War, as I came to report it, was something fought between people with causes, however crazy or honourable: like between the American and British occupiers of Iraq and the insurgents who opposed them. Then I stumbled across Mexico's drug war – which has claimed nearly 40,000 lives, mostly civilians – and all the rules changed. This is warfare for the 21st century, and another creature altogether.

Mexico's war is inextricable from everyday life. In Ciudad Juarez, the most murderous city in the world, street markets and malls remain open; Sarah Brightman sang a concert there recently. When I was back there last month, people had reappeared at night to eat dinner and socialise, out of devil-may-care recklessness and exhaustion with years of self-imposed curfew. Before, there had been an eerie quiet at night, now there is an even eerier semblance of normality – punctuated by gunfire.

On the surface, the combatants have the veneer of a cause: control of smuggling routes into the US. But even if this were the full explanation, the cause of drugs places Mexico's war firmly in our new postideological, postmoral, postpolitical world. The only causes are profits from the chemicals that get America and Europe high.

Illustration by Daniel Pudles

Interestingly, in a highly politicised society there is no rightwing or Mussolinian "law and order" mass movement against the cartels, or any significant leftwing or union opposition. The grassroots movement against the postpolitical cartel warriors, the National Movement for Peace, is famously led by the poet Javier Sicilia, who organised a week-long peace march after the murder of his son in the spring. This very male war is opposed by women, in the workplaces and barrios, and in the home.

But this is not just a war between narco-cartels. Juarez has imploded into a state of criminal anarchy – the cartels, acting like any corporation, have outsourced violence to gangs affiliated or unaffiliated with them, who compete for tenders with corrupt police officers. The army plays its own mercurial role. "Cartel war" does not explain the story my friend, and Juarez journalist, Sandra Rodriguez told me over dinner last month: about two children who killed their parents "because", they explained to her, "they could". The culture of impunity, she said, "goes from boys like that right to the top – the whole city is a criminal enterprise".

Not by coincidence, Juarez is also a model for the capitalist economy. Recruits for the drug war come from the vast, sprawling maquiladora – bonded assembly plants where, for rock-bottom wages, workers make the goods that fill America's supermarket shelves or become America's automobiles, imported duty-free. Now, the corporations can do it cheaper in Asia, casually shedding their Mexican workers, and Juarez has become a teeming recruitment pool for the cartels and killers. It is a city that follows religiously the philosophy of a free market.

"It's a city based on markets and on trash," says Julián Cardona, a photographer who has chronicled the implosion. "Killing and drug addiction are activities in the economy, and the economy is based on what happens when you treat people like trash." Very much, then, a war for the 21st century. Cardona told me how many times he had been asked for his view on the Javier Sicilia peace march: "I replied: 'How can you march against the market?'"

Mexico's war does not only belong to the postpolitical, postmoral world. It belongs to the world of belligerent hyper-materialism, in which the only ideology left – which the leaders of "legitimate" politics, business and banking preach by example – is greed. A very brave man called Mario Trevino lives in the city of Reynosa, which is in the grip of the Gulf cartel. He said of the killers and cartels: "They are revolting people who do what they do because they cannot be seen to wear the same label T-shirt as they wore last year, they must wear another brand, and more expensive." It can't be that banal, I objected, but he pleaded with me not to underestimate these considerations. The thing that really makes Mexico's war a different war, and of our time, is that it is about, in the end, nothing.

It certainly belongs to the cacophony of the era of digital communication. The killers post their atrocities on YouTube with relish, commanding a vast viewing public; they are busy across thickets of internet hot-sites and the narco-blogosphere. Journalists find it hard that while even people as crazy as Osama bin Laden will talk to the media – they feel they have a message to get across – the narco-cartels have no interest in talking at all. They control the message, they are democratic the postmodern way.

People often ask: why the savagery of Mexico's war? It is infamous for such inventive perversions as sewing one victim's flayed face to a soccer ball or hanging decapitated corpses from bridges by the ankles; and innovative torture, such as dipping people into vats of acid so that their limbs evaporate while doctors keep the victim conscious.

I answer tentatively that I think there is a correlation between the causelessness of Mexico's war and the savagery. The cruelty is in and of the nihilism, the greed for violence reflects the greed for brands, and becomes a brand in itself.

People also ask: what can be done? There is endless debate over military tactics, US aid to Mexico, the war on drugs, and whether narcotics should be decriminalised. I answer: these are largely of tangential importance; what can the authorities do? Simple: Go After the Money. But they won't.

Narco-cartels are not pastiches of global corporations, nor are they errant bastards of the global economy – they are pioneers of it. They point, in their business logic and modus operandi, to how the legal economy will arrange itself next. The Mexican cartels epitomised the North American free trade agreement long before it was dreamed up, and they thrive upon it.

Mexico's carnage is that of the age of effective global government by multinational banks – banks that, according to Antonio Maria Costa, the former head of the UN Office on Drugs and Crime, have been for years kept afloat by laundering drug and criminal profits. Cartel bosses and street gangbangers cannot go around in trucks full of cash. They have to bank it – and politicians could throttle this river of money, as they have with actions against terrorist funding. But they choose not to, for obvious reasons: the good burgers of capitalism and their political quislings depend on this money, while bleating about the evils of drugs cooked in the ghetto and snorted up the noses of the rich.

So Mexico's war is how the future will look, because it belongs not in the 19th century with wars of empire, or the 20th with wars of ideology, race and religion – but utterly in a present to which the global economy is committed, and to a zeitgeist of frenzied materialism we adamantly refuse to temper: it is the inevitable war of capitalism gone mad. Twelve years ago Cardona and the writer Charles Bowden curated a book called Juarez: The Laboratory of Our Future. They could not have known how prescient their title was. In a recent book, Murder City, Bowden puts it another way: "Juarez is not a breakdown of the social order. Juarez is the new order."