A failed state is a state that doesn’t have a central, stable form of government. It cannot defend its own territory, collect taxes, or manage the economy. This sets it apart from other nations because it cannot function on its own and often requires help from a strong state. A state becomes classified based on the number of responsibilities it can live up to compared to the number of responsibilities it should.
I think that Mexico is in the beginning steps of becoming a failed state. The drug cartels are running the northern part of the state dragging political figures, police and citizens into harm. The government of the state is slowly starting to crumble and the economy is going down with the rest of the country. Although drugs make money, this money is not counted in the GDP and is not taxable since it is illegal. Also, the money made from drugs is also being used to pay off government officials.
http://www.ethiopianreview.com/news/161675
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