The primary economic consequence of establishing a government policy of Prohibition is to drive the prohibited market underground. The primary political and social consequence is the creation of a criminal element in the market, which then spawns corruption of politicians. Note that the market does not disappear.
There are numerous secondary and tertiary consequences of Prohibition. (I am using the term “Prohibition” to refer to any government policy of banning market activity.) We can look to the notorious example of alcohol Prohibition in the United States from 1920 to 1933 for instructive guidance, but the failure of attempts at Prohibition is manifest in all countries; most fundamentally, efforts appear to be motivated by the insatiable desire of some to forcibly impose on others conformity with their own world view.
I have absolutely no interest personally in the use of mind-altering drugs; I do not want to sink to the level of losing complete control of my consciousness. That being said, I am an advocate of the complete repeal of all anti-drug legislation, particularly in the U.S. but of course everywhere. The U.S. is singled out because it is at the forefront of enforcement initiatives domestically and internationally; it also represents the biggest market for drugs in the world. Any intelligent steps taken to resolve the myriad problems with Prohibition in the U.S. would redound to the benefit of the entire world.
The latest illustration of the destruction that accompanies Prohibition can be witnessed in Jamaica. Despite the catchy appeal of the Bob Marley song, “One Love,” which was modified by Jamaican Airlines to make a vacation on the tropical island sound irresistible, this once idyllic tourist destination has been turning into a hell-hole for a long time. “Come to Jamaica and feel alright” might as well be interpreted as “Come to Jamaica and get high on drugs”. In a state of disorientation you may not notice the bullets flying around Kingston lately. The battle between the “Shower Posse” led by one Christopher “Dudus” Coke, a gangster, and the police and military controlled by Prime Minister Golding, has cost dozens of civilians their lives.
Mr. Coke has learned the hard way not to trust a politician. Despite fighting against Mr. Coke’s extradition by the U.S. Justice Department for six months, the revelation of his own corruption has led to public contrition by Mr. Golding, who in a display of government essence has sent the police and military after Mr. Coke. So far, the gang leader has eluded capture.
Political corruption is just one unintended consequence of anti-drug laws. There are many others, some already mentioned:
- The demand for drugs does not change significantly. When people freely trade for the acquisition of these substances, making their possession, sale and consumption illegal simply raises the costs for all participants and turns them into criminals.
- Drug users will pay any price; lower-income users can be tempted to turn to actual criminal behaviour or prostitution to get the money to support their habits.
- The price goes up because supply and distribution is constrained by law enforcement which must be circumvented.
- A criminal class is created because legitimate entrepreneurs will not normally breach the laws.
- Law enforcement costs escalate even as success is fleeting at best.
- The top criminals—the most ruthless and violent—acquire outlandish riches as a result of their criminal enterprises and compete vigorously, gangland style, to pay corrupt police, military and politicians to turn away from interception of shipments or to cooperate with other enabling activities.
So how does one end it all? Stop Prohibition. Let the open markets determine prices. Entrepreneurs will move in immediately to begin domestic production and/or importation of high quality product at the lowest possible cost as they compete to gain market share. The criminals, who utilize physical force rather than price and quality to compete, would be driven out of business by the private sector. Entrepreneurs would also find other legitimate uses for the drugs and create new markets.
Absent Prohibition, there may be a tick up in consumption initially, as marginal demand may flirt with the novelty of ready availability. That is really the point. The choice to use drugs is an individual one. There need not be any extraordinary concern about a rash of stoned automobile drivers or employees high on the job. Private enterprise is more capable at prohibiting unacceptable behaviour as part of the contractual relationship that arises from doing business and trade. Most businesses have some form of policy with regard to handling intoxicated persons or they simply require staff to show up for work sober as part of the employment contract. Mandatory drug testing is already practiced by many large employers in several industries.
Many advocates of drug “legalization” leap to make the argument that a new source of tax revenue would be created and that this would be a way for the government to exert better control. This too is wrong. Punitively taxing the sale of the product would lead to the same consequences as with Prohibition. Consider the extraordinary efforts of cigarette black marketers that have developed in the wake of ridiculously high tobacco taxes.
The educational efforts of social institutions to warn against the debilitating effects of drug use could continue post-Prohibition, possibly to the same level of benefit that campaigns against tobacco and alcohol use have. It is only through voluntary conduct, possibly impelled to some extent by social pressure that many people will change from bad habits. Certainly the high cost and unintended consequences of Prohibition is not preferable. The savings in government expenditures for drug law enforcement would accumulate to billions of dollars. On these grounds alone, the U.S. government could end the madness related to drug trafficking around the world by the logical expedient of repealing all anti-drug legislation.
©Copyright 2010 Edward Podritske