I found a recent article at stopthedrugwar.org/ I think I'll check this site out some more. Stickboy posted a few links in other topics directing towards this site.

Former Mexican President Proposes Legalizing Drugs in Mexico AND the U.S.
Posted in Chronicle Blog by Scott Morgan on Thu, 09/17/2009 - 9:45pm

As President Calderon's leadership continues to drive Mexico deeper into the abyss of cyclical drug war violence, his predecessor Vicente Fox is looking for real solutions instead of hollow, tough-guy rhetoric. And it sounds like he found the answer:

Mr. Fox says a thirst for riches propels the street violence. So legalizing drugs — as Holland has done — could have the same effect that ending Prohibition had in the United States in 1933: Removing the incentive for criminals.

But if the domestic market in Mexico collapsed because of legalization, the export market might become even more valuable. Any move toward legalization would work only if done in concert with the United States, Mr. Fox said. [St. Louis Post-Dispatch]

Those are strong words coming from the man who was leading the Mexican drug war just three years ago. Fox knows as well as anyone how powerful prohibition has made the cartels and he's rapidly becoming the nation's loudest voice for reform.

It's almost become a cliche at this point, but the observation that Mexico can’t change the direction of its drug policy without U.S. backing is probably correct. It's awfully hard to just come out and tell the Americans, "Hey, you guys are on your own now. We're not fighting anymore. Good luck locking down your borders and convincing everyone to stop buying drugs." Even if drug sales in Mexico were tightly regulated, the fight over lucrative smuggling routes will continue. You can regulate marijuana sales in Tijuana, but the government can't be arbitrating trade disputes between international drug organizations or issuing permits to dig tunnels under the border.

Nevertheless, the present hopelessness griping the country could form the framework for a massive popular movement to end Mexico's war against the cartels. Everyone already knows the whole mess owes its origins to American drug demand and it may be only a matter of time before a politically significant portion of the Mexican population stops supporting politicians who take drug war orders from the U.S. State Department. The next presidential elections in Mexico will likely bring about the most interesting drug policy dialogue that's ever taken place there.

No one knows what's going to happen next, but I can guarantee you that the current strategy of fighting it out in the streets isn't going to change the game. As hard as it is to imagine a combined U.S. and Mexican withdrawal after decades of aggressive interdiction efforts, it stands to reason that the one viable policy solution will eventually emerge. With leaders like Vicente Fox beginning to speak out, that moment may come sooner than we expect.