Legalise drugs, save money

April 23, 2009 at 9:11 pm | Posted in Drugs | 1 Comment

I don’t know whether this is a flaw or a strength, but frequent visitors will notice that I tend to fixate on issues for several weeks before moving on to something else. I did it with the US elections, with the conflict in Gaza and with the fight over Pakistan’s SWAT valley; more domestically, I’ve done it on the issues of prison reform, reform of the asylum system, the welfare state and domestic violence. Sure, I always return to these issues every once in a while, but more often than not they’re squeezed between some other new issue which I’m reading feverishly about.

I often wonder whether this habit comes across as a kind of skittishness; as if I don’t have the discipline to devote myself entirely to one topic and instead skim superficially over issues which always require more words than I’m able to give.

For what it’s worth, the reason I do it is to keep myself interested as much as anyone else. Most of what I write is based on information, arguments or analyses I didn’t know existed beforehand, and so the act of blogging is also an act of learning something new. On top of that, I like the space blogging gives you to develop interests over many months and years, with this site basically acting as a repository for different thoughts or events or scraps of information which can be dug up at a later date. I’m not sure if that’s what Iain Dale intended when he invented the political weblog, but it works for me.

Anyway, let’s cut the self-obsessed meandering and return to my Latest Blogging Obsession: the War on Drugs. I realised last night that whilst my last two posts on the topic (the disastrous consequences of prohibition in Mexico and the benign effects of decriminalisation in Portugal) were tangentially related to ending prohibition in Britain, this place was still missing something more Anglocentric which could give the argument greater force. By happy coincidence, earlier this month the drug policy group Transform released a cost-benefit analysis on the effects of prohibition to the tax payers. It makes for incredibly instructive reading.

In 2003, the Cabinet Office estimated that the harms arising from drug use cost the taxpayer £24bn a year, £16bn of which was from acquisitive crime (ie an addict mugging an old lady in order to get his/her fix). On the occasions it’s been challenged on whether it makes sense to be spending all of this money, the government has replied that the costs far outweigh any benefits which may be brought by legalisation. No, they’ve never conducted a thorough study to prove this is the case and have never intended to; we’re just supposed to trust them.

So how can legalisation reduce the acquisitive crime which stems from addiction? Mostly because of this:

markup

Supply chains and subsequent mark-ups for cocaine and heroin in the UK (Click to enlarge)

The image above shows the average price of cocaine & heroin at every stage of distribution from the farm in Columbia through to some dimly-lit inner city street corner in the UK. As you can see, the price mark-up is quite extraordinary, and reflective of several factors: global prohibition, the risk involved at every stage of the supply chain and the cost of protecting one’s territory/supply chains through force, coercion, human trafficking and bribery. The logic of this report is simple: legalisation should dramatically reduce the street value of these substances and as a result lead to a drop in the billions we spend prosecuting acquisitive crime. As the table below shows, the costs for heavy users of the most addictive class A drugs can run into thousands of pounds a month, which then costs us billions every year when they turn to crime to pay for it.

The estimated cost of drug use for a heavy user in 2003/04 (click to enlarge)

The estimated cost of drug use for a heavy user in 2003/04 (click to enlarge)

At this point, it’s worth remembering one of the key findings from Glenn Greenwald’s report on Portugal. There, decriminalisation removed the legal stigma of drug abuse and led to more addicts seeking treatment. I don’t think it’s unreasonable to assume that the same thing could happen if the British state legalised drugs.

So how much money does Transform think taxpayers could save through legalisation? Well, it’s important to recognise that without the kind of information-gathering abilities which only a state can possess, much of this relies on estimation, but the group has used the best available evidence and come up with four different scenarios:

scenarios

As you can see, even with a 50-100% increase in drug use under legal regulation (a scenario which seems unlikely given Portugal’s experience), the state could still save somewhere between £4bn and £7bn that it currently spends on prohibition. Are these figures innacurate? It’s difficult to say, but they certainly make a strong case for a thorough cross-departmental review to determine how much money could be saved.

It’s getting late, so I’m going to wind this post up and try to write something more succinct over the weekend, but for now I’ll leave you with this as a well-worded explanation of why legalisation/decriminalisation is an issue which deserves far more rational policy debate than it currently receives:

Current approaches ignore the basic finding that the policy of prohibition itself is the direct source of what is perceived as ‘the drug problem‘ – specifically the vast majority of drug-related crime – rather than drug use per se.  The Government has also repeatedly failed to acknowledge that prohibition is a policy choice, not a fixed feature of the policy landscape that must be worked within, or around.

The political context of these analytical shortcomings cannot be ignored. Whether it is an ideological commitment to prohibition, investment in populist drug war posturing, or fear of the domestic and international policy implications of questioning the status quo, there are clearly substantial obstacles to mainstream policy makers moving forward on this issue that have nothing to do with rational policy analysis and debate.

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  1. I think most people would agree that saving money is something “easier said than done”. Personally, I believe it’s a mind-set that needs to be developed by creating good money-saving habits.

    Here are some things I’ve done to help change my spending habits:

    – Cook more at home ( Eating out is very expensive especially
    if you do it a couple times a week
    – Try shopping online ( You can find better deals than in the
    store and you save on gas (I recommend  HYPERLINK
    “http://www.shoptivity.com” http://www.shoptivity.com)
    – Pay the full balance on credit cards each month ( Interest
    charge is like giving away free money
    – Don’t forget to pay yourself ( Set up an online savings
    account (they pay higher interest than a normal savings
    account)
    – Set a budget and goals ( It’s good to have your goals
    written down so you see them everyday and don’t lose focus
    on your ultimate objectives

    Again, saving money requires a lot of patience and hard work. However, you’ll thank yourself later on in life. Good luck everyone!! =)


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