Tomas Bravo / Reuters

What I remember most about my return to Mexico last year are the narcomantas. At least that’s what everyone called them: “drug banners.” Perhaps a dozen feet long and several feet high, they were hung in parks and plazas around Monterrey. Their messages were hand-painted in black block letters. They all said virtually the same thing, even misspelling the same name in the same way. Similar banners appeared in eight other Mexican cities that day—Aug. 26, 2008.

The banners were likely the work of the Gulf drug cartel, one of the biggest drug gangs in Mexico. Its rival from the Pacific Coast, the Sinaloa cartel, had moved into Gulf turf near Texas, and now the groups were fighting a propaganda war as well as an escalating gun battle. One banner accused the purported leader of the Sinaloa cartel, Joaquín “El Chapo” Guzmán Loera, of being protected by Mexican President Felipe Calderón and the army. After some time, the city’s police showed up politely to take the banners down.

I’d recently lived in Mexico for a decade, but I’d never seen anything like this. I left in 2004—as it turned out, just a year before Mexico’s long-running trouble with drug gangs took a dark new turn for the worse. Monterrey was the safest region in the country when I lived there, thanks to its robust economy and the sturdy social control of an industrial elite. The narcobanners were a chilling reminder of how openly and brazenly the drug gangs now operate in Mexico, and how little they fear the police and government.

That week in Monterrey, newspapers reported, Mexico clocked 167 drug-related murders. When I lived there, they didn’t have to measure murder by the week. There were only about a thousand drug-related killings annually. The Mexico I returned to in 2008 would end that year with a body count of more than 5,300 dead. That’s almost double the death toll from the year before—and more than all the U.S. troops killed in Iraq since that war began.

But it wasn’t just the amount of killing that shocked me. When I lived in Mexico, the occasional gang member would turn up executed, maybe with duct-taped hands, rolled in a carpet, and dropped in an alley. But Mexico’s newspapers itemized a different kind of slaughter last August: Twenty-four of the week’s 167 dead were cops, 21 were decapitated, and 30 showed signs of torture. Campesinos found a pile of 12 more headless bodies in the Yucatán. Four more decapitated corpses were found in Tijuana, the same city where barrels of acid containing human remains were later placed in front of a seafood restaurant. A couple of weeks later, someone threw two hand grenades into an Independence Day celebration in Morelia, killing eight and injuring dozens more. And at any time, you could find YouTube videos of Mexican gangs executing their rivals—an eerie reminder of, and possibly a lesson learned from, al Qaeda in Iraq.

Then there are the guns. When I lived in Mexico, its cartels were content with assault rifles and large-caliber pistols, mostly bought at American gun shops. Now, Mexican authorities are finding arsenals that would have been incomprehensible in the Mexico I knew. The former U.S. drug czar, Gen. Barry McCaffrey, was in Mexico not long ago, and this is what he found:

The outgunned Mexican law enforcement authorities face armed criminal attacks from platoon-sized units employing night vision goggles, electronic intercept collection, encrypted communications, fairly sophisticated information operations, sea-going submersibles, helicopters and modern transport aviation, automatic weapons, RPG’s, Anti-Tank 66 mm rockets, mines and booby traps, heavy machine guns, 50 [caliber] sniper rifles, massive use of military hand grenades, and the most modern models of 40mm grenade machine guns.

These are the weapons the drug gangs are now turning against the Mexican government as Calderón escalates the war against the cartels.

Mexico’s surge in gang violence has been accompanied by a similar spike in kidnapping. This old problem, once confined to certain unstable regions, is now a nationwide crisis. While I was in Monterrey, the supervisor of the city’s office of the AFI—Mexico’s FBI—was charged with running a kidnapping ring. The son of a Mexico City sporting-goods magnate was recently kidnapped and killed. Newspapers reported that women in San Pedro, once one of Mexico’s safest cities, now take classes in surviving abductions.

All of this is taking a toll on Mexicans who had been insulated from the country’s drug violence. Elites are retreating to bunkered lives behind video cameras and security gates. Others are fleeing for places like San Antonio and McAllen, Texas. Among them is the president of Mexico’s prominent Grupo Reforma chain of newspapers. My week in Mexico last August ended with countrywide marches of people dressed in white, holding candles and demanding an end to the violence.