Tag Archives: Illegal drug trade

Drug Legalization! Yes Please!

Marijuana

Marijuana (Photo credit: warrantedarrest)

English: Number of arrests in the USA, by drug...

After reading many articles on drug legalization over the past few days and after talking to friends about it, I felt that it was appropriate to express my own view on drug legalization and the war on drugs. To me it’s not understandable that we have declared war on something that cannot be defeated, and instead of exploiting the trade in our favor we are plunging other states into underdevelopment when the drug trade can give them so much potential.  I think there are two  main implications which must be taken into consideration when discussing drug legalization; the economic effects and most importantly the effect on health. All of which clearly points in favor of legalization.

Let me start with the effects on cost. So far this year 34 billion dollars have been spent on the war on drugs in the United States according to drugsense.com, moreover it is estimated that the total money spent on drug crackdown since the declaration of the war on drugs by the Nixon administration accounts for one trillion dollars, which is data published by the New Internationalist magazine. These costs include the arrest and detainment of people who were accused for 1,400,000 drug offenses this year; every 19 seconds someone is arrested for drug law offenses (drugsense.com). These costs also go to police training funds in Central and Latin America which either, in the case of Mexico, ends up in the pockets of bureaucrats, or used to bolster the machine of terror and repression instead of drug crackdown. One trillion dollars is enough money to socialize healthcare in the US or provide free college education in order to find remedies to more solvable issues such as student bankruptcy and house disclosures, or even investing it in rehabilitation programs and drug education in order to restrict the abuse of drugs. It is definitely worth relocating the funding of the war on drugs to more pragmatic issues such as education and healthcare.

In addition to the positive fiscal domestic effects of legalization of drugs, thereby ending the war on drugs is the economic development of areas which are hit hard by the criminalization of drugs most like in Columbia. The problem with the criminalization of drugs is that the middle men between the poppy plant farmer and the consumer are the ones that gain the largest share of profits for the transaction sales. This is because the farmers cannot sell their produce directly to the market and cannot set the market price, while the consumer of the drug is also paying higher than the actual market price due to the illegality of the drug and the costs of smuggling the drug. Therefore the mafia and drug gangs are free to exploit both the consumer and the producer of drugs. Legalizing drugs would mean the end to the middleman and therefore the farmer will be able to sell his produce directly to the market, thereby increasing efficiency and market welfare as price reduces to its natural equilibrium, and increases profitability for both the consumer and producer.  Also the fact that the crackdown on drug farmers will be stopped, means that there will be an increase in productivity, and the ability to allocate more resources to the production of drugs meaning market expansion and economic growth and an increased income for farmers in Columbia or Bolivia or any other producer of drugs in Central and Latin America.

In addition to the increased economic efficiency in the underdeveloped regions, States can also tax the industry in order to improve underfunded services such as healthcare and education. It is estimated that the total value of the drug market is between 320-400 billion dollars, thus legalizing the market would eliminate current deficiencies and expand the value of the market. With the current market value, if the drug trade was taxed by 10% it would lead to at least an increase in revenue by 25 billion dollars considering that the demand for drugs is relatively inelastic and the market size reduction due to the tax would not have a significant effect on sales.

What is more important than the economics behind drug legalization is the health improvement. With the legalization of drugs also comes the ability to regulate the content of drugs. At the moment drug dealers may mix the cocaine with rat poison in order to make it heavier to sell for a higher price, in essence the drugs consumed can contain anything as there are no law enforcement agencies determining what goes in the drugs. Also through drug legalization limits on buying heavy drugs like cocaine and heroin can be established by reserving sales rights to state pharmaceutics companies which can track individual’s consumption, even though that would keep the illegal trade alive, it would still reduce the consumption from illegal trade as it will be more expensive. Decriminalization of drug use has had positive effects in the country where it has been instituted, Portugal. Since 2001 (when decriminalization was instituted) the number of addicts on hard drugs went down from 100,000 to 40,000.

The legalization of drugs has a huge potential of increasing economic development in underdeveloped regions heavily dependent on the drug trade, while also decreasing health and security costs in the North America and Europe. It is almost disgusting how drug legalization was not ever mentioned in the US election by the two mainstream parties while it is very likely that it can improve the situation for the key issues; legalization can give the rise to a new industry in America thus creating new jobs, and it is also a source of tax revenue for increasing income to solve the rising debt. When asking classmates and friends all agreed that drugs should be legalized to some extent, although I believe in full legalization of all drugs, drug legalization of at least marijuana seems universally accepted. Then why isn’t it becoming a political issue for the mainstream parties in both the EU and North America?