Jorge Cabrera / Reuters

A woman shows a placard to riot police during a protest outside the National Congress in Tegucigalpa on Thursday. Thousands of teachers and activists of the National Front of Popular Resistance marched.

TEGUCIGALPA, Honduras — Street surveillance cameras in one of the world's most dangerous cities were turned off last week because Honduras' government hasn't paid millions of dollars it owes. The operator that runs them is now threatening to suspend police radio service as well.

Teachers have been demonstrating almost every day because they haven't been paid in six months, while doctors complain about the shortage of essential medicines, gauze, needles and latex gloves.

This Central American country has been on the brink of bankruptcy for months, as lawmakers put off passing a budget necessary to pay for basic government services. Honduras is also grappling with $5 billion in foreign debt, a figure equivalent to last year's entire government budget.

"There are definitely patients who haven't been able to get better because of this problem," said Dr. Lilian Discua, a pediatrician. "An epileptic who doesn't take his medicine will have a crisis. This is happening."

The financial problems add to a general sense that Honduras is a country in meltdown, as homicides soar, drug trafficking overruns cities and coasts and the nation's highest court has been embattled in a constitutional fight with the Congress.

Many streets are riddled with potholes, and cities aren't replacing stolen manhole covers. Soldiers aren't receiving their regular salaries, while the education secretary says 96 percent of schools close several days every week or month because of teacher strikes.

Some government offices must close because they don't have ink to take fingerprints. The country's national registration agency has been shuttered for 10 days because of unpaid salaries.

"In many ways, the state is no longer functioning," said Robert Naiman, policy director of Just Foreign Policy, a Washington D.C.-based organization aimed at reforming U.S. foreign policy. "If they keep not paying their soldiers, those soldiers are probably going to stop being soldiers and maybe take some other action."

Experts say a mix of government corruption, election-year politics and a struggling economy has fueled the crisis.

Jorge Cabrera / Reuters

Demonstrators march toward the National Congress in Tegucigalpa on Thursday. Among them are teachers who say they haven't been paid in six months.

Although Congress goes on recess Friday, lawmakers have only partially passed a budget to pay some of state employees and contractors. That leaves undecided the budgets of autonomous institutions such as utilities and the port authority.

The institutional paralysis has also spread to the justice system. The Constitutional Chamber of the Supreme Court has not met for a month and a half because President Porfirio Lobo accused the magistrates of being part of a conspiracy to overthrow him. 

The government and the ruling bloc have at least one idea to solve the fiscal crunch: They've introduced a bill that would create the country's first sales tax while eliminating tax breaks for companies that import goods.

The bill's supporters predict it will generate an additional $1.2 billion in revenue, which would double the government's yearly tax intake.

Some families have survived the government vacuum with remittances sent by some of the 1 million Hondurans living in the United States. Their money equals 19 percent of the country's gross domestic product, according to the World Bank.

Yet it isn't enough for government workers such as teacher Daniel Espunda, who have lost paychecks to the political crisis.

"Now they owe me five months of salary. January will be the sixth I haven't been paid," Espunda said. "No one says anything about when the payday will come."

Stringer / Reuters

Honduras President Porfirio Lobo speaks during a news conference at the Francisco Morazan Military Academy in Tegucigalpa on Friday. Lobo asserted that there is a conspiracy brewing against him that could mimic the coup that removed former president Manuel Zelaya in 2009.

Honduras' president on Friday accused a group led by a powerful publishing magnate of plotting to repeat "the crisis of 2009," when his predecessor, Manuel Zelaya, was whisked out of the country at gunpoint in a civilian coup.  

President Porfirio Lobo, speaking at a military event, did not use the word coup, but referred several times to the June 2009 incident that caused a political and economic crisis in this Central American country that in many ways has still not been resolved.  

Both drug trafficking and killing have risen since then in Honduras, where two-thirds of the 8.2 million people live in poverty. With a homicide rate of 91 per 100,000 residents, it is often called the most violent country in the world.

Lobo said he knows who is meeting and how, though he did not say why they were conspiring or whether they were planning to overthrow his government. Lobo has accused groups in the past of plotting against him without providing details.  

"What they're doing is a danger to the country," he said. "These citizens have not learned. We had a crisis in 2009 and they want to repeat it in 2012."

Gen. Rene Osorio, chief of the armed forces, appeared with Lobo, saying he supports the president. He said he has provided Lobo with intelligence reports but said they are confidential.

"In the armed forces, no one is thinking about a coup d'etat," Osorio said. "We will continue to inform the president with investigation and intelligence to give him our support."

In 2009, the populist-leaning Zelaya was seized at gunpoint by soldiers and flown out of the country in a coup that had wide support among the political elites, including members of Zelaya's own political party.

Zelaya, who lived in exile but has since returned and formed his own political party, expressed support for Lobo on Friday.

"In Honduras, we have a dictatorship by the oligarchy," he said.

A rich landowner like Lobo, Zelaya angered the business elite that had run Honduras for decades with a campaign to rewrite the constitution, promising the poor they would get a voice in shaping the future of the country. He also closely aligned himself with leftist Venezuelan President Hugo Chavez.

Zelaya was deposed when he ignored a Supreme Court order to cancel a referendum on his grandiose plan.

Lobo was democratically elected in a previously scheduled election later that year and took office in January 2010.

He has been at odds with the same Supreme Court that supported Zelaya's ouster. The court shot down Lobo's plans to build private cities as a means of attracting investment and economic development. The Supreme Court next week is also expected to reject Lobo's plan to clean up the corrupt Honduran national police, which are often involved in killings and organized crime.  

Lobo said the leader of the conspiracy is Jorge Canahuati, owner of Grupo Opsa, which publishes El Heraldo and La Prensa, the country's two largest daily newspapers.

Canahuati denied any involvement in a statement published on his newspapers' websites. It called Lobo's comments reckless, unfounded and intimidating and said they are "endangering freedom of expression."

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Argentinian forensic experts have traveled to southern Mexico to exhume 96 bodies thought to be those of Central Americans who died as they tried to get to the United States, according to local reports. 

Six experts from The Argentine Forensic Anthropology Team (EAAF) are working with local and federal authorities in the cities of Tapachula and Ciudad Hidalgo in the state of Chiapas, Mexico's Proceso magazine reported on Monday. (Link to story in Spanish)

The EAAF team, which plans to spend at least two months in Chiapas, arrived on Monday at a municipal cemetery in the city of Tapachula, along with medical, human rights and justice officials, as well as representatives of the Guatemalan, Honduran and Salvadoran consulates, Proceso added.

The EAAF was asked to help identify the bodies in Chiapas -- the majority of which were placed in one communal grave by local medical officials -- by groups advocating for the rights of migrants, Proceso reported.

Migration in the Americas: Mom works in US while family stays in el Salvador

In most of Mexico, the bodies of indigent or unidentified people who have died in care are buried in group graves, with five to 10 corpses placed on each level, according to a Mexico forensics expert who asked not to be identified.  

Non-governmental EAAF was established in 1984 to investigate the cases of some 9,000 disappeared people in Argentina under the military government that ruled from 1976 to 1983. It now works around the world. 

The teams will analyze DNA samples from the buried bodies and those provided by families searching their missing loved ones, Proceso reported. The cemeteries are on routes known to be used by Central American migrants.

Migration in the Americas: The end of North America

The organization Voces Mesoamericanas (Mesoamerican Voices) requested the government of Chiapas look in the tombs for many missing migrants, the magazine said.  

The organization has also looked along the so-called migrant route for clues to the location of some 2,000 migrants thought to have died along the way to the United States, Proceso said. 

Central American migrants protest targeting by Mexico gangs 

It isn't known how many of the estimated 500,000 Central American migrants who pass through Mexico on their way to the United States actually make it to their destination, according to the Council on Hemispheric Affairs.

Many migrants are preyed on by criminal gangs and suffer assault, sexual slavery, kidnapping and murder, the organization added.

The EAAF, Mesoamerican Voices and local officials in Chiapas were not immediately available for comment.  

NBC News' F. Brinley Bruton contributed to this report.

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Honduran authorities say at least 13 people have died at a prison after armed inmates started a fire during a riot Thursday.

San Pedro Sula police commissioner Yair Mesa says there are at least 13 dead, but the riot has been brought under control.

Inmates began fighting among themselves and tossed the severed head of one prisoner over the walls of the jail as they held firefighters at bay, according to one report.

La Prensa de Honduras reported the riot occurred after a fight broke out between groups of inmates following the discovery of the decapitated body of Mario Alvarez in a cell.

The fire, which allegedly occurred in the prison kitchen, according to La Prensa, was controlled by firefighters who had to leave the jail because of threats from inmates.

The grisly scene at the prison in the northern city of San Pedro Sula came 1 1/2 months after Honduras' overcrowded prisons were hit by the worst prison fire in a century, a Feb. 14 blaze at the Comayagua farm prison that killed 361 inmates.

The Associated Press contributed to this report.

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Estbean Felix / AP

The bodies of inmates who were killed in a the deadliest prison fire in the last century were transported within the morgue in Tegucigalpa, Honduras.

TEGUCIGALPA, Honduras – No one knows for sure what started the prison fire at the Comayagua prison 50 miles north of here. But everyone agrees that the hero is a convicted murderer, an inmate named Marco Antonio Bonilla.

Antonio Bonilla, who had just months left on his sentence, roamed more freely than the others and was the prison nurse. He is credited with saving hundreds of inmates on the day of the deadliest prison fire in the last century. The prison's six guards, spooked by the flames, either ran away or refused to unlock the cells -- witness accounts differ -- but Antonio Bonilla was unrelenting, even using a heavy bench to smash open a lock, according to witnesses.

The Valentine’s Day fire started late in the day and raced through five barracks at the Comayagua prison farm, burning and suffocating screaming men trapped behind locked doors.

The reasons given for how the fire started are many: An angry inmate had threatened to torch the prison; inmates had been fighting over a mattress; an inmate had fallen asleep while smoking.   

Prisoners later said that the guard responsible for the keys threw them on the ground, while others said that Antonio Bonilla demanded them and started opening doors when the guard turned them over.

Inmate Jose Enrique Guevara said Antonio Bonilla used a bench to break open the lock on his cell block, No. 6, where the fire started. Enrique Guevara survived with burns.

There were 852 prisoners in the prison the night of the fire; on Tuesday, the total death toll had reached 360. Enrique Guevara's cell block was hit hard. Of the 105 prisoners crammed into rows of bunks four levels high, four survived.

Estbean Felix / AP

A forensic worker hangs a list of the names of inmates whose remains would be returned to their relatives at the morgue in Tegucigalpa, Honduras. The prison fire killed 360 men.

In his weekly meeting with ministers broadcast on Channel 8, President Porfirio Lobo said he would give Antonio Bonilla a presidential pardon for his murder conviction.

"He put himself at incredible risk trying to save lives during the tragedy," Lobo said.

The United States Embassy in Honduras issued a statement saying investigators from the Bureau of Alcohol Tobacco and Firearms believed the fire was an accident. They found that crowding, poor safety practices and the presence of flammable materials in and around the tightly packed bunk beds caused the rapid spread of the flames.

Inmates had clothes, curtains and small electrical devices hung from their bunks. Some also had materials to light makeshift kitchen stoves, according to some of the survivors.

Honduras has experienced deadly fires in its overcrowded prisons in the past, Reuters reported.

In 2003, 68 people died inside a prison in northern Honduras when a fire broke out during a riot and investigators later found guards had killed inmates with machetes and guns on the inside. A year later, more than 100 inmates died in another prison fire in the city of San Pedro Sula.

This article includes reporting by Reuters and The Associated Press.

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