David R. Henderson  

Schumer's Nonsensical Solution for Pharmacy Robberies

Stocks and the Economy, Again... I Told You So...
New York. Associated Press. June 26

In the wake of last week's deadly shooting at a Long Island pharmacy, Sen. Charles Schumer says the federal government must work harder to fight prescription drug abuse.

Schumer said Sunday that the abuse of prescription narcotics is reaching levels not seen since the crack epidemic of the 1980s and early 1990s.

What's Chuck Schumer responding to? Here's what:
New York. Associated Press. June 25

Armed robberies at pharmacies rose 81 percent between 2006 and 2010, from 380 to 686, the U.S. Drug Enforcement Administration says. The number of pills stolen went from 706,000 to 1.3 million. Thieves are overwhelmingly taking oxycodone painkillers like OxyContin or Roxicodone, or hydrocodone-based painkillers like Vicodin and Norco. Both narcotics are highly addictive.

Econ 101 Question: If the government makes it even harder for people to get Oxycontin and other drugs, will the number of pharmacy robberies decrease, increase, or stay the same.
Bonus Poli Sci 101 Question: Will the New York Times write an editorial in the next two weeks calling Schumer out on his idea?

HT to Charley Hooper.

Comments and Sharing

COMMENTS (16 to date)
SkippyMaximus writes:


Increase. And even further, if robberies increase, the supply of those drugs to people with legal prescriptions will decrease, possibly raising the legal price of those drugs (less supply, higher demand price...all things remaining same, of course). With the increase in legal price, the incentive to steal and sell on the black market increases even more.

Economically speaking, sounds like the robbers are simply increasing the supply of those drugs to a wider customer base who is demanding it...fixing a market failure.

Hmm. That would be an interesting 5-min discussion.

Phil writes:

I'm not 100% sure what you're getting at here.

If the government is indeed successful about reducing prescription drug abuse, robberies will indeed drop, won't they? If abuse drops 50%, demand drops 50%, and robberies drop (as a first approximation) 50%.

For instance, I don't know of any addiction to prescription antibiotics. And the number of armed robberies of pharmacists for antibiotics is (I assume) zero.

I agree that if the government cracks down on SUPPLY, without doing anything about demand, armed robberies will indeed go up.

Am I missing something?

Floccina writes:
If the government makes it even harder for people to get Oxycontin and other drugs, will the number of pharmacy robberies decrease, increase, or stay the same.

Most likely increase as the black market price rises making the theft more profitable. I think Schumer might be think that his voters will believe that with better enforcement there will be fewer addicts and so price will not rise because demand will fall along with supply, but I find that hard to believe. There would at least be a delay.

Will the New York Times write an editorial in the next two weeks calling Schumer out on his idea?

No because the New York Times is in business to sell ads and if the talk badly about Schumer he may deny then access to interviews and information that readers are interested in. This would produce fewer readers and fewer readers would eventually mean less ad revenue.

kurlos writes:

Phil is right. Robberies will decrease. The loose prescribing of the drugs in the first place is what creates the demand. This is what you're asking: What effect will the creation of fewer prescription-drug addicts have on the number of addicts breaking into pharmacies to obtain prescription drugs?

BZ writes:

Floccina nailed it.

@Kurlos -- so drug prohibition has decreased crime then by reducing all that demand? Hahahahahahaha

John Thacker writes:

Phil and kurlos, surely if addicts were able to get prescriptions easily, they wouldn't need to get the drugs on the black market, and robberies would decline. Cracking down on prescriptions will only increase the number of robberies.

I find it unbelievable that you claim that people only become addicted to these drugs by being introduced to them via prescription. That's not true in my experience.

I find it horrifying how many people you'll condemn to pain and suffering while only making the robberies worse.

Lint writes:

Extra bonus: If they made obtaining prescription drugs that are addictive harder to get, robbers may also begin to target other drugs more heavily as some patients may be denied scripts for Adderall and the like. So not only could the number of robberies increase, but so could their size and scope.

Philo writes:

What kind of "fighting prescription drug abuse" does Schumer have in mind? Here's a possibility: execute all prescription drug abusers. *That* might reduce pharmacy robberies!

Kurlos writes:

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David C writes:

I agree with Philo. Schumer didn't specify how he wanted to reduce abuse, and there's no article linked. He probably doesn't have a plan and is just hoping to score political points. It seems ridiculous for the New York Times to write an op ed entirely about how Schumer evaded saying anything substantive since politicians do that all the time.

kurlos writes:

David C-- Perhaps it was too obvious to mention: Physicians, most of whom receive government reimbursement, should stop creating iatrogenic addictions. Because you think this is analogous to prohibition, instead of being analogous to hand-washing, you cannot see what is in front of you.

Gabriel rossman writes:

The people who are arguing with phil and kurlos don't seem to get that there's a short-term versus long-term issue with the two being different because opiates are an addiction good (indeed, the paradigmatic case of an addiction good).

In the short-term, theft and scrip fraud (and for that matter, graduating to heroin) are substitutes: reducing the supply of opiates diverted through prescription fraud will increase the demand for opiates diverted through outright theft. However in the long-run they may very well be complements: making scrip fraud more difficult would decrease the number of pill-poppers which would in turn decrease the demand for stolen pills.

I think it's pretty plausible that it would work that way, especially if you de-widget it and look at the specifics. It's well known that the career of a heroin addict typically start with sniffing or smoking and only later graduates to shooting because most people are averse to needles until they become so addicted that their craving for heroin overcomes their fear of needles. As a thought experiment, if we could magically change the nature of heroin and/or human physiology so that heroin could only be shot (and not smoked or snorted), this would decrease the stream of new junkies and in the long-run decrease the demand for shooting heroin. Similarly, I think most people would find it much more appealing to steal prescriptions than to commit armed robbery such that the latter would be confined to addicts. Making it more difficult to steal scrip would thus interrupt the pill popper career at a crucial point and decrease the pipeline of people who will eventually graduate to burglary.

This is a common belief in the political class: that if a behavior is mandated or prohibited nearly everybody will, of course, obey the law. They don't believe people will respond to the ill effects of drug abuse but will respond to a legal requirement to do avoid drugs.

I have heard that people who smoked enough dope in college don't recall it (or, apparently, that anybody else their age had done so) but I didn't believe that until recently...

steve writes:

I would say it depends on where the supply and demand are coming from, and how hard it is currently to get those prescription drugs.

For supply:

1.) If it is currently easy to get prescription drugs, then maybe many are being sold into the black market and robberies would increase if it became harder.

2.) If it is already hard, then maybe the black market is largely supplied by these thefts or other sources and making it harder still will have little effect.

For demand:

3.) If the demand mostly comes from previous prescription drug users, then maybe making it harder to get them will temporarily boost robberies but reduce them over time as new demand fails to appear.

4.) If the demand mostly comes from druggies in general and not former prescription users then making prescriptions harder to get will have little effect on demand.

I can't say which cases apply for supply and demand but Schumer seems to be counting on 3.

DP writes:

The issue Sen. Schumer is addressing is one created by inventory, and pharmacies keep large inventories because the market must meet the demands of not for the junkie but individuals with legitimate use.

The demand pharmacies are meeting [i would think] is directly associated with the number annual scrips written by physicians. Could the state/fed put a cap on the number of narco scrips physicians are authorized to write each year in their practice or per person?

In the short term short supply would generate spikes of violent behavior to meet current demand levels. However, long term reduction in pharmacy narco inventory would not only yield less per robbery and increase the amount of effort to meet current addiction levels (why people turn to harder drugs), but also increase the likelihood of law enforcement capture.

Bryan Willman writes:

And what percentage of perscriptions are dubious?

The 2nd tier demand is the demand caused by people with some sort of pain requires management.
So one might argue that very effective programs for preventing back injuries would reduce the need/desire for legit uses of oxycodone, and THAT would eventually reduce the robberies of pharmacies. Somehow an improved program to prevent back injuries is probably not what Mr. Schumer has in mind.

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