Wednesday, June 27, 2012

The Global Drug War in Numbers: 270 Million Users; a $330 Billion Black Market; $100 Billion in Wasted Law Enforcement

The Global Drug War in Numbers: 270 Million Users; a $330 Billion Black Market; $100 Billion in Wasted Law Enforcement:
The United Nations Office on
Drugs and Crime released its annual report today on
the state of the global drug war
. Despite some concessions
about the need for increased funding of rehabilitation, the report
does not bode well for drug policy reform advocates. The U.N.
insists that legalization, which more and more countries in Central
and South America are considering, would lead to substantial
increases in drug use; that crop eradication efforts need to be
supplemented with market-distorting subsidies to farmers; and that
international police efforts need more funding. In other words, the
U.N. wants to do more of everything it's already doing in the war
on drugs.
If there's a silver lining—and that's a big "if"—it's the U.N.'s
acknowledgement that guns and chains are not the best way to treat
drug use, and that the global drug war has had some unintended
consequences. On that first point, the U.N. report states that
there is growing recognition that treatment and
rehabilitation of illicit drug users are more effective than
Of course, this does not mean abandoning law enforcement
activities; instead, the supply and demand sides need to
complement each other. This means balancing
our efforts against drug trafficking with alternative
development programmes for farmers and helping drug users
to be rehabilitated and reintegrated into
Because the U.N. employs "user" and "addict" interchangeably
throughout its report, the implication (as noted in the passage
above) is that all 270 million people who used drugs in 2010
(the U.N.'s most recent estimate) are social outcasts. That's
simply not true.
The other arguable silver lining is the U.N.'s admission that
the drug war has had unintended consequences:
The development of black markets and the opportunities they
create for organized crime have been among the unintended side
effects. Black markets are not specific to controlled
psychoactive substances, of course, as they affect a broad
range of regulated or prohibited goods and services. Effective
drug control measures seem to have given rise to another main
category of unintended consequences in illicit drug markets.
These are various replacement or displacement effects, sometimes
generically referred to as the “balloon effect.”
The list of unintended consequences doesn't end there, but you
won't find the others in the U.N.'s report. For that, we'll turn
to the U.K.-based Count the Cost Initative's "Alternative
World Drug Report
." The Count the Cost Initiative was started
by the Transform Drug Policy Foundation as a way to tally the cost
of the drug war. This year's numbers are pretty stark: 270 million
users; a $330 billion black-market economy; $100 billion in wasted
law enforcement dollars.
Count the Costs makes the case that the unintended
consequences of prohibition affect everything from the environment
(crop eradication efforts lead illegal groups to use protected
forests) to public health (the creation of designer drugs and the
cutting of traditional drugs with harmful chemicals) to human
rights (roughly 1,000 people a year are executed for drug-related
crimes, and in many other countries, sentences are disproportionate
to the crime).
Some other big financial data points from Count the Costs'
  • In 1998, the International Monetary Fund estimated that
    total money laundering represents 2-5% of global GDP. In 2009,
    the UNODC put the figure at 2.7% of global GDP, or
    US $1.6 trillion. 
  • According to the former head of the UNODC, Antonio Maria
    Costa, there was strong evidence that funds from drugs and
    other criminal activity were, “the only liquid investment
    capital” available to some banks at the time. He said that,
    “inter-bank loans were funded by money that originated from
    the drugs trade,” and that, “there were signs that some banks
    were rescued that way.”
  • Drug-related corruption causes Mexic to suffer investment
    losses of up to $1.6 billion annually.
  • Prison spending in the U.S. increased by approximately
    127% between 1987 and 2007.
  • In producer countries, state security agencies and the
    military often benefit greatly from increased enforcement
    efforts. In Colombia, for instance, defence expenditure
    increased from 3.6% of GDP in 2003 to 6% in 2006. This
    resulted in an actual increase of security forces from 250,000
    (150,000 military plus 100,000 police) to 850,000 over the
    four years.
The big questions I had from skimming these two reports was
this: Why doesn't the U.N. acknowledge the human costs of
prohibition? And why does the U.N.'s report fail to mention the
ongoing success of decriminalization in Portugal?
The Alternative World Drug Report suggests an answer:
"Established under the three drug conventions, [the UN Office
of Drugs and Crime's] default position is to defend these
conventions, and seek consensus among the member states it
serves. This lends itself to inertia rather than challenging the
system it operates within."
The Count the Costs report serves as much-needed balast to the
inflexible prerogatives of the UN Office of Drugs and
Crime. Another
report out today
by the reform-minded Global Commission on Drug
Policy finds that prohibition is leading the to spread of
infectious diseases such as HIV/AIDS and tuberculosis.