Emily Skarbek  

Buyer Licencing of Illegal Drugs

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"The uncertainties associated with the precise nature of legalization regimes and with their expected outcomes sometimes are used to justify the maintenance of drug prohibition. This paper details the role that buyer licensing and exclusion might play in implementing a low-risk, post-prohibition drug regulatory regime. Buyer licencing and exclusion provide assistance to those who exhibit or are worried about self-control problems with drugs, while not being significantly constraining upon those who are informed and satisfied drug consumers. Relative to prohibition, licensing and self-exclusion can be part of a drug regulatory structure that is much more finely tuned to the risks of harms stemming from drug use."

That's the abstract from James Leitzel's (University of Chicago) paper on approaches on drug re-legalization. He bases his approach on a certain degree of agnosticism with respect to the rationality of drug consumption:

"At what point does a drug habit or addiction stop representing a rational choice, and instead signify a diseased brain? My claim is that I don't know at what point a habit becomes less-than-rational--not even with respect to my own habits--and further, that no one knows. The conclusion that I draw from this ignorance is one of harm reduction: public policy aimed at drugs should work tolerably well irrespective of the degree of rationality involved in adult drug decisions. That is, the drug control system should be reasonably effective at promoting human flourishing if all drug choices are fully rational, and should also work fairly well if drug decisions frequently implicate disease or serious self-control shortcomings. This notion is what I have termed the ''robustness principle'': drug policy should be robust with respect to the extent of rationality displayed by adult drug-related decisions."

His main discussion focuses on ways in which buyers could be required to opt-in to obtain a license to use (currently) controlled substances. Consumers may be able to set limits on how much they use in a given period, need to pass tests on the potential dangers of using particular drugs, meet with a counsellor before receiving a license, set renewal periods for the length of their license, and many innovative limitations. One advantage of buyer licensing is that it avoids the near-universal prohibition that currently exists.

Leitzel's focus on harm reduction has the potential to resonate in future public policy debates. The Johns Hopkins-Lancet Commission on Drug Policy and Health recently released a report that is a marked departure from national and international strict prohibition stances. "The idea that all drug use is dangerous and evil has led to enforcement-heavy policies and has made it difficult to see potentially dangerous drugs in the same light as potentially dangerous foods, tobacco, and alcohol, for which the goal of social policy is to reduce potential harms."

What's interesting about his approach is the clear recognition that there is no single way to end drug prohibition. In tackling the legalization of cocaine, Leitzel suggests utilizing a double default method that makes it costly for people to obtain the licence without knowing the risks associated with the drug. The approach, however, is not without problems. Sin taxes are generally regressive in nature, and I would be concerned that an approach to legalization that involved taxing and licencing drugs would be similarly relatively more punitive to low-income consumers. In my opinion, any departure from prohibition is a welcome advance towards a free society. Re-focusing the debate on buyer licencing does put the decision back in the hands of the individual and would significantly reduce the violence, health risks, and the human/family costs of incarceration associated with current prohibition.

Less outright coercion and more freedom of choice should strongly appeal to libertarians, but licencing also raises important concerns of paternalism. Either way, his book on the topic, Regulating Vice: Misguided Prohibitions and Realistic Controls, looks to offer a treasure trove of provocative ideas. What do you think?

HT: John Alcorn

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COMMENTS (7 to date)
CMOT writes:

Buyer licensing will just set up secondary markets where people scalp their own supplies to those who have exceeded their personal allotment.

Libertarian approved rationing isn't, or at least shouldn't be, a thing.

Better to push for the optimal policy, which is full legalization.

ThaomasH writes:

This is something that we ought to try with gun ownership.

BH writes:

Those who are likely to go through such a licensing regime are the least likely to want to use these drugs. So, that will still leave a big market for drugs outside the licensing regime.

GregS writes:

“[P]ublic policy aimed at drugs should work tolerably well irrespective of the degree of rationality involved in adult drug decisions.”

This is a good observation, and one I’ve been thinking a lot about. What’s kind of funny is that prohibition doesn’t make sense *regardless* of your assumptions about user rationality. (I’m taking “irrational” to mean something like “unreasonably insensitive to risk.”) If drug users are pretty rational, then they are already mostly accounting correctly for the costs of their drug use and choosing an appropriate amount of consumption. If drug users are pretty irrational, then they won’t be deterred (much) by legal penalties. In the rational case there’s no need to deter drug use, and in the irrational case the deterrent (be it a penalty or a tax) will almost certainly do more harm than good. Drug policy makers can make whatever assumptions they like about user rationality, but they need to be consistent and they need to follow those assumptions to their logical conclusions.

I anticipated an objection to my argument that goes: “Well, prohibition doesn’t just blandly raise the price; it puts a big fixed cost between users and drugs. In an illegal market they need to search and find a supplier.” It’s at least plausible that an irrational drug user would be deterred by a big fixed cost. I thought that licensing drug users would be a good answer to this objection, because it accomplishes the same thing in a much more sanitized way. It’s nice to see someone else has hit on the same idea and articulated it pretty well. Not my preferred drug policy, but it would definitely be an improvement.

Noah writes:

Uruguay implemented a maximum monthly purchase of marijuana.

BC writes:

Interesting. Essentially, buyer licensing is a "nudge" against drug use, requiring an opt-in, replacing the current outright prohibition. In general, replacing current hard coercion with nudges is better than using nudges where there was no coercion before.

kass writes:

BH, the better setup might be the option to opt-out of legal rights rather than opt-in. A Ulysses pact. The more rational version of ourselves can decide we can't handle gambling, rec drugs, or all-you-can-eat buffets, and take action to restrict future use

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