Posted on 08/11/2014 6:13:42 AM PDT by Kaslin
America’s first foray into rolling back prohibition 2.0 is barely underway, and already marijuana prices have dropped low enough to convince some cartel farmers in Mexico to abandon the crop. Mere months after two US states legalized marijuana sales, five Nobel Prize-winning economists released a UN report recommending that countries end their war on drugs. It would seem they were onto something. But in order to further decrease drug-trade violence in so-called producer states, the US first needs to legalize marijuana, but then also the US must stop using the UN to pressure producer countries into supply-based drug prohibition.
Latin America is the largest global exporter of cannabis and cocaine. In 2011 the DOJ’s now-shuttered National Drug Intelligence Center found that the top cartels controlled the majority of drug trade in marijuana, heroin, and methamphetamine in over 1,000 US cities.
Research into black markets shows that producer countries experience more violence than consumer countries. In essence, the global war on drugs is a UN scheme to shrug drug war costs off rich countries’ shoulders and onto poor Latin American countries, with horrifyingly violent results. Much of the recent child migrant crisis is a direct result of children fleeing cartel violence and conscription into criminal gangs.
When drug prices are high, cartels will step up and produce. By keeping demand for cannabis and cocaine high, but supply low, the US in essence forced the Latin America economy to revolve around drugs. Under prohibition, there is no more profitable export. And of course violence proliferates in illegal industries. So in countries where the dominant export is illegal, violence will be endemic.
That’s exactly what the five economists found.
Every single one of the 20 cities with the highest murder rates in the world are in Latin America. Half of the top 10 global kidnapping hotspots are Latin American countries. Time magazine reports that the violence in the murder capital of the world, San Pedro Sula, Honduras, is due to the influx of Mexican drug cartels that funnel U.S.-bound drugs through the country. The cartels are also responsible for an increase in “atrocious crimes” like decapitation, usually used against rival gangs.
Ending the Drug Wars describes drug prohibition as “a transfer of the costs of the drug problem from consumer to producer and transit countries.” It references a report called Drugs and Democracy: Toward a Paradigm Shift by the Latin American Commission on Drugs and Democracy, headed by former Latin American presidents Fernando Henrique Cardoso, Cesar Gaviria and Ernesto Zedillo found that Latin America’s willingness to cave to first-world pressure has had horrific results, including:
The 200-percent growth rate of the illegal drug market between 1994 and 2008 explains roughly 25 percent of the current homicide rate in Colombia, according to recent research. That means Colombia sees about 3,800 more homicides per year on average associated with the war on drugs.
But when drug prices drop, the cartels will move onto other schemes. VICE News asked retired federal agent Terry Nelson whether legalization was hurting the cartels. “The cartels are criminal organizations that were making as much as 35-40 percent of their income from marijuana,” Nelson said, “They aren’t able to move as much cannabis inside the US now.”
America, the United Kingdom and other wealthy states are epicenters of demand. Not only do demand states prohibit drug production and sales within their borders, but have traditionally used the UN to bully producer countries to do the same through moves such as the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances of 1988 or the US annual certification process.
And for what? The report points out that worldwide drug prohibition has succeeded in raising prices on illicit drugs. This may have impacted rates of use in consumer nations. Even if higher prices suppress demand, for which there’s little evidence, there is simply no way to look at the worldwide cost of prohibition as being worth that possible outcome.
“There is now a new willingness among certain states, particularly in Latin America, to be vocal about the inherent problems within the system and to try to extricate themselves from the global drug war quagmires,” according to Ending the Drug Wars.
Ending the Drug Wars acknowledges the “microeconomic contradictions inherent in the supply-centric model of control.” It calls out the UN for trying to “enforce a uniform set of prohibitionist oriented policies often at the expense of other, arguably more effective policies that incorporate broad frameworks of public health and illicit market management.”
However, the ultimately unresolvable problem with prohibition is that:
In a world where demand remains relatively constant, suppressing supply can have short-run price effects. However, in a footloose industry like illicit drugs, these price increases incentivise a new rise in supply, via shifting commodity supply chains. This then feeds back into lower prices and an eventual return to a market equilibrium similar to that which existed prior to the supply-reduction intervention.
Fixing this problem might be the most exciting part about ending America’s war on cannabis. Prices will continue to drop as American growth flourishes. Get ready for cheap, high-quality weed. And as prices drop and the supply side moves into the white market,cartels will get out of the game. And just as ending alcohol prohibition greatly diminished the size, influence, and brutality of organized crime, so will legalizing weed diminish the size, influence, and brutality of Mexican cartels.
As the epicenters of supply, Latin American countries resemble America’s inner cities, wracked with violent crime and corruption. Demand countries, however, resemble America’s suburbs, where the size and scope of the violence pales in comparison. Considering the power wielded by rich countries compared with poor ones, it shouldn’t be surprising that they’d be successful in using international pressure to turn poor countries into lawless killing fields. What’s galling is that they would choose to use their power this way, and get away with it for decades.
Prohibition doesn’t work. But the way it doesn’t work varies greatly depending on whether a state is primarily a producer or a consumer of illicit substances. Stopping international pressure on producer countries is the first step to a fairer, more effective international approach to drugs.
So they’ll up meth and heroin production.
Yup, this will follow the end of prohibition....the former illegal sellers will become the new legal distributors.
Reminds me of when I was a kid, I asked my dad why were the numbers and bookmaking illegal. My dad said to me as soon as the state figures a way to make money off it, it will be legal son. That was 50 years ago, long before lottos and off track betting.
Using the same logic. Let's prohibit murder.
If prices actually dropped that low, then prices in the legal stores would likely be higher than street prices...and the illegal trade would continue to do well, killing the State profits.
Except the mob offered better odds.....
We'll have to legalize those next. /S
Well, not really. Under prohibition organized crime made so much money that by the time it ended they had huge amounts of ill-gotten capital to invest in more lucrative enterprises.
Which is the Mafia basically owned NYC in the 1970s, with the Gambino family pulling in an estimated $500mm per year. And that was back when $500mm was a lot of money.
But I do agree, and have often argued, that making drugs illegal is what raises the price and makes it an attractive business for organized criminals.
Too bad the War on Drugs has already financed all the Cartels to the point where they have become ubiquitous in America.
US Marijuana Legalization Already Weakening Mexican Cartels.
BS tons of the stuff is smuggled every day to keep up with the demand in California the DEA can’t keep up with them even the LA time reports it.
armed robbery of wacko weed shops don’t count as violence?
If legalizing dope ends dope crime maybe they should legalize robbery, rape and other criminal acts too.
Then there won’t be any crime at all.
/s
stop! It makes too much sense! My brain is exploding from the simple logic and clear analogy to alcohol Prohibition’s effect on US criminality!
Enter stage right, Darwinism. Both of those drugs as well as cocaine are like catching a wasting disease.
Personally I can’t understand how anybody can tolerate opiates and the constipation that comes along with frequent usage.
Well somewhat, 600-1 on a number but small pots vis a vis lotto and track odds on horses up to a certain limit of odds, usually 30 to one in my areas but what they did offer was credit...they had excellent loan collectors!
America’s first foray into rolling back prohibition 2.0 is barely underway, and already marijuana prices have dropped low enough to convince some cartel farmers in Mexico to abandon the crop.
Nah, I call BULLSHIT!
These are people that kill as easily as they take a leak. Not going to give up a profitable business without a fight.
The Current FReepathon Pays For The Current Quarter's Expenses?
What makes drugs attractive to organized crime is profit. Profit requires sales, which comes from demand.
Nothing is being done to address demand. If anything use of these drugs is being encouraged.
Right, because bootleg liquor competes well when anyone can pick up booze at the store.
As long as users go unpunished, legalization is the only option.
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