerman, is right here. If you care about this issue, you have to stay and watch this film. And it's a shortened version of it and it's less than an hour, but it is extraordinary because what it does is it focuses on the lives of Mexicans who are making this decision about whether to emigrate. And you understand the human tragedies that they go through, because every single decision to emigrate means to break up their families, and it puts the issue in a completely different light from what we're used to understanding in a U.S. political context.

And I think that's part of what we have to understand, that the issue for so many Mexicans is not just a question of seeking to take somebody's job; it's somehow how to give an opportunity to (ask ?) parts of their family. But what they want is not to go and stay, it's to go and return, or, in fact, frankly, to be able to stay to begin with.

The other part of this equation -- and that's at 5:30, right? Okay. So you have my commercial now. (Inaudible.)

But the other part of this issue is, you know, Mexico -- it's part of the contrast of multiple realities in Mexico. I mean, there are 47 million poor people in Mexico, based on Mexican government statistics. And that's the bad news.

The positive thing is that because it's also a G-20 country, it has the 12th, 13th largest economy in the world, a sophisticating (sic; sophisticated) banking sector. But it's a banking sector that doesn't penetrate. And some of these guys can tell you and will tell you a little bit more about this later. But it lends yourself -- lends itself to solutions or at least interventions that can make a difference.

In Mexico, 25 percent of the population has access to a bank account. In the U.S. and Europe, it would be somewhere between 90 and 99 percent. In Chile, it's 60 percent; in Brazil, it's 48 percent.

Cell phones. There are now projects -- commercial projects being developed to allow for the use of cell phones to people to be able to pay their bills. If you could use that, for example, in the Oportunidades program that we were mentioning before, where you transmit the payments vis-a-vis your cell phone notice and you take it to your local 7-Eleven, and the mechanism for that is that the individual now has a bank account which draws down the money, you've suddenly brought 15 million people into the banking sector that were never there before. Those kinds of things can be done in Mexico that don't have the same prospect in other countries that I think can give people a sense of hope that there are the mechanisms to help eradicate some of these problems.

SUAREZ: At this time I'd like to invite members and guests to join our conversation with their questions. Please wait for the microphone. There are runners in the aisles. Speak directly into it. Stand; state your name and affiliation. And please, in the spirit of brotherhood and international cooperation, please ask a question that's a question, that is an actual interrogation. If you're speaking English, your voice will even go up a little bit at the end to signal that there's a question mark there. (Laughter.) In Spanish, we have the benefit of having two question marks in the sentence, so the -- it can't be avoided. But don't make a speech; don't give us your best thoughts on Mexican policy. Just ask us a question. Okay?

Right here.

QUESTIONER: Hi. My name is Ana Paula Ordorica. I'm a journalist in Mexico City. And I wanted your comments on today's Washington Post story on joint operations security, or military cooperation that is going on.

SARUKHAN: A very, very short response. There are no joint operations. And the Washington Post article doesn't speak about joint operations. What there is, and what the Washington Post article talks about, is enhanced training, exchange of intelligence, and what is a normal process in an area where the relationship had gone further and this had lagged behind, which is the normalization of the military-to-military interaction between the Pentagon and the Mexican defense ministries.

As you know well, one of the results of 9/11 was that the United States re-created its regional command, its (sync ?) system, and created NORTHCOM for North America. And Mexico for decades had been sort of in limbo. It wasn't part of SOUTHCOM. It had a -- sort of a special relationship with DOD directly through the Pentagon. And after 9/11, Mexico was put with Canada in NORTHCOM. And for many years after 9/11, Mexico refused, for many reasons -- oh, visions of the relationship -- refused even to acknowledge the fact that their interaction was through NORTHCOM.

And one of the things that has changed dramatically in the past years is that there is a much more normal relationship between both Marina (ph) and Defensa (ph) in their relationship, formal, institutional, with NORTHCOM, to the point where today we have, like the Canadians have in NORTHCOM, Marina (ph) and Defensa (ph) liaisons in Colorado Springs working on day-to-day basis, and the institutional ties and relationships with the Pentagon.

The article is also addressing something that Carlos and I and our colleagues in the Mexican and U.S. government have been working on since we kicked off Merida, which is, how do we ensure that the intelligence, the information, that the processing of that intelligence information provides an end game, it provides a result, that that information, the collation of the analysis provides the results that we're looking for, which is arresting the bad guys? And so what you see in the article today is simply manifestation of a relationship which, as the rest of the bilateral relationship in terms of security, is moving into the 21st century.

SUAREZ: Ambassador?

PASCUAL: Arturo is absolutely right. And the only thing I would add is that if one compared the levels of cooperation -- and we have intensive cooperation across virtually every single part of our two governments -- and the area which is most intensive is actually among law-enforcement agencies. And if -- you know, the extent to which DEA, FBI, Department of Justice are constantly working with their counterparts -- and, I should add, CBP and ICE -- in Mexico far exceeds anything that happens on a military level.

I mean, just to put it in context, this is an extraordinary issue for some people because of the historical context that Arturo mentions. I think generally the challenge that everybody faces is at a point in time like this, when we understand what the long-term solutions need to be in terms of building capacity, establishing the rule of law and so forth: What is it that can be done to bring to bear the intelligence and the experience to make the most effective use of the forces and the capabilities that are -- that are there today? And that's the challenge that they all face and that they're working on on a constant basis, is how to share experience on how to bring greater capacity to have an impact. Because it can't -- we can't wait the 5 to 10 years that it's going to take to build up the institutions.

So what do you do in the short term? And that's why I think it's important that we bring all the capabilities, experience that we have, recognizing that the vast, vast bulk of this is actually going to come through U.S. law enforcement agencies and their cooperation with their counterparts.

SUAREZ: Yes, sir?

QUESTIONER: Thank you very much. Christopher Graves with Ogilvy Public Relations. It's clear that the trade relationship is that the drugs go to the U.S. consumers; the guns and the cash come south from the U.S. They aren't at gun stores that we know of in Mexico; the guns all come down from the U.S. side of the border.

But these are two issues in this political climate that would seem to be very, very tough for anybody to take on in the U.S. How do you get the U.S. to acknowledge complicity, and how do you get the populations and populace who understand the complexity of the problem, to see that the U.S. is in fact a culprit?

PASCUAL: Maybe let me start, since part of it comes here on what U.S. policy is and what we do about it. I think, first of all, the president of the United States, the secretary of State, Secretary Napolitano and others have been very clear, and the number of times that we've talked about co-responsibility, from the first visits to Mexico, have been very straightforward and constant.

The president has consistently emphasized that the kinds of issues that we're dealing here -- with here, in narcotics trade and organized crime, are transnational issues, and they have points of supply and demand and transit that cover the entire hemisphere; and therefore, they need transnational solutions and that we all have to participate in doing our part to advance those solutions.

And so we need to do this because it's part of our responsibility to in fact come up with solutions that are effective for the United States.

You didn't, in your list of issues, talk about drug demand, and that's one of those things that we need to put a strong -- a stronger emphasis on, and this administration has developed, I think, a more comprehensive and creative demand-reduction strategy than we've seen in the past, dealing with issues from prevention to treatment, to working with addicts, to working with prisoners, to providing job alternatives, to community grant programs, and we've increased the budget for that. Well, we've requested an increase of 13 percent. We're on a continuing resolution, and we don't have that increase yet, but that's one of the things that we need to come back to.

There's a huge amount more that we need to do. And if you look at what was done, for example, with tobacco and the efforts of our wider society to educate people on reduction -- reducing use of tobacco, it just underscores how much more we need to do.

On arms, part of the solution is stronger and more consistent inspections, but, you know, realistically, a 3,000-kilometer border, it's going to be hard to stop everything that's potentially moving across. And so you inspect to deter, but you inspect not expecting that you're going to catch everything.

And so one of the things that we've done with Mexico is introduce an electronic tracing system, which is the same electronic tracing system we have in United States. It's been translated into Spanish. It's been licensed to be used in Mexico. And by entering the serial numbers of guns that have been seized, it allows us to look at the last point of sale, and then analyze the patterns of sales from individual gun stores or who the purchasers are, and to build up cases.

So for example, in August, we had a very strong case and a conviction. Two individuals ran a network of 10 straw purchasers selling AK-47s to the Sinaloa Cartel. One ended up in jail 57 months, the other 48 months. That's part of the -- a critical part of the strategy is that you have to create a cost to the illegal export of arms.

On money-laundering issues, these are issues that we're both trying to intensify the work that we do. We've had a lot of good work at a macroeconomic level that allows us to compare the financial flows between both -- between both countries.

One of the things that is a consistent challenge is, how do you bring this down to individual accounts, companies, real estate transactions? And so a key element here is going to be to build up the tools that allow that to happen. For example, Mexico is now in the process for the first time of creating digitalized property registrars. They've -- they started the process in 19 states. They haven't begun in 13 other states. But in the past, it hasn't been able -- they haven't been able at a central level to analyze who owns what property and how to trace that through the country, which creates a huge loophole.

These are the kinds of things that I think we can do together. And it requires a recognition, yes, on the United States we have a responsibility and that we have to take action on our side of the border. But we need to work on both sides, and we need to keep a picture -- a view of the -- of the importance of sustaining the rule of law.

And I'll just close with this point, and to underscore how important it is. You can buy an AK-47 in the smallest village in Africa, anywhere. It's just a question of margin on the price. So in the end, one of the factors is, yes, we have to make it harder to sell those in the United States. But at the same time, we have to keep combining this with all of the other efforts that we've been saying about promoting the rule of law and being able to crack down on violence, because demand -- and unfortunately, demand, whether it's for drugs or whether it's for weapons, can be a very powerful force. And one has to work on both sides of the equation.


SARUKHAN: Can I very quickly respond to that?

SUAREZ: I'm sorry.

SARUKHAN: Thank you. I'm convinced that, despite how tough this issue is -- and you can imagine that I am not the flavor of the month for the NRA when we talk about the issue of guns going south -- I do think the NRA can become a very important co-stakeholder in Mexico and the United States governments' efforts to stamp down on flow of guns towards -- going into Mexico, for one very powerful reason. The Founding Fathers didn't draft the Second Amendment to allow international organized crime to, A, illicitly buy weapons in gun shops and gun shows; B, illicitly cross them over an international border; and C, sell them to individuals of a country where those calibers or types of weapons are prohibited.

So if we can work with the NRA and the U.S. government in getting the information out, making people and owners of FFLs -- federal firearms licensees -- understand the rules of the game as it relates to guns in Mexico and why these guns going over the border pose a significant threat to Mexico's security, I think this would be a win-win for the NRA. They ensure that they are not being criticized for being -- for allowing, either complicitly -- or overtly or covertly allowing guns to go into the hands of drug traffickers who then cross them over the border into Mexico.

So I would certainly call upon the NRA to step up to the challenge of working with us and with the U.S. government, in finding out -- in devising a new ethics code that we can work together with. We can educate owners of gun shops and the people who go to gun shows, and create awareness of how this impacts security on the other side of the border.

This isn't about -- I may or may not agree with what's in the Second Amendment, but that's beyond the point. As Mexican ambassador to the United States, what I need to make sure is that what's in the books is enforced, and that we can work with Americans from all walks of life in converting them to co-stakeholders of ensuring that those guns are not going into places and into the hands of people that they shouldn't be going into.

QUESTIONER: Hi. Jonathan Chanis, New Tide Asset Management.

Could either or both speakers please say something about the state of Mexico's oil industry, its prospects for reform, the prospects for cooperation with American companies, and stemming with a really serious production decline?

SUAREZ: Ambassador?

SARUKHAN: Mexico -- this is the first administration that has attempted to tackle the huge challenge of: How do we open up the energy sector in Mexico so that it can continue to provide for the economic well-being and the growth of Mexico over the next decades? The first bill that was presented by President Calderon and approved by Congress, by all parties in Congress, is certainly a first step in the right direction.

Is it enough to change the nature of the game and to allow PEMEX to capitalize and to be able to do the deep-sea water exploration and drilling that it needs to, to be able to continue to provide not only for our growth but also for one critically important issue that we face in North America -- Canada, Mexico and the United States -- given that on any given day it is Canada or Mexico that sells you the highest percentage of your oil on a given -- on a daily given basis. How do we -- how do we ensure energy security in North America?

SUAREZ: Currently, foreign investment in PEMEX is not allowed, right?

SARUKHAN: It is not allowed. So what I -- what I think is clear, much in the same way as Carlos was speaking about perceptions across the ideological and political partisan realm in Mexico as it relates to the fight against drugs, I think much in the same way, with a few exceptions, I think most political actors in Mexico today understand that the style of (couante ?), in terms of our energy policy, is untenable.

We have been able to stabilize Cantarell, which is our main oil field. There was the -- Cantarell had been experiencing a precipitous drop in its production. That is now being stabilized.

But what is very clear and must be understood is that it's not going to increase. It's going to stay level if we continue to inject the resources that we're injecting into PEMEX, but in 10, 12 years, Cantarell will be drying out. So the huge challenge is, how do we open up the energy sector in Mexico so that foreign or domestic private investment, in whatever form or regime that you can devise and push forward, can ensure that PEMEX continues to be a viable company that continues to provide growth for Mexico and continues to provide security for the North American region?

SUAREZ: Quick comment, Ambassador?

PASCUAL: Yeah. I mean, production in decline from 3-1/2 million barrels a day to 2.4 million barrels a day -- it's now up -- getting close to 2.6 (million). The current head of PEMEX, Juan Jose Suarez Coppel, is a very talented individual, Ph.D. from the University of Chicago. He has brought a more creative approach to how you could use the existing legal framework, to be able to work within it to attract the best technology and capital.

One of the reflections of that is that PEMEX is the largest customer of the U.S. Export-Import Bank in the world, with an exposure of about $7.8 billion. With the use of U.S. technology, in particular applying it to the re-injection of gas to fields that have previously been abandoned, they've been able to go back and reopen a number of fields, which has been part of the main reason for the -- reestablishing some of the production.

There's now a more aggressive exploration and production program. At the end of this year, PEMEX will issue tenders for what it calls incentive contracts. These are mechanisms that have been created if you can't have private investment in the Mexican oil and gas sector, how to bring in on a contract basis major international companies and not only pay them for their services but provide certain incentives that compensate the success or failure of the work, which might be a slight compensating factor that will bring it closer to the financial calculations that you would have if you had an opportunity for an equity investment -- unclear how those are going to work, but it's -- within the current legal framework, it's pretty much about as far as PEMEX is able to go.

SUAREZ: We have time for one more. Yes, ma'am. Stand up, so they can see you. We'll get you a mike.

QUESTIONER: Hi. I'm Alexandra Starr from the Center on Law and Security at NYU Law School. Ambassador Pascual, you spoke a little bit about a grassroots campaign to, I guess, cultivate support for immigration reform. Can you elaborate on that a little bit? (Inaudible) -- timetable for actually submitting legislation?

And you know, part of the problem, I guess, is the fact that when these debates flare up -- I'd be interested in getting your opinion of what happens in Mexico as they see the kind of emotions that are unleashed when the U.S. grapples with legislation of that kind.

PASCUAL: I -- yeah, I think I'd be in serious trouble if I actually tried to give you a timetable on legislation. And I think probably some people in the White House would think that they -- they're controlling the legislative agenda, and we'll see what the timetable is.

It -- the -- what was -- what has been fascinating to is to see that there are grassroots groups throughout the country -- some of them are Mexican-American-based, some of them are not -- who have an interest in trying to normalize the legal framework for immigration.

About three weeks ago, I spent some time in Los Angeles making -- meeting with a whole range of different Mexican-American organizations. And what they've all realized is that they feel affronted by what's happened and the inability to move forward aggressively with legislation, but they actually haven't united in some way of advancing those legislative efforts. There are some groups, like La Raza, which has played historically a much more centerpiece role in trying to organize the Mexican-American community.

I think the challenge right now is to try to build up a coalition that includes the traditional constituents -- in particular, the Mexican-American community -- other immigrant communities, so that it's not just a Mexican issue but that it is more broadly based with Hispanics but also other immigrant groups that are seriously represented in the United States, and then the business community.

The challenge, of course, in all of this is where the dialogue -- how the dialogue is going to be -- is structured and formulated with the labor unions, because there is where the greatest fear factors lie. And if one can reach a better understanding with the labor unions on how immigration reform and a transparent legal base can also be of benefit to U.S. labor, then you potentially have a formula that can work.

But the trick is going to be to bring constituents to -- constituencies together, because if you have different immigrant groups with their own perspective without uniting, if you have businesses on the other side of the equation pushing for only part of the agenda, then you end up with this clash, and then you end up with a Republican/Democratic split, where the Democrats are willing to look at the social-justice issues with the undocumented workers in the United States but don't want to talk about future flows, and you have Republicans who want to talk about future flows but want -- don't want to talk about undocumented workers. Right?

So the key right now at the grass roots is how to bring those together. And that, quite frankly, is still an evolving process. But that's why the president has said we've got to keep the issue on the agenda, because if we take it off the agenda, then the momentum for it is going to go away and you're not going to get the kind of push that's going to be necessary to bring together and get some consolidation of those constituencies.

SUAREZ: Ambassador, very quick response to Ms. Starr, and then quick final comments from both of you.

SARUKHAN: The question is how this would impact Mexico?

SUAREZ: How Mexican public opinion responds when we have the peaks and valleys here on the -- in the --

SARUKHAN: Well, obviously, one of the reasons why I think public perception across both sides of the border seems to be working in the other direction of where government and government interaction is moving -- it would actually seem to be going in the other direction -- is because of public perceptions triggered by the debate on immigration -- how Mexico reacts to things like S.B. 1070 or some of the TV spots that we saw in the campaign or some of the local or state initiatives that are being enacted. There is a -- there is a pervasive sense in Mexico of -- America has gone down the road of nativism. It certainly doesn't make Carlos' or my life any easier in working both sides of the border and ensuring that people understand that regardless of the noise in the system, the relationship is moving forward in a way in which it had not moved in the past 10 years.

SUAREZ: Quick final comments from you both.


PASCUAL: Rule of law, absolutely critical to providing greater security to populations but also to strengthening business activity; transnational perspective, for business to look at how we work together in global markets; from a security perspective, to be able to work on issues in a way that takes a transnational perspective of mutual responsibility; and window of opportunity, where we have a moment of greater economic competitiveness within Mexico. And it's important to work together to have those economic factors shape the security future and not let insecurity shape the economic realities.

SUAREZ: Ambassador.

SARUKHAN: Just two very brief comments in ending -- or three, maybe, but I'll be very short.

Number one, despite what you've heard today, it would seem that security is the overwhelming issue in the bilateral relationship. It is true. Security is at the core of the bilateral relationship today.

But the bilateral relationship is much more than just security, and it is very diverse. And there are a host of issues that we haven't touched upon today, everything from border infrastructure to how we're working together on environmental issues on the border, which play a critical role in the bilateral relationship.

Second, that the bilateral relationship isn't only about the bilateral relationship. What do I mean by this? That increasingly, Mexico and the United States have been working together on other global and regional issues, the way that Mexico has been working with the United States and the U.N. Security Council, how we are chairing the Security Council in June, work with the United States to send an unequivocal message to Iran in terms of the need for their compliance of all their commitments regarding the pacific uses of nuclear power.

The way these two countries have been working together on issues, which traditionally Mexico and the United States would have not discussed or put in their bilateral agenda, is a huge change. I've always believed as a -- as a Mexican career diplomat, that for a country like mine that isn't a military powerhouse, there are two ways to go around the world: You sit at the table, or you're on the menu. And the only way that Mexico will be sitting at the table is if we can deepen the footprint of engagement with the United States on a number of global and regional issues.

And finally that -- and I don't want to use the term "special relationship" because I don't want our British friends to feel annoyed -- (laughter) -- but I'm piggybacking on their -- on their paradigm -- but there are truly two countries that have a unique relationship with the United States. And both countries have something in common: a concept that was coined in this house, in the Council of Foreign Relations, many years ago by Bayless Manning, who talked about "intermestic" issues, the convergence of domestic and foreign policy, and how this changes the nature of diplomatic relations. There are two countries on the face of the Earth that have the unique challenge of having our foreign policy issues be domestic policy in the United States and vice versa, and the challenges of taking on domestic constituencies to move the bilateral relationship forward. Those two countries are Israel and Mexico.

Thank you.

SUAREZ: Thank you very much for your attention. Thank you to our two ambassadors. And it's probably one of the few times that a Mexican, a Cuban and a Puerto Rican have shared the stage -- (laughter) -- at the Council on Foreign Relations rather than being the opening line of a joke. (Laughter.) So thank you -- thank you for -- (inaudible). (Applause.)







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