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They seem to have become more powerful, no doubt. Their rise to power clearly relates to the drug trade and our USA policies. That said, if all drugs were legalized here today, I’m not sure how that would help solve the problems there, since many of the current activities, especially in terms of extortion, don’t seem to me to be directly related to the drug trade.

No, but it removes their primary source of income and with it, much of their power and raison d'être. And it allows the police better options than they currently have so that can go after extortionists instead of worrying about who's protecting them.