ARE HIGHER COCAINE PRICES A GOOD THING?

Here we go again. President Bush's Drug Czar is claiming success in
the war on drugs because cocaine prices are rising. Except two recent
government reports say cocaine is still widely available; and higher
cocaine prices means greater profits for organized crime and greater
violence in our communities. So what is the Bush Administration smoking?

Let's assume that a recent report by the Drug Enforcement
Administration (DEA) is accurate, and the average price per pure gram
of cocaine increased 47% in the U.S. since last October. That hardly
means we're winning the war on drugs. Cocaine prices are still lower
than they were 30 years ago, and rising cocaine prices will lead to
greater trafficking, not less.

As the price of cocaine increases, it becomes more profitable to
manufacture and sell cocaine, which means more people will get into
the market and more cocaine will be made and sold. DEA Administrator
Karen Tandy was just in Europe in May warning that higher cocaine
prices there are causing Latin American drug traffickers to ship more
and more drugs there. Higher U.S. prices will lead traffickers to ship
more drugs here too.

As the Associated Press notes:

Even while acknowledging previously announced shortages during the
first half of the year, [a] report prepared by the Justice
Department's drug intelligence center found "cocaine availability may
already be returning to previous levels in some areas."

The Justice Department report echoes the findings of another study
presented to Congress on Oct. 25 by the Government Accountability Office.

Then there is the impact of higher drug prices on our communities. The
minority of cocaine users who commit crimes to support their habit
will commit even more crimes to pay for higher prices. And the
increased profits that come from higher drug prices will spark turf
wars between violent drug gangs. In their best-selling book
Freakonomics, economist Steven Levitt and journalist Stephen Dubner
review the scientific literature and conclude that falling cocaine
prices resulted in a 15 percent decline in violent crime in the 1990s.
Sustained increases in cocaine prices could drive crime rates back
up.

The Bush administration is citing rising cocaine prices as a reason to
give Mexico $1.4 billion for supply reduction efforts there. But even
if successful, decreasing the supply would just make cocaine more
valuable, boosting the profits of major drug cartels and increasing
prohibition-related violence on both sides of the border. A more
sensible approach would be to spend that $1.4 billion on drug
treatment here at home. An estimated 20 percent of cocaine users
account for 80 percent of the quantity consumed. Providing treatment
to those who need it most could significantly reduce demand and make
drug selling less profitable.