Drug Policy is Deja Vu All Over Again

Stephen T. EastonSimon Fraser University

andThe Fraser Institute

To set the stage for today’s discussion:

We need to go back a little to see how future history will treat us by remembering the last prohibition

Remember the Last Great Prohibition

Canada prohibited the consumption of alcohol from 1917 to 1922 (more or less)

The United States prohibited the consumption of alcohol from 1918 to 1932

The Consequences

As an enduring testament to futility, Recall that the “Untouchables” is

still running on TV.

History anyone?

There they are, deeply committed to fighting what is now a legal and respectable line of work: brewing and distributing alcohol.

So, sip your Chardonnay, have a brew, or mix a retro martini and applaud Elliot Ness and the Untouchables as he fights your kind of crime.

A Message to Current History

We cannot prevent people from consuming illegal substances that they want

It is a war that was lost in the 1920s and 1930s and is being lost again

Let’s take a look at the facts

Lifetime Numbers

Reality CheckDrug Lifetime

UsageNumber of

Adults

Marijuana/cannabis 23.1% 5,320,000Cocaine 3.8% 875,000LSD 5.2% 1,200,000Speed 2.1% 485,000Heroin 0.5% 115,000

Current Users

Current UsersMarijuana/cannabis 7.4%Cocaine 0.7%LSD

SpeedHeroin

1.1%

Business is about Resource Allocation

What do we do in a “business” oriented approach?

Business is about Resource Allocation

We look at the harm inflicted.We look at the difficulty of

enforcementWe reallocate resources so that they

reflect the observation that an additional unit of effort yield the same payoff in each activity to which we are committed

Business is about Resource Allocation

We spend too much time and money on vainly trying to control the uncontrollable -- Elliott Ness and you.

We spend too little time in preventing, educating and remedying those who are in misery with drugs.

Incidentally, our policy makes available large sums of money to people who violate the law.

So Is Drug Control Really about the Harm they do?

Let’s ask about what is currently legal:

Tobacco and Alcohol

27% of the Canadian Population Currently Smoke (Tobacco)

TobaccoHabits Usage

%Cigarettes(billion)

Cigarettes per dayper smoker

Never 46Former 26Present 27 52.8 20.5

72% of Canadians Use this Formerly Formerly “Prohibited”“Prohibited” Substance

Alcohol Consumption

Current Litres of Alcohol per person Drinks Heavy Drinks

Drinkers Beer Wine Spirits per week Occasions per Heavy

72.30% 4.3 1.2 2.1 4.2 46% (15) 5

What is the Putative Effect of Behaviours such as Smoking and Drinking?

Attributed Consequencesof

Tobacco and Alcohol ConsumptionAttributed

SourceAttributed Mortality

AnnualTotal

Rate per100,000

AttributedHospital

Days('millions)

Tobacco 33,500 118* 3.02***Alcohol 6,700 23.6** 1.15****

*17 and **3.4 percent of deaths from all causes***7 and ****2.8 percent of hospitalizations from all causes

What is the message?

Clearly, the harm the substance may do is not the criterion by which we determine illegality.

Even with the poignant story over the weekend, nobody is suggesting banning cars that can drive fast simply because some do drive fast.

The futility of trying to stop drugs from the production end

Let us take the most obvious example of drug production that absorbs police energy:

Marijuana ProductionIt is profitableIt is easy.

Some Costs of Production

Material Costs of a Grow-opCost of growing equipment andsupplies

$6,000

Miscellaneous supplies for future crops $4,000House rental for 1 year $18,000Electricity bypass 0Labour Cost: tending and guarding 72,000

Total expenses $100,000

So Why Do It?

Cost $100,000Value of Crop $50,0003 Crops a Year!Value of $150,000 on a Cost of

$100,000.A very good return on capital even

with these very, very conservative assumptions

There is lots of money in marijuana, not to mention the other drugs

Marijuana alone probably nets at least $700 million into producers’ pockets -- just in Vancouver.

Drug W and Charges Canada and British Columbia, 1998

1998population:

CANADABC

30,300,424,009,922

BC’s population is 13% ofCanada

IncidentsKnown to

Canada BC BC Incidents Cleared byCharge

the Police Actual Actual Share CanadaNumber Number of

CanadaBC net of BC

Heroin - Total 1,317 894 68% 70% 71%Cocaine - Total 12,184 3,570 29% 68% 75%

Possession 34,907 8,848 25% 19% 68%Trafficking 7,869 1,099 14% 61% 68%Importation 998 79 8% 9% 13%Cultivation 7,535 2,347 31% 32% 34%Cannabis -

Total51,309 12,373 24% 25% 62%

What does the pattern mean?

In BC marijuana possession is in some sort of legal limbo.

How the Courts proceed is anyone’s guess

It is not just we, the general public who are confused about “crime” and “punishment”

So is our money well spent?

It is pretty clear that enforcement in the case of marijuana (and most other drugs) has not limited their accessibility -- just ask at any local high school, not only at Hastings and Main.

Many producers use drug money for other undesirable ends (just like Al Capone)

What if we legalize drugs?

We will end the supply of money to people who use it for bad ends.

More people will “do” them. Yes, but we can treat/educate in the open. Just imagine if alcohol was still illegal.

Replay Hastings and Main multiplied by a factor of 70!

Conclusion

We have a problem. We have been trying to interdict the supply and punish users and suppliers.

Prohibition does not seem to work and is very costly -- as detailed by others here.

The costs of the alternative, if alcohol prohibition is a model, are worth considering.

Oh yes, as an economist

If it is legal, we get to measure it, tax it, and regulate it, something we simply cannot do when it is illegal.