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Just how good would drug legalization be?
John Nye, Megan McArdle and I debated this question at a party today (Robin Hanson asked that we not ban robots, some people called for open borders, John and I explained the hierarchy of the economics profession to Will Wilkinson, and Bryan Caplan told me I have the uncanny ability to predict when people will die, among other highlights; sadly Alex had to leave early). We also asked some questions that are seldom asked.
Under one model, local gangs have a more or less fixed ability to terrorize a neighborhood. Even if everything is legalized, the gangs will continue local monopolies to maximize tribute, subject of course to constraints from other gangs and the police. In this model, legalizing drugs doesn't do much good. The local gang either shifts its monopoly to another area (milk and sugar, if need be), or de facto the gang's local monopoly on the drug trade continues. The gang busts you if you try to get your supply of crack cocaine from Merck. I call this the Rio de Janeiro model; no, drugs are not formally legal there but I don't think it would much matter if they were.
Under a second model, the ability of a local gang to monopolize and terrorize depends on the availability of drug trade revenue. Take away illegal drugs and the gang collapses -- Merck outcompetes them -- and the neighborhood revitalizes.
Libertarian arguments for legalization typically envision the second model rather than the first. I expect something in between. So I don't favor the War on Drugs but I believe the benefits from stopping that war are often exaggerated. Note that whether the first or second scenario holds may depend on just how easy drugs are to get legally.
One claim was that -- a'la Freakonomics -- current drug suppliers don't reap huge rents, so legalizing drugs won't much discourage them.
Another question from the evening is how much the abolition of zoning in New York City would boost gross national product. I heard some overoptimistic estimates on that one.
On a scale of 1 to 10, I give the party at least a nine.
Posted by Tyler Cowen on April 26, 2008 at 09:33 PM in Law | Permalink
Comments
There are some internet communities/message boards where not only the vast majority of participants favor legalization of drugs, but they pretty much compete to see who can paint a rosier picture of a world where drugs are legal. Drug legalization is a panacea for all society's problems, in the minds of some.
Posted by: Mike at Apr 26, 2008 9:41:32 PM
You make a good observation, that criminal elements will simply move on to other activities.
However, the legalization crowd has a better argument than "legalize drugs, end crime". They state, "legalize drugs, put real criminals in prison". It's not that legalization or decriminalization suddenly makes all other types of crime disappear, it's that removing the buying and use of drugs as a crime allows police to focus on crimes that involve people directly harming other people.
That said, I think you have a real difficulty with the current investment in the War on Drugs.
Posted by: Xmas at Apr 26, 2008 9:52:03 PM
While the organized criminal element will simply move on, it won't stop the junkies. Junkies produce their own crime, both as the criminals and the victims. Legalizing heroin or crack doesn't suddenly make someone able to hold down a job who couldn't before.
Posted by: mouse at Apr 26, 2008 9:57:43 PM
>The gang busts you if you try to get your supply of crack cocaine from Merck.
Are there any real-life cases where gangs take vengeance on you if you purchase goods or services from legal suppliers instead of the gang? (With the exception of, say, security.)
Posted by: Phil at Apr 26, 2008 9:59:08 PM
Yes, I don't know how gangs would be able to compete/enforce against your getting drugs at the supermarket or through the mail. There's simply no way for them to verify your sources if drugs were legal.
Businesses could always undercut gang prices through the miracle of mass production.
Posted by: jamie at Apr 26, 2008 10:12:12 PM
How does one get invited to these parties?
Posted by: Luke G. at Apr 26, 2008 10:34:16 PM
Tyler,
We have a real life example of what happens after you end drug prohibition. It is called the 21st Amendment to the constitution. Distrubtion crime plummeted after repeal of Prohibition because everyone has protection under the law.
Do various wine vintners or liquor store owners engage in drive by shootings or assassinations of their competition? If you believe in you variation #1 listed above, it is incumbent upon you to explain why there is no liquor distribution crime today (excepting tariff violations), let alone liquor distribution violent crime.
Posted by: happyjuggler0 at Apr 26, 2008 10:35:02 PM
I am from Rio de Janeiro, and I think there may be something to your argument.
But here's another aspect of the issue: a large (probably the largest) part of cocaine buyers are not the poor who live in the slums where the drug is sold. It's relativelly affluent people who live in neighbourhoods outside the control of gangs. These people could probably buy legal drugs in the supermarket with relative ease.
So, even if legalisation will not cause the gangs automatically to dissolve (in Rio, the main worry is, what kind of crime would they commit instead?), it would make a big dent on the gang's profits.
Another common objection against legalization in the local debate is: if we legalize before rich countries do, won't that cause a massive inflow of drug-addicted tourists? That's not exactly the crowd we've been trying to attract.
Posted by: Na Prática a Teoria é Outra at Apr 26, 2008 10:35:06 PM
The local gang either shifts its monopoly to another area (milk and sugar, if need be)
While I'm at it, what kind of economist thinks that an economic agent leaves that kind of money on the table, assuming they can make money coercively monopolizing milk and sugar?
If they aren't trying to make money off of milk and sugar now it seems silly to think they would be able to after the end of drug prohibition.
Posted by: happyjuggler0 at Apr 26, 2008 10:38:27 PM
In Russia during the 90's (somewhat less today, though only somewhat less) criminal gangs controlled most of the local markets where many people got most of their food (and also kiosks in the subways and under-passes in Moscow.) They did not literally control the milk and sugar trade as such, but they did control who could sell at such markets. If you didn't pay your "insurance" you'd find your kiosk or stand blown up. The Pushkin Square bombing in Moscow in '00 was almost certainly just one of the most dramatic of such events. Drugs _might_ become like that in the US if they were legalized. But, the big difference between the US and Russia in the 90's is that the US has a largely functional government. It's that sort of thing that makes me doubt the wisdom of more extreme libertarians and especially anarchists. What we'd get w/o a functional government is, it seems, government by gangs, a much worse option. Given that we do have a functional government (not ideal, of course, but functional) I'd expect us to be closer to the good than the bad side here, but only because we have a functional government.
Posted by: Matt at Apr 26, 2008 11:06:21 PM
Personally, I find the possibility to reduce the harm from drug use, and to reduce the number of people who start taking drugs, the most compelling argument, for legalization of drugs.
There is limited empirical evidence of how this would work. However MR readers may want to look at the positive impact of such a program in Zurich. An evaluation was published in The Lancet "Incidence of heroin use in Zurich, Switzerland: a treatment case register analysis" by Carlos Nordt and Rudolf Stohler. The authors found that the policy of making heroin use a medical problem rather than a crimial activity enabled them to implement a program that lowered incidence (of new users).
http://www.puk-west.unizh.ch/de/pdf/Nordt_Stohler_Lancet_2006.pdf
Posted by: April at Apr 26, 2008 11:39:48 PM
I echo Xmas's comments. Crime is not the only negative consequence of the drug war.
Posted by: Paul N at Apr 27, 2008 12:05:33 AM
World Bank economist Branko Milanovic makes a pretty compelling case that drug legalization would improve the governance of countries where drugs are a major export....so one could argue for drug legalization as a means to promote the economic development of, say, Afghanistan and Colombia.
http://yaleglobal.yale.edu/display.article?id=9920
And, this development strategy could be both more successful and cheaper than the current ones.
Posted by: April at Apr 27, 2008 12:08:50 AM
"I expect something in between."
This is the standard cop out statement. How far in between? Do you think one model more likely than the other and how much more likely and why?
I think you are right, but I think second model is closer to the truth. My biggest concern though is something Megan McArdle brought up. If this happens a lot of unskilled young people will suddenly be unemployed, which may increase the the crime rate in the short run. And it's not clear what happens in the long run.
"I believe the benefits from stopping that war are often exaggerated."
I do too and if legalization ever occurs and the promised utopia that libertarians fails to appear, then that will be a blow to other libertarian models. A realistic, fact based analysis is needed. The problem that people have when discussing this is the inability to grant reasonable argument of the other side. Libertarians downplay the damage that addiction causes. It is very real. However, the standard crack head that those in favor of prohibition brings out as evidence isn't representative of the typical drug user.
The questions that need to be addressed are:
1. What is the damage of drug use? How much is lost? How many can we expect to get so addicted they can no longer function in society?
2. What is the damage of prohibition? What is lost in terms of individual rights? Is this trade off worth it? How big of a role does prohibition itself play in the dangerousness of the drug world now?
Libertarians don't like to phrase the argument tackling 1. while prohibitionists don't like the phrasing of 2. But both are very important.
Posted by: Ken at Apr 27, 2008 12:10:52 AM
My impression from Freakonomics was that the soldiers earn less than minimum wage while the kingpin suppliers and distributors had huge margins.
My view is this. According to microeconomic game theory, less players in a market makes it more likely the players will collude to set monopoly pricing and less players in a market result from high barriers to entry.
To take The Wire, for example, in Season One Avon Barksdale and Proposition Joe came to an understanding that Avon had the west and Joe had the east. They both reaped huge profits because they agreed not to enter each other's markets and they killed whoever else tried to get on my turf. And with drugs illegalized, the upstart players can't exactly call the cops when they're threatened. If drugs are legalized, police could focus on those willing to use violence for market share and greatly reduce inner-city violence.
I still have issues though with the legalization of harder drugs. The price of drugs, both in dollars and in the threat of police protection, would greatly decrease and quantity sold would almost certainly increase. While the addicts wouldn't likely commit other crimes with drugs so cheap, more heroin addicts still isn't exactly a good thing.
Posted by: MW at Apr 27, 2008 12:19:38 AM
"While the addicts wouldn't likely commit other crimes with drugs so cheap, more heroin addicts still isn't exactly a good thing."
This is based on the assumption that if X heroin causes Y heroin addicts, then 2X heroin causes 2Y heroin addicts.
Most recent scientific evidence suggests that individuals are pre-disposed (or indisposed) to become addicted, based mostly on genetics, circumstances, access to mental healthcare—things other than the drug. So more drug addicts isn't a particularly likely outcome, even if there was a significant uptick in drug use (which is also unlikely).
That said, I expect there to be a migration of sorts from highly addictive drugs, like alcohol, to effectively non-addictive drugs, like marijuana. Keep in mind that most people are aware of consequences and choose drugs responsibly.
Posted by: Brandon at Apr 27, 2008 1:04:29 AM
"Keep in mind that most people are aware of consequences and choose drugs responsibly."
That is the most ridiculous statement I've ever heard someone make about drug use. Are you saying that people choose to do drugs responsibly, because that certainly isn't true. Or, are you saying that people who "do drugs" choose specific drugs responsibly, because I doubt that to be true, too. People don't make T- charts with the pros and cons of the drugs they're choosing between, they get high off of whatever is available to them.
Posted by: Brian at Apr 27, 2008 1:45:55 AM
An important thing to remember when consider the effect of legalisation on addiction is that if there is a legal prohibition on doing something, the people who do it will be more maladjusted than average.
In a legal drug market, the average drug user will be much more responsible than the average drug user now. In fact I'd be very surprised if there were a lot of people who are dysfunctional enough to destroy themselves with drugs, but can't or won't do so because drug use is illegal.
Posted by: James K at Apr 27, 2008 2:37:38 AM
"The price of drugs, both in dollars and in the threat of police protection, would greatly decrease and quantity sold would almost certainly increase. While the addicts wouldn't likely commit other crimes with drugs so cheap, more heroin addicts still isn't exactly a good thing."
MW, I agree with you about the increase of quantity sold, but I have some doubts about the increase of heroin(and other drugs) addicts.
I mean, some of the people that are already addict will consume more with lower prices, and maybe this explain better the increase of quantity sold than the increase of total addicts.
To simplify the discussion, let's imagine three group of people:
(1)- people that will not take any drugs, ever
(2)- people that are open to take some drugs to know how it works, but basically because they value the experience
(3)- people that will take a lot of drugs trough their lives
The first group wouldn't be affected by lower prices. The later group will be affected because they'll consume more drugs. The seconded group will be affected too, but how? Well, all depends of the difference between the price of actual illegal drugs if they were legalized.
Personally I believe that the number of addicts(in terms of percentage) would be quite the same that is today if we legalize this drugs.
Posted by: Renato Drumond at Apr 27, 2008 2:45:06 AM
If the British system is any indication, then a system where drugs such as heroin are prescribed is on the whole a positive thing for society. The illegal drug trade is kept depressed by the handout of drugs, and mushrooms locally when a clinic closes. Demand remains constant, regardless of where the drugs come from. However, prescription allow doctors to standardize dosage and strength of drugs, which minimizes harmful effects on addicts. This helps them hold down jobs and lead a somewhat normal life. When addicts turn to the illegal market they have to depend on their own wits and discipline, which is hard enough for an addict but complicated by factors such as irregularity of supply and the varying strength of street drugs. There's also the financial stress of having to pay through their noses for drugs. Needless to say addicts often can't handle it, lose their jobs and become increasingly marginalized. Some die from overdosing, others turn to crime with a major increase in burglaries and theft in the closed clinic's area. People might argue moral hazard in handing out drugs, but it does bring addicts under some supervision and also hands them a good chance at being productive tax-paying citizens instead of free-loading petty criminals.
Of course, all the above is probably far too radical an option for almost any country. However, decriminalizing possession of small quantities could crudely mimic the effect of prescriptions in that it could help set a practical upper limit for personal consumption. The purity of the drugs would probably also increase (more bang per allowed gram), which could make it easier for addicts to measure their intake. And lower costs due to decriminalization could in turn lead to less property crimes if less money is needed for funding an addiction.
Posted by: Twinings at Apr 27, 2008 4:31:40 AM
Are the police in Rio largely not corrupt? Prohibition is a big corrupting influence. Legalization may look different in two different countries (or cities!) depending on what the cops will allow.
Besides, you say drugs might as well be because they have so many problems. But the aren't legal! So, why isn't it the prohibition itself as the problem?
As I recall, Freakonomics point was that the dealers on the street didn't make much. The kingpins disdained violence (used by low-level thugs to impress middle management) and wanted things copacetic because they were doing alright with their local monopoly.
And, my two cents: though not a panacea, deprohibition would make a lot of other crimes disappear. Imagine if a gas station couldn't make a profit selling gas. Don't you think their candy and beef jerky business would dry up eventually, or at least their ability to monopolize those markets as well? There are logistics involved in the drug business, and those logistics can support other endeavors and the other endeavors likewise support the drug trade. It would take time, but I wonder how big organized crime is in Las Vegas after years without illegal gambling and prostitution to support their infrastructure.
Posted by: Andrew at Apr 27, 2008 5:04:38 AM
Second line should say:
Besides, you say drugs might as well be legal because they have so many problems. But they aren't legal! So, why isn't it the prohibition itself as the problem?
Posted by: Andrew at Apr 27, 2008 5:06:07 AM
"Libertarians downplay the damage that addiction causes."
I don't. I focus on the market. What types of technology would arise under a free market versus what arises under the current prohibitionist system?
Current prohibitionist: drugs advance along the lines of potency (smaller for easier concealment, e.g. crack, or ability to make it at home, e.g. meth), all other technologies subordinated - addiction is good because you want to extract money from crackheads as quickly as possible, and if they die who cares, your whole business is already illegal.
Legalization: Wouldn't legal drug manufacturers focus on pleasing the customer? Wouldn't customers want a new drug? One that won't make you sick. One that won't make you talk too much, or make your head feel 3 feet thick? In other words, wouldn't they fix the addiction problem?
The question in my mind is this. What comes after meth? If we keep our current prohibitions in place, what will be the next technological advance along the lines of more potent, concealable and addictive?
"...they get high off of whatever is available to them." Is this not because there are limited choices available to them? Is the lack of availability of better choices not partly due to prohibition?
Posted by: Andrew at Apr 27, 2008 5:18:56 AM
Non-state gangs/political factions hostile to the US finance their actions by controlling and/or taxing drug production. Think Taliban in Afghanistan, FARC in Columbia. The cost of the war on drugs includes some percentage of US military and homeland security budgets.
Can the US afford the war on drugs?
Steven Zoraster
Posted by: Steven Zoraster at Apr 27, 2008 9:23:47 AM
With drugs legal, the demand curve moves left, meaning a lower equilibrium amount of crime. This happened after Prohibition. Gang resources would shift to other markets, which while more lucrative/attractive than legal behavior, were less so than drugs.
Posted by: Larry at Apr 27, 2008 9:25:58 AM
"Bryan Caplan told me I have the uncanny ability to predict when people will die"
"sadly Alex had to leave early"
Is that a euphamism? We'll miss you Alex.
Posted by: PLW at Apr 27, 2008 10:12:53 AM
What about the liability cost of legal drugs, why would Merck on any company assume the cost, if a drug user looks at you funny let alone the potential in property damage the lawsuits will be enormous?
Posted by: Craig at Apr 27, 2008 10:19:02 AM
Maybe to settle the issue, it is useful to move beyond a bipolar legalization/prohibition debate framework. Personally, I cannot think of any scenario in the foreseeable future whereby it would be possible to buy, say, crystal meth at a convenience store. However, there are a number of middle-of-the-road, harm-reduction regulatory regimes that might be adopted. The potential effects would therefore depend on the specifics of said regime.
Overall, the evidence from several European countries (Netherlands, Switzerland, Spain, UK, etc.) does seem to indicate that moves toward decriminalization of the drug trade do lead to a reduction in drug-related violence. Nevertheless, the intensity of the effect seems to be contingent on: a) the type of harm-reduction measures (methadone substitution, marijuana decriminalization, heroin maintenance programs, etc.); b) general patterns of criminal activity (how decisive is the influence of organized crime?); c) patterns of drug consumption (heroin, for instance, is more amenable to harm reduction programs than cocaine); and, d) state capacity (higher in Switzerland than in, say, Italy). So, Rio de Janeiro or post-prohibition Chicago? Probably neither and probably something ressembling post-harm reduction Amsterdam or Zurich: a reduction, but not an elimination, of drug-related black markets and violence.
Posted by: Alejandro Hope at Apr 27, 2008 10:24:15 AM
As Zoraster pointed out, we can direct the market. Legalization does not preclude regulation. For example, instead of banning all drugs which do not have medical uses such as marijuana, just ban the chemically addictive drugs. Drug companies will invest billions to develop drugs which satisfy the regulations to be safe and less addictive. Of course, it is nearly impossible to classify something as not-addictive, since technically everything is addictive (gambling, driving fast, sex, video games). But certainly there is a measurable difference between pain medication and heroine. I would not know, but perhaps drugs could be developed which do not cause physical withdraw? Or, if such is impossible, then perhaps drugs with good antidotes to prevent withdraw symptoms for those that are detoxing?
Posted by: LoneSnark at Apr 27, 2008 10:25:45 AM
Law enforcement can't be very effective without local support. While drugs are illegal, cops are in some neighborhoods largely seen as the enemy. Were there were a switch from mostly policing victimless crimes such as drug possession or use or dealing to policing non-victimless crimes such as extortion, calling the cops in and letting them know what's going on would suddenly be a lot more appealing.
You'd also free up a lot of resources in the justice system. Fewer prison cells and less court time taken up by nonviolent drug offenders means it should be easier to arrest, try, and imprison the violent ones.
You'd also make the police less corrupt. Currently policemen can get anyone they want arrested by "finding" a tiny baggie of drugs on the suspect's person or in their car or on their premises. In a post-legalization world, it would be harder for cops to plant evidence and harder for cops to get or extort or steal bribes. Not impossible, but harder.
LoneSnark: Heroin *is* pain medication. Incidentally, were it legal, the major long-term negative side effect of regular heroin use (when taken safely and cheaply in pill form) is constipation.
Posted by: Glen Raphael at Apr 27, 2008 10:58:11 AM
There are so many variables in all of this, it is impossible to predict the likely outcome. Would legalization break up the ghetto crime scene or would dealer rings turn to other crime? If the former, there could be huge economic advantages, if the latter, maybe none at all.
"LoneSnark: Heroin *is* pain medication. Incidentally, were it legal, the major long-term negative side effect of regular heroin use (when taken safely and cheaply in pill form) is constipation."
This points to one of the biggest fallacies of the legalization cum Switzerland & UK. True, heroin is a pain mediation; true it is almost identical chemically to several legal pain medications. Almost. Why is it illegal and those are legal? Because it is much more addictive, especially for a subset of people, than those other drugs.
Keep in mind:
(1) There are many people addicted to other pain relievers too; they can also destroy lives.
(2) Heroin, in any form, is much more addictive than those.
(3) "Side effects" are not the issue - many addictive drugs have few "side effects" - the chief side effect of alcohol, when taken safely in bottle form, is having to pee. Does that mean that alcohol addiction is never a problem?
This is not to say that there wouldn't potentially be benefits to legalization of heroin. We just have to be realistic about what it would mean. There might be great benefits in terms of crime reduction and overdose reduction (*might* be, we don't know that for sure). But we also *might* see an increase in use, and hence likely an increase in addiction.
I do not agree that all those who would be addicted are addicted. When other pain meds and fun pills started becoming easier to obtain from the doctor - mamma's little helper - there was a huge increase in addiction.
Sounds like it was a great party.
Posted by: liberty at Apr 27, 2008 11:19:33 AM
I often wonder why there is not more discussion of medicalization for addictive drugs. More specifically, clinicalization.
Suppose a drug addict could walk into a clinic and get his or her drug for free, but he or she is not allowed to leave for some hours after administration. Effects:
o Drug use would be a lot less fun (this is no party), giving addicts more incentive to break the habit.
o Illegal drug sellers would lose (many, most of?) their customers as soon as they got addicted.
o Addicts would be brought in constant contact with addiction professionals.
I've only done limited research, but I can't find anywhere that this clinicalization approach has been tried.
Posted by: Steve Roth at Apr 27, 2008 12:09:07 PM
> John and I explained the hierarchy of the economics profession to Will Wilkinson
For the benefits of aspiring economists, could you share some of this insight?
Posted by: th at Apr 27, 2008 12:18:08 PM
"I've only done limited research, but I can't find anywhere that this clinicalization approach has been tried."
It has been tried for heroin addicts, with some success, in Zurich, Switzerland, and Vancouver, Canada. You can find some info on those programs here (http://www.drugwarfacts.org/hatreatm.htm) and here (http://stopthedrugwar.org/chronicle-old/374/naomi.shtml).
Posted by: Alejandro Hope at Apr 27, 2008 12:38:19 PM
"In other words, wouldn't they fix the addiction problem?"
I can't conceive of legalization leading to a prevalence of non-addictive drugs due to a different, path-dependent development. While there's a possible story in competitive pressure leading to less-addictive substances, that seems like an excessively short-term view. Companies want market share, but they also want repeat consumers. With imperfect information, what's to discourage them from disingenuously peddling the highly addictive stuff, or offering steep discounts to new customers?
Posted by: anglo-burgundian at Apr 27, 2008 2:22:01 PM
The local gang either shifts its monopoly to another area (milk and sugar, if need be)...
I had the same reaction as someone else above did to this statement. Is there a single gang in the country that has a monopoly on these items?
Do the supporters of model #1 think it's just a pure coincidence that gangs (mafia, etc.) deal in areas that are prohibited or heavily regulated--narcotics, alcohol (when illegal but not when legal), prostitution, gambling, loan-sharking...?
If you want to say that these powerful gangs would never have arisen w/o the Drug War, but now they exist and won't go away quietly, that is a reasonable argument. But to me there is no doubt that drug prohibition created these powerful gangs in the first place.
I'm also curious how many people in this party's discussion had ever, say, seen more than $1000 worth of drugs at one sitting. I'm not claiming to have led an adventurous younger life, but the limited exposure I had to actual drug dealers in "bad" neighborhoods etc. makes some of these speculations seem pretty abstract.
People go seek out the drug dealers. How in the world would the dealers switch to a monopoly on sugar? Would they say if they saw anyone in the project go to the grocery store, they would shoot them? (If so, are they going to then open a gang grocery and supply all of the other things people need from a grocery store?)
I realize Tyler was just making a quick point, and I'm sure you could amend the description of model #1, but the way it was presented strikes me as absurd.
To reiterate, the reason dealers right now can have turf wars is that people need to buy drugs in ill-defensible areas, like street corners. If somebody can open up a store front next to a police department, it's going to be hard for gang members to mess with that business.
Posted by: Bob Murphy at Apr 27, 2008 3:12:19 PM
I call this the Rio de Janeiro model; no, drugs are not formally legal there but I don't think it would much matter if they were.
Tyler, I had given you the benefit of the doubt and assumed that this meant the drug laws weren't really enforced in Rio. That is the only way you could plausibly point to this city as evidence of what happens when drugs are legalized.
But no, when I typed in "Rio de Janeiro" in google, the first hit was a story of how police killed 11 people in a slum raid, going after drug traffickers. The story concludes:
Rio police are notorious for rough tactics against drug gangs that control many of the city's shantytowns.
Now this doesn't prove whether model #1 or model #2 is correct. But you can't use Rio as evidence of model #1! You have to find a place where drugs are actually legal, or at worst you get a slap on the wrist, and then show us the drug gangs still terrorize people in that place.
It's completely irrelevant that drug gangs are very violent in a city where the police are literally at war with them. That's the libertarian's whole point, that if you go to war with a certain group of people, don't be surprised if they grow violent!
Posted by: Bob Murphy at Apr 27, 2008 3:48:50 PM
Liberty, I think in the Sullum's book about smoking is quoted a small statistics about heroin users - it concludes that something like 85% of heroin users are casual - not regular. That doesn't look that addictive, does it...especially compared to smoking....
Posted by: andy at Apr 27, 2008 4:05:06 PM
Re: heroin as a pain reliever
Would you rather your child be in constant excruciating pain, or pain free and possibly drug addicted?
Posted by: Ed Dunkle at Apr 27, 2008 6:12:38 PM
Liberty, I think in the Sullum's book about smoking is quoted a small statistics about heroin users - it concludes that something like 85% of heroin users are casual - not regular. That doesn't look that addictive, does it...especially compared to smoking....
- andy
I'm not sure that we have good evidence other than the physical addiction facts; however there is an obvious question for this study.
Was this 85% of people who have ever taken heroin, or 85% observed at a given moment in time? If it is the latter, then it is meaningless. How many will go on to become addicts after some period? If there are new entrants, there may always be a large group who are not addicted. Those who are addicted die off and are replaced by fresh faces.
If it is the former, then one still needs to control for those who take it just once or twice-- nobody said that if you take the drug once, you will be addicted. The question is whether there is some number of times after which everyone seems to end up an addict. Then you can determine how many who have become an addict are ever able to quit and remain quit for any length of time.
If you are to compare to smoking, you would do the same for smoking. However, even if (as some argue) it is less addictive than smoking, that doesn't prove that it is less harmful. A lifelong smoker (even if he dies young or has health problems) may still be better off than a lifelong heroin addict.
- none of this is to say that legal or illegal is better; that is a separate question.
Posted by: liberty at Apr 27, 2008 7:04:31 PM
I'm rather more curious about the NYC zoning and GNP boost part of the post, but regarding the "milk and sugar" polemics: I believe there are examples of something similar in Rio, where militias charge favela inhabitants for gas cannisters, but I don't know the details.
Posted by: Cisco at Apr 27, 2008 11:45:45 PM
(as others have pointed to, Switzerland's Heroin Assisted Treatment has drastically reduced crime, raised the average age of addicts (via a reduction in the # of new addicts), increased the health and employability of addicts and reduced their cost on public dollars.
The Netherlands with its coffee shops has a per capita national drug use rate 1/2 that of ours here in the US.
Afghanistan supplies over 90% of the world's heroin. Turkey was once a major supplier for Europe's heroin addicts. Now that Turkey is one of those nations growing opium for legitimate medicine their illicit opium problem is minimal. Candian org, the Senlis Council proposes legitimizing Afghan's opium farmers to help alleviate the global shortage of opioid medicines.
Given freedom of choice do more people buy beer or vodka and whiskey? In the same vein most people would, given a choice, choose pot over heroin, and... can grow their own much the way people can bottle their own wine and beer at home.
Plus, legalization is not a Constitution destroying policy like Prohibition II happens to be.
Some excellent, intelligent comments, a few ninnies, but overall a thoughtful discussion. Props on that...
Posted by: allan at Apr 28, 2008 12:27:34 AM
*Canadian*
Posted by: allan at Apr 28, 2008 12:29:48 AM
If the supply of criminals is elastic or criminals are not occupied full time as criminals, then criminals have already exploited all criminal activity at the margin. Therefore legalization of drugs would not result in a shift to new criminal activity. If the supply of criminals is inelastic, then we would see substitution toward other crime. I suspect that over time, the supply is elastic.
Posted by: wd40 at Apr 28, 2008 12:33:32 AM
I find it hard to conceive of a seller in the marketplace who wouldn't find it necessary to change their operations when forced into a lower-margin product.
Posted by: Russell Nelson at Apr 28, 2008 2:24:19 AM
happyjuggler0,
I think the illiquidity of institutions is a factor; the social capital of an illegal drug cartel/gang is not the sort of thing you can easily reallocate to legal uses in a free society. It is perfectly consistent to say that it would be obviously unprofitable to start a milk and sugar gang from nothing (which is the essence of the argument that illegalization creates drug gangs), and that given such a gang already formed, if its main business is made legal, it will try to apply the same methods under different conditions. (Bootleggers switching to harder drugs after the end of prohibition is a weak example, but the most obvious one.)
There are two related reasons drug dealing gangs might try to keep their business model. First, the pure economic reason: a venture that would be unprofitable to create from the ground up might still be profitable if the infrastructure is already there and idle -- in other words, if there is a positive marginal value, like using an idle factory to produce goods the profit margins of which would not have justified the building of the factory. Second, a more behavioral reason: the sunk costs fallacy.
Posted by: Benquo at Apr 28, 2008 2:44:09 AM
Will they move on to other work? Yeah, that's the point. Will they choose crime?
I think the number of people who have their heart set on committing crime is fairly low. I watch one of my favorite movies, Heat, and think, man, these guys could make hundreds of thousands of dollars legally with their skill set. And, sure enough, Michael Mann, who researched the film, said at any one time, there are anywhere from zero to one (maybe) of these type crews working in the United States. Now, one of the themes of his move was that the "justice" system (aka Gladiator Academy) trains people to be better criminals and keeps people from getting those legal jobs that can pay like bankrobbing. But, that is for guys with records who can't learn anything else.
I suspect there would be some spillover for reasons already discussed, but over time, one less profitable criminal activity is one less profitable criminal activity.
Posted by: Andrew at Apr 28, 2008 3:30:27 AM
"I can't conceive of legalization leading to a prevalence of non-addictive drugs due to a different, path-dependent development."
You are right. Companies don't care about customers, they care about their money. But dead or jobless customers aren't usually what professionals are interested in.
And what about marijuana? Legalizing marijuana would lead to a prevalence of non-addictive marijuana, no? And, thinking about it now, the drug manufacturers might fix it, or another company might fix it. Think the smokers' patch.
That's not to say that solutions would happen by magic, but there would be a demand for it, whereas today, it's hard for drug users to demand anything. They can't demand security because they will get arrested along with the dealer. They can't demand safe product, etc.
Posted by: Andrew at Apr 28, 2008 3:42:20 AM
"(1) There are many people addicted to other pain relievers too; they can also destroy lives."
True, but there are also examples like Rush Limbaugh and Ricky Willians. People who manage their "addictions" while performing at the top of their field in highly demanding professions.
But, these people are top performance, and not everyone is. Point taken. But still, the main problem people addicted to drugs face is incarceration and other hassles associated with enforcement. Noone even noticed Limbaugh's problem except for his odd loss of hearing story, and Williams might have been one of the greatest running backs ever had the league not harassed him.
The enforcers are here to help, as in, "to keep you from destroying your life, we are going to break down your door, maybe shoot you, and if you survive arrest, put you in prison for many years, destroy your career and make you commiserate with other criminals...you're welcome."
Posted by: Andrew at Apr 28, 2008 4:01:11 AM
What will happen when, THEDRUGWAR,"prohibition 2", comes to it's richly deserved,demise? Educated guess's can be usefull, but the fact is, we won't know untill we get there.And we won't get there if fear and greed get in the way. I say ,damn the fear and screw the greedy. Go for it and lets see.Anything would be better than a continuation of this ,ONDCP/DEA insanity.
Posted by: Red at Apr 28, 2008 11:30:43 AM
--But still, the main problem people addicted to drugs face is incarceration and other hassles associated with enforcement.
Where is your data to support this claim? What in the WORLD makes you think that the main problem a junkie has is with law enforcement?
I posit that none of you making such claims realizes what a junkie's life is like, and almost none of you are aware of how many of your coworkers, colleagues, or acquaintances are addicts.
There are addicts at your place of work. Addicts in your neighborhood. Law enforcement is usually the LAST of the issues facing them.
Posted by: Sarah at Apr 28, 2008 11:07:36 PM
I don't think drug gangs could beat Walmart. Look at Walmart's track record of dropping generic drug prices...think what they could do with heroin.
But the most important economic loss in the US due to the drug war is due to the incarceration of black young men. This not only dramatically reduces their lifetime potential earnings, but also by pulling them out of the dating pool it encourages single-parent families, which leads to mothers who are not working enough hours because of child care issues and they have dramatically reduced lifetime potential earnings and remain in poverty.
I've known plenty of functioning drug addicts (alcoholism runs in my family), who were accountants, doctors, and research biologists. Luckily they didn't need to pay 100 times the free-market rate for their drugs, or else I don't think they would have survived.
Posted by: Mr. Econotarian at Apr 29, 2008 1:56:35 PM
I believe that a geneology of drug laws should be considered in this debate as Nietzsche pondered his Geneology of Morals. All anti-drugs laws in this country have roots in anti-immigration or anti-ethnic sentiment. This starts with the prohibition of smoked opium in San Francisco of 1875 discriminating against Chinese immigrants. It also includes the laws criminalizing marijuana from the 1930s that targeted Mexican laborers. Current crack cocaine laws disproportionately affects African Americans.
If we pay attention to the right of the state to discriminate against groups, we might be able to better understand how health consequences - both real or imagined - became used along the way.
Posted by: Kevin at Apr 29, 2008 3:37:52 PM
The first model is deeply flawed. 1 - Drugs are not like sugar and milk. 2 - If the gangs could profit from monopolizing the sale of other "legalized" goods why don't they? They could always hire more people, buy more guns, etc. 3- Most of the consumers of cocaine/marihuana are not poor and do not live in areas controlled by the gangs. How would the gangs avoid them to buy cocaine from Merck?
The freakonomic's style claim also makes no sense. The rents are small because the costs are huge (guns, mortality risk, police cathces the cargo, bribes). If drugs were legalized, these costs would still be there for the gangs but not for the companies.
Finally my opinion, I think some drugs like crack cocaine and meth should never be allowed, but when we forbid the sale of "less harmful" drugs like marihuana and cocaine it allows the drug dealers to use the infrastructure ( fixed cost) they built based on marihuana and cocaine trafficking to also sell those more damaging drugs. If we legalized these less dangerous drugs, we'd make the market for crack, heroin and meth almost inviable, in my opinion.
Posted by: Bruno at Apr 29, 2008 4:09:09 PM
Ho-hum. It sounds like a tame version of the University of Florida's Economics Society, which meets on a weekly basis and has soirees that lately have involved a) the gold standard, b) intellectual property rights, and c) drug legalization.
Posted by: Admiral at Apr 29, 2008 5:46:47 PM
Tyler,
Monopolies would be impossible in the drug industry if drugs were legalized, as monopolies are nearly impossible in all legal industries. The reason being - Wal-mart or Kaiser would act in their own self-interest and find, grow, or make drugs themselves. Even if a drug cartel operated with a gang to form a monopoly before legalization, corporations looking to increase profits could find ways to sell more drugs at lower prices. Gangs fueled by drugs would collapse.
Posted by: David at Apr 29, 2008 8:46:34 PM
This is a comprehensive addiction portal focusing on topics of alcohol and drug abuse. http://www.alcoholaddiction.org
Posted by: MICHEAL SMITH at May 13, 2008 7:16:27 PM
