THE 2005 FEDERAL ANTI-DRUG BUDGET

More of the Same, and Some Hidden Costs

In a time when the federal government faces multi-trillion dollar
budget deficits and is warning of belt-tightening all around, the
federal anti-drug budget will increase by 4.7% this fiscal year to
$12.468 billion dollars. John Walters, head of the Office of National
Drug Control Policy (ONDCP) presented the new budget proposal Monday.
After two decades of ever increasing federal spending on the war on
drugs, the FY 2005 anti-drug budget is largely more of the same -- a
small cut here, an increase there, always expanding overall, but its
essential contours unchanged -- as always, law enforcement eats up
most of the federal billions actually spent to impose
prohibition.

But you wouldn't know it from the Bush administration's drug budget.
Because of budgetary legerdemain beginning with last year's drug
budget, the FY 2005 numbers both seriously undercount the actual costs
of federal drug law enforcement and distort the ratio of spending on
demand reduction versus law enforcement. Last year, ONDCP
"restructured" its budget, but according to John Walsh, the Washington
Office on Latin America's (http://www.wola.org) senior associate for
the Andes and Drug Policy, that restructuring resulted in a
significant distortion of both the total anti-drug budget and spending
priorities within that budget by simply removing the more than $4
billion spent each year to prosecute, try, and imprison federal drug
offenders. More on that below, but first the numbers.

When broken down by federal government department, the anti-drug
budget looks like this:

Department of Defense -- a slight decrease from $908.6 million in FY
2004 to $852.7 million in FY 2005.

Department of Education -- a fractional decrease from $611.0 million
in FY 2004 to $604.5 million in FY 2005.

Department of Health and Human Services (includes the National
Institute on Drug Abuse and the Substance Abuse and Mental Health
Services Administration) -- increased from $3.48 billion in FY 2004 to
$3.66 billion in FY 2005.

Department of Homeland Security -- increased from $2.38 billion in FY
2004 to $2.52 billion in FY 2005.

Department of Justice, Bureau of Prisons -- a slight increase from
$47.7 million in FY 2004 to $49.3 million in FY 2005. (Per the budget
restructuring in FY 2004, this line item is for prison drug treatment
only; it does not include the cost of housing drug offenders, who make
up 70% of the federal prison population.)

Department of Justice, Drug Enforcement Administration -- the lead
federal drug law enforcement agency saw a budget increase from $1.7
billion in FY 2004 to $1.82 billion in FY 2005.

Department of Justice, Interagency Programs -- includes FBI and other
federal drug-related law enforcement programs, up from $550.6 million
in FY 2004 to $580.6 million in FY 2005.

Department of Justice, Office of Justice Programs -- increased
dramatically from $181.3 million in FY 2004 to $304.3 million in FY
2005.

Office of National Drug Control Policy -- the drug czar's office saw a
slight decrease in funding, from $522.2 million in FY 2004 to $511
million in FY 2005.

Department of State -- the department's Bureau of International
Narcotics and Law Enforcement Affairs saw a slight increase, from
$914.4 million in FY 2004 to $921.6 million in FY 2005. The bulk of
these funds, $731 million, is earmarked for the administration's
Andean Initiative, and the bulk of those funds is earmarked for
military and fumigation assistance for Colombia.

Department of Veterans Affairs -- a significant increase in drug
treatment funding from $763.5 million in FY 2004 to $822.8 in FY 2005.

Other Presidential Priorities -- includes the Small Business
Administration's Drug Free Workplace grant program and the Department
of Transportation's impaired driving initiative and increased from
$2.2 million in FY 2004 to $3.5 million in FY 2005. The 2005 anti-drug
budget also includes a number of ONDCP initiatives, among them $145
million for the widely criticized National Youth Anti-Drug Media
Campaign, $80 million for the Drug-Free Communities Program, which
funds the Community Anti-Drug Coalitions of America (CADCA), and $23
million for grants to encourage school districts to undertake drug
testing of students, an idea President Bush touted during his State of
the Union Address.

The budget also pencils in $70 million to expand the drug courts
program, a $32 million increase over FY 2004, as well as a number of
initiatives aimed at interdiction and tightening US borders, including
$11.9 million of the $54 million allocated for Remote Video Systems
along the Canadian border.

When it comes to the ratio between spending on demand reduction
(prevention and treatment) and supply reduction (domestic law
enforcement, interdiction and crop eradication), the FY 2005 budget
shows a nearly even split, with demand-side programs taking up 45% of
the budget, compared to 55% for supply reduction programs. And herein
lies the rub. By removing the costs of prosecuting, trying, and
imprisoning federal drug law offenders from the anti-drug budget, as
it did beginning last year, ONDCP seriously distorts both spending
levels and priorities. Those costs came to more than $4 billion the
last time they were counted, in the FY 2003 budget.

"By removing Bureau of Prison and other drug prosecution spending from
the budget, a budget that is really two-thirds law enforcement and
supply reduction now looks like it is balanced between demand
reduction and enforcement," said WOLA's Walsh, who analyzed last
year's anti-drug budget for the Federation of American Scientists'
Drug Policy Analysis Bulletin. "This was intended to end the debate
about the imbalance between the demand and the supply sides -- they
can say, 'Look, we have a budget that is balanced,'" he told DRCNet.
"But that's because it fails to include money that is still being
spent, and presumably at a higher rate. It is a distortion. People who
rely on the drug budget to gauge what we're spending won't get an
accurate picture."

ONDCP argued in its budget summary last year that the restructuring of
the budget was to make it more useful in carrying out policy analysis
of the relative costs and benefits of drug control, Walsh said. "But
if you don't include all the spending, how can you do that? Instead of
making the budget more useful, this has made it useless. It is
ridiculous; this doesn't pass the laugh test."

Walsh is correct, said Peter Reuter, coauthor of "Drug War Heresies"
and professor of public affairs and criminal justice at the University
of Maryland, who hastened to add that he had worked with Walsh on
parts of the analysis. "The change is absolutely mystifying to me," he
told DRCNet. "I can't invent an argument that says arresting drug
sellers and users is supply reduction, but locking them up is just a
response to their use and not part of supply or demand reduction."

ONDCP has reconstituted the budget in a way that "is analytically
difficult to justify," Reuter said. But there may be other
justifications, he hinted. "It's hard not to believe there was a
political intent to create a more balanced looking drug budget," he
said.

And ONDCP is doing it retroactively as well. While the federal drug
budget has for the past 20 years hewed closely to the one-third for
demand reduction, two-thirds for law enforcement ratio, any evidence
of that has disappeared from the federal drug budget like an
out-of-favor Soviet apparatchik from a Communist Party photo. In its
table on "Historical Drug Control Funding by Function, 1996-2005," the
budget summary simply erases Bureau of Prisons and other
prosecution-related funding as if it never happened. Suddenly, we find
that in 1996 demand reduction spending was 52.6% of the total
anti-drug budget. But it wasn't so then, and merely erasing the
figures doesn't make it so now. ONDCP does note that "consistent with
the restructured budget, ONDCP has adjusted the amounts reported for
the years 1996-2002," but it only points to the BYRNE law enforcement
grant program and the National Highway Traffic Safety Administration's
impaired driving program, not to Bureau of Prisons spending.

"This is the new model budget," said Walsh. "It eliminates the things
they eliminated last year, and it is pretty clear future budgets would
give no hint of the things that have been excised. And sure enough, if
you didn't already know about it, you would have no reason to see in
this budget anything about the Bureau of Prisons, the federal court
system, the US Marshals, the whole structure related to processing
people once they're arrested. Most of them are arrested, and most of
those go to prison. This is a major aspect of federal drug control,
and it has vanished from the budget."

And speaking of vanishing, that is what has happened to the drug
budget as a political issue, said Reuter. "Ten or fifteen years ago,
there was an active debate about how to reshape the drug policy
budget, but now I am hardly aware of any discussion of the topic," he
said. "The drug budget has disappeared as a way of debating drug policy."

The Bush administration is happy with the budget, and the Democrats
are not making an issue of it, Reuter said. "Why would Walters and
Bush have made any change?" Reuter asked. "It's their budget. If you
think that US drug policy is fundamentally wrong, there is an argument
for change, but there is no political driver to carry this forward,"
he said.

Visit http://www.whitehousedrugpolicy.gov/publications/policy/budgetsum04/
to read the FY 2005 federal drug budget and related documents.

Visit http://www.fas.org/drugs/ to find out more about the Federation
of American Scientists' Drug Policy Project and/or to subscribe to the
FAS Drug Policy Analysis Bulletin online.

Visit http://www.fas.org/drugs/issue10.htm#1 to read Walsh's report, "Fuzzy
Logic: Why the White House Drug Control Budget Doesn't Add Up."