This looks like Marx's utopic socialism.
Would you counter that with Friedman's utopic laissez-faireism?
You can't simply destroy criminality by legalizing drugs. Do you think those guys at Mexico or the drug dealers in Rio's slums would simply throw their guns away and open a legal drug business? Of course not.
First of all, yes—that may very well happen. But there are certain conditions and situations necessary where that could happen. It's not a magic, unilateral rule that the concept works, though. Legalisation in Mexico, alone and without any kind of management, would be doomed to fail. The drug cartels there have very little competition, and they're so powerful already that any legal, government-approved alternative
for less money could very easily be targeted at the legislative-level with bribery, threats and assassination to secure and retain their position as #1. They already do that, shamelessly. If they remained illegal in the rest of North America, I doubt little would change except that the cartels could become even more powerful within their home nation.
If "drugs" (marijuana, cocaine, heroin?) were legalised State-side, it could rock the Mexican economy, providing the cartels use legal routes of transmission and submit to the inevitable government regulations. How it would rock the economy is difficult to imagine. The majority of illicit drug-producers that are entrenched in Mexico, Brazil, Columbia, Venezuela etc, are entrenched because of the growing conditions necessary for these drugs to be produced; America would have to produce its own product to economically threaten the South-American drug trade, which exports largely to N. America and Europe, and that is difficult. That could be done by simply making the regulations too tight for them to get around: having a caveat which expressly forbids the import of drugs from countries where they are illicit under local law should be sufficient. Under that environment, their clientele (Americans) would be seriously dissuaded from purchasing foreign drugs, and they'd remain absolute enemies to the State. The flip-side to that, though, is the ripple effect of such demonisation may negatively impact other states. Europe may see a spike in prices, and the frustration of traffickers may push them into other, riskier markets where they normally wouldn't tackle.
Well, if you make drugs legal, the guys in Mexico aren't doing anything illegal anymore.
See the above.
Gangs wouldn't be shooting each other over drugs if they were legal, because the drug industry would explode with production.
However, as pointed out before, the monopoly-motive—which is a strong incentive when you're already used to killing people—is very strong, and would remain a driving-force of intra-cartel/gang violence. So long as there is competition outside of the retail-legal-country's borders, and the trade remains illegal outside those borders, the Cartels have little to lose. Certain circumstances could provoke spikes in violence as they vie for top
valid position.
It's like with the abortion debate, in places where abortions are illegal, they still happen, but happen in a back alleyway with a coat hanger, instead of being safely performed by a medical professional. Similarly, meth is cooked in some guy's basement and he blows himself up because it's illegal, and can't be made safely in a laboratory environment by a chemist who knows what they're doing.
Because our #1 concern over meth sales is the safety of those producing it.
And do you seriously think legalizing drugs is going to make this kind of thing profitable for the government?
Only if they tax or subsidize it. Then yes, obviously. (However, the associated health-care costs might negate such an advantage.)
Yes, every drug in the world makes you feel better. But it doesn't make you better.
Of course they do. 
Not to mention less likely to vomit on things or need to go to the ER for poisoning.
