The political economy of drug trafficking
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THE POLITICAL ECONOMY OF DRUG TRAFFICKING. INTRODUCTION 1. Pervasiveness of issue 2. Typicality? Or an extreme case? 3. Categorizing “illicit drugs”— Marijuana Heroin Cocaine ATS/designer drugs 4. Note: Dangerous prescription drugs. READING. Smith, Talons , ch. 14

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THE POLITICAL ECONOMY OF DRUG TRAFFICKING

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The political economy of drug trafficking

THE POLITICAL ECONOMY OF DRUG TRAFFICKING

INTRODUCTION

1. Pervasiveness of issue

2. Typicality? Or an extreme case?

3. Categorizing “illicit drugs”—

Marijuana

Heroin

Cocaine

ATS/designer drugs

4. Note: Dangerous prescription drugs


Reading

READING

  • Smith, Talons, ch. 14

  • DFC, Contemporary, chs. 2 and 9 (Mexico + Colombia)


The political economy of drug trafficking

THE GLOBAL MARKET:

STRUCTURE AND SCALE

1.Worldwide flows, variations by drug

Consumption around the world

* 149-272 million users

* 15-20 million “addicts” or problem users

* $320 billion per year (est.)

3.The U.S. market: magnitudes, profits and costs


The political economy of drug trafficking

Global Production and Trafficking

MDMA

Amphetamine Type Stimulants

Cocaine

Heroin

Potential Cocaine Production (mt)


Sources of heroin

Sources of Heroin

Metric Tons

5,106

5,082

5,000

4,452

4,263

4,068

3,671

3,441

3,389

3,302

1,264

ONDCP/FEB02

* Values for Latin America are projected


The political economy of drug trafficking

3 percent

Direct to U.S.

43 percent

Caribbean Corridor

Estimated Cocaine Flows ca. 2000

54 percent Mexico/Central

American Corridor


The political economy of drug trafficking

75 METRIC TONS DETECTED DEPARTING FOR NON-US MARKETS

Interdiction of Cocaine, 1999

Arrival Zone Seizures

Transit Zone Seizures

MEXICO /

CENTRAL

AMERICAN

CORRIDOR

-60 MT

-37 MT

54%

277 MT

512

Metric Tons Depart

South America

for U.S.

382 MT

Potentially

Arrives in the U.S.

43%

220 MT

CARIBBEAN

CORRIDOR

-14 MT

-7 MT

3%

15 MT

DIRECT TO CONTINENTAL

U.S.

-12 MT


The political economy of drug trafficking

Cocaine and Heroin Prices: 1981-2010


The political economy of drug trafficking

Cultivation: 2000-2009


The political economy of drug trafficking

Who Are the Winners…?

Where are the profits?

Price structure of one kilo of pure cocaine, ca. 2000:

Coca leaf (e.g., farmgate in Peru) $ 300

Coca base (farmgate) 900

Cocaine hydrochloride (export/Colombia) 1,500

Cocaine hydrochloride (import/Miami)15,000

Cocaine (67% pure/dealer U.S.)40,000

Cocaine (67% pure (retail/U.S.)150,000


The political economy of drug trafficking

New survey

series*

Percent Reporting Past Month Use of Any Illicit Drug

Trends in Drug Consumption, 1985-2000

*The survey methodology was changed in 1999. Estimates based on the new survey series are not comparable to previous years.

Source: SAMHSA, National Household Survey on Drug Abuse.


U s drug users

U.S. DRUG USERS

  • 1990 = 13.5 million (6.7%)

  • 2000= 14.0 million (6.3%)

  • 2007= 19.9 million (̴ 8%)

  • 2010 = 22.6 million (8.9%)


Usage of marijuana

Usage of Marijuana

Percent Reporting Past Month Use of Illicit Drugs, 2000

Only a drug other than marijuana

Marijuana only

Marijuana and some other drug

Source: 2000 National Household Survey on Drug Abuse


The political economy of drug trafficking

Percent Reporting Past Month Use of an Illicit Drug

Drug Abuse by Age Cohort

Prime example of an aging cohort of drug users -- this group began use in 1970s.

Source: 2000 National Household Survey on Drug Abuse


The political economy of drug trafficking

Percent Reporting Use of “Any Illicit Drug”

Drug usage among American Students

Source: Monitoring the Future Study


The political economy of drug trafficking

Drug Use by Drug Type


The political economy of drug trafficking

U.S. Users Spend $63.2 Billion Annually

Consumer Expenditures on Illicit Drugs, 2000

Billions of Dollars

(Projections for 1999)

Source: ONDCP Paper,

What America’s Users Spend on Illegal Drugs


The political economy of drug trafficking

U.S. POLICY: THE DRUG WARS

1.Participants and processes

2.Strategic content:

Goal: Reduce illegal drug use and availability

Enforcement > education, treatment, thus 2:1 ratio in federal budget

Supply control > demand reduction, thus interdiction and eradication

Assumption: One policy fits all….

Criteria for evaluation


The political economy of drug trafficking

Fiscal Year 1986 -2003

Dollars, in Billions

Composition of Federal Expenditures, 2000


The political economy of drug trafficking

Federal Prisons

145,416

U.S. Prison Population, 1985-2000

Local Jails

621,149

Number of Inmates, in Millions

State Prisons

1,236,476

Source: Bureau of Justice Statistics, 2001


The political economy of drug trafficking

Reasons for Drug Arrests, 2000

Source: Uniform Crime Reports, FBI.


The political economy of drug trafficking

IMPLICATIONS FOR LATIN AMERICA

1.Economic costs and benefits

2.Violence (and “drug wars” in multiple forms)

3.Corruption

4.Growth in consumption

5.Threats to governability

Challenges to sovereignty—e.g., invasion of Panama 1989

Process of “certification” (now modified)


Questions of public policy what are the alternatives

QUESTIONS OF PUBLIC POLICY: WHAT ARE THE ALTERNATIVES?

INTRODUCTION

1. What might be desirable? Or feasible?

2.    What are the prospects?


The political economy of drug trafficking

ARE THERE ALTERNATIVES?

1.Continuation (or acceleration) of current policy:

·        Increased budgets

·        Establish coherence

·        Long-term durability


2 legalization regulation not legalization decriminalization partial or complete

2.      Legalization:

·        Regulation, not legalization

·        Decriminalization?

·        Partial or complete?


The political economy of drug trafficking

3.Changing priorities:

·        Demand reduction > law enforcement

·        Law enforcement = more on money laundering, less on retail pushers

·        Focus on governability as key issue in Latin America

·       Multilateral efforts against consumption and demand, rather than supply

·       What about certification?


Enlightenment in latin america

ENLIGHTENMENT IN LATIN AMERICA!

  • Marijuana personal use is decriminalized in :

    • Argentina

    • Brazil (depenalized)

    • Colombia

    • Costa Rica

    • Mexico

    • Peru

    • Uruguay

    • Venezuela


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