Prohibition versus Legalization

1. Prohibition versus Legalization Do Economists Reach a Conclusion on Drug Policy? by Mark Thornton

2. What to do? • Keep current policy on drug prevention? • Increase spending and efforts? • Decriminalize and/or legalize drugs?

3. War on Drugs • Economists have at the forefront of the debate. • Criticism of ineffectiveness • Unintended Consequences • Violent crime • Corruption of police • Corruption of public officials

4. War on Drugs • Costs (2005): • US Gov’t cost report on drug control; $12b • In a separate US Gov’t report; • Incarceration: $30.1b • Police protection: $9.1b • Legal costs: $4.5b • State & Fed corrections: $11.0b • Total : $34.7

5. Survey of Economists • 15% favored status quo • 21% favored increased efforts • 58% favored a change in policy • 71% favored legalization or decriminalization • <2% favored stiffer sentences and increased enforcement budgets

6. Survey of Americans • 36% favored legalization or controlled distribution of most drugs • 40% believe decriminalization of cocaine would reduce violent crime • 3-1 margin preferred addiction treatment and counseling for drug users over fines and/or imprisonment

7. Demographic Characteristics • Characteristic Reformers Prohibitionists • Sex Male Female • Race White Nonwhite • Education College or more Grade School • Occupation Professional/Farmer Clerical/manual • Income level High and Middle Low • Age Young and Middle 50+ years • Region Northeast and West South • Religion Jewish or none Protestant • Politics Independent Dem. and Rep.

8. Positions Against • The permanent reduction in price caused by legalization is likely to have a substantial positive effect on use, particularly among the poor and young • Prohibition shows that the society can make a dent in the consumption of drugs through laws.

9. Positions Against • The estimate of al the effects of drug use needs to be improved substantially before it can be determined whether the benefits outweigh the costs of decriminalization. • The elasticity of demand is not zero; • Decriminalization will sharply lower prices • Will lead to a noticeable increase in use of drugs, new users and addicts

10. Positions For • Taxpayers, who are usually not associated with illegal drug activity, foot the bill of the war on drugs • Tax revenues from legalized drugs could fund drug education and rehab

11. Positions For • Prohibition has, at least in part, led to; • Increase in street crime • Increase in gang activity • Police corruption • Congested courts • Overcrowded prisons • The repeal of alcohol prohibition led to the demise of bootleggers

12. Conclusion • The general consensus among drug-policy researchers and economists is in opposition to prohibition • Still, only timidly in support of decriminalization and even more timidly in favor of legalization

13. Conclusion • The ONLY feasible way to eliminate the black market for drugs is to legalize them • The legalization of drugs will lead to some, maybe different but nonetheless, problems • Much more research needs to be conducted before a legalization policy is enacted

14. Work Cited • Thornton, Mark 2007. Prohibition versus legalization. The Independent Review, Winter 2007, pp417-433.