It has been clear for many years that America’s “War on Drugs” is a failure from a moral perspective. For you hard-headed realists, it is worth remembering that it is a failure from an economic perspective, as well.

The very simple version of this fact, which you may have already intuited, is: We have spent more than a trillion dollars on the War on Drugs and yet you can still buy drugs everywhere, and decades of furious government attacks on the drug trade have not caused drug prices to increase significantly. It is self-evident that our drug policy is an enormous economic failure, even if you set aside the perhaps incalculable cost of the human lives destroyed by violence and incarceration as a direct result of this policy. But for a slightly more detailed economic explanation, Tom Wainwright, an editor at The Economist, makes an inarguable case that even if you do want to fight a War on Drugs, you sure as hell shouldn’t do it the way we have been—by trying to disrupt the supply of drugs. The fact that that is a losing strategy has been amply demonstrated by recent history. Instead, he says attack the demand:


Demand for drugs is inelastic—that is, when prices rise, people cut their consumption relatively little. (Given that most banned drugs are addictive, this isn’t surprising.) So even when governments can drive up prices, dealers continue to sell almost as much as they did before—only at higher prices, meaning that the value of the criminal market increases. Reducing demand, by contrast, triggers a fall in both the amount consumed and the price paid, cutting into the criminal market on two fronts.

Demand-side interventions are not only more effective, they’re also considerably cheaper than playing about with helicopters in the Andes. A dollar spent on drug education in U.S. schools cuts cocaine consumption by twice as much as spending that dollar on reducing supply in South America; spending it on treatment for addicts reduces it by 10 times as much.

This is essentially an economic justification for the view that we should be treating drug abuse as a health problem. You can arrive at that view via a high-minded examination of morality, or via a grounded and practical view of what is cost-effective. Either way, it is what we should be doing and our current drug policy was, is, and continues to be insane.

Legalize and regulate drugs and treat drug addicts. Unfortunately we have to keep on repeating this boring and obvious truth until it happens.


[Photo: AP]