Posts Tagged ‘efficiency test|’

Hypocrite, Who?… Moi?

Monday, February 7th, 2011

It is well known that Europe (taken as a whole) is the second largest consumer of drugs in the world, after the USA. It is also well known that the attitude of European countries towards the demand for drugs, more specifically, personal consumption of drugs is far from uniform. A quick glance at the current legislation on drugs will show that it covers the whole spectrum, from ‘criminal prosecution’ of drug users at one end, to ‘harm reduction’ and ‘tolerance of consumption’ at the other end.[1] Of those countries which have opted for more lenient approaches to tackle the so-called ‘drug problem’, some have, implicitly or explicitly, depenalised the personal consumption of certain drugs (particularly, marijuana) while others have gone the extra mile and have explicitly decriminalised it—with Portugal at the top of the list as the only country that has decriminalised the personal consumption of ALL drugs, including cocaine and heroin.[2]

Whether the consumption of drugs is depenalised or decriminalised, whether these policies are incorporated into the current legislation explicitly or implicitly, the policies adopted by those European countries have a factor in common: the production and distribution of drugs remain illegal, and the prohibition to engage in these activities continues to be enforced via the policies covered under the umbrella of the War on Drugs (WoD).

I have said it many times, and I say it again: I am fully in favour of the legalisation of the demand for all drugs. However, is it not rather hypocritical and self-serving to think that it is all well and good for us to say that we need to deal with the demand for drugs through means other than the penal code, but when it comes to the supply of drugs, the call is for tougher and tougher enforcement of the prohibition to supply them?

Do countries that have decriminalised or depenalised the demand have a moral obligation to introduce changes in national and international laws to seek the decriminalisation or depenalisation of the supply, too? What sort of policies, initiatives or programmes have drug consuming countries put forward to that effect in the recent past? Do drug consuming countries that have opted for ‘soft’ policies for the demand for drugs have effective incentives to seek equivalent policies for the supply, given that the bulk of the catastrophic effects of the WoD are borne by producing and distributing countries?

It can be argued that decriminalisation or depenalisation of the demand is a step in the right direction, albeit an indirect one, towards achieving a similar status for the supply of drugs, as the case for keeping the prohibition on the supply will be eroded, slowly but surely, as the number of countries following these policies increases. I have no doubts that some advances will be made in the long run, but as the famous economist John Maynard Keynes used to say, in the long run we are all dead.

So, even though I do accept that those demand policies may have a positive effect, the fact is that there is little to show on that front, so far. Let’s see, personal consumption in Spain, generally speaking, has never been considered a crime, Holand’s policies have been in place since the 1970’s and Portugal’s decriminalisation of all drugs, since 2001. I do think that one is entitled to ask several questions:

  • Have we seen an erosion of the WoD throughout this period? Hardly. If anything, the cries for tougher prohibition laws have increased as a whole during the intervening decades. What is more perverse, the greater the havoc created by the enforcement of the WoD, the louder the voices calling for measures even more draconian than the present ones—assuming that is possible.
  • Have we witnessed any qualitative change in the way the supply of drugs issues have been and are being debated either nationally or internationally? Again, the answer is, hardly. It is true that the denouncement of the irrationality of the WoD has been growing louder and louder with time, and the inefficacy of their policies is there for all to see. But does it mean that the discourse about the supply of drugs has experienced a major shift? I really doubt it. Much of what Milton Friedman said back in 1972,[3]just to mention one distinguished critic of the WoD, continues to be relevant and applicable to the current situation.
  • Have national or international laws moved in parallel with the changes introduced in a large number of countries all over the world to meet the demand for drugs? The answer is a categorical no. Just the opposite. If one looks at the international legislation at the centre of the WoD,[4] what one sees is a progressive hardening of the prohibitionist position and the increasing ascendancy of the voices calling for stiffer criminal penalties.

Partial legalisations—in the case we are discussing, depenalisation or decriminalisation of the demand for drugs—are fraught with inconsistencies and distortions, which could undermine the case for the implementation of a generalised legalisation.[5]

From an economic point of view, partial legalisations fail to recognise two major economic facts: one, that the demand for drugs is highly inelastic and two, that the supply of drugs, like any other illegal market, manages to extract high rents (i.e. profits) because it is illegal; and because it is illegal and highly profitable, those in control of this market are willing and able to resort to any means to protect and secure the benefits satisfying a ‘captive’ demand procures.[6]

And that is not all, for partial legalisations not only fail the economic test, they fail the efficiency and the moral tests, too. As far as the efficiency test is concerned, partial legalisations run the risk of what I call the half-measure paradox; that is, that because we have not being totally committed to the application of the best solution to solve a problem, instead of being more thorough in its application, we abandon the right solution in favour of a second best solution. In our case, we know that legalisation is the best solution to the drug problem, and instead of being thorough in its application and liberalise both sides of the market, we go half-way and only depenalised or decriminalise the demand. If this solution fails (i.e. the market for illegal drugs not only does not decline but grows) we wrongly conclude that the problem is the solution (legalisation) and not its implementation (partial legalisation). In other words, we fail to recognise that the reason for the failure is not that we applied the wrong solution, but that we did not apply it properly.

What about the moral test. Well, I always feel a little bit uneasy playing the moral card, even though I do believe that all judgements and actions are intrinsically and unavoidably moral in nature (but that is a different discussion). Anyway, the point is that legalising the demand side of the drugs market is equivalent to relieving drug consuming countries of any responsibility we may have, and we have a lot, in the state of affairs regarding the illicit drugs market. We may not like it, we may even get angry with anybody suggesting it, but as I said in my previous post, our demand, and our willingness and ability to pay for illegal drugs, are sufficient and necessary conditions to make the supply of drugs possible and to sustain and stimulate its relentless growth. So, I find it rather cynical the way some drug consuming countries have decided to concentrate exclusively on their side of the fence, the consumption, and completely ignore what is happening on the other side, the production.

Never mind the havoc our demand for drugs is creating in drug producing countries, we have decided that what matters is what is happening at home. It is indeed highly hypocritical that despite the fact that it is our demand which underpins and sustains the ‘drug trafficking business’, we continue to show a total lack of commitment to seek real changes in the legislation, a state of affairs that, to be frank, is tantamount to turning a blind eye to the catastrophic consequences the WoD is having on drug producing countries.

I do not have any doubts that the decriminalisation of the demand for drugs is a sensible policy, but if we were serious about tackling the ‘drug problem’, we should be accompanying those same policies with equally sensible policies towards the supply of drugs. We should also be promoting the legalisation of the supply. We should be the ones making all the noises calling for a change in the national and international legislation on drugs. In a nutshell, we should be spearheading the movement seeking to legalise the production and distribution of all drugs.

I have run out of space but there is an argument that I would definitely like to tackle in the next post and is this: it has been argued that the reason why consuming countries have not being pro-active in seeking the legalisation of the supply of drugs is because no country has legal footings to decriminalise the supply (for non-medical purposes) in the same way they have to decriminalise the demand (for personal consumption purposes).

As I will show in my next post, the same argument applies to drug producing countries as well, as the recent attempt by the Bolivian government to have ‘mambeo’ (chewing of coca leaves) removed from the list of illegal activities so poignantly illustrates.[7]

I hope to see you then. In the meantime, your comments are very much welcome.

  1. [1] An overview of the current legislation on the use and possession of drugs for personal use in the EU Member States can be seen in EMCDDA Illicit Drug Use in the EU: Legislative Approaches, 2005
  2. [2] In order to understand the difference in scope of the drug legislation among European countries it is important to distinguish between legalisation, decriminalisation and depenalisation. As Greenwald puts it,
    «… “decriminalization” means either that only noncriminal sanctions (such as fines or treatment requirements) are imposed or that no penal sanctions can be. In a “depenalized” framework, drug usage remains a criminal offense, but imprisonment is no longer imposed for possession or usage even as other criminal sanctions (e.g., fines, police record, probation) remain available. “Legalization”—which no EU state has yet adopted—means that there are no prohibitions of any kind under the law on drug manufacturing, sales, possession, or usage.»
    See Greenwald, Glenn. Drug Decriminalization in Portugal: Lessons for Creating Fair and Successful Drug Policies, Cato Institute, 2009, p.2
  3. [3] Friedman, Milton. Prohibition and Drugs, Newsweek, May 1, 1972.
  4. [4] The current international legislation on “illicit drugs” revolves around the following three conventions:
    UN Single Convention on Narcotic Drugs, 1961
    UN Convention on Psychotropic Substances, 1971 and
    UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988
  5. [5] Could the same be said in the case of partial legalisation of the supply of drugs? Would our analysis be any different should a drug producing country, say México, decided to depenalised or decriminalised both the production and distribution of drugs and allow the trafficking of drugs to flow unimpeded to countries where the consumption is harshly penalised, say the USA or Sweden…or the UK for that matter?
  6. [6] Economists have contributed extensively to both the analysis of illegal goods markets as well as the Prohibition v Legalisation debate. Some of said contributions can be downloaded from the “Key Research Paper” page in this website. For starters, the following papers are quite relevant:
    Becker, G. S. et al. The Economic Theory of Illegal Goods: The Case of Drugs, NBER Working Paper 10976, 2004
    Miron, J. A. The Economics of Drug Prohibition and Drug Legalization, New School for Social Research, 2001
    Reuter, P. (Ed.), Understanding the Demand for Illegal Drugs, National Research Council, 2010
    Mejia, D. & Restrepo, P. (2011) – The War on Illegal Drugs in Producer and Consumer Countries – A Simple Analytical Framework
  7. [7] See, for instance: The Economist – The costs of drug prohibition: Let them chew coca, Jan 20th 2011
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