Mexican drug cartel violence threatens Acapulco

Drug cartel violence is escalating in the once-popular tourist resort town of Acapulco, Mexico.

Daniel Reams and his wife Pamela moved from Virginia ten years ago to run a beach-side hotel in Acapulco. They have 22 rooms. But on this weekend, only four are booked. They estimate their business is off by 60 percent, reports CBS News correspondent Terry McCarthy.

"We are making a living, sort of - but it is way down from what we were," said Daniel.

The problem, they say, is that the deadly drug war has been creeping closer to tourist areas.

"The violence in the news has killed us," said Daniel.

The port of Acapulco has become a bloody battleground between rival drug cartels. Just this past weekend nearly 30 men were killed, including 12 taxi drivers shot in their vehicles. Four other men were thrown to their deaths from a bridge. And last month, 15 decapitated men were dumped at a shopping center, all in the shadow of lucrative tourist areas.

The decapitated bodies were found on the sidewalk. The drug cartels haven't directly targeted foreign tourists, but the hotels are just 10 minutes away from here. For many Americans, that's way too close.

Now tourists see truckloads of police everywhere. Two cruise lines have just canceled their Acapulco stops taking their 5,000 passengers with them. And the city is no longer among the top 100 destinations for Americans.

"You are here! You feel safe? It's safe!" answered Guerrero Governor Zeferino Toreblanca when asked if it was safe for American tourists in Acapulco.

Acapulco's governor downplays the violence, saying they expect 9 million visitors this year. But looking around - the town is eerily empty.

"I was walking down the beach this morning and every hotel here is empty on the beach side," said American tourist Garth Mark. "There was no one."

On the main tourist strip, nightclubs -- the staple of spring breakers -- are struggling. On one recent Saturday night one club only had about 20 people in it.

"You can see it right over here, it is a hard situation now," said a nightclub worker, gesturing to an empty line.

As violence creeps ever closer, many fear the tourists will stay further away.