I’ve made the point before (here and here) that drug
prohibition is a losing battle. In order to deter drug use, you have to raise
the cost faced by the consumer of drugs. In this post I want to make a simple
scaling argument. My conclusion will be that the costs of prohibition most
likely scale faster than the benefits.
Supposedly drug users irrationally harm themselves with
their nasty habits, so we have to stop them. That’s a typical rationale for
drug prohibition: People don’t fully account for the cost of their vices, so it
would be good to stop them from indulging. But then these supposedly irrational
drug users are presumed to respond rationally to legal sanctions. It’s akin to believing,
“People don’t respond rationally to the [pharmacological] risks of drug use,
but they do respond rationally to the [legal] risks of drug use.” Say the
sentence without the words in square brackets to see the obvious contradiction.
Maybe we can be more precise than this hand-waving.
Let’s suppose a potential drug consumer faces a price “X”. This
X is the full economic cost to the user. It factors in the money paid to obtain
the drugs, the time spent acquiring and using them, the potential health risks
of using, the potential shame and social sanctions if his use is discovered,
potential harassment by police, jailing, prison, etc. You can express X in any
units. “Dollars” would be the most obvious: monetize the time value and the health
and legal risks and roll it all up into a clean dollar figure. Or you can
express it in “man-hours of labor,” or “% risk of completely ruining your life,”
or “expected years (or months or days or hours) spent in misery.” It doesn’t
matter for our purposes. I’m not going to try to estimate what this cost is, or
even specify which drug I’m talking about. What matters is that you have this price
called X, and to get you to stop using drugs I have to increase X. This is how
drug prohibition works.
How strongly do you react when I raise X? Maybe there is a
simple inverse relationship, whereby if I increase X by some factor Z, rates of
drug use drop by a factor of 1/Z. So, for example, if I double the cost, I cut
the amount of drug use in half. Taking that example, we have half as many
users, but they are all paying twice the cost! It’s a wash! (By the way, I am
leaving out *many* of the other costs of drug prohibition.) The chart below
shows what this relationship looks like (simple inverse-relationship chart
here). It is impossible to achieve “success” in this world. Hammer the users as
hard as you like. The total cost will stay flat. This is a losing game,
especially when you factor in the cost of waging a drug war.
(The “quantity consumed” is in arbitrary units. It doesn’t
matter whether “5” means “5 metric tons per year” or “5 million users,” and
again it doesn’t matter what drug I’m talking about or what the real-world
value is. I’m simply making a scaling argument here, so the actual values don’t
matter. These are *not* supply-and-demand curves from economics 101, which
traditionally cross and tell you the market price and quantity supplied. Although
the “Quantity Consumed” curve *is* actually a demand curve. If it’s confusing
that I’m recycling the y-axis for three different kinds of values, don’t get
hung up on it. My point is to show how total costs scale up with the price
faced by the user.)
But maybe there’s reason for hope! Maybe it’s not a 1/Z
relationship, but more like a 1/Z^2 or a 1/Z^10 relationship between price and
total use. If this is the case, we do added harm to the remaining users, but
those remaining users drop off quickly. Quickly enough that the total cost
falls. Anything with a 1/Z^(anything greater than 1.0) relationship will show
this falling cost pattern. The chart below shows what a 1/Z^1.5 relationship
looks like.
Success! The cost falls when you hammer drug users with
harsher penalties. (Once again I’m ignoring a whole host of other relevant
costs.)
Is the above scenario reasonable? Not really. It assumes
that drug demand is fairly elastic. “Demand elasticity” is usually expressed as
a (% change in demand) / (% change in price). If you increase the price by 1%
and demand falls by 2%, the elasticity is 2.0 (demand is fairly elastic). If
you increase the price by 1% and demand falls by 0.5%, the elasticity is 0.5
(demand is fairly inelastic). Very roughly, inelastic demand means people are
willing to pay quite a bit more to keep buying the product; elastic demand
means that people buy quite a bit less when the price rises significantly.
Demand for drugs is actually quite *inelastic*. You can
raise the price by a lot and you get a small demand response. Measured elasticities
for common addictive substances (tobacco, alcohol, heroin, cocaine) are
typically in the -0.3 range. So the relationship between cost and quantity
probably follows more like a 1/Z^0.5 (anyway, 1/Z^(something-between-0-and-1)
relationship, probably closer to 0 than 1). A 1/Z^0.5 relationship gives you a
picture like the following:
The total cost *increases* as you increase X. There are
fewer users, but they each face a much greater cost. Doubling the price doesn’t
quite cut the using population in half, so you have *more than* half as many
users each facing twice the cost. Here prohibition is clearly a losing game. It
does you no good to hammer the users with stiffer sanctions because the costs
scale up *faster* than the benefits.
Quite a lot is left out of this analysis. Harm to third
parties is ignored, but then many of the costs of *prohibition* (as opposed to
the costs imposed by the users themselves) are born by third parties. It’s not
at all clear that accounting for the costs to third parties swings the analysis
in favor of prohibition. Indeed, including those costs would most likely strengthen the case *against* prohibition. Also consider that many of those “costs
to third parties” involve behaviors that are already sanctioned. Economic
crimes to acquire drug money, pharmacologically induced violence (which despite
a few scare stories is grotesquely exaggerated by the popular media), child neglect, and driving
under the influence are already criminalized. If the goal is to deter these
behaviors, we should crack down on them specifically. It makes no sense to
focus our law enforcement resources on a behavior that kinda sorta sometimes
leads to these other social problems. Address those problems directly if they
are problems worth solving. If someone wants to do a more thorough accounting
of these third-party costs, I’d love to see it. But please don’t dismiss my
argument because I left out this consideration.
I want to clarify that my above argument does *not* apply to
all crimes, but it does apply to all crimes in which the criminal harms
primarily himself. The prohibition
approach makes the following deal with such “criminal”: “I’m going to harm you
if you indulge in self-harming behavior X.” The vice-criminal already faces an
implicit tax on the vice, in that such a vice has intrinsic harms. ("Vice-criminal" contains
a wonderful double-meaning; a vice-criminal is not really a criminal, in the
same way that the vice president is not really the president.) A real criminal
is someone who primarily harms a third party, but whose crime imposes minimal
cost/risk to himself. Sanctioning a crime raises the price from something negligible to something large. Sanctioning a vice raises the price from “already substantial” to “somewhat
more substantial.” If you’re trying to deter a vice with inelastic demand, it’s
hard to gain any ground. We should approach vices with “harm reduction,” not a
prohibition approach. I don’t’ doubt that there are real harms associated with many
vices. These are costs to be managed, not
problems to be “solved.”
No comments:
Post a Comment