International Analysis: LSE Expert Group on the Economics of Drugs

By John Collins and Michael Cox — The Mark News

The global “war on drugs” has created health epidemics, enormous violence, and appalling levels of mass incarceration. Meanwhile, it has achieved none of its stated goals. In fact, over the past few decades, the prices of illicit drugs have been falling while purity has been increasing.

These failures stem from the systemic problem inherent in the “war on drugs” approach: the belief that the supply and use of drugs can be eliminated through crop eradication, interdiction, enforcement, and repressive policies.

At the academic level, we have known for a long time that a “war on drugs” is an irrational way to manage global drug issues. Our recent LSE IDEAS report, Ending the Drug Wars: Report of the LSE Expert Group on the Economics of Drug Policy, contains a call from some of the world’s leading economists, including five Nobel Prize winners, to end the “war on drugs” and experiment with alternative policies:

 It is time to end the ‘war on drugs’ and massively redirect resources towards effective evidence-based policies underpinned by rigorous economic analysis. The pursuit of a militarised and enforcement-led global ‘war on drugs’ strategy has produced enormous negative outcomes and collateral damage.

 These damages are often hard to quantify. There are enormous human rights and legal institutional costs, for instance, to pursuing a “war on drugs.”  Nevertheless, many of the costs of the strategy are clear. For example, illicit drug markets, particularly if poorly managed, tend to be violent relative to licit markets.

The report states the following:

 [The] increase in the size of illegal drug markets observed between 1994 and 2008 (about 200 percent) explains roughly 25 percent of the current homicide rate in Colombia. This translates into about 3,800 more homicides per year on average that are associated with illegal drug markets and the war on drugs.

Traditionally, the goal has been to utilize law enforcement and even the military to suppress the size of the illicit market, but such strategies have produced enormous negative outcomes and have often only made the situation worse.

Even if they succeed in suppressing the market in one area, which is extremely rare, the violence is often merely shifted to other locations. In Colombia, for example, success with counter-narcotics programs displaced criminal gangs – and their associated violence – to Mexico. The result was a threefold increase in the homicide rate in Mexico within a period of just four years.

This is not to say that there is no place for law enforcement in global drug policy. The problem is with the pursuit of a “war on drugs” strategy that fails to recognize the limits of enforcement and results in extreme misallocations of resources towards ineffective and often counterproductive policies. Generally, these come at the expense of far more effective public health policies.

This is why our report calls for a drastic reallocation of focus and resources towards public health policies based on access to treatment and harm reduction services.

Such approaches have proven successful at saving lives and protecting the health and human rights of people who use drugs. They are also cost-effective. Our report highlights that treatment costs an average of $1,583 per person but benefits society at the level of $11,487 – a 7:1 ratio.

There are even greater returns on harm reduction initiatives like substitution therapies, supervised drug consumption facilities, and needle and syringe exchange services. Vancouver, British Columbia has been a hemispheric leader in this regard with its highly effective Insite facility.

Our report highlights how Insite has prevented overdose deaths and HIV transmission and has saved the broader community roughly $6 million a year. Despite these clear benefits, the current Canadian government has sought to close Insite out of a deference to “war on drugs” ideology, and has ceased advocating public-health-focused drug policies at the international level.

More broadly, one study cited in the report found that every dollar invested in opioid dependence treatment programs returned between $4 and $7 in reduced drug-related crime, criminal justice costs, and theft. When savings related to health care are included, total savings can exceed costs by a ratio of 12:1.

The report concludes that governments must drastically reallocate resources away from damaging and counterproductive strategies based on punitive and enforcement-led policies. It also calls for the international community to focus on ensuring population security, economic development, and the protection of human rights instead of blindly focusing on the quantities of narcotics seized or numbers of people arrested.

Finally, our report calls for policy makers to pursue rigorously monitored experimentation with cannabis regulation, as is currently underway in Uruguay, Washington State, and Colorado.

Guatemalan President Otto Pérez Molina will be taking our report to the United Nations to directly influence the General Assembly review of the drug control system, which will take place at a special session in 2016.

For the first time in decades, the international community is contemplating a more rational approach to drug control. Let us hope that science and evidence overcome fear and irrationality in these discussions. The LSE’s report should serve as a starting point.

Professor Michael Cox is the Founding Co-Director of IDEAS, a center at the London School of Economics focused on international affairs, diplomacy, and strategy. Professor John Collins is the Director of the International Drug Policy Project at the IDEAS center. 

 

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