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The Drug War Is Bad For Business

Eric Sterling has an interesting piece at Forbes looking at the big picture economic impact of the War on Drugs.

Today, tens of millions of Americans — would-be consumers – because they have been convicted of a drug offense, aren’t earning what they could earn without a record. Our prison population, estimated as high as 2.3 million persons, is out of the car market. Ford and GM should calculate how many cars they could sell in the U.S. if our imprisonment rates were close to those of their European or Japanese competitors (instead of 7-to-10 times higher). How many cars could they sell if tens of millions of Americans did not have a conviction-suppressed income? A reduced average household income and credit capacity suppresses sales of goods and services for almost every American business. While most of those offenses were instances of youthful bad judgment, the consequences for the economy last for decades.

The business community needs a complete economic analysis of the impact of drug policy. In the 1980s, war on drugs policies were not on the radar of business or investors at all. Today, the intensity of global competition and the fragility of our domestic economy require management and investors to fully understand how American drug policy plays with their profits. Every investor should analyze how much the costs of drug policy shrink return on investment. [Forbes]

Other than Eric Sterling, and perhaps occasionally others in the reform movement, I don't hear anyone asking these kinds of questions. It's an entire category of drug war cost that has simply never been measured.

This gets back to a point I've made often here, which is that we've really never had anything approaching a full accounting of all the costs created by our drug laws. I can't imagine how such a thing could even be conceived. Things like the damage to virgin forests caused by illicit marijuana cultivation, the number of crimes that go unsolved because drug-involved witnesses wish to avoid police contact, the extent to which police corruption compromises costly law enforcement expenditures; all these things and many more are horrendous in their effects, incalculable in their scale, and yet rarely even acknowledged outside the realm of reform advocacy, let alone quantified in the course of the raging debate over whether these policies are worth their price-tag.

In other words, however harmful you believe the War on Drugs to be, it is almost certainly considerably worse. And whatever benefits one expects to enjoy following the fall of prohibition, the true and total impact of effective reforms could exceed anyone's expectations by addressing problems that should have been blamed on the drug war but weren't. I suppose there's only one way to find out.

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Sterling has unique blend of experience and passion

Eric Sterling's experience as a key legal staff member of a New Jersey Congressman was In Washington to  help craft the crack cocaine laws of 1986 & 1988.. Unlike most of his colleagues, Sterling was able to quickly see that this legislation had many unintended consequences and created more problems than it addressed. This experience has been the genesis of Sterling's distinguished career as a leading expert on drug policy as well as one our most effective advocates in the movement. 

I would like to see more appearances of Sterling addressing the flaws in the drug war. His arguments for change can be made on many levels and he always provides his audience with thought provoking analysis to illustrates the harms of the drug war. As a speaker for LEAP, anyone can recommend Sterling for a speaking engagement at your college or suggest to a producer that he appear on the media to debate this issue. We need advocates like Eric Sterling to challenge the status quo by appearing in the media and at public events. He is a gem that should be utilized as often as possible. 


Drug war ruins families, expands welfare, and is anti-education

How many mothers need public housing and food stamps when their breadwinner husbands go to prison?  How much money go to afterschool programs or combating juvenile delinquency when the mother has to be the breadwinner working long irregular hours and can't be home to watch the kids or respond to calls from school? 

It's all over the media that fewer men are graduating from college than women, and I am sure that is partly due to our arresting young men at four times the rate of women for drug offenses.  Not only that, government data shows that men are more likely to receive harsher sentences than women for the same crime. 

A profound disaster

Thanks for this article. You are right to make these points. The drug war was scaled up by Nixon as an extension of the Vietnam war. Nixon aimed it at the peace activists protesting the Vietnam war and it's primary purpose ever since has been to divide communities for military and corporate gain. Divided, the people, will always be defeated. The drug war is responsible for fear and suspicion within the community, it fosters a culture of secrecy and criminality. Many people cannot report crimes against themselves because they cannot afford to have the police come to their door. Nor can they report crime against others, or bare witness, for the same reason. This leaves a lot of criminal activity outside the normal community police code, basically sanctioning a large volume of crime.  How many women were raped who did not report it because of their choice of drug consumption?  Domestic violence? How many women and children were abused by drunken men? Had those men had a nice smoke instead of a drink to relax with at the end of a hard day there might be fewer children with cigarette burns on their faces and fewer battered women.  If there were less drug related crime and greater community co-operation, taxes and insurance premiums would go down and so too would security fences and maybe people would just talk to each other more.  The drug war has been with us a very long time and the consequences will be profound, not least of all because in order to administer a callous and brutal law like this you have to have callous and brutal people in power and such people always tend towards corruption and extreme incompetence. They are more inclined to push there own agendas through with brute force rather than democratic methods.  Without the drug war there might less violations of human rights around the world and less resentment of  the powerful military states that rule the world and so there might be less terrorism.  Farmers are struggling without several important crops and the industries that go with them.  This weakens our rural economy depriving country towns of jobs and income.  Younger generations discovering drugs are more easily identified and targeted for police harassment in small towns and have to leave town further depopulating rural regions and increasing the burden on overcrowded cities. The cops literally run those kids out of town. With narco-trafficking and war going on in some of the remotest forests on Earth nothing can be done to prevent logging and destruction of pristine ecology's.  The poverty caused by the drug war and the loss of the hemp economy to the worlds poor people has resulted in those people resorting to desperate measures to survive, like killing the last Javanese rhino for its horn; the poacher probably got 10 to 20 dollars to feed the family.All round the drug war has been an absolute disaster.The drug war is a crime against humanity and genocide.Please support marijuana ballot initiatives near you.Legalize! Apologize! Compensate!2012

Cost of prohibition

Great analysis!

It seems to me another cost is that of the ubiquitous urine-testing industry.  That must cost businesses something.

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