Thoughts on economics and liberty

Legalize Drugs Now! – a 2006 essay by Walter Block

This is really good.

Legalize Drugs Now! An Analysis of the Benefits of Legalized Drugs (with Meaghan Cussen)

From American Journal of Economics and Sociology 59, no. 3 (2000): 525–36. Meaghan Cussen graduated from the College of the Holy Cross, Worcester, Mass., U.S.A. in 1998 and wrote this paper with Dr. Walter Block while under his instruction as an economics student.

Basic Constitutional Rights
Many argue that drug prohibition protects addicts from themselves by exerting parental control over their behavior. This government-enforced control, the anti-drug laws, strictly monitors addicts treatment of their own bodies. For example, the government decides that it wants to protect Fred Brown from destroying his body. The government, therefore, outlaws narcotics and, in effect, takes control of Fred’s body. Under the United States Constitution and the anti-slavery laws, this hegemony should not happen. The guiding principles of the United States, iterated both in the Declaration of Independence and the Constitution, protect Fred’s basic civil liberties to “pursue his own happiness” as long as he doesn’t infringe on others’ rights to life and property. With prohibition, Fred no longer has this constitutional right. He no longer controls his own body. Regulation has stripped him of his civil liberty. Fred’s role of “owner of his own body” is taken away from him. This has, in effect, made him a slave.

Are we being hysterical in categorizing present drug law as a form of servitude? No, our drug laws amount to partial slavery. We must all question the practices of roadblocks, strip-searches, urine tests, locker searches, and money-laundering laws. Philosophically speaking, drug prohibition severely threatens our civil liberties and is inconsistent with the anti-slavery philosophy and the founding documents of the United States. The legalization of drugs would give a basic civil liberty back to U.S. citizens, by granting them control over their own bodies.

Free Trade
Free trade benefits all parties. It can be assumed that if drugs were legalized, and thus were a part of the market, both the buyer and the seller would gain. Each time a trade occurs, the welfare of both parties is improved; if Joe sold you his shirt for $10, he would benefit because he obviously values the $10 more than the shirt. If he didn’t, he would not have traded it. You would also gain from the trade because you obviously value the shirt more than you do the $10. If you didn’t, then you would not have agreed to the deal. Free trade in the drug market works the same way. If Joe sells you marijuana for $10, he gains because he values the money more, and you gain because you value the drugs more. Whether or not another person thinks you should value the drugs more is not the question. That third party is not involved in the trade. The amount of pleasure the drug brings you is your motivation for buying it. Trade is a positive-sum game. Both parties gain, at least in the ex ante sense.

It cannot be denied that certain third parties will be offended by the drug transaction, on moral or ethical grounds. However, try to find any transaction that does not offend at least one person. Many people object to the sale of alcohol, cigarettes, birth control or animal products, but their feelings or beliefs do not stop these items from being sold. Marxists object to any market transactions because they see commercial activity as necessarily exploitative. There is obviously no pleasing everyone when it comes to market transactions. In our free-enterprise economy, however, anyone who participates in the market will benefit from it. “For all third parties who say they will be aggrieved by a legalized drug trade, there will be many more benefiting from the reduction in crime” (Block 1993). “A third party can verbally oppose any given trade. But that opposition cannot be revealed through market choices in the same way that trade between the two parties indicates a positive evaluation of the transaction” (Block 1996, p. 434). Free trade of all goods contributes to the number of those who gain. In a free-market economy, everybody has opportunity to participate in the market, and therefore, equal opportunity to gain in a positive-sum transaction.

Not only would the legalization of drugs protect basic freedoms and lead to individual benefit through free trade, but it would also bring enormous benefits to society as a whole. The first and most important societal benefit is a reduction in crime.

Reductions in Crime
When addictive drugs are made legal, crime will decrease substantially, for four main reasons. First, the lowered price of narcotics will eliminate the theft and murder associated with their high prices. When drugs are legalized, law-abiding businesspeople will no longer be deterred by the illegality of drug commerce and will become willing to enter the market. With this increase of supply, assuming a less than proportional increase in demand, the price of narcotics will fall. Addicts who were formerly forced to steal, murder, and engage in illegal employment to earn enough money for their habits will be able to afford the lower prices. Therefore, these types of drug-related crimes will decrease.

Second, substance-related disputes such as gang wars and street violence will be reduced. Dealers will be able to use the courts to settle their disputes instead of taking the law into their own hands. Violations of rights within the drug business will be resolved through the judicial system, thereby decreasing gang violence, and saving the many innocent lives that often get caught in the crossfire.

Third, the drug business creates great profits for cartels. Cartels are often international organizations, many of which support terrorism and add to violent crime in America. If the narcotics market were open, drug revenues would be equally distributed by free-market forces, and would have less of a chance of supporting terrorist organizations, crime rings, and cartel activity and profit.

Finally, and most obviously, with transport, sale, and possession legalized, formerly illegal activities will now become society-approved business transactions. Crime, an act that breaks the law, which in its very insurrectional essence leads to societal instability, will be greatly reduced through the legalization of the inevitable activity of drug transactions.

The prohibition of alcohol in the 1920s provides us with a perfect case in point. The high crime rates during this decade were due to the existence of the black market, spawned from the government-enforced illegalization of alcohol. The black market led to the formation of major crime rings. The underground market for alcohol grew and led many profit-hungry entrepreneurs into a risky lifestyle of crime. Many were jailed due to transport, sale, and possession.

When Prohibition ended, alcohol-related crime ceased. The profit balloon driven by the limited supply of the illegal substance was deflated. The black market disappeared, along with all of the illegal activity associated with it. Crime rings were forced to disband and seek other means of income. How many crime rings exist today for the selling of alcohol? The answer is none. The reason is legalization.

In contrast, drug-related crime is skyrocketing. As Ostrowski (1993, p. 209) notes, “The President’s Commission on Organized Crime estimates a total of seventy drug-market murders yearly in Miami alone. Based on that figure and FBI data, a reasonable nationwide estimate would be at least 750 murders a year. Recent estimates from New York and Washington are even higher.” Anyone who questions whether prohibition is responsible for violence should note the relative peace that prevails in the alcohol and legal drug markets. [Sanjeev: This fails to account for the massive rates of murder and crime in the countries of origin – that should be added up.]

The Potency Effect
The end of Prohibition also brought the end of the dangerous potency effect. During Prohibition, it was in the best interests of the sellers to carry more potent forms of alcohol. Hence, an alcohol dealer would be more likely to carry vodka and other hard liquor instead of beer and wine because of hard liquor’s greater value (per unit of volume). Therefore, people began drinking vodka and other hard liquor, which because of their high potency are more dangerous than beer and wine.

Alcohol-related deaths increased. This horrific result is known as the potency effect.
Fifty years after the repeal of Prohibition, the potency effect has been reversed. The average per capita consumption of alcohol has fallen to its lowest level ever (Hamid 1993, p. 184). In fact, people have begun switching to weaker alcohol alternatives, such as wine coolers and non- alcoholic beer. The legalization of alcohol reversed the potency effect. The legalization of drugs will do the same.

For example, the risks involved in transporting marijuana, a low- potency drug, for the purpose of sale are extremely high. It is in the best interests of the dealer to carry more potent, thus more expensive, drugs, which is why he or she will be more likely to carry cocaine because of its greater value (per unit of volume). Because cocaine is more potent, it is also more dangerous. Addicts face increased health risks when using cocaine as opposed to using marijuana. These health risks grow as potency increases. Stronger and more dangerous drugs such as crack, “ice,” and PCP are substituted for the weaker, relatively safer drugs. The results are often deadly.

Health Benefits
The legalization of drugs would eliminate serious health risks by assuring market-driven high quality substances and the availability of clean needles. Prohibition in the 1920s created a market for cheap versions of alcoholic products, such as bathtub gin. Alcohol was diluted or adulterated in often dangerous ways. Needless deaths occurred because of the poor quality of the product. So is drug prohibition worth the health risks? Fly-by-night goods cannot always be trusted. If narcotics were legalized, purity could be all but guaranteed. Drugstores, held accountable by customers, would deliver safe products. Brand names would bring competition into the market and assure safer, better products. Doctors would now be able to monitor the drug use of seriously addicted patients. Poor quality would be a thing of the past.

In addition, clean needles would be readily available. Drug vendors and health care organizations would be able to provide clean needles for their customers and patients respectively. Today, needles are shared because they are difficult to obtain. About 25 percent of AIDS cases are contracted through the sharing of intravenous needles (Boaz 1990, p. 3). Legalizing drugs would eliminate this problem. “In Hong Kong, where needles are available in drugstores, as of 1987 there were no cases of AIDS among drug users” (ibid.).

When was the last time you heard of a diabetic contracting AIDS from contaminated needles? If insulin were prohibited, this situation would surely change for the worse.

Societal Benefits
Illegal drug sale creates a destructive atmosphere. When a criminal culture emerges, a community is torn apart. A booming black market fosters a large criminal presence. Casual recreational users are forced to come in contact with criminals to make their purchases, as prohibition makes it impossible to make a legal transaction. Additionally, basically good citizens often deal with and, unfortunately, become influenced by, the criminals of the area (Boaz 1990, p. 2).

Inner-city youths, surrounded by the booming black market, are influenced by the sheer amount of money dealers make and often fall into a life of crime (Boaz 1990, p. 2). These youths often see themselves as having the choice of remaining in poverty, earning “chump change,” or pursuing a life of crime and making thousands of dollars a week. Which do you think all too many young people will choose?

The black market presence often leads to the corruption of police officers and public officials. Police, on average, make $35,000 a year. When they arrest the denizens of the drug world who make ten times that amount, it is often difficult not to be tempted into a life of crime.

Drug corruption charges have been leveled against FBI agents, police officers, prison guards, U.S. customs inspectors, even prosecutors. In 1986, in New York City’s 77th Precinct, twelve police officers were arrested for stealing and selling drugs. Miami’s problem is worse. In June 1986, seven officers there were indicted for using their jobs to run a drug operation that used murders, threats, and bribery. Add to that two dozen other cases of corruption in the last three years in Miami alone. (Ostrowski 1993, pp. 296–307)

We must question a policy that so frequently turns police officers into the very outlaws they are authorized to bring to justice. We must question a policy that leads to the enormous success of those willing to break the laws of our society. We must question a policy that leaves a criminal profession in a position of great influence over our youth and other honest citizens. Milton Friedman put it best when he wrote, “Drugs are a tragedy for addicts. But criminalizing their use converts the tragedy into a disaster for society, for users and nonusers alike” (Friedman 1989).

Prohibit the Crime, Not the Drug
The laws of the United States prohibit violent acts against other citizens. This is consistent with the founding principles of our nation, which allow each free individual to pursue life, liberty, and happiness. The laws of the United States should not prohibit the intake of narcotics that only have an immediate effect on the individual consumer. If I ingest a drug, I am doing possible harm only to myself, and no other. If I subsequently act violently on account of my altered state of mind, only then am I doing harm to others. It is the subsequent action that is harmful, not the drug-taking itself. Since I am responsible for my actions, I should be arrested and punished only when I am violent. Alcohol is legal even though people commit rapes, murders, beatings, and other violent crimes when they are drunk. Yet if a person commits these crimes when intoxicated, he or she is held responsible for them. A mere substance should not and does not serve as an excuse for the violent acts. The ingestion of alcohol is not illegal per se. The same standard should be applied to the use of presently illegal drugs.

It should also be noted that every narcotic does not turn the user into a crazed, enraged lunatic capable of all sorts of violent crimes. In fact, it is just the opposite. Most drugs induce lethargy. Remember that opium, now illegal, was used quite often in England, China, and the United States, and tended to induce stupor. The use of traditional opiates did not render users violent. In fact, no drug is “as strongly associated with violent behavior as is alcohol. According to justice Department statistics, 54 percent of all jail inmates convicted of violent crimes in 1983 reported having just used alcohol prior to committing their offense” (Nadelmann 1989, p. 22). This statistic renders the prohibition of drugs rather than alcohol a legal inconsistency.

Save the U.S. Taxpayer Money
According to the U.S. Department of Justice, federal, state, and local governments currently spend over $20 billion per year on drug enforcement. In 1992, there were more than one million arrests for drug law violations. In 1993, 60 percent of the seventy-seven thousand federal prisoners were incarcerated for drug-related crimes (Miron and Zwiebel 1995, p. 176). Jails are crowded and large amounts of tax dollars are being spent on enforcement efforts that only aggravate the problem. We can add to this sum the amount of money spent on research and medical care for those infected with AIDS and other diseases caused by needle sharing.

With legalization, the tax dollars spent on enforcement would be saved. The availability of clean needles would reduce the rate of AIDS infections, and would consequently reduce the amount of money spent on medical care, to say nothing of the reduction in human misery.

Don’t Help Inflate Criminals’ Profit Balloons
If we continue with the same anti-drug policies, we are only helping drug lords get richer. Each time a bust occurs and a shipment is captured and destroyed, the criminals benefit. The seizure reduces supply and takes out one or more black market participants. According to the laws of supply and demand, with a decrease in drug supply, black market prices will rise, creating a larger profit for suppliers. So, every time we think we are winning a battle in the war, we are really strengthening the enemy rather than weakening it. The way to win is not by fighting the alligators, but by draining their swamp (Block 1993, p. 696). It is better to ruin drug lords’ businesses by deflating the profit balloon than by acting in a way (i.e., prohibition) that only benefits them. “By taking the profits out of [drugs], we could at one full swoop do more to reduce their power than decades of fighting them directly” (Holloway and Block 1998, p. 6).

At present, governmental control of the drug lords, while minuscule, is as effective as it will ever be in any sector of society (Thornton 1991). Just think, even in jails, where the lives of residents are completely controlled by the government, drugs still have not been eliminated. If the government cannot even control the drug trade within its own house, how can it expect to control it within the entire nation? Are we to imprison the whole citizenry in an attempt? Legalization will take the profits out of the narcotics industry.

Elasticity of Demand for Drugs
Many believe the elasticity of demand for narcotics is very high. If drugs are legalized and their prices fall, the amount purchased will increase by a large amount. This is not the case. In fact, the elasticity of demand for drugs in general is very low for three main reasons. First, narcotics are seen as necessities for drug users, not luxuries. “While one might severely reduce demand for [luxuries] in the face of an increased price, or even give it up entirety in the extreme, this does not apply to [neces- sities]” (Block 1993, p. 696). This behavioral pattern indicates that drugs are indeed low-elasticity goods. In fact, there is really no good reason to assume that many Americans would suddenly start to ingest or inject narcotics even if given the legal opportunity.

Second, most people recognize the danger of drugs and will avoid them no matter what the price. Third, if drugs are made legal, they will no longer have to be pushed. If they are sold over the counter to adults, criminals will no longer have to pawn these goods off on innocent youths. Competition will be high and dealers will have no reason to resort to this extreme measure. Certainly, market competition will occur which may result in advertisements targeting particular age groups. However, this would have a negligible effect compared to drug pushers’ current youth-targeted tactics.

Finally, we should realize that legalization would cause potency to fall. With normalized supply, people will begin purchasing weaker, safer drugs. This normalized supply, along with the low elasticity of demand for narcotics, will lead to only a small increase in consumption.

Government Regulations
A main driver of anti-drug legislation is the concern that government would be sanctioning an immoral and destructive activity, viewed as sinful in the eyes of many in the population. However, the legalization of drugs does not mean that government and society would sanction their use. Alcohol and cigarettes are legal but we have pretty successful campaigns against these substances. Gossiping and burping are also legal, but you never see a government-sponsored advertisement advocating catty behavior or belching in public. Are we as a society to prohibit automobile racing, extreme skiing, the ingestion of ice cream and fried foods because they may have a detrimental effect on human health? No. Dangers associated with these activities cannot be measured. “Such inherently unquantifiable variables cannot be measured, much less weighed against each other. Interpersonal comparison of utility is incompatible with valid economic analysis” (Block 1996, p. 435). We cannot allow such legal inconsistencies to take place.

Legalizing drugs would eliminate these inconsistencies, guarantee freedoms, and increase the efficiency and effectiveness of the government’s anti-drug beliefs. If drugs were legalized, taxes could be cut with the elimination of government expenditures on enforcement. All of the money saved could be used to promote anti-drug campaigns. Private organizations could take over the tasks of inspecting and regulating. A minimum age of twenty-one would be mandated for the consumption of drugs. Transactions would take place in a drugstore, with upstanding suppliers. Drugs could safely be administered, with clean needles, in hospitals where medical professionals could monitor and rehabilitate the addicted. MADD (Mothers Against Drunk Driving) is a good example of a successful anti-substance-abuse campaign. Private, nonprofit groups like this one could help in the fight against drug abuse.

Currently, we are not by any means winning the war on drugs. Our futile attempts at enforcement only exacerbate the problem. We need to de-escalate the war rather than continue fighting the over twenty-three million adult Americans who are obviously determined to enjoy them- selves as they see fit (Boaz 1990, p. 5). We must also remember that those that need to be deterred the most, the hard-core drug users, are the least likely to be stopped (Ostrowski 1993, p. 205). Our law enforcement is not working to contain and control the very people the anti-drug laws are designed to control. The war on drugs has done little to reduce narcotics use in the United States and has thus proved counterproductive (Holloway and Block 1998, p. 6). Philosophically and practically speaking, drugs should be legalized. This act would prevent our civil liberties from being threatened, reduce crime rates, reverse the potency effect, improve the quality of life in inner cities, prevent the spread of disease, save the taxpayer money, and generally benefit both individuals and society as a whole.

Sanjeev Sabhlok

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