Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Monday, June 06, 2005

Leading Economists Urge Drug Legalization - -

Over 500 economists have urged the complete legalization of marijuana, not just for clinical use, but as a recreational drug as well.

In a report released today, Dr. Jeffrey Miron, visiting professor of economics at Harvard University, estimates that replacing marijuana prohibition with a system of taxation and regulation similar to that used for alcoholic beverages would produce combined savings and tax revenues of between $10 billion and $14 billion per year. In response, a group of more than 500 distinguished economists—led by Nobel Prize-winner Dr. Milton Friedman—released an open letter to President Bush and other public officials calling for “an open and honest debate about marijuana prohibition,” adding, “We believe such a debate will favor a regime in which marijuana is legal but taxed and regulated like other goods.”
The above quotation and link are provided by Stephen Ayer of Disinterested Party, who goes even further:

It’s not just marijuana. The war on drugs has been one of the most costly social-policy failures in U.S. history. On one estimate, the U.S. spends more than $40 billion of taxpayer’s money every year fighting illegal drugs. About one in four of America’s prison population is locked up thanks to a drug-related offense, usually non-violent. A report released on May 18th by the White House Office of National Drug Control Policy acknowledge that 1.6% of state prisoners are incarcerated for marijuana-related offenses alone.

Moreover, there is little connection between the severity of a drugs policy and prevalence of use. Illegal drugs continue to get easier and cheaper to obtain—for example, a gram of cocaine cost about $38 wholesale in the U.S. in 2003, down from $48 in 2000 and $100 in 1986. The illegal-drugs business continues unabated, with global sales on the same scale as the global tobacco industry. The industry fuels corrupt regimes, terrorists, civil wars, gangs… the list is endless. Worse, the fallout from this criminal activity disproportionately impacts poor countries or poor people in developed countries.

Legalizing drugs would cut profits, crime and exploitation. It would empty America’s jails of people who by most measures should never have been incarcerated in the first place.

To read an editorial that Milton Friedman wrote for the NYTimes in 1998 about legalizing even hard drugs, click here.

So why do major democracies continue to wage the war on drugs?

  1. Pressure from social and religious fanatics who think it is inappropriate for people to enjoy themselves.
  2. Pressure from the drug-war lobby who have a vested interest in continued spending on their services.
  3. Pressure from the alcohol, tobacco, and other lobbies who continue to attempt to limit competition for their own products.

The list of 500 economists favouring the legalization is here. I think I recognized three of the names. Why hasn't the campaign been more successful among better-known economists at higher ranked institutions? And why has it been successful where it has?

Update: The U.S. Supreme Court has just decreed that private medicinal use of personally grown marijauana violates federal statutes, AND that federal takes precedence over state law in this regard because such use affects the interstate, albeit illegal, market for marijuana. Huh? See more, along with links to majority and minority opinions here.

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