Mexico is poor; it is the economic conditions that drive conflict not the U.S.  Declining real income drives social unrest and instability. Real incomes for workers in Mexico's manufacturing sector declined by a cumulative 2.6 percent between 1995 and 2005. It is likely that the decline in the informal economy is larger. The Government keeps a tight control over the minimum wage preventing it from rising. Although this does not affect many Mexicans directly a lot more have their wages set at a multiple of the minimum wage. At the same time there has been high unemployment and lower benefits. [1] In 1994-5 Mexico was hit hard by a financial crisis known as the ‘peso’ or ‘Tequila’ crisis. The peso depreciated by 47%, inflation went up to 52% and GDP fell by 6% not reaching its 1993 level until 1997. Unsurprisingly household income fell substantially; by 31% between 1994 and 1996, those in poverty rose from 10.4% of the population to 17% [2] Since 1996 although Mexico has experienced growth not only has it been slower than most developing countries this has been significantly cut into in real per capita terms by population growth. Mexico has large disparities in income between urban and rural areas and the gap between rich and poor has been widening. [3] The inequality leads people to be more willing to engage in the potentially lucrative drugs trafficking and the informal economy. Unemployment meanwhile makes them more likely to take drugs themselves as an escape.  [1] Gundzik, Jephraim P. , ‘As Elections Approach, Mexico Faces Internal Instability', Power and Interest News report.  [2] Baldacci, Emanuele, Luiz de Mello and Gabriela Inchauste, Financial crises, Poverty and Income distribution, IMF Working paper, pp.20-21.  [3] Economy Watch, ‘Mexico Economy’, 24 March 2010.