Rethinking the drug war

Maybe this has happened to you. As you walk up to a convenience store, some kids, probably boys, saunter over and ask you to buy them beer or cigarettes.

(At a certain point in my life, I may have been one of them, but I can’t remember for sure.)

That’s a huge irony hidden in plain sight. It’s not easy for kids to buy beer or cigarettes. That’s true not because they’re illegal — it’s because they’re legal and regulated.

Dealers in illegal drugs, on the other hand, don’t generally ask for IDs.

And they’re not regulated. The illegal substance people buy may or may not be what they think it is. The cocaine or heroin could be cut with any and all kinds of nasty substances, some of which are poisonous and disease causing. One could overdose, get nowhere, or just be poisoned.

What are you going to do then: call the cops?

It’s an unregulated market with a lot of what economists call “information asymmetries,” meaning the seller knows more than the buyer and isn’t about to tell.

Sticking to the language of economics, this is also an example of inelastic demand. Elastic demand is what it sounds like, i.e. something that goes up and down depending on market changes. An example might be people who buy more chicken when the price of beef goes up.

Inelastic demand, on the other hand, tends to remain fairly constant, even while prices change. A spike in gasoline prices may reduce Sunday driving, but, without public transportation, people still need to get to work, to health care, to the store, etc.

Addiction is a classic example of inelastic demand. It remains constant whether a product is scarce or plentiful, legal or illegal.

It’s hard to imagine now, but in the early 20th century opium products were legal and inexpensive. One could buy medicines containing them at the local pharmacy.

Most people who used them legally didn’t become addicted, but some did. That was unfortunate for themselves and their loved ones, but, usually, they stayed at home and led normal lives, like many people with drinking problems today. They generally didn’t have to resort to theft, violence, dealing or prostitution to meet their cravings.

Prohibition reduced the size of the supply, but not the demand. People who couldn’t get their fix legally had to rely on criminals, who benefited by increased profitability of the trade in scarce commodities.

The criminals cashing in on prohibition were another group that couldn’t rely on courts or cops to secure compliance with contracts or enhance market share. For them, violence or the threat of violence were necessary.

In fact, those who were crueler or who at least had a credible reputation for cruelty had a comparative advantage over competitors. That’s as true of the Al Capone mob days as it is of drug cartels today.

The economics of the drug war also led to what economist Richard Cowen called “the iron law of prohibition.” He describes it with remarkable brevity like this: “the harder the enforcement, the harder the drugs.”

Johan Hari, author of “Chasing the Scream: The First and Last Days of the War on Drugs,” put it this way: “When you ban a drug, it’s very risky to transport it — so dealers will always choose the drug that packs the strongest possible kick into the smallest possible space. That means that, under prohibition, you can only get the most hard-core form of a drug.”

For example, before the ban on alcohol in 1920, beer was the most popular drink. After it went into effect, the hard stuff was more popular. After it was repealed in 1933, beer bounced back to the top spot.

This critique of the drug war isn’t a matter of ideology. Conservative economist Milton Friedman, who is cherished by many Republican politicians, had a lot to say about this. Here are some samples:

“See, if you look at the drug war from a purely economic point of view, the role of the government is to protect the drug cartel. That’s literally true.”

And

“Most of the harm that comes from drugs is because they are illegal.”

And

“Every friend of freedom must be as revolted as I am by the prospect of turning the United States into an armed camp, by the vision of jails filled with casual drug users and of an army of enforcers empowered to invade the liberty of citizens on slight evidence.”

I don’t usually see eye to eye with Friedman, but I’m with him on this.

It’s almost a law of nature that the unintelligent application of force leads to resistance and unforeseen consequences. Natural selection responds to challenges in the environment. When we overprescribe antibiotics, they stop working. When one group acquires a military advantage over another, an arms race often ensues. Push someone, and they’re likely to push back — harder. Pull someone toward you, and they’ll try to pull away. Hit a nail, and it goes in deeper.

So it goes.

The war on drugs is the textbook example of all this. It’s been around for over 100 years and the patterns haven’t changed — but the problems have gotten worse.

It might be time to try something different.

(Note: this appeared as an op-ed in the Charleston Gazette-Mail a while back.)