PeakTrader.com

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PeakTrader said...

The Economics of Drug Legalization - 1995

"Proponents of legalization suggest that their policy will save society money...First, we will not have to pay police to enforce the present criminal-justice approach to drug usage. Second, we will be able to tax legal drugs, thereby raising revenue.

The FY 1994 federal budget allocates $7.51 billion for drug control (supply reduction) which includes criminal justice, interdiction, international programs and intelligence. State and local governments spend even more, $12.6 billion a year.

The total revenue collected from alcohol taxes at the federal, state, and local levels amounts to about $13.1 billion a year, a paltry sum compared to the social costs associated with alcohol consumption.

Treating drug addicts is enormously expensive. Take crack babies as an example. In 1988, it cost $2.5 billion for the intensive care needed to keep the babies alive after birth.

But that was just the beginning of the expenses. It is estimated that it will cost $15 billion to prepare these children for kindergarten, and will then cost between $6 billion and $12 billion for every year of special learning programs.

Even assuming the low-ball figure, the social costs of educating all of the crack babies born in 1988 - not all crack babies, mind you, just those born that year - will run approximately $90 billion by the time they graduate from high school.

Already, drug addicts cost the country roughly $33 billion dollars a year in lost productivity and job-related accidents, according to a study conducted in 1987 by the Research Triangle Institute of Research Triangle Park, North Carolina.

If legalized, addiction rates would increase and the cost would rise to between $140 billion and $210 billion a year. And who will pay for lost productivity and job-related accidents? Consumers will, of course, in the final costs of the produced goods.

We spend approximately $20 billion a year on drug control activities. If drugs were legalized, we would see an increase in addiction rates.

Consequently we would have more crack babies (the kind that already will cost the system $90 billion), decreased productivity (at a cost of between $140 billion and $210 billion), more job-related accidents, and more dead people.

And given the potential black market effect, it is unlikely that we could raise even several billion dollars in tax revenue.

From a purely economic standpoint, legalization is not cost effective."

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THE EDUCATOR - Spring 1998
Drug Enforcement Works

"Strong drug enforcement in the United States is correlated with dramatic reductions in crime, drug use, and drug addiction rates.

Drug arrest rates are not an accurate measure of how tough the nation is on drugs.

There are three times as many alcohol related arrests than drug arrests. Is alcohol policy three times tougher than drug policy? If we legalize drugs, we may triple the number of drug arrests.

Permissive drug policy was an abject failure in the U.S.

A drug criminal was four times more likely to serve prison time in 1960 than in 1980 and the incarceration rate plummeted 79 percent.

This drug-tolerant era brought a doubling of the murder rate, a 230% increase in burglaries, a ten-fold increase in teen drug use, and a 900% rise in addiction rates.

From 1980-1997...incarceration rate rose over four-fold and crime and drug use began a steady, unprecedented decline,

Murder rates fell by over 25 percent, burglary rates dropped 41 percent, teen drug use reduced by more than a third, and heavy cocaine and heroin use levels fell.

With peak drug incarceration rates, many cities such as New York, reached record low crime levels."

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Morganovich, you're confusing prevention and treatment with decriminalization, which increases drug use, as we see with marijuana.

There's a positive correlation between drug use and crime. So, legalization would increase costs of criminal activity.

I don't recall marijuana and other illegal drugs being sold at drug stores or liquor stores. So, it's not the same as prohibition.

Yes, the government can collect taxes from legalization. However, it won't be able to collect enough taxes to cover the increased devastation caused by drug use.

You're not losing a right, because illegal drugs have never been legal while you've been alive.

Over the past 30 years, the U.S. has likely saved over $1 trillion in social costs, which include lost productivity, traffic & work accidents, health problems & drug treatment, mental illness, unemployment, crime, domestic violence, child abuse, and other social services.

Also, I may add, there are private benefits and private costs. However, drug addicts face rising private costs, over time, just to maintain private benefits.

We need to spend more on prevention and treatment, like Japan and Portugal, because it makes economic sense to spend $1 to reduce and prevent $5 of social costs.

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Mike says: "...as long as you don't harm me or expect me to clean up your mess..."

I agree. However, we already have an alcohol problem. So, why create more or bigger problems?:

The Impact of Alcohol Abuse on American Society

Alcohol related accidents are the leading cause of deaths among young people. Dallas Times - Sat., 6/9/90

In 1988, 25,000 Americans were killed in auto accidents involving alcohol. Over one half million were injured. AFA journal - 1/90

One half of all traffic accidents are alcohol related. U.S.A. Today - 1/24/90

Of all murders, alcohol was involved in at least 34% of cases.

Rape - More than 1/2 of rapists had been drinking.

Child abuse - mothers convicted are 3 times more likely to be alcoholics - fathers 10 times more likely.

Suicide - Up to 36% of victims were drinking just before. Prodigy Services Co. - 3/3/92

Heavy drinking is involved in 60% of violent crimes, 30% of suicides, and 80% of fire and drowning accidents.

The suicide rate of alcoholics is 30 times that of the general population. AFA journal - 1/90

Among men arrested for serious crime in 12 major cities, 53% (in Phoenix) to 79% (New York) tested positive for illicit drugs in voluntary urine analysis at time of arrest. Insight - 2/29/89

About 2/3 of people arrested in larger cities for felonies. . .test positive for illegal drugs. Economist - 1/21/89

More than half of all confirmed abuse reports and 75% of child deaths involve drug or alcohol abuse on the part of the parents. Time - 1/27/92

The economic cost of alcohol abuse is projected to be $150 billion in 1995. Alcohol & Health - U.S. dept. of H.H.S. 1/90

The economic cost of America’s drug habit is somewhere between $50 billion and $100 billion a year. (Does not include alcohol) Economist - 1/21/89

It is estimated that 375,000 babies born each year are exposed to one or more illicit drugs prenatally.

The Office of National Drug Control Policy uses an estimate of 100,000 drug exposed babies per year. Maternal Drug Abuse and Drug Exposed children - U.S. Dept. of H.H. S. - 9/92

The cost of government to prepare drug babies to enter kindergarten will soon reach $15 billion per year. Reader’s Digest - 2/91

More than 1,000 babies a day are being born drug damaged. More than 100,000 per year are "crack babies." CBS Nightly News - 4/5/90

One baby with Fetal Alcohol Syndrome will cost $405,000 in direct special services from birth to 65 years. San Diego County Dept. of Health Services

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Prices of many illegal drugs are falling, because demand has been falling faster than supply.

U.S. Illegal Drug Use Down Substantially from 1970s
17 April 2012

"The Obama administration is working to reduce the demand for illegal drugs inside the United States.

Drug use in the United States “has dropped substantially over the past thirty years,” thanks to local, state and federal government efforts, as well as international cooperation.

“The rate of Americans using illicit drugs today is roughly one-third the rate it was in the late '70s.

More recently, there has been a 40 percent drop in current cocaine use and meth use has dropped by half.”"

My comment: Without the War on Drugs, the U.S. would be in a drug "bubble" rather than a drug depression, with millions of more drug addicts.

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Morganovich and Methinks, your statements are full of illogic and ignorance, while you two just make things up.

Slavery isn't the same as illegal drugs. There's a difference between a law that applies to some people and a law that applies to everyone.

If speed limits, for example, aren't enforced, drivers will drive faster. That's why marijuana use has increased.

My statement of social costs of over $1 trillion in 30 years is conservative. Most studies show social costs of illegal drug use is between $100 billion and $200 billion a year, and that was years ago. It's likely higher, because of decriminalization of marijuana.

It's amazing how you ignore actual data and just make up data to show legalization makes economic sense.

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Morganovich, the data show more drug users increase crime, not reduce it. So, that component of social costs will rise.

Also, you seem to believe if crack cocaine was legal, there would be fewer crack babies, etc..

US crime rate at lowest point in decades.
January 9, 2012

The last time the crime rate for serious crime – murder, rape, robbery, assault – fell to these levels, gasoline cost 29 cents a gallon and the average income for a working American was $5,807. That was 1963.

In the past 20 years, for instance, the murder rate in the United States has dropped by almost half...Meanwhile, robberies were down 10 percent in 2010 from the year before and 8 percent in 2009.

The declines are not just a blip, say criminologists. Rather, they are the result of a host of changes that have fundamentally reversed the high-crime trends of the 1980s.

James Alan Fox, a criminologist at Northeastern University in Boston. "We are indeed a safer nation than 20 years ago."

He and others give four main reasons for the decline:

*Increased incarceration, including longer sentences, that keeps more criminals off the streets.

*Improved law enforcement strategies, including advances in computer analysis and innovative technology.

*The waning of the crack cocaine epidemic that soared from 1984 to 1990, which made cocaine cheaply available in cities across the US.

*The graying of America characterized by the fastest-growing segment of the US population – baby boomers – passing the age of 50.

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PeakTrader said...

Has the War on Drugs reduced crime?

"Over 95% of state prisoners are violent and repeat criminals. Under one-tenth of one per cent of inmates are non-violent, first time marijuana offenders.

Most state drug prisoners are traffickers or repeat and/or violent offenders.

A federal marijuana inmate was involved with 3.5 tons of the drug on average; a crack offender averaged 18,000 doses.

Federal agencies have almost no jurisdiction over violent street crime; that is why most federal cases involve major cocaine and heroin drug traffickers."

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PFCT, Morganovich and his sidekick Methinks not only believe rock climbing and smoking pot are similar activities, they also believe slavery (for some) is the same as illegal drugs (for all), when speed limits aren't enforced, drivers won't drive faster, legalizing crack cocaine won't lead to more crack babies, etc.

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Morganovich says: "it's an argument for consistency."

The consistency is not promoting alcohol and illegal drugs.

Decriminalizing marijuana is an inconsistency.

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Morganovich, no matter how much data you're shown (rather than propaganda), you remain confused.

Decriminalization increases drug use. Prevention and treatment decrease drug use.

I guess, you won't be happy till there are millions of more marijuana users.

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Morganovich says: "estimated $40bn a year drug taxes would raise."

I've shown you data on alcohol that with over 100 million users, total taxes are $20 billion a year (social costs are roughly $200 billion a year).

It's similar with tobacco, given 60 million users, total taxes are $20 billion a year (which is many times less than health care social costs).

Even if every American over 18 was a drug user or addict, I doubt $40 billion a year could be raised in taxes.

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Morganovich and VangelV, you two want to promote drug use and you call me "morally bankrupt!?"

Your weak methodology and make believe data don't dispute any of my statements. You don't even see the contradictions in your estimated data.

If you want to believe in things that aren't true, you have that right. You've certainly exercised that right often.

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"by what consistent legal and moral standard does the government have the right to prevent americans from making their own recreational choices so long as those choices do not violate the rights of others?"

I stated before, if drug users can afford their private costs and external costs were small, I'd be for drug legalization.

However, the devastation is massive. So, why promote illegal drugs?

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Why promote alcohol or illegal drugs when the devastation is massive.

Do we need more alcoholics and drug addicts?

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Unlike others (which we see on this site), I started from an unbiased position (not the "wrong side").

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I'm sure drug users would prefer taxes, regulation, monopoly power, predatory pricing, etc. over the guilt caused by their demand for illegal drugs (which many can't control).

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Morganovich, why do you find my statement of starting from an unbiased position so hard to accept?

You should try it.

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bart said...

"turn out the variable most correlated with drug use is wealth.

i guess we just need to become poorer to stop this menace..."

My admiration for your most excellent and awesome perspicacity and expertise in finding the simple solution is boundless?

(and just in case, that's sarcasm)

And more seriously, that is a surprise about the wealth correlation - wouldn't have thought it was germane at 1st glance, but it's also not an area of expertise for me. Thanks.

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PeakTrader said...

Yet, marijuana use is up in a depression:

Teen drinking, smoking continue to decline, but pot use is up
Los Angeles Times
December 15, 2011

One in four of the 47,000 teens surveyed for the 2011 Monitoring the Future report said they had used marijuana during the last year, up from 21.4% in 2007.

The survey, which polled students nationwide in the eighth, 10th and 12th grades, also found that 1 in 15 of the oldest students used pot on a daily or near-daily basis — the highest rate since 1981.

The survey also revealed that teens don't think of marijuana as dangerous. Because of that, "we can predict that use of marijuana is going to increase," said Dr. Nora Volkow, director of the National Institute on Drug Abuse, which funds the annual study.

That pot has become more widely used as more states legalize the use of medical marijuana cannot be ignored, said R. Gil Kerlikowske, director of the White House Office of National Drug Control Policy.

"We know that any substance that is legally available is more widely used," he said.

The rise of marijuana use is largely responsible for an overall increase in youth drug use over the last four years, said study leader Lloyd Johnston of the University of Michigan's Institute for Social Research, which conducts the annual survey.

When marijuana is taken out of the equation, the proportion of teens reporting they had used any illicit drug declined through the first half of the 2000s and has been stable over the last three years.

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How much wealth was lost again between 2007 and 2011?

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Morganovich says: "what is the legitimate role of government and how does that role allow them to ban personal choices that do not violate the rights of others."

Actually, I answered your question before. I'll answer it in another way.

Whether or not you like a law, if you break it, you should be punished, right?

Why should someone who obeys the law be punished by the law-breaker's ignorance, selfishness, carelessness, etc.?

Should people have the right to choose which laws they want to obey?

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PeakTrader said...

I wonder what happens without a War on Obesity.

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Morganovich says: "i suspect it will be about as successful as the war on drugs."

Yes, there would be much fewer fat Americans and much fewer fatter fat Americans.

Of course, some people, like Methinks, believe epidemics are good, e.g. to control population.

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Morganovich, all you've shown me is how desperate you are by declaring drug laws are bad, and citing studies that contradict U.S. data.

You cite biased studies, including from the WHO (which is also pro-socialized medicine, ranking U.S. health care below Cuba), and Cato (a libertarian institute).

You also cite studies that have nothing to do with decriminalization on drug use, or omit prevention and treatment factors.

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http://www.blogger.com/comment.g?blogID=28997633&postID=4252074849062494958

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Portugal Info:

http://www.blogger.com/comment.g?blogID=28997633&postID=1159745899120278967

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PeakTrader said...

People who think Obama is doing a good job on the economy must be on drugs.

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PeakTrader said...

Despite enormous propaganda, marijuana is not medicine or candy:

Myth: Marijuana Is Medicine
May 02, 2012

"The scientific and medical communities have determined that smoked marijuana is a health danger, not a cure. There is no medical evidence that smoking marijuana helps patients. In fact, the Food and Drug Administration (FDA) has approved no medications that are smoked.

Marijuana remains in schedule 1 of the Controlled Substances Act because it has a high potential for abuse, a lack of accepted safety for use under medical supervision, and no currently accepted medical value.

The American Medical Association has rejected pleas to endorse marijuana as medicine.

The National Multiple Sclerosis Society stated that studies done to date "have not provided convincing evidence that marijuana benefits people with MS."

The British Medical Association has taken a similar position, voicing "extreme concern" that downgrading the criminal status of marijuana would "mislead" the public into thinking that the drug is safe to use.

The IOM (Institute of Medicine) further found that there was no scientific evidence that smoked marijuana had medical value, even for the chronically ill.

Gateway Drug

The Journal of the American Medical Association reported, based on a study of 300 sets of twins, that marijuana-using twins were four times more likely than their siblings to use cocaine and crack cocaine, and five times more likely to use hallucinogens such as LSD."

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