This is the second of a multi-part series on illegal drugs and their impact on our society with a special emphasis on the US-Mexico border region, exploring how we got here, what are the economic and social impacts of our policies, and exploring alternatives to our current policies going forward.
The first article of this series explored the history of the War on Drugs going back more than a century where we described how our government officials (local, state and federal) changed our policies and subsequent regulations and laws to view drugs and drug abuse. This was not done through the lens of a social problem with social solutions but rather as a criminal problem to be resolved primarily through a criminal justice approach. These changes often occurred with obvious racial and/or economic bias supported in whole or in part by misinformation and sensationalism promoted by self-serving media (the Hearst Publications) and newly created state/federal agencies, e.g. the Federal Bureau of Narcotics. This latter agency went after marijuana (a non-narcotic drug) with propaganda efforts such as the movie “Reefer Madness”–the butt of many jokes among teens and young adults in later years. While initially a focus of limited federal and state funding, renewed interest in drugs and drug abuse in the early 70’s with President Nixon’s declared “War on Drugs” has led to an estimated $1 trillion cost to the taxpayers in pursuing this strategy over the past 40 years (!). We will discuss some of these costs from a purely economic point of view and later look at them from a social cost perspective which has a more significant impact on our society and culture, although it is less easily and objectively analyzed.
Economic Costs of the War on Drugs: In an AP press report in 2010, reporter Martha Mendoza estimated that the US War on Drugs has cost over $1 trillion dating back to the Nixon Administration. Figure 1 shows the funding breakout in terms of law enforcement/interdiction, treatment/prevention and international (military aid and interdiction efforts abroad, principally in Columbia and Mexico) through 2009. In that year we spend more than $14.1 billion; more recent figures from the Obama 2012 budget put the numbers at $13.4 B, $10.7 B, and $2.1 B, respectively, totaling over $26.2 B*,suggesting the actual costs were much higher.
Mendoza’s article broke out the numbers further where taxpayers spent the following over 40 years:
- $20 billion to fight drug gangs abroad, e.g. $6 billion in Columbia
- $33 billion in such marketing campaigns as “Just Say No” aimed at American youth with illegal drug use rates by high school students little changed since 1970
- $49 billion for law enforcement efforts along our borders, primarily with Mexico
- $121 billion to arrest more than 37 million nonviolent drug offenders
- $450 billion to lock those people up in federal prison alone; last year roughly half of all federal prisoners were serving sentences for drug offenses.
Incarceration for Drug Offenses: A closer look at the rates and the costs of incarceration in the US is instructive, particularly as it pertains to drugs and drug offenses. Overall, the US has the highest documented incarceration rate in the world (743 per 100,000) compared to Russia (next highest at 577 per 100,000), Rwanda (561), England (155) and the Netherlands (94). According to Department of Justice statistics in 2010 the US had 2.3 million adults incarcerated in US federal, state and county prisons/jails (many of them privately owned and operated). An additional 7.2 million adults were under correctional supervision (parole or probation) or roughly 3.1% of our adult population either jailed or under supervision. These numbers dwarf those of the former Soviet Union, which during the height of its infamous Gulag system of prison camps and colonies (1934-53) incarcerated between 1.2 to 1.5 million people.
Figure 2 shows the number of incarcerated Americans between 1920 to 2006 with a huge change beginning in the early 1980s continuing today.
Such a quadrupling of our prison population did not occur due to increases in violent crimes, whose rates have been relatively constant or declining over decades. Rather the increase came about by changes in public policy causing more prison sentences and lengthening of time served caused by mandatory minimum sentences, “three strikes” laws, and reductions in paroles and early release. While championed as policies to protect the public from serious and violent offenders, they instead yielded high rates of offenders guilty of non-violent offenses, many of them drug offenders. In 2010 almost half of federal inmates were incarcerated for drug offenses, of which less than 8% were considered violent. Drug offenders in state prisons were roughly 17.2% of all prisoners or 21% of the total federal and state prisoners. Applying this to the total prison population of approximately 2.45 million prisoners in 2006, we can estimate approximately 500,000 prisoners are currently in jail for drug offenses at any given time.
As shown in Figure 3 the total costs for Corrections (primarily incarceration) amounted to over $75 billion or just over roughly $30,000 per inmate. This suggests we are spending more than $15 billion annually for the incarceration of drug offenders, most considered non-violent. In 2010, for instance, 82 percent of all drug abuse arrests were for possession of drugs in lieu of sale of drugs.
There are other costs than incarceration to determine the actual economic impact of illicit drug use on American society. The National Drug Intelligence Center’s latest report from 2011 calculates that these costs added up to over $193 billion in 2007! These are broken out in three principal areas: crime (including criminal justice system, victim costs, and other crime costs) $61.4 billion; health ( hospital/emergency room, insurance and other health costs) $11.4 billion; productivity costs (labor participation, specialty treatment, hospitalization, incarceration and premature mortality costs) $120 billion. In this day of concern for trillion dollar budget deficits over periods of decades, costs of illicit drugs to our society amounts to almost $2 trillion in just one decade. Looking at only the criminal justice component of these costs this adds up to over $564 billion in that same period.
Looked at another way, the $56.4 billion in criminal justice costs for illicit drug activities amounts to sufficient funds in one year to pay for two National Institutes of Health, three NASAs, seven National Science Foundations or fifty-six National Institutes of Health. Imagine if we were to invest these funds toward social solutions of drug use and abuse to mitigate the problems rather than simply applying criminal justice as the only solution. And these figures only look at the cost side of the equation. If marijuana, for instance, was taxed at a similar rate as cigarettes ($2-$5 per pack) based on current consumption figures from the Office of National Drug Control Strategy (approximately 1.5 billion grams of grass consumed in 2011) there would be an additional $3.5 billion to $8.0 billion in revenues annually!
As suggested in a quip attributed to the late Senator Everett Dirksen, “A billion here and a billion there and pretty soon, you’re talking about real money.” –Paul Maxwell with Marshall Carter Tripp
*The discrepancy is due in large part to including drug-related Medicare, Medicaid and other agency numbers not included previously by the Office of National Drug Control Policy, ONDCP