How Not to Legalize Drugs

I want to give a great big cheer for Mexico’s new drug policy. I want to, but I can’t. On its face, the policy seems like a victory for opponents of the drug war, as it eliminates punishment for use and (limited) possession of marijuana, cocaine, heroin, and a variety of other drugs. But I fear that, much as California’s “deregulation” of electricity markets gave real deregulation a bad name, Mexico’s “legalization” of drugs will give real legalization a bad name.

The problem? Mexico’s new policy maintains, even strengthens, the laws against drug trafficking. The Mexican government will go after the producers, transporters, and dealers, and they’ll have even more funds with which to do so. But it’s precisely the anti-trafficking efforts that spawn most of the violence and other adverse consequences of the drug war.

With the elimination of anti-user laws, demand for drugs will increase (on this point I think the drug warriors are correct; the forbidden fruit syndrome is real, but probably not large enough to overcome the penalty effect). The larger demand will create an even greater incentive for suppliers to enter the market and battle it out for market share. Tougher anti-trafficking policy will simply increase the comparative advantage of the most dangerous suppliers. Having a stronger incentive to market their product, but still lacking legal means of enforcing their agreements, they will resort even more often to private – and often violent – means of enforcement. So don't expect violent crime to drop much; it could easily rise. And users, while no longer thrown in jail for their drug use, will still have no recourse against dealers who cheat them or supply them with tainted product. So don’t expect drug overdoses to drop, either.

On the up side, at least Mexico’s policy signals changing attitudes. People have begun to realize the current drug policy just isn’t working, and they are questioning the wisdom of treating a vice as a criminal activity. Yet the new policy simultaneously perpetuates the notion that it’s okay for people to consume something unhealthy but somehow terribly wrong for anyone else to sell it to those who want it. Sadly, if this experiment produces undesirable consequences – as I think it will – then public opinion could turn against true legalization.