The economic case for the US to legalize all drugs

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June 7, 2013 Quartz

Two states in the US—Washington and Colorado—legalized recreational marijuana use this year. More than half of Americans now support legalizing marijuana, up 20 percentage points in the last decade. But the concept of legalizing drugs is not as radical and modern as it may seem. For thousands of years, most drugs, including marijuana, morphine, and cocaine, were produced, sold and consumed legally. It was not until the early 20th century, under an initiative led by American missionaries and temperance groups, that the concept of a global prohibition of drugs took hold.  Even then, many countries, particularly drug-producing ones, were reluctant to embrace prohibition. Opponents predicted that criminalizing drug use would never eliminate demand and the cost of interdiction would fall disproportionately on them. They were right. The US and Europe should rethink their drug policy, not only marijuana but all other drugs too.

Prohibition of drugs has not been effective at eradicating their use. As the global drug trade continues to thrive, developing countries pay most of the price. The cost to them not only includes law enforcement, but the violence and corruption associated with the drug trade, which undermines economic development and keeps millions in poverty. A better use of resources would be to treat drugs as a health problem, and legalize and regulate the use and sale of drugs. That would probably make richer countries better, or at least no worse, off, and improve the lot of developing countries.

The US spends more than $40 billion each year on drug prohibition. But that is just the explicit cost. The implicit cost: increased violence, otherwise productive citizens in prison, and perpetual poverty, both at home and, especially, abroad. Countries mired by the violence and corruption associated with the drug trade might otherwise be viable trading partners, with the money spent on drug interdiction better spent on other means. According to the World Bank, at least three-fourths of expenditures on drugs in the US goes toward apprehending and punishing dealers and users; treatment expenditures account for, at most, a mere one-sixth of the total. That’s in spite of evidence that treatment programs are more effective and economical than interdiction. Read More