David R. Henderson  

Some Simple Analytics of Anti-Marijuana Laws

PRINT
The Recalculation Story: A Su... From the Cutting-Room Floor: W...

That's not the title of a piece in today's San Francisco Chronicle by my friend and Hoover colleague, Joe McNamara. But it could be. One excerpt:

Who would buy pot on dangerous streets if they could get it at regulated stores without unsafe impurities? Al Capone and his rivals made machine-gun battles a staple of 1920s city street life when they fought to control the illegal alcohol market. No one today shoots up the local neighborhood to compete in the beer market. The federal Drug Enforcement Administration estimates that Mexican cartels derive more than 60 percent of their profits from marijuana. How much did the cartels make last year dealing in Budweiser, Corona or Dos Equis?

Another:
The California Police Chiefs Association, of which I have been a member for 34 years, is also in opposition. Personally, I have never even smoked a cigarette, let alone taken a hit from a bong, and while I have great respect for the police chiefs, I wouldn't want to live in a country where it is a crime to behave contrary to the way cops think we should.

While a policeman in New York city, Joe earned his Ph.D. in sociology and did his dissertation on the roots of the drug war in the early 20th century. If I recall correctly, his major finding was that there was not some major outbreak of drug problems that led to illegalization. He later became police chief in Kansas City and then police chief in San Jose.


Comments and Sharing


CATEGORIES: Regulation



COMMENTS (12 to date)
Chris Koresko writes:

When discussing the legalization of recreational drugs it's almost inevitable that someone will bring up the Prohibition era. The discussion usually runs off course at that point, because nobody involved knows much about Prohibition.

I think anyone inclined to call Prohibition an abject failure ought to listen to the EconTalk interview with Daniel Okrent from a few weeks ago. It's a fascinating account, and based on it one might make the argument that on balance Prohibition was a good thing because it led to a drastic, long-term reduction in American alcohol consumption.

That conclusion is far from comfortable from a Libertarian point of view, and it may even be demonstrably incorrect, but I think it would be wrong to dismiss it out-of-hand.

David R. Henderson writes:

@Chris Koresko,
You didn't say, though, how Joe McNamara's analysis ran off course. Do you think the crime in the liquor industry had nothing to do with the fact of Prohibition?
Also, I'm a libertarian but I don't find it uncomfortable that harsh government penalties on consumption of something can reduce consumption. I don't want the government doing that, even if it reduces consumption after the penalties are removed. Moreover, if removing penalties doesn't cause consumption to increase much, as you seem to be suggesting, doesn't this argue, from your viewpoint, for removing those penalties?

rpl writes:

David, I would go a bit further in responding to Chris' argument and add that the persistence of reduced alcohol consumption after the end of prohibition undermines the argument that prohibition caused the reduction in consumption. It's possible that prohibition and the decline in consumption shared a common cause, or that consumption was already declining before prohibition and continued to do so independent of the rise and fall of prohibition. Either of these explanations seems more likely than the claim that prohibition caused such a sea-change in our national attitude toward alcohol that the change has persisted for decades after the policy itself was repealed.


caveat bettor writes:

I immediately thought of Okrent's "Last Call" (which I have not read, but have read interviews with him, as well as several reviews). It seems like the jury is still out on a lot of this. From what I have gathered, the incidence of drunkenness leading up to Prohibition was much higher than it is today, which increased the incidence of domestic abuse and also constrained the productivity of the work force. And in order to find alternative revenue for the federal government, which relied heavily on liquor taxes, the advocates of Prohibition successfully amended the Constitution to allow for income taxes. I think we are at the point where the MTRs are constraining the productivity of the workforce.

Who knows if the constraint is greater today, or will be in the future, than from drunkenness in the 1800s?

John Jenkins writes:

Whether prohibition resulted in reduced consumption of alcohol after it ended isn't really relevant.

Does anyone seriously dispute that prohibition caused an increase in organized crime (in the broadest sense) as criminals smuggled and sold alcohol and that the same dynamic is at work in the drug trade?

Suppose, though, that prohibition did reduce consumption of alcohol even after it ended. Doesn't that counsel in favor of ending the drug war now and reaping the benefit of reduced consumption (assuming you believe that's a benefit) without the enforcement costs and infringements on liberty?

[As an aside, how does drunkenness correlate with domestic abuse over time? I know it's a cliche of every B&W era movie that the old man gets drunk and beats everyone, but what part to changing social mores (and readily available divorce) have to play in that? How do you control for those kinds of variables to parse out causes and effects? I am skeptical of any conclusion on these issues.]

caveat bettor writes:

Did you read the Paul Romer piece in City Journal? His thesis in that essay is that strategic interventions by government actually can Pareto-improve social norms.

http://www.city-journal.org/2010/eon0723pr.html

Chris Koresko writes:

David Henderson: You didn't say, though, how Joe McNamara's analysis ran off course. Do you think the crime in the liquor industry had nothing to do with the fact of Prohibition?

Obviously there is crime associated with prohibition of alcohol or drugs. I don't have a well-founded opinion on the extent to which overall crime, or violent crime in particular, is affected, though, and I don't think McNamara does either.

My main point, though, was only that if we are going to use the Prohibition experience to support a policy change with respect to recreational drugs, then we should take care to understand what that experience actually was.

I'm a libertarian but I don't find it uncomfortable that harsh government penalties on consumption of something can reduce consumption. I don't want the government doing that, even if it reduces consumption after the penalties are removed.

But what if a reasonable interpretation of the data showed that an enormous number of deaths were avoided as the result of a temporarily coercive social experiment? I haven't got the data, but off-hand that result does not seem implausible. If a proper study supported it, then we would have to concede to the Progressives a genuine success, regardless of any ethical objection to their methods. That prospect makes me, at least, quite uncomfortable.

rpl: It's possible that prohibition and the decline in consumption shared a common cause, or that consumption was already declining before prohibition and continued to do so independent of the rise and fall of prohibition. Either of these explanations seems more likely than the claim that prohibition caused such a sea-change in our national attitude toward alcohol that the change has persisted for decades after the policy itself was repealed.

My impression from the podcast was that alcohol consumption was historically much higher before Prohibition, that it had been so for centuries, and that after the repeal it never returned to anything close to its previous level. I agree it's possible that the timing coincidence could have been the result of Prohibition and the decline in alcohol consumption sharing a common cause, but it's not obvious to me what that cause could be.

Urstoff writes:

If a justification for a temporary prohibition is that it will lead to less consumption in the long-run, then hasn't prohibition on marijuana had plenty of time to accomplish that goal? Surely even that argument supports legalization. It seems the only consistent way to support the prohibition of marijuana is to also support a reinstatement of the prohibition of alcohol.

particle61 writes:

~
the persistent decline may be not a consequence of the govt restriction - but rather the instigation of a new industry...all above board, large scale, regulated and taxed...and for sale - which (of course) drove the moonshiners right out of business

another change was the decline of regional breweries - again most easilly understood as a result of the creation of a multi-million dollar biz structure that was quickly corralled by money boys - - I assure you that that was not in any way associated with the protecting government's valient and useful attempt to be cultural custodians (this description of prohibition is, of course, sarcasm)

my question to those attempting to find addiction and the 'spread of dirty users' in the supremely rational and public safety based concept of legalizing a substance that is used daily by millions of Americans and tried at least once by more than 50 percent of us and has no physically addictive properties, is - ya read any yellow journalism by w r hearst lately?

KnotRP writes:

> But what if a reasonable interpretation of the data
> showed that an enormous number of deaths were
> avoided as the result of a temporarily coercive social
> experiment? I haven't got the data, but off-hand that
> result does not seem implausible. If a proper study
> supported it, then we would have to concede to the
> Progressives a genuine success, regardless of any
> ethical objection to their methods. That prospect
> makes me, at least, quite uncomfortable.

Voluntary self-imposed death does not equate with mob/criminal innocent bystander death, not by a long shot....yet you tally up the boards as if the two are of equal detriment. Some folks will find a substance to abuse no matter what you do. But killing bystanders who may be productive members of society, and saying that's the same, is a mistatement of the tradeoff.

Jessica6 writes:
My impression from the podcast was that alcohol consumption was historically much higher before Prohibition, that it had been so for centuries, and that after the repeal it never returned to anything close to its previous level. I agree it's possible that the timing coincidence could have been the result of Prohibition and the decline in alcohol consumption sharing a common cause, but it's not obvious to me what that cause could be.

It could also be that reduced alcohol consumption was matched over the long term with consumption increases in other drugs - not just 'recreational drugs' but abuse of prescription drugs, anti-depressant use and so on, particularly from the 50s onwards.

More important, though rarely addressed are the reasons behind the demand for various mind-altering substances. There's too much emphasis on supply, but the drug industry is not driven by supply alone.

Michael Warhurst writes:

Those of you who are looking for a cause for the decrease in alcohol consumption, no need to look to prohibition. How about the Great Depression? How many unemployed destitute people can afford to go out and get drunk nightly?
I would say the depression also depressed alcohol consumption - likely far more than prohibition.

Comments for this entry have been closed
Return to top