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ANDERSON COOPER 360 DEGREES

U.S. Guns to Mexico; Americans Abducted in Mexico; Secretary Clinton in Mexico; Teen Assassins for Hire

Aired March 25, 2009 - 23:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(COMMERCIAL BREAK)

ANDERSON COOPER, CNN ANCHOR: Good evening everyone from El Paso, Texas where tonight we take you inside this WAR NEXT DOOR, it's a fight that is killing, corrupting, and spreading misery on both sides of the border and threatening to turn Mexico into a failed state.

And that's not us saying that. That's the United States Pentagon. A picture of Pakistan or Afghanistan, literally right across the Rio Grande just a few steps away, right over there.

Fact, every year Mexican cartels smuggle nearly $40 billion worth of illegal drugs into America. We'll be tracing their route north and how the money flows back south.

Another fact, 6,500 people have been slaughtered last year as cartels battle one another and Mexican authorities; 800 killings so far. And it's not just the numbers of people getting killed it's the way people are getting killed, being beheaded, very public executions. These drug cartels are sowing terror in the streets of Mexico.

The war, of course, fueled by American weapons smuggled south and drugs brought north. About 90 percent of the cocaine consumed in the U.S. travels through Mexico. But it's not just cocaine it's marijuana, its methamphetamine, and it's heroin. All of it coming to the United States from Mexico.

A sobering fact that Secretary of State Clinton acknowledged today in Mexico city, laying out the administration's new plan for trying to beef up the border.

(BEGIN VIDEO CLIP)

HILLARY CLINTON, SECRETARY OF STATE: We have to do a better job of convincing Americans that illegal drugs are a terrible choice. We have to convince them that more treatment programs that they would take advantage of, are a way out because obviously our demand for drugs is what motivates these drug gangs.

(END VIDEO CLIP)

COOPER: Right now no sign of any hope in reducing the demand of drugs inside the United States. Right now, for Mexican authorities the focus is on stopping the supply and battling these drug cartels.

As we mentioned, we are also going to be focusing on weapons. But I just want to set the scene a little bit, where we are right now a kind of this no man's land between El Paso and Juarez. Over my shoulder is the city of Juarez, Mexico. We have another camera which can show you another view through the Rio Grande River.

Juarez is a city now under siege; 9,500 Mexican military personnel have now taken control of Juarez from local officials, and local police who were not able to stop the bloodshed.

They have temporarily it seems halted the bloodshed in Juarez. There haven't been any murders there in the last two or three days. Normally in the last couple of weeks there have been about ten murders every day. So Juarez is just a few hundred yards from where I'm standing.

Now back over here on the U.S. side, this is the border. This is the wall, 18 foot high, it's made of mesh, its metal and stretches as far as the eye can see down this way. But if you -- it stretches down there, a couple hundred yards, but then it stops. This is a very active border crossing area where people are trying to, as soon as night falls around this time they start to wait on the Juarez side and then try to run across to the U.S. side.

I can tell you, there's an awful lot of border patrol agents here who are waiting. And they're going to be here all night. And as they say it is a very active area.

One of the things that we want to focus on tonight as U.S. officials are focusing is not just the flow of drugs from Mexico up north but what the Obama administration is repeatedly saying now, this is a shared responsibility. This is a shared threat.

And it's not just a question of drugs coming up it's also a question of U.S. weapons going down. 95 percent of the weapons according to Mexican authorities that the drug cartels use come from the United States.

Drew Griffin shows us where they're coming from.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS CORRESPONDENT: Had it not been for one good tip, this 50 caliber barrette rifle firing rounds as big as your palm -- could have easily gotten into the hands of the narco-killers in Mexico.

THOMAS MANIGAN, ATF: Absolutely. Four or five barrettes have already made this way south.

GRIFFIN: Call it the worst free trade imaginable. Mexican drugs easily flow north; American guns and ammunition flow south. An illegal trade that ATF agent and former New York cop Peter Forcelli says is like nothing he has ever seen.

PETER FORCELLI, ATF AGENT: And those weapons are being used by drug cartel members and people that are involved in drug trafficking and the war that they are having with Mexican authorities be it the military and Mexican police...

GRIFFIN: A war?

FORCELLI: Pretty much yes and in some of the battles they're actually winning.

GRIFFIN: Guns are hard to buy in Mexico. It is why the guns fueling the drug war are bought north of the border. ATF agents comb gun shows like this one in Phoenix or stake out gun stores where they've arrested girlfriends, illegal dealers, or just opportunists hoping to cash in on the gun and ammo smuggling trade.

This is the ammo for that?

FORCELLI: Yes, yes. In fact, the last time we worked one of these shows we seized 8,000 rounds of this type of ammo and approximately 19 of these firearms just in two days.

GRIFFIN: And those 50 caliber guns are showing up on the streets of Juarez, Mexico, like this street Gatsamala (ph), next to a day care center, where a commander of the police department coming out of his home and getting in his car was gunned down right here with the largest weapon you can legally buy in the United States.

I assume he's your friend?

UNIDENTIFIED MALE: Yes. He was the person behind me, the second in charge here.

GRIFFIN: Last March we met Juan Antonio Roman Garcia, the police director in Juarez shortly after his friend and second in command Francisco Salazar had been gunned down with that American-bought gun.

Juarez police officers like Ceasar Quitana are literally afraid their small caliber, government-issued rifles are no match for the Narcos.

CEASAR QUITANA, JUAREZ POLICE DEPARTMENT (through translator): I think most of us feel scared just to bring this with us.

GRIFFIN: And just two months after we met Commander Garcia he, too, was gunned down, police say by narco-terrorists using an AK-47, a gun most likely bought in the U.S.

Drew Griffin, CNN, Juarez, Mexico.

(END VIDEO CLIP)

COOPER: They're being outgunned, there's no doubt about that.

Let's "Dig Deeper" now with film maker and author Rusty Fleming, he's spent an awful lot of time on the other side of the border, his documentary "Drug Wars: Silver or Lead" is a chilling look inside the cartels. So sophisticated they now have their own intelligence and surveillance operations. Also with us Arvin West, the Sheriff in Hudspeth County, Texas, who's profiled in a movie. I appreciate both of you being with us.

Rusty, let's start with you. Why has the violence increased so dramatically over the last two years?

RUSTY FLEMING, FILMMAKER, "DRUG WARS": Well, there's two reasons really. And one is the fact that they are fighting over these valuable ports of entry. You've got Laredo, you've got El Paso, you've got San Diego.

COOPER: Smuggling routes?

FLEMING: Exactly and these ports of entry are invaluable for not just the drugs going north but as you mentioned the guns and the cash going south. And whoever controls those ports controls the contraband going through.

COOPER: So as Mexican authorities have been trying to crack down on the cartels, the cartels are really battling amongst themselves for control as well as battling against Mexican authorities.

FLEMING: Exactly and they're battling the government at the same time. And they have never really been put in a box like they have in the last 12 months.

You know, the Calderon administration has really been the most sincere that we've seen in decades about coming against the Narcos.

And until they started pushing those guys, you know, into that box, they weren't going to retaliate for the level that they have been.

COOPER: Sheriff West, you met with Homeland Security Secretary Janet Napolitano a couple weeks ago. Is the federal government you think doing enough to help local law enforcement on the U.S. side of the border?

SHERIFF ARVIN WEST, CHAIRMAN, TEXAS BORDER SHERIFF'S COALITION: Well, they're starting to move, it appears that they're to move. There's a lot that can be done. It's just a matter of them getting down here and getting to where -- getting their feet on the ground so to speak.

COOPER: What do you think about this idea of having U.S. military personnel on the border? Do you think the border needs to be militarized?

WEST: Well, if they don't militarize the border, the one key initial thing that they do need to do is give us an access to be able to push that button and call for help when we do -- if we do encounter something of that nature where we're definitely -- you think Mexico is out-gunned you ought to see some of the stuff we're carrying to defend ourselves.

COOPER: Rusty, I want to play a clip from your documentary and kind of show what authorities are up against in trying to prevent some of the smuggling and just how some of these drugs are smuggled into the United States. Let's take a look.

(BEGIN VIDEO CLIP)

FLEMING: Camouflaged by thousands of truck loads of legal commerce, multi-ton shipments of drugs come across the border with ease and efficiency.

UNIDENTIFIED MALE (through translator): If we prepare a shipment of 40 tons in three trailers, they will send three or four cars ahead with 50 to 60 kilos of drugs in each. When they reach the bridge, the dogs will detect at least one of the shipments in the car.

At this point all of the police and sheriffs will focus on that vehicle. In the meantime, the traffic on the bridge must keep going. So at that point they only have one officer trying to direct traffic and all he is saying is, go, go, go, allowing the trailers to pass through undetected.

(END VIDEO CLIP)

COOPER: You can't talk about this drug war without talking about corruption. And it occurs really on both sides of the border. How big a problem is this?

FLEMING: It's what allows this to exist. I mean, they cannot operate without being able to corrupt authorities. And that's on every level. And you're right. It is on both sides of the border.

I mean, we always think of corruption as being a Mexican problem and truly it is. But it is just as big a problem here. It's just the difference is that's the rule and this is the exception.

COOPER: And I was talking to the Attorney General in Mexico City awhile back, a couple weeks ago. The former drug czar in Mexico got arrested, accused of taking about a $425,000, $450,000 a month from drug cartels.

FLEMING: That's right and they've got the resources to do it. They're not having to beg somebody for the money; they've got plenty of it. And they spend about 50 percent of their income on corruption.

COOPER: Sheriff West, how serious a problem is this? I mean, from your perch on this side of the border, is this only getting worse?

WEST: Absolutely it's getting worse. I mean, you talk about the corruption. Those that aren't corrupt over there in Mexico, their life expectancy is real short.

We try to establish relationships with our counterparts in Mexico and if they're good, dependable, good, honest folks, for example my chief of police that's the counterpart in Mexico, they put his head in an ice chest. That's just reality over there.

COOPER: They put his head in an ice chest. They beheaded him.

WEST: Yes, right.

COOPER: It's unbelievable what they're facing. Sheriff Arvin West we appreciate your time. Rusty Fleming as well, we'll be talking to you throughout these next couple of days.

Whether you know it or not you have a stake in this story; we all do. Again, the Justice Department says that the Mexican drug cartels are the biggest organized crime threat in the United States right now.

Let us know what you think; join the live chat happening now at ac360.com.

Up next what they call the spillover -- the victims here, an American family abducted in Mexico.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: They didn't care if these were our kids and our babies. They just were after whatever they could get. And if they could have kept us and gotten more, they would have done that.

(END VIDEO CLIP)

COOPER: And the threat existing on both sides of the border. We'll talk about the risks and how to stay safe, which parts of Mexico are safe, with a security expert.

And later, American teenagers being recruited as soldiers, even assassins, killing in American cities for Mexican drug cartels. Taking American lives in this WAR NEXT DOOR.

(COMMERCIAL BREAK)

COOPER: That's the view from the border you're looking over at Juarez, Mexico. Those are the lights of the city of Juarez. The camera is panning, that's across the Rio Grande. The border is actually right in the middle of the Rio Grande.

Those lights now on the left-hand side of the screen those are our lights. We are right in front of the actual border fence; 18 feet high. We showed it to you a few moments ago and we'll show it to you in a little bit.

We're back live right here in El Paso, Texas reporting on the WAR NEXT DOOR. It's really a war that increasingly we're feeling the effects of in the United States. It's happening right here.

President Obama says that America stands shoulder to shoulder with Mexico in this bloody and growing battle linked to drugs. The president believes we can do more to help. Listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: President Calderon has been very courageous in taking on these drug cartels. We've got to also take some steps. Even as he is doing more to deal with the drug cartels sending drugs into the United States, we need to do more to make sure that illegal guns and cash aren't flowing back to these cartels. That's part of what's financing the operations and part of what's arming them. That's what makes them so dangerous.

(END VIDEO CLIP)

COOPER: Dangerous and terrifying. Those cartels are also targeting Americans. We're seeing home invasions in Tucson. We're going to have a story about that coming up, also kidnappings, drug- related kidnappings on the rise.

I want you to hear one family's chilling encounter with these armed killers. A lot of people are concerned about whether or not it is safe to go to Mexico and certainly a lot of places are safe.

We're going to talk to a security consultant about exactly where is safe and how you should behave. But this family's story was first featured in "Men's Journal." Tonight they are giving their first television interview.

They are concerned about their safety but they hope that by talking to CNN and showing you what happened to them that it won't happen to other innocent Americans.

Here's Randi Kaye.

(BEGIN VIDEOTAPE)

DEBRA HALL, ABDUCTED IN MEXICO: We're not anyone to them.

RANDI KAYE, CNN CORRESPONDENT: Debra and Chris Hall don't sleep very well though it's better now. Nightmares that used to keep them awake for days now keep them up for hours.

D. HALL: They first got in the truck and opened the back door. Our son said, oh, my God. Please, no, God. And if I live to be a hundred I will always hear that tone in his voice.

KAYE: Debra and her husband live near San Diego and for years since their teens they've been driving into Mexico to vacation. But they'll never go back again, not now, not after their last trip.

The Halls were driving along this road in Mexico just about seven miles from the U.S. border. It was a cold, foggy November night shortly before midnight when they suddenly saw flashing lights in their rear view mirror.

They thought it was police so they pulled over. Within seconds, they were surrounded by ten masked gunmen all dressed in black pointing guns at their heads.

D. HALL: They said, "We're getting in. Shut up. Put your heads down. We're going to kill you." KAYE: The Halls were pulling a camper that was covered with race car stickers and the gunmen demanded to know where the race car was; a prize that could have been traded for cash or drugs.

The Halls say their abductors drove them a mile or so into the hills and demanded jewelry including Debra's wedding ring and they ripped the radio and navigation system out of their truck.

Then they told them all to kneel face down in a ditch. The gunmen covered them with a sleeping bag.

D. HALL: I thought they were going to kill us then. They were covering us with the sleeping bag so that they wouldn't get blood on them.

CHRIS HALL, ABDUCTED IN MEXICO: I tried to cover my daughter with my body to protect her.

KAYE: Did you talk to her?

C. HALL: Yes.

KAYE: What did you say?

C. HALL: Just kept telling her sorry.

DIVINIA HALL, ABDUCTED IN MEXICO: I really thought we weren't coming home. And I was kind of facing my own mortality.

I was OK with the fact that I was with them and that if it was my time to go it was my time to go. At least I was with my family and I knew that they knew I loved them and I knew that they loved me, too.

KAYE: they were face down in a ditch waiting to be executed. Time passed slowly until suddenly the Halls realized they were alone. The gunmen had left in their truck. It took them two hours to walk to a town. Baja police drove them back across the border.

The Halls had no money and no I.D. When they got to this McDonald's on the U.S. side of the border they told me someone gave them a quarter so they could use a pay phone and call a relative to pick them up.

They filed a report with the San Diego police and this one with the Mexican consulate. But the men who terrorized the family were never caught.

Even worse, the gunmen know where they live. They stole their driver's licenses. Aware that cartel hitmen are striking on the U.S. side of the border they don't feel safe. It's as if fear is always stalking them and still they feel like they lost much more.

You'll never go back?

D. HALL: No, no way. And that's sad.

KAYE: The country they loved stolen from them in the middle of the night on a Mexican highway.

Randi Kaye, CNN, on the U.S.-Mexico border.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

COOPER: I should point out tourism is incredibly important to Mexico; brings in a lot of money to that country. The drugs bring in more money frankly, but it is a major industry in that country and is being affected by all this violence and by concerns. Many of them are justifiable.

But plenty of people go to Mexico and it's entirely safe. I went on vacation there recently for a couple days. You just have to know where to go and how to behave.

We'll talk to a security consultant coming up in this hour.

We'll also going to be following the drug trail north and the money trail south. Step by step, how tons of drugs come into America and billions of dollars enrich druglords, corrupt local officials on both sides of the border and buy more weapons.

Also are you safe traveling in Mexico? Millions of Americans visiting. Terrorism and Security expert Fred Burton joins us to talk about that.

And later, Secretary of State Hillary Clinton in Mexico tonight; she sits down with CNN talking about the problems and some new answers in this WAR NEXT DOOR.

(COMMERCIAL BREAK)

COOPER: THE WAR NEXT DOOR, we're on the border with Mexico tonight reporting live.

It's a war we all have to pay attention to; the deadly battle with the cartels is fueled by America's appetite for drugs. No two ways about it. Secretary of State Hillary Clinton made that very clear today.

There are hundreds of narcotic distribution networks across the U.S. And those supply lines bring in billions of dollars in marijuana, methamphetamine, cocaine, heroine. The journey ends in just about every community in this country from Anchorage, Alaska to Atlanta, Georgia. It often though begins a continent away.

Tom Foreman reports.

(BEGIN VIDEO CLIP)

TOM FOREMAN, CNN CORRESPONDENT: How do Mexican cartels get drugs into the United States? The Drug Enforcement Administration maps out a typical scenario, a ton of pure cocaine is ordered from Colombia and it's hidden inside a shipment of coffee inside a semi truck. A professional courier then starts driving north through Central America.

If he runs into any problem, they simply shift the load onto a boat, they bypass the problem area, and bring it back to the truck and then continue on north up here to the border. There he waits.

What is he waiting for? Well, for the drug bosses to watch what's going on there and figure out an optimal time to cross.

What are they looking for? They're looking for times of heavy traffic along the border when there are lots of people there. They're looking for times when there might be a holiday. They're looking for times when they might have a big storm of some sort; anything that will distract law enforcement.

When the right moment comes they signal and their truck driver simply blends in with the traffic and he drives north into the United States and he's ready for the next leg on the drug delivery road.

(END VIDEO CLIP)

COOPER: We'll show you that next leg coming up. How the drugs end up in American cities, possibly in your town. We'll have more with Tom Foreman.

Right now let's "Dig Deeper" on the travel threat; each year millions of Americans come to Mexico. The question is, are their lives in danger? There are an awful lot of folks who are concerned about their kids on Spring Break right now in Mexico.

What about here in the U.S.? A lot of people are also concerned about violence spilling over the border from Mexico into the United States especially in these border areas.

With me now is Fred Burton, counterterrorism expert and analyst and expert on security. Fred thanks for being with us.

It bears repeating that El Paso which is, for a city its size, actually one of the safer cities in America. There is concern in all of these border communities about the violence spilling over. We have seen home invasions, we have seen kidnappings, but for the most part those are drug related, right?

FRED BURTON, STRATFOR: Yes, for the most part they are, Anderson. However, there is a nexus with the cartels in Mexico and the criminal gangs in the streets of all of our cities in our country which most people fail to recognize.

COOPER: What you're saying, the Justice Department is saying 230 cities drug cartels operate in and that they're the biggest organized crime threat that we now face in America.

BURTON: Yes. There is no doubt that this is a homeland security issue and some would say a national security issue.

Let's face it. Think about the volume of drugs and weapons flowing both sides of the border and think about the possibilities for terrorism to come into the United States.

Mexico is fighting an insurgency now. This past year we've seen an elevation in the amount of assassinations, the police killings, the insurgent kind of activities that are taking place in Mexico. It's just a matter of time before it really spills over into the United States unless we certainly shore up the border as best we can.

COOPER: OK. What about for people traveling to Mexico? Certainly a lot of parents concerned about their kids. I was in Baja just a couple of weekends ago, felt very safe there. Is it safe for people to take a vacation or travel in Mexico right now?

BURTON: It is safe, Anderson, if you use good, common sense and you maintain a high degree of situational awareness. You don't go out and do anything stupid after hours. You stay on the resort property. You don't get into the taxis. You just keep a cool head and you'll be fine.

But again, violence has occurred for the most part throughout the border area but we have seen sporadic kinds of violence in most of the resort areas as well.

COOPER: So most of the killings, when you hear 6500 people killed in Mexico last year, most of that is drug related, either police getting killed, hundreds of police officers have been killed, or people getting caught in the crossfire of the drug cartels?

BURTON: Yes. Most of that is towards the north, northern part of Mexico right on the border though we have had some high profile kidnappings in Mexico City and we had an assassination of a very senior Mexican intelligence officer in Mexico City, which was a brilliant kind of hit operation. So the cartels have the capability of carrying out violence anywhere they want.

COOPER: One of the things, Fred, what's so scary is for Mexicans that it's not just rich people getting kidnapped but people at all economic levels. There was a family, I was in a marketplace in Mexico City and one of the people who owned a stall their son was kidnapped -- a little boy, 5 years old.

They didn't have much money. They were going to kidnap him for $500 and when they thought the police was moving in the kidnappers injected this little boy with acid and killed him.

It's unbelievable that these kidnappings going on, it's affecting all levels of society.

Fred, appreciate your expertise. Fred Burton tonight. Thank you.

Coming up, Secretary of State Hillary Clinton taking on the WAR NEXT DOOR; she is in Mexico for two days of high-level meetings and talked with our own Jill Dougherty about what's at stake in this mission. You'll hear from her.

Also, a story that will make your blood run cold. American teens as young as 13 paid to kill, hired by Mexican drug cartels as hitmen. Why do they do it? We'll hear from a young man now behind bars.

(COMMERCIAL BREAK)

COOPER: We are looking at a gun battle in the streets of Juarez. A police officer pinned down by members of drug cartels shooting it out in the streets. That's how civilians get killed, caught in the crossfire.

At one point as many as ten people were getting killed every day in the city of Juarez; Juarez just over my shoulder just a couple hundred yards away. In fact, you can see right now there are some police cars going by, the sirens going. The drug cartels that have kidnapped Americans here in the U.S. and that have killed more than 6,000 people last year alone in Mexico control vast regions of Mexico.

I want to show you a map; just give you an idea of their terror and their reach. A large number of drug cartels, various, overlapping areas of operation. It's all about controlling supply routes into the United States but as you can see it's not just in the border states in Mexico, it's all across Mexico these drug cartels are operating.

People smuggling; they're into that. Also obviously drug smuggling, also kidnappings and extortion; whatever they can do to make money. At least four of the groups are now found in parts of Texas, New Mexico, Arizona, and California.

Now, earlier we showed you how this endless supply of drug shipments are brought to the border but how do they get in?

Once again here's Tom Foreman.

(BEGIN VIDEO CLIP)

FOREMAN: Once a drug truck enters the U.S. with, for example, the typical ton of cocaine the DEA describes, the first goal is to get away from the crossing point.

In that process officials say it may well act like a delivery van making drops in places like Las Vegas here or Los Angeles or San Francisco, maybe even up to Portland. In each place, a mid level cartel boss collects payment from local distributors who move the product to their own places, mix it with talcum powder, turn the one ton into five tons, and within 48 hours the Mexican cartel's whole load is selling on the street supplying hundreds of dealers in dozens of surrounding towns and thousands of American drug users.

(END VIDEO CLIP)

COOPER: The reach is just incredible. How does all that illegal money get back into Mexico? Tom is going to have that part of the story coming up.

First, more of Hillary Clinton's mission in Mexico; the secretary of state arriving with plenty of support. A new poll shows 71 percent of Americans approve of how she's handling her new job. It doesn't make the job any easier. Jill Dougherty joins me now. She's been following Secretary of State Clinton in Mexico City. Jill, they're also -- you talked to Secretary of State Clinton; what did she have to say?

JILL DOUGHERTY, CNN CORRESPONDENT: Well, Secretary Clinton says that Americans' insatiable demand for drugs is actually one of the factors that's fueling the war along the border. So I asked her to explain that.

(BEGIN VIDEO CLIP)

CLINTON: We've spent an enormous amount of time and money in an effort to try to reduce demand and interdict the drugs that come into our country and, you know, it kind of goes up and down. We make a little progress and then we lose ground.

We have to do a better job of convincing Americans that illegal drugs are a terrible choice. We have to convince them that more treatment programs that they would take advantage of, are a way out because obviously our demand for drugs is what motivates these drug gangs.

I mean, if they didn't think they were going to make a bunch of money across the border they'd go into another line of work. And so we do share responsibility for the security challenges facing the Mexican people.

(END VIDEO CLIP)

DOUGHERTY: And she says it's not only drugs, it is money laundering and it's also guns that are coming over from the U.S. into Mexico that are part of the problem -- Anderson.

COOPER: Yes, there's no doubt about that. Jill Dougherty in Mexico City. Jill thanks.

Behind the business of the drug trade we know how the cartels get their stuff into the U.S. How do they get their billions in profits back? We'll have that answer, next.

Also tonight Obama's personal plea: the closed door meeting with his own party members who may abandon ship over his budget proposal.

Later, is the worst over on the economy? Some new housing figures and more good news on the economy to report. That's right. I said actually good news on the economy. Coming up.

We'll be right back.

(COMMERCIAL BREAK)

COOPER: Welcome back, live, from the Texas-Mexico border.

Mexican drug cartels have bribed politicians and bought police officers and much of the money they use to gain that influence comes from the United States. The cash comes from across America, small towns, street corners, big cities. The question is how does it get back across the border?

Once again here's Tom Foreman.

(BEGIN VIDEO CLIP)

FOREMAN: Estimates on the value of the illegal drug trade vary widely but one state department number suggests $4 million worth may be entering the United States every hour. Some parts of the country pay more than others to support this illegal supply and demand.

The DEA says a kilo of cocaine in the west may go for $17,000 but the extra cost involved and the risk in bringing it across the country to the east makes it more like $22,000 by the time it arrives over here.

All that money may be smuggled directly back into Mexico or the cartel might pull one last trick, using the money to buy appliances and other consumer goods here, products which can be loaded legally on to a truck, exported back to Mexico, and resold there where the cartel collects the now laundered cash.

(END VIDEO CLIP)

COOPER: For the last couple years we've been following this story. Back in 2006, the middle of 2006, the Immigration Customs Enforcement discovered a tunnel going from Tijuana to San Diego over in Otay Mesa.

They gave us an exclusive tour of that tunnel. I just want to show you what it looked like back then.

(BEGIN VIDEO CLIP)

COOPER: So this is the tunnel. It's 2,400 feet all the way through to Mexico. It's the size of about eight football fields in length. Seven of the football fields are underneath U.S. territory. One football field is in Tijuana. It goes from this warehouse here all the way to a warehouse in Mexico.

The tunnel immediately starts to slope down from ground level. It goes down about 60 feet. If you look down at the ground here, this is all concrete. The walls down here are -- it's a soft rock.

They don't know exactly how this tunnel was dug but you can tell some sort of a drill was used. You can actually see the markings here on the side of the wall.

(END VIDEO CLIP)

COOPER: That tunnel was so sophisticated they said it probably wasn't being used to smuggle people, it's probably being used to smuggle drugs.

Now in this area along the Texas-Mexico border here around El Paso, tunnels aren't really possible because you have the Rio Grande River right there. You can't dig a tunnel underneath that river. But there are big areas of concern here. We showed you the border fencing all along this area. The border personnel who are basically stationed right there, there's an officer right there in an SUV, this is a very active crossover point.

The city of Juarez is right over there. People as soon as it gets dark, people kind of gather and then they make a run for it.

If you look over there there's a drainage tunnel that's there underneath that bridge under the overpass and they use that. People run, try to get into that, and once they get in there that'll take them right into the city of El Paso.

There's another drainage tunnel there which takes them right to city hall, ironically enough. That's one of the entry points and there are border patrol agents here 24 hours a day. We just saw a border helicopter passing over as well. It is a very active area because the border fence, while it's strong in this area, about 18 feet high, it actually stops about a hundred or 200 yards away and there's just a highway right there.

A lot more to tell you about what is happening here in this area. We're reporting tonight as well as tomorrow night.

Coming up in just a second, other news of the day. Also some good economic news if you can believe it. Good to tell you about that.

And before we leave tonight we'll also show you how Mexican drug cartels are recruiting young Americans, teenagers in some cases, to become hitmen for the cartels.

We'll be right back.

(COMMERCIAL BREAK)

COOPER: Just ahead a story that frankly stunned us. American teenagers turned assassins, kids as young as 13 hired by drug cartels to do their dirty work.

First, though, Tom Foreman joins us with the "360 News and Business Bulletin."

FOREMAN: Hi, Anderson.

President Obama met with Senate Democrats on Capitol Hill today to drum up support for his $3.6 trillion budget. The committees in the senate and house are debating Congressional budget plans that would scale back the president's blueprint. Key votes are expected in both chambers this week.

On Wall Street all three major stock indexes rose today on better than expected reports of new home sales and durable good orders; we could all use some durable good. The Dow jumped nearly 90 points; the Nasdaq added 12 and the S&P 500 rose nearly 8. In North Dakota, hundreds of volunteers are racing to fill sand bags as the state braces for record floods. The Red River is expected to crest at 41 feet this weekend. Ice jams in the Missouri river have caused water to back up forcing evacuations in Bismarck. Today demolition crews blasted car-sized ice chunks to break up those jams.

Historian John Hope Franklin, a revered scholar on issues of race and the south, has died. The grandson of a slave, he became the first black department chairman at Duke University and in 1995 received the presidential medal of freedom. John Hope Franklin was 94 years old -- Anderson.

COOPER: Remarkable man. Tom, thanks.

Up next, American teenagers turned into paid killers by Mexican drug cartels -- hitmen who are still boys. The question is what makes them do it? How many are actually being recruited?

Plus, taking you inside THE WAR NEXT DOOR. Remarkable images from the front lines of the battle that's now closer and deadlier than ever.

(COMMERCIAL BREAK)

COOPER: Welcome back.

You're looking at a border patrol vehicle right along the Texas/Mexico border here in El Paso. The druglords who control swaths in Mexico have found willing executioners to assassinate enemies in America. The hitmen didn't have to cross the border to do it.

In videotaped confession that we're about to play for you tonight, two teenagers from the United States describe how a cartel paid them to murder. And as you'll see and hear, these young men loved it.

Ed Lavandera reports.

(BEGIN VIDEOTAPE)

ED LAVANDERA, CNN CORRESPONDENT: Moises Garcia had just finished a family lunch in Laredo, Texas. Garcia helped his pregnant wife and 3-year-old boy into their white Lexus.

LORI GARCIA, MOTHER OF MOISES GARCIA: This guy came out of the car and just started shooting them.

LAVANDERA: Garcia was a wanted man. He had a $10,000 bounty on his head. Garcia's wife was shot in the chest. She and her son survived but Moises was dead.

GARCIA: It happened so fast, he didn't have a chance of anything.

LAVANDERA: Garcia's murder at first looked like an isolated gangland-style killing. But there were more; seven murders in a year- long stretch. There was something more sinister brewing.

Then Noey Flores (ph) was killed, an innocent victim in a case of mistaken identity. Investigators found fingerprints on the cigarette box in the shooter's getaway car.

The chilling truth unraveled. The clue led police to Gabriel Cardona and Rosalio Reta, American teenagers working as Mexican drug cartel hitmen in the United States.

ROBERT GARCIA, LAREDO, TEXAS POLICE: They were very good at what they did. They were professional at what they did.

LAVANDERA: Assassins is what they were. How Gabriel Cardona and Rosalio Reta evolved from average teenagers into hitmen is laid out in court records and these police interrogation videos obtained by CNN.

In this tape, Reta happily details how he carried out his first cartel assassination at the age of 13.

"I loved doing it, killing that first person, I loved it. I thought I was superman," said Reta. Detective Robert Garcia is the man sitting across the table from Reta.

R. GARCIA: That's one thing that you wonder all the time, what made him be this way?

LAVANDERA: Like many Americans, these teenagers started hitting the cantinas and bars just across the border in Mexico. And that's where investigators say the cartel was waiting to recruit them.

These kids were easy targets for the cartel. The two started living the high life; they got tattoos honoring Santa Muerte, the Grim Reaper-like saint honored by drug traffickers. Cardona had eyeballs tattooed on his eyelids and markings covered Reta's face.

Cardona and Reta should have been in school here, but instead, investigators say they dropped out and joined the cartel's payroll. They drove around town in a $70,000 Mercedes. They were paid $500 a week as a retainer to sit and wait for the call to kill. Then they could make up to $50,000 for a hit.

Prosecutors say Cardona and Reta were hitmen for the Zetas, a group of former Mexican special military forces that do the dirty work for the notorious Gulf Cartel.

URIEL DRUKER, WEBB COUNTY, TEXAS ASST. DISTRICT ATTORNEY: They actually enjoy it and laugh about it and compete, discussing their exploits about conducting these activities.

R. GARCIA: They just told us that they're already here. There are sleeper cells -- they're already here in the U.S. Not just in Laredo; they're all throughout the U.S.

LAVANDERA: In Cardona's interrogation, he tells detectives the Zetas are moving their operations deeper into the U.S. Cardona says he knows of hits carried out in Houston and Dallas. Cardona and Reta are in prison now serving long terms for murder. But before they were arrested, federal authorities recorded a phone call between the two young men.

Cardona brags about killing 14-year-old Inez Villareal, the innocent cousin of a Cardona enemy who's also murdered. Cardona laughs about torturing both, making "guiso" or stew out of their bodies in large metal drums. Villareal and his cousin have never been found.

Before the call ends, Cardona says, "There are three left to kill, there are three left." It's a reminder the cartel's work never ends as they recruit the next generation of killers.

Ed Lavandera, CNN, Laredo.

(END VIDEOTAPE)

COOPER: Up next, some incredible photos from inside THE WAR NEXT DOOR. Could we soon see the same level of bloodshed here inside the United States? U.S. authorities say it's not going to happen and they're going to prevent it.

President Obama's vowed to stem the guns, drugs and violence spreading across the border. Can he do that?

Details when we continue.

(COMMERCIAL BREAK)

COOPER: For tonight's "Shot," the reality of THE WAR NEXT DOOR in black and white. Take a look at some of these pictures from Juarez and Tijuana taken by photojournalist Shaul Schwartz for Getty Images.

Here's a U.S. border patrol officer standing behind a sheet of bulletproof glass that absorbed the impact of several rounds. At a police station in Juarez, pictures of the missing including children. Scores of civilians have vanished from the city. Many were kidnapped by the cartels, never to be seen alive.

Under the white sheet, the body of Rene Rodriguez; his killer had pulled him from his car. And as his family watched, they executed him just a few hundred yards from the U.S. border.

And from earlier this month in Tijuana; what they're fighting for. Mexican police seizing nearly 4,000 pounds of marijuana from one ranch; a drop in the bucket in this increasingly violent battle.

That does it for 360. Thanks for watching. I'll be on the border tomorrow night.

"LARRY KING" starts right now.