Illegal Drugs

STUMBLING IN THE DARK

Moral Outrage Has Proved A Bad Basis For Policy On Illegal Drugs, Says
Frances Cairncross. Time For Governments To Go Back To First Principles.

If only it were legitimate, there would be much to admire about the drugs
industry. It is, to start with, highly profitable. It produces goods for a
small fraction of the price its customers are willing to pay. It has
skilfully taken advantage of globalisation, deftly responding to changing
markets and transport routes.

It is global but dispersed, built upon a high level of trust, and markets
its wares to the young with no spending on conventional advertising. It
brings rewards to some of the world's poorer countries, and employs many of
the rich world's minorities and unskilled.

However, it is an odd business.

Its products, simple agricultural extracts and chemical compounds, sell for
astonishing prices.

A kilo of heroin, 40% pure, sells (in units of less than 100 milligrams)
for up to $290,000 on the streets of the United States--enough to buy a
Rolls-Royce car. These prices directly reflect the ferocious efforts by the
rich countries to suppress drugs.

The effect is to drive a massive wedge between import and retail prices.

The import prices of both heroin and cocaine are about 10-15% of retail
prices in rich countries.

In poor countries, the ratio may be more like 25%. Add a little more for
seizures, valued at import prices, and the grand total is probably about
$20 billion.

That would put the industry in the same league as Coca-Cola's world revenues.

Taken at retail prices, it is almost certainly the world's largest illicit
market, although probably smaller than the widely quoted estimate by the
United Nations Office of Drug Control and Crime Prevention of $400 billion,
which would put it ahead of the global petroleum industry.

Every number about the production, consumption and price of drugs involves
much guesswork, a warning that applies all through this survey.

But global retail sales are probably around $150 billion, about half the
sales of the (legitimate) world pharmaceutical industry and in the same
league as consumer spending on tobacco ($204 billion) and alcohol ($252
billion).

The estimate of world drug sales comes from Peter Reuter, an economist at
the University of Maryland and co-author (with Robert MacCoun) of a
comprehensive new study of illegal drugs on which this survey frequently
draws. He notes that the official estimate of retail drug sales in the
United States is $60 billion, making America easily the world's most
valuable market.

European sales are at most the same again, probably less. Pakistan,
Thailand, Iran and China account for most of the world's heroin
consumption, but prices are low, and so sales in total are probably worth
no more than $10 billion.

Add in Australia and Canada; add, too, Eastern Europe and Russia, where
sales are growing fast, but probably still make up less than 10% of the
world's total.

Exclude European marijuana, much of which is domestically produced.

It may seem distasteful to think of drugs as a business, responding to
normal economic signals.

To do so, however, is not to deny the fact that the drugs trade rewards
some of the world's nastiest people and most disagreeable countries.

Nor is it to underestimate the harm that misuse of drugs can do to the
health of individuals, or the moral fury that drug-taking can arouse.

For many people, indeed, the debate is a moral one, akin to debates about
allowing divorce, say, or abortion.

But moral outrage has turned out to be a poor basis for policy.

America's illegal-drugs policy is a dismal re-run of its attempt to
prohibit the sale of alcohol

Nowhere is that more evident than in the United States. Here is the world's
most expensive drugs policy, absorbing $35 billion-40 billion a year of
taxpayers' cash. It has eroded civil liberties, locked up unprecedented
numbers of young blacks and Hispanics, and corroded foreign policy.

It has proved a dismal rerun of America's attempt, in 1920-33, to prohibit
the sale of alcohol.

That experiment--not copied in any other big country--inflated alcohol
prices, promoted bootleg suppliers, encouraged the spread of guns and
crime, increased hard-liquor drinking and corrupted a quarter of the
federal enforcement agents, all within a decade.

Half a century from now, America's current drugs policy may seem just as
perverse as Prohibition.

For the moment, though, even having an honest debate about the policy is
extremely difficult there.

Official publications are full of patently false claims. A recent report on
the National Drug Control Strategy announced: "National anti-drug policy is
working." In evidence, it cited a further rise in the budget for drugs
control; a decline in cocaine production in Peru and Bolivia (no mention of
Colombia); and the fact that the proportion of 12th-grade youngsters who
have used marijuana in the past month appears to have levelled off at
around 25%. If these demonstrate success, what can failure be like?

Nearer the truth is the picture portrayed in "Traffic", a recent film that
vividly demonstrated the futility of fighting supply and ignoring demand.
In its most telling scene, the film's drugs tsar, played by Michael
Douglas, asks his staff to think creatively about new ideas for tackling
the problem.

An embarrassed silence ensues.

This survey will concentrate largely (but not exclusively) on the American
market, partly because it is the biggest.

Americans probably consume more drugs per head, especially cocaine and
amphetamines, than most other countries. In addition, the effects of
America's misdirected policies spill across the world.

Other rich countries that try to change their policies meet fierce American
resistance; poor countries that ship drugs come (as Latin American
experience shows) under huge pressure to prevent the trade, whatever the
cost to civil liberties or the environment.

Moreover, America's experience demonstrates the awkward reality that there
is little connection between the severity of a drugs policy on the one hand
and prevalence of use on the other.

Almost a third of Americans over 12 years old admit to having tried drugs
at some point, almost one in ten (26.2m) in the past year. Drugs continue
to pour into the country, prices have fallen and purity has risen.

Cocaine costs half of what it did in the early 1980s and heroin sells for
three-fifths of its price a decade ago. Greater purity means that heroin
does not have to be injected to produce a high, but can be smoked or sniffed.

A Matter Of Fashion

However, American experience also suggests that the pattern of drug
consumption is altering, arguably for the better.

Casual use seems to have fallen; heavy use has stabilised. More American
teenagers are using cannabis (which, strictly speaking, includes not just
the herb--marijuana--but the resin), but the number of youngsters
experimenting with cocaine or heroin has stayed fairly steady.

The American heroin epidemic peaked around 1973, since when the number of
new addicts has dropped back to the levels of the mid-1960s. The average
age of heroin addicts is rising in many countries--indeed, the Dutch have
just opened the first home for elderly junkies in Rotterdam. America's
hideous crack epidemic has also long passed, and cocaine use has retreated
from its 1970s peak. And a recent study shows that the likelihood of
proceeding from cannabis to harder drugs such as cocaine or heroin has
fallen consistently for a decade. "We are largely dealing with history,"
says Mr Reuter. "The total population of drug users has been pretty stable
since the late 1980s."

This is not an unmixed blessing: heavy users seem to be using more drugs,
and to be injuring and killing themselves more often.

As with cigarette-smoking, drug-taking is increasingly concentrated among
the poor. And in some rich countries other than America, such as Britain,
the number of both casual and heavy users of most drugs is still rising.

In the poorer countries and in Central and Eastern Europe too, drugs
markets are flourishing. India and China are probably the fastest-growing
large markets for heroin.

In rich countries, the drugs that increasingly attract young users are
those that are typically taken sporadically.

But in the rich countries, the drugs that increasingly attract young users
are those that are typically taken sporadically, not continuously:
cannabis, ecstasy, amphetamines and cocaine.

In that sense, they are more like alcohol than tobacco: users may binge one
or two nights a week or indulge every so often with friends, but most do
not crave a dose every day, year in, year out, as smokers generally do.
That does not mean that these drugs are harmless, but it should raise
questions about whether current policies are still appropriate.

Today's policies took shape mainly in the mid-1980s, when an epidemic of
crack cocaine use proved a perfect issue around which President Ronald
Reagan could rally "middle America". His vice-president, George Bush,
called for a "real war on drugs", which caught the mood of the time:
opinion polls showed that drugs were at the top of people's lists of
worries. By the early 1990s the crack scare had faded, but a series of
increasingly ferocious laws, passed in the second half of the 1980s, set
the framework within which Mr Bush's war on drugs is still waged today.

This framework is not immutable, although formidable vested
interests--including the police and prison officers--now back tough drugs
laws. Attitudes to policy change over time (see article), and drugs
policies in many countries are changing with them. Governments are
gradually putting more emphasis on treatment rather than punishment. Last
autumn, in a referendum, California voted to send first- and second-time
drug offenders for treatment rather than to prison.

And the law on possessing cannabis is being relaxed, even in parts of the
United States, where several states now permit the possession of small
amounts of it for medical use.

In Europe and Australia, governments have relaxed the enforcement of laws
on possessing "soft" drugs.

In Switzerland, farmers who grow cannabis for commercial sale within the
country will be protected from prosecution if a new government proposal
goes through.

In Britain, Michael Portillo, a top opposition politician, advocates
legalisation. But it is hard for an individual country to set its own
course without becoming a net exporter, as the experience of Europe's more
liberal countries shows.

Ultimately, the policies of the world's biggest drugs importer will limit
the freedom of others to act.

Mill Muses On Morality

At the heart of the debate on drugs lies a moral question: what duty does
the state have to protect individual citizens from harming themselves? The
Economist has always taken a libertarian approach.

It stands with John Stuart Mill, whose famous essay "On Liberty" argued that:

The only purpose for which power can be rightfully exercised over any
member of a civilised community, against his will, is to prevent harm to
others. His own good, either physical or moral, is not a sufficient
warrant. He cannot rightfully be compelled to do or forbear because it will
be better for him to do so, because it will make him happier, because, in
the opinions of others, to do so would be wise, or even right.

These are good reasons for remonstrating with him, or reasoning with him,
or persuading him, or entreating him, but not for compelling him, or
visiting him with any evil in case he do otherwise.

Over himself, over his own body and mind, the individual is sovereign.

This survey broadly endorses that view. But it tempers liberalism with
pragmatism. Mill was not running for election.

Attitudes towards drug-taking may be changing, but it will be a long time
before most voters are comfortable with a policy that involves only
remonstration and reason. People fret about protecting youngsters, a group
that Mill himself accepted might need special protection. They fret, too,
that drug-takers may not be truly "sovereign" if they become addicted.

And some aspects of drug-taking do indeed harm others.

So a first priority is to look for measures that reduce the harm drugs do,
both to users and to society at large.

Next article: http://www.mapinc.org/drugnews/v01.n1355.a05.html