With its liberal gun laws, Arizona is at the heart of the storm. Unlike most states, the popular semiautomatic rifles, AK-47s, AR-15s, are easily purchased with little more than a driver's license and some forms. The large caliber rifles, like those Beltrán stored, are also for sale.

   But nobody can explain how a .50-caliber rifle can be driven down to the Mexico border and then crossed over.

   The ease with which guns can be purchased in this state incapacitates American law enforcement, whose officers at times can only stand by and watch.

   Consider the case of George Iknadosian. When Iknadosian was arrested, police tried to paint a portrait of a nearly archetypal arms dealer instead of the mere gunstore owner he claimed to be. State prosecutors argued that the Egyptian-born businessman moved to Arizona after the federal assault rifle ban sunsetted, and then sold hundreds of weapons to the Beltrán Leyvas family. Between March 2007 and 2008, prosecutors say Iknadosian sold 711 weapons that were used to commit crimes in Mexico. They also say Alfredo "El Mochomo" Beltrán Leyva had one of Iknadosian's pistols tucked into his belt when he was arrested in Sinaloa, and that the diamond-studded map of Sinaloa on the gun butt of a narco-syndicate on the Mexican border cost $35,000. They argued Iknadosian's employees sold the guns on the streets of Mexican border towns, and these guns were used in an attack in Sinaloa where eight federal police were killed.

   The officers "ran out of ammunition in the fight," Newell says. "They got overwhelmed."

   But in April, a county judge threw the case out before it even reached the jury; the buyers were eligible to buy the guns and as a result, Iknadosian's sales were legitimate. Whether his guns were found tucked into the waistband of a crime boss or used to blow away eight officers was of no legal concern. Newell stirs at the point.

   "Iknadosian was coaching undercover ATF agents on how to avoid being detected," he said. "He admitted he knew the guns were being taken to Mexico. So..." he says, throwing his hands up in the air.

   These days, the only phone number to Iknadosian's gun store, X-Caliber Guns, is disconnected. And when a reporter arrives the store is closed.

The Discussion in Washington

   The Obama Administration has steeped itself in Mexico's security crisis, though it's not clear how effective its attempts to stem the flow of weapons will ever be. A week before the new administration was sworn in, Mexican cops found a half million rounds in an abandoned warehouse. Thus far, the rhetoric coming out of Washington is stronger than the operations taken along the border hundreds of miles away.

   With the Mexican border seething, Secretary of State Hillary Clinton acknowledged what Mexico has long argued: This country's "insatiable demand for illegal drugs fuels the drug trade," she said in March. "Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police, of soldiers and civilians."

   One program introduced this year is an outbound inspection unit at the ports of entry leading into Mexico. Customs and Border Protection, the Homeland Security agency that monitors the border, implemented the $95 million program, small teams of inspectors that stop suspicious-looking cars and border crossers heading south.

   The teams recover cash people try to take out of the country, and sometimes (but rarely) weapons.

   Standing in the shade of the port of entry in Nogales, Ariz., assistant port director Joe Agosttini watched as one of the K-9 units raced around a new pickup truck, the dog sniffing the tires and the undercarriage as the inspector tapped on its fenders.

   "They're going as far as modifying engines and axles," he said, noting a recent case where officers found $200,000 stuffed in the transmission. "They're using the same vehicles they use for north-bound smuggling. It's just a vicious cycle."

   In three months, the teams at the Arizona ports of entry have seized $4 million, but few guns.

   Then there are the grenades. April 2008: Rafael Alcantar, a Mexican man, is sentenced in federal court, charged with trying to buy a 40mm grenade launcher, three fragmentation grenades and 26 full-auto machine guns from undercover agents in Tucson.