This is how it used to work: In the 1970s farmers would pay Mexican officials for permission to plant hectares of marijuana or poppy. “Once the fields had been sown,” an anonymous source tells Mexican journalist Anabel Hernández, “they stuck little colored flags on them, according to the arrangement. This meant that when the [government] helicopters flew over, instead of fumigating them they would water them.”

Drug traffickers also paid fees to store their harvest in warehouses, and again to smuggle the drugs over the border into the United States. Through such under-the-table “taxes,” which amounted to about $60 a kilo, the Mexican government fattened its coffers while controlling the production and movement of drugs within its borders.

Today the servant has become the master. Cartels dominate not only large portions of Mexico’s government, but also much of the country’s civil society. Their payroll includes not just army personnel, police officers, intelligence agents, prison guards, business owners, and politicians, but also soda vendors, tortilla sellers, and gas-station attendants. Under their rule, fear has reached legendary proportions throughout Mexico. A man in Ciudad Juárez tells journalist Óscar Martínez that he’s afraid to use public bathrooms because he doesn’t want to find decapitated heads. “It sounds at first like he’s paranoid, or crazy,” Martínez writes, “but it’s happened to him twice.”

How did the Mexican government lose control of its traffickers? An answer can be found in two new books: Hernández’s Narcoland: The Mexican Drug Lords and Their Godfathers and Martínez’s The Beast: Riding the Rails and Dodging Narcos on the Migrant Trail. Together they provide a top-down, bottom-up view of how Mexican cartels have consolidated and corporatized in the past two decades. As the cartels have integrated vertically, destroyed their competition, and diversified their interests, their business has grown more efficient—and so has their cruelty. In fact, a short version of Hernández’ book might run like this: Government officials thought they were training sheep; instead they were raising wolves.

Mexican police tolerated drugs in the 1970s for two reasons: they considered leftists their real enemy, and they were broke. Local branches of the federal judicial police received no money for cars, radios, guns, or support staff. A periodic shearing of the local drug men funded operating budgets. Hernández’ primary source for this history is an anonymous “Informer” who, she says, observed the drug world from within the Mexican government for 35 years. He alleges that three branches of government each took a cut of the drug “tax.” Every month, he says, three suitcases traveled throughout Mexico, gathering bundles of cash on their way to the capital. There, one suitcase stopped at the attorney general’s office, another at the secretary of the interior, and a third at the secretary of defense. (Hernández reveals few details about this informer, a fundamental weakness of Narcoland, though understandable given how many witnesses have been assassinated in Mexico over the past decade.)

The so-called “years of control” unraveled in the 1980s. According to the informer, the change began when President Miguel de la Madrid took office in 1982 and appointed Sergio García Ramírez attorney general. Rather than tax all traffickers and spread the proceeds around various departments, García Ramírez’ staff protected pet traffickers in each region, then funneled their “taxes” into the pockets of individual politicians.

Bigger, richer traffickers meant more money for their political mentors. But selective protection also meant that the little criminal gangs began to consolidate into larger, more organized cartels. “Semi-illiterate peasants [turned major cartel leaders] like El Príncipe, Don Neto, El Azul, El Mayo, and El Chapo would not have got far without the collusion of businessmen, politicians, and policemen, and all of those who exercise everyday power from behind a false halo of legality,” Hernández writes. “All these are the true godfathers of Narcoland.”

In the 1980s, the fledgling cartels also located an unexpected source of support: the CIA. After 1982’s Boland Amendment made it illegal for the Reagan administration to continue funding the Nicaraguan Contras, the CIA used Colombian cocaine traffickers as a source of off-the-books cash. In exchange, CIA agents let tons of Colombian cocaine enter the US, sometimes on government planes. The upshot of this lesser-known piece of the Iran-Contra affair is that Mexican cartels began to play a crucial role in the distribution of cocaine. As Hernández points out, Mexico has “a strategic location, halfway between producers and consumers.” Airplanes leaving the US with medicine and weapons for the Contras, or flying back with Colombian drugs, would stop at hidden landing strips in Mexico to refuel.

In 1993, after Colombian drug lord Pablo Escobar was killed, Mexican trafficker Amado Carrillo Fuentes brokered deals with the Cali and the Medellín cartels, replacing Escobar as the most powerful cocaine smuggler in Latin America. Carrillo Fuentes grew his empire with the help of Joaquín “El Chapo” Guzmán and the Beltrán Leyva brothers. Together they expanded retail distribution to every region of the US, pioneered the large-scale production of crystal meth, and cultivated relationships with elite Mexican bankers who helped them launder millions of dollars.

As the riches grew, so did the government’s greed. According to Hernández, in the 1990s Mexican officials instituted a fresh fundraising strategy: “No more ‘paying taxes’: now you had to offer hefty bribes, enough to make the fortunes of politicians and businessmen overnight.” From then on, she suggests, it was only a matter of time before the drug lords began to consider corrupt officials part of their personal staff. As one former cartel member explained, “The traffickers pay for the campaigns, and then get protection when their guys are elected.”

In 1997, after Carrillo Fuentes died (or, some say, faked his death), his empire fractured into smaller groups. Then in 2001, shortly after El Chapo escaped from prison, more than 25 major traffickers merged into a nationwide group known as The Federation, with El Chapo at the helm. Hernández’ most incendiary argument is that presidents Vicente Fox and Felipe Calderón essentially worked for El Chapo. Their “war on drugs,” she argues, was a front for The Federation’s hostile takeover of the Tijuana Cartel and its attempt to expand its territory by attacking the paramilitary cartel known as Los Zetas. “In previous epochs,” she writes, “none of the cartels would have dared to declare war on another, nor would any government have allowed it.” But Fox, Calderón, and their ministers not only sanctioned the war, she alleges, they used police and intelligence agents to support El Chapo’s agenda.

Here, as in many areas of this provocative history, Hernández’ evidence is largely circumstantial. She points, for example, to the inexplicable personal fortune of Calderón’s director of the “war on drugs,” Genaro García Luna (worth some $2.8 million in 2010), as well as to a study by economist Edgardo Buscaglia, which found that only 1.8 percent of the organized-crime arrests in Mexico from 2006 through 2010 were of people connected to El Chapo’s cartel. She also provides details about officials who have been tried for corruption, about drug trials that have turned into farces, and about honest anti-drug officials who have been reassigned.

But what Hernández reads as corruption may simply be the ugly business of realpolitik. As Buscaglia himself points out in Narcoland, even American anti-drug agencies “think that it’s always more feasible to control a single, consolidated organization, rather than hundreds of atoms that don’t really hook up, producing a situation of chaos and instability.” Policies that favor one cartel over another don’t necessarily mean that the Mexican presidency is beholden to a particular narco.

Whether or not Hernández is accurate about all the dirty details, her diagnosis that much of Mexico is now run by cartels is undeniable. Anyone who doubts it should read Martínez’ gripping work of travel reportage, The Beast.

In style and substance, the two books could not be more different. An accomplished investigative journalist who entered the field after her father was kidnapped and murdered in 2000, Hernández analyzes scores of criminal trials and recently declassified documents, fleshing out details with interviews of a few highly placed anonymous sources. Her writing is uneven but her research is impressive, and she has put her life in permanent peril by focusing on Mexican presidents and their top ministers, as well as the leaders of Mexico’s most powerful cartels.

The Beast is less interested in narcos than Central American migrants who traverse Mexico in hopes of reaching the United States. A reporter for the online newspaper ElFaro.net, Martínez is a powerful storyteller and his approach to investigative journalism is closer to anthropological immersion: He walks with migrants through bloody forests, eats with them at spartan shelters, and rides with them atop speeding trains.

The journey through Mexico has always been dangerous for undocumented Central American migrants. Traveling without legal visas or any connection to the local population, they risk robbery, rape, and murder. But now the dangers are almost impossible to escape. As Martínez follows migrants up the eastern side of Mexico, he keeps encountering towns that are ruled by Los Zetas. “We realized,” Martínez writes, “that machetes had given way to assault rifles; that remote mountaintops had given way to safe houses; that your everyday delinquents had joined Los Zetas; that robbery had turned into assaults and abductions.” Consolidation may work for Mexico’s government and our own Drug Enforcement Agency, but for average Mexicans and desperate migrants it’s a disaster.

Every year cartels kidnap thousands of migrants and hold them for ransom. In 2007, a cartel kidnapped 300 Mexican and Central American migrants at once in Sonora. A priest managed to negotiate the release of 120. “Most of them were beaten black and blue,” Martínez writes, “and had their ankles broken by a bat.” Afterward not one filed a police report and the remaining 180 victims were never heard from again. For cartels like Los Zetas, kidnapping is an easy franchise: They delegate the violence to local gangs, supply them with guns, give them permission to use the name “Zeta,” and collect between $300 and $1,500 for each migrant. They can sell the women to brothels.

Given these circumstances, it’s hard to understand why anyone would attempt the journey north—until you realize that many of the migrants are already facing murder or destitution at home. In the first chapter of The Beast, Martínez introduces three brothers who fled El Salvador after they were threatened with death—they had asked too many questions about their mother’s murder. Another migrant used to work as a police officer in Honduras. After her first and second husbands were killed by members of the Mara Salvatruchas gang, she fantasized about shooting herself, her daughters, and her dog. “Then we’ll have nothing left to fear,” she thought. In the end, she decided to try for the US instead.

At times, Martínez seems almost angry that the US doesn’t make it easier for migrants like these to enter our country. And certainly he’s correct that no amount of border tightening will deter migrants fleeing terror, any more than the threat of incarceration deters drug traffickers from pursuing criminal profits. Recently, President Enrique Peña Nieto has redoubled Mexico’s efforts to arrest cartel leaders; the notoriously sadistic Zeta leader Miguel Angel Trevino Morales was captured in July. Such headline-grabbing arrests might play well in the international press, but if history is any guide they won’t hurt cartel operations. Extradition or even death simply spur institutional reorganization. A single kilo of cocaine, purchased in Colombia and sold in New York, brings more than $20,000 in profits. Nobody is going to let a business like that die just because the top man goes down.

In her book, Hernández presents a better strategy: Attack the money. In Mexico, the popular wisdom about cartels is that they live by “plata o plomo.” Silver or lead. Benjamins or bullets. If the narcos target you, you pay or you die. At the heart of this saying is a profound understanding of the narco psychology: what motivates them is money. They are the ultimate cutthroat capitalists.

To make her point, Hernández quotes extensively from Edgardo Buscaglia, who now works as a senior researcher at Columbia Law School. “I always tell friends and colleagues that El Chapo’s goal is to pay taxes,” says Buscaglia. “When the criminal groups legalize their wealth, their success is complete.” Seizing their cash, he argues, is the only way to truly disrupt their logistics and their power to corrupt. But weaning Mexicans from the billions of dollars in drug profits that have propped up their legal economy for more than a decade? That sounds as easy as weaning Americans from the more than 100,000 kilos of cocaine they consume each year.

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Marcela Valdes is a freelance writer who specializes in Latin American literature and culture.