Ernesto Ibarra Santes was brimming with bravado when he took his new post of federal judicial police commander for the border city of Tijuana on Aug. 16. After years of unkept promises of reform, said Ibarra, he would be the one to clean up a federal force that he readily acknowledged was owned and operated by drug traffickers. "Police [in Tijuana] had become so corrupted that they weren't just friends of the traffickers, they were their servants," Ibarra told the Los Angeles Times Sept. 12. Two days later, while riding in a taxi in Mexico City, Ibarra and two agents were torn to pieces by a fusillade of AK-47 bullets fired from a passing vehicle.

A week after Ibarra's murder, killers struck again, taking out another Tijuana federal commander, Jorge Garcia Vargas, along with three colleagues. No arrests have been made in the assassinations, though they are widely believed to be the work of Tijuana's most notorious gang, the Arellano Felix cocaine smuggling ring. And, if recent history is a guide, no arrests are forthcoming. Ibarra and Garcia were the sixth and seventh high-ranking law-enforcement officials in Tijuana to be gunned down this year, and none of the crimes has been solved. The killings have become new black marks on the record of a Mexican government that seems strangely powerless in the face of swelling corruption, lawlessness and an armed insurrection that reflects civil unrest throughout the country.

That impotence, together with the continuing pain of Mexico's economic crisis, may signal a new era in Mexican history. Besieged by out-of-control drug barons, crooked police, skyrocketing crime and plummeting living standards, the Mexican people may finally be ready for a historic change in government. After 67 years of continuous rule--longer than any other political party in the world--the Institutional Revolutionary Party, or P.R.I., may lose control of Congress in midterm elections scheduled for next July. And polls in the race to elect a mayor of Mexico City--until now an appointed position--show the P.R.I. running third.

The P.R.I.'s fortunes could rebound by the time of the next presidential election in 2000, but for now it seems to be going backward rather than forward. At the party's 17th assembly last week, delegates underscored their discomfort with the free-market policies of President Ernesto Zedillo Ponce de Leon by endorsing a doctrine of "revolutionary nationalism." The convention also delivered a slap to the technocrats who have held the reins of government for more than a decade by demanding that all future P.R.I. candidates for President have a 10-year party career and experience in elective office--restrictions that would have excluded the past five chief executives, including Zedillo.

Party officials are worried because Zedillo's government has very little support among the people, who are in an increasingly black mood. Millions, particularly in rural areas, are without work and barely able to feed their families, even as the Forbes magazine list of Mexican billionaires grew from 10 in 1995 to 15 this year. Polls show that most citizens consider their politicians to be corrupt and incompetent, their police in thrall to criminals. Crime has risen precipitously--it was up 35% last year in Mexico City--and rural villagers who don't trust the courts to do justice against wrongdoers sometimes lynch them. Some analysts think the country is becoming dangerously unstable. "Mexico is explosive," says Douglas Payne, a Latin American specialist formerly with the New York-based human-rights group Freedom House. "It is a powder keg."

That assessment is shared across the border in California and Texas, where Mexico's inability to contain drug trafficking and related crimes is seen as a growing danger. Last week the San Diego Union-Tribune boldly proposed, in reaction to the Ibarra murder, that the Mexican government declare martial law in narcotics-soaked Tijuana. "Either government and police move quickly with radical measures, including even martial law, to regain control," said the newspaper, "or anarchy will triumph."

In a limited way, it already has. The explosion of violence in late August by a well-armed rebel grOUP CALLING ITSELF THE POPULAR REVOLUTIONARY ARMY, OR E.P.R., has shaken Mexico. The shadowy guerrilla group launched coordinated attacks on police stations and military posts in three southern and central states, killing 16. The rebels have since declared a cease-fire in Guerrero, the state where they are most active, until after local elections Oct. 6.

The E.P.R. is a long way from matching the public relations success of subcomandante Marcos, the charismatic leader of the Zapatista Army of National Liberation, who maneuvered the misery of the Chiapas Indians onto the government's agenda with his 10-day uprising beginning Jan. 1, 1994. But in a poll taken in Mexico's three largest cities after the E.P.R. attacks, 30% of respondents said they considered the rebels' use of violence "justified."

"The Zapatistas are a local abscess," says Rafael Segovia, a respected political analyst in Mexico. "The E.P.R. is a general infection."

The pickup truck, brimming with federal police and soldiers, automatic weapons at the ready, veered off the rural mountain road and lumbered down a steep embankment known locally as El Balcon. The soldiers were hunting E.P.R. rebels, and watching them pass from his tin-roofed mud hut, Servando Meyer felt apprehensive. The heavy military presence is new to this region of Hidalgo state, and elsewhere the army has been accused of dealing rough treatment to peasants even thinly suspected of involvement with the E.P.R.

Meyer, 33, a farmer, says he has no sympathy for the guerrillas. But he can understand how frustration with the broken promises emanating from Mexico City could lead some Mexicans to violence. In his part of Hidalgo, called La Huasteca, recent government surveys showed that 72% of the people have no running water, 51% no electricity. The economic disaster that began with the devaluation of the peso in December 1994 has tripled the cost of staples like cooking oil. Meyer barely manages to feed and clothe his wife and three children on the meager crop of peanuts, maize and beans that he scratches out of a patch of ground on the steep mountain slope. Why might poor farm laborers take up arms against the government? "There is no other way out," says Meyer.

Given the country's current travails, it is hard to believe that just three years ago, in the run-up to the implementation of the North American Free Trade Agreement with Canada and the U.S., Mexico was advertised as a society on the brink of first-world status. Under the administration of President Carlos Salinas de Gortari, Mexico's economy was being rapidly privatized and deregulated. Trade boomed with the U.S., Europe and Japan, high-tech factories sprang up, and a new middle class of professionals and technocrats was burgeoning.

Today the optimism that animated the Salinas era is seen as a bitter delusion. Salinas is in self-imposed exile in Ireland--probably because that nation has no extradition treaty with Mexico. His brother Raul is in jail in Mexico, accused of conspiracy in the murder of a P.R.I. leader and corruption on a scale that takes the breath away. Raul Salinas, whose trial is now in progress, accumulated more than $100 million in European and U.S. bank accounts by allegedly selling his influence with his brother's government, and possibly by selling protection to drug barons.

Investigations into the misdeeds of Raul Salinas and others who accumulated great wealth during that era have shown that some of the privatizations launched by Carlos Salinas to great applause from abroad were corrupt. Perhaps most politicized was the sale of the banks to various Salinas cronies. In the wake of the peso crisis, the government has been forced to bail out failing and mismanaged banks at a cost of billions of dollars.

Like the banks, much of the rest of Mexico's economic infrastructure was seriously weakened after the peso devaluation. To be sure, the economy appears to have snapped back, with GDP growth in the second quarter of this year more than 7%, mostly the result of a humming export sector helped by the cheap peso. But that does little for the million-plus Mexicans who lost their jobs, businesses, houses and cars during the catastrophic recession of 1995, the worst downturn in 50 years.

The home video was hazy and out of focus, but the horror it depicted was all too clear. A man identified as Rodolfo Soler Hernandez, already beaten nearly unconscious, his eyes swollen shut, is being tied to a tree. Accused of raping and killing a woman in the small town of Tatahuicaopan in the state of Veracruz, Soler had been captured by villagers the same day, "tried" by the mob and sentenced to death. After a town official makes a speech about the uncertainty of justice, one citizen pours gasoline over Soler, then another throws a lighted match. A faint scream can be heard as flames engulf the accused malefactor. The video ends.

The tape of the Aug. 31 killing made its way into the hands of network-television executives and was broadcast to the nation. But while public officials have expressed shock at the lynching--"I asked myself, 'Where are we living?'" said supreme court Justice Olga Sanchez Cordero--few Mexicans were surprised. Frustration with the government's inability to protect the citizenry against crime long ago reached the boiling point.

In fact, the only unusual aspect of the Veracruz lynching was the stark video record. There have been five other confirmed vigilante murders this year in various locations across Mexico, and many other attempts. At the heart of the gruesome practice is a justice system in which it is too easy to buy an acquittal.

The rot reaches the highest levels. The government maintains that P.R.I. presidential candidate Luis Donaldo Colosio, gunned down in Tijuana in March 1994, was the victim of a conspiracy, but no culprits except the shooter have been brought to justice. Last month Attorney General Antonio Lozano appointed a new special prosecutor to investigate the case, but few expect him to have any more success than his predecessors. Mexico's other high-profile assassination, that of top P.R.I. official Jose Francisco Ruiz Massieu, is the crime Raul Salinas is accused of plotting. Again, few expect the full circumstances of Ruiz Massieu's death to be unveiled.

Two new apparent failures of justice that surfaced over the summer only deepened the public's cynicism. Ruben Figueroa, a former governor of Guerrero, was absolved by state judges he controls of charges that he helped cover up the 1995 massacre by state police of 17 peasants, even though the federal supreme court issued a highly critical report on the case. Similarly, P.R.I. Governor Roberto Madrazo of Tabasco was accused of illegally lavishing an astonishing $70 million of public funds on his 1994 election campaign; a local court found him not guilty despite the existence of receipts proving that the money was indeed spent.

But by far the most egregious cases of cover-up and impunity concern Mexico's drug traffickers, who are credited with supplying the U.S. with tons of cocaine, heroin and marijuana. The pipeline is kept open and the dope shipments guarded by both federal and local police eager to supplement their meager pay of as little as $200 a month. "The police have become the personal army of the narcotics traffickers--that's the truth," admits a top aide to President Zedillo.

Honest cops who try to disrupt the evil partnership will probably suffer the fate of Ernesto Ibarra, who took office in Tijuana after a nationwide purge of 737 federal police suspected of corruption. Ibarra reportedly took an active role in cleaning out Tijuana's 120-officer force. Was he killed by his own dismissed officers, or by the narcotics traffickers who allegedly employed some of the police? Was he corrupt himself? Investigators found $50,000 in a bag in the trunk of the taxi Ibarra was riding in, but many suspect it was planted by police or drug traffickers trying to sully his name. The answers may never be known.

Nothing upsets U.S. agents assigned to help Mexico in the war on drugs more than the Zedillo government's failure to hunt down cop killers. Thomas Constantine, head of the U.S. Drug Enforcement Administration, went on record in an interview with Time to air his frustrations. Constantine said, "If we had in the United States several special agents in charge from the fbi, two U.S. attorneys, two former U.S. attorneys, all of whom were involved in major narcotics cases, all assassinated, and those crimes not solved, can you imagine the outrage in this country?"

For some analysts, the breakdown in public order and widespread public alienation are a clear sign of the once omnipotent P.R.I.'s decline. "We're living through the collapse of a system, and these kinds of problems--like robbery and social upheaval--are what happen when systems fall," says Enrique Krauze, a historian in Mexico City.

Ironically, the main architect of the P.R.I.'s destruction and, just possibly, his country's salvation, may be Zedillo himself. Early in his term he declared political reform to be an overriding goal. Against formidable odds, he has kept that promise. In July he wound up 18 months of negotiations with opposition parties to sign an agreement on electoral reforms that go a long way toward ending the P.R.I.'s reign as, in the words of its critics, the "ministry of elections." The federal electoral institute will be taken out of the direct control of the government, there will be realistic limits on campaign spending, and the supreme court will rule on electoral laws.

One paradox of Zedillo's tenure is that he is frequently accused of being a weak President in part because he is willing to yield up the traditional prerogatives of his office. "Mexicans are clamoring for greater democracy, but when they find a President who wants to limit the powers of the government, they say he's weak," notes M. Delal Baer, head of the Mexico Project at the Center for Strategic and International Studies in Washington. Adds Susan Kaufman Purcell, Mexico specialist at the Americas Society in New York: "In times of crisis people yearn for a strong leader."

That yearning was in evidence at last week's meeting of the P.R.I. assembly. The 4,423 delegates rejected a proposal by Zedillo's allies that they elect the P.R.I.'s next presidential candidate by majority vote, but decided on no replacement for the traditional dedazo, in which the President points his "big finger" to anoint a successor, something Zedillo has vowed not to do. "The party put all its hopes and bets on its own past, not on the future," says Juan Molinar, a political scientist at the Colegio de Mexico. "They seemed lost, without a concept of how to build a realistic future for themselves."

Those who blame the P.R.I. for Mexico's myriad tribulations hope, of course, that the party's future will be short. "If Miguel Hidalgo were alive today, he'd have every reason to rise up just like before," says Servando Meyer, referring to the priest who in 1810 made a call to arms against the Spanish. "We're worse off today than ever." No one expects that Mexico's problems would disappear together with the P.R.I. But many think it would be a good beginning.

--Reported by James L. Graff/Mexico City, Aixa M. Pascual/New York, Elaine Shannon/ Washington and Paul Sherman/Chilpancingo