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Mexico's drug war is scaring away foreign tourists, and that's bad news for Mexico, for which tourism is the third largest source of legal revenue. The tourism industry has been badly hurt by gun battles near resorts, the arrest of Cancun's mayor on drug-related charges, and a general sense that the country is not safe. As part of our weeklong series on the affects of Mexico's drug war, NPR's Jason Beaubien looks at what was Mexico's top beach resort: Acapulco.

(Soundbite of music)

Mr. ELVIS PRESLEY (Singer): (Singing) Acapulco, look here comes the sun.

JASON BEAUBIEN: In the 1950s and early 60s, Acapulco had a great reputation. Elvis crooned that you "Cant Say No in Acapulco." In "Come Fly With Me," Frank Sinatra promised some young beauty that theyd race away together down to Acapulco Bay. It was the playground of the Hollywood stars.

In 1954, John Wayne and nine other celebrities even bought their own hotel, Los Flamingos. The compound still looks out from the citys rugged cliffs over the Pacific Ocean and it still has great sunsets but now it has very few guests.

Mr. ADOLFO SANTIAGO (Manager, Los Flamingos): (Spanish spoken)

BEAUBIEN: Adolfo Santiago worked at the hotel back when John Wayne and the other stars bought it. Now hes the manager. He says the golden age of the hotel and of Acapulco was in the late 1950s. Back then Errol Flynn, Johnny Weissmuller, Roy Rogers, Cary Grant and others came to lounge by the kidney-shaped pool at Los Flamingos.

Mr. SANTIGAGO: (Spanish spoken)

BEAUBIEN: For me right now business is very bad, Santiago says. I think for all the businesses, hotels especially, things are not good. Since last year, weve had a big drop. Now with all the problems we have, business is very slow.

The problems for Acapulco and Mexican tourism nationally are bigger than just the drug violence. Last year the swine flu outbreak crippled Mexicos resorts for months. The downturn in the global economy also kept many tourists at home.

But Acapulco has been a battleground where two of Mexicos most powerful cartels have recently been fighting for control. In April, a shootout on the main tourist strip in Acapulco left six people dead, including a mother and her eight-year-old daughter. In June of last year another firefight between cartel gunmen and the military left 16 people dead. Tourists have yet to be caught up in the clashes.

Now soldiers in black ski masks patrol in front of the high rise hotels. The state police have welded makeshift gun turrets over the cabs of their pickup trucks and motorcycle cops, when they arent hitting tourists up for bribes, drive around with long automatic rifles slung over their shoulders.

Mr. FELIX AVILA DIAZ (Sub-Secretary for Tourism, Guerrero): (Foreign language spoken)

BEAUBIEN: Felix Avila Diaz, the sub-secretary for tourism in the surrounding state of Guerrero, says tourism is the number one priority for the region. He says its the most important element of the state economy and its in serious decline.

Mr. AVILA DIAZ: (Spanish spoken)

BEAUBIEN: This was a very difficult year, not just for Acapulco or for Guerrero, he says, but for the whole country. He also notes that Swine Flu hit Mexican tourism hard. Travel warnings regarding the drug violence from the U.S. State Department kept many visitors away.

Over the last two years the number of international tourists visiting Acapulco has dropped 33 percent. Avila says the beach resort now caters primarily to Mexicans.

Mr. AVILA DIAZ: (Spanish spoken)

BEAUBIEN: The composition of tourists has changed drastically, Avila says. It used to be 85 to 90 percent of the tourists were foreigners. Now 85 to 90 percent are Mexican.

This decline has been gradual.

(Soundbite of music)

THE FOUR TOPS (Music Group): (Singing) Going loco down in Acapulco if you stay too long...

BEAUBIEN: Even as late 1988, the Four Tops were still singing about Acapulco as a magical destination. The city also got a lot of mileage out of re-runs of the TV show "The Love Boat," in which the crew were perpetually en route or returning from the Mexican port.

But its image as an idyllic, tranquil resort has been shattered repeatedly by the drug cartels. In 2006 they decapitated several local policemen and stuck their heads outside a government building. Theyve hurled grenades at nightclubs and police stations. And over time international tourists have migrated to other places with sand, warm weather and less violence.

Jason Beaubien, NPR News.

INSKEEP: All this week, Jason has shown us where Mexico's drug war stands. Tomorrow he tells us how we got here. It's a history of Mexico's drug cartels.

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