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Transcript of 1 THE POLITICAL ECONOMY OF DRUG TRAFFICKING INTRODUCTION 1. Pervasiveness of issue 2. Challenges for...
1
THE POLITICAL ECONOMY OF
DRUG TRAFFICKING INTRODUCTION
1. Pervasiveness of issue
2. Challenges for research
3. Categorizing “illicit drugs”—
• Marijuana
• Heroin
• Cocaine
• ATS/designer drugs
4. Note: Dangerous prescription drugs
2
READING
• Smith, Talons, ch. 14
• DFC, Contemporary, chs. 2 and 9 (Mexico + Colombia)
3
THE GLOBAL MARKET:
SOURCES OF SUPPLY
1. Worldwide flows, variations by drug
2. Consumption around the world
* 149-272 million users
* 15-20 million “addicts” or problem users
* $320 billion per year (est.)
4
0
200
400
600
800
1000
1996 1997 1998 1999 2000
Bolivia
Peru
Colombia
Global Production and Trafficking
Amphetamine Type Stimulants
Cocaine
MDMA
Pot
enti
al C
ocai
ne P
rodu
ctio
n (m
t)
0
1000
2000
3000
4000
5000
6000
1996 1997 1998 1999 2000
Pot
enti
al O
pium
Pro
duct
ion
(mt)
MexicoColombiaSE AsiaSWAsia
Heroin
Sources of Heroin
0
1,000
2,000
3,000
4,000
5,000
6,000
91 92 93 94 95 96 97 98 99 00 01*
Colombia
Mexico
Pakistan
Thailand
Vietnam
Laos
Afghanistan
Burma
* Values for Latin America are projected
3,441 3,3893,671
3,302
4,068
5,106 5,000
4,452 4,263
5,082
1,264
Metric Tons
ONDCP/FEB02
6
54 percent
Mexico/CentralAmerican Corridor
Estimated Cocaine Flows ca. 2000
43 percentCaribbean Corridor
3 percentDirect to U.S.
7
Interdiction of Cocaine, 1999
512Metric Tons
DepartSouth
Americafor U.S.
Arrival Zone Seizures
Transit Zone Seizures
MEXICO /CENTRAL
AMERICANCORRIDOR
-60 MT -37 MT
3% 15 MT
43%220 MT
54%277 MT
75 METRIC TONS DETECTED
DEPARTING FOR NON-US MARKETS
-14 MT -7 MT
-12 MTDIRECT TO CONTINENTAL U.S.
CARIBBEANCORRIDOR
382 MTPotentially
Arrives in the U.S.
8
• Where are the profits?
• Price structure of one kilo of pure cocaine, ca. 2000:
Coca leaf (e.g., farmgate in Peru) $ 300Coca base (farmgate) 900Cocaine hydrochloride (export/Colombia) 1,500Cocaine hydrochloride (import/Miami) 15,000Cocaine (67% pure/dealer U.S.) 40,000Cocaine (67% pure (retail/U.S.) 150,000
Who Are the Winners…?
9
DIMENSIONS OF U.S. DEMAND
% Reporting Past Month Usage, 1985-2000
0
5
10
15
1985 1988 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
Source: SAMHSA, National Household Survey on Drug Abuse.
*The survey methodology was changed in 1999. Estimates based on the new survey series are not comparable to previous years.
New surveyseries*
U.S. DRUG USERS, 1990-2010
• 1990 = 13.5 million (6.7%)
• 2000 = 14.0 million (6.3%)
• 2007 = 19.9 million (< 8%)
• 2010 = 22.6 million (8.9%)10
11
Drug Use by Drug Type
12
Percent Reporting Past Month Use of any Illicit Drug
3
9.8
16.4
19.6
13.2
7.8 75.3
6.54.8
2.40.3
0
5
10
15
20
25
12-13Yearsof age
14-15 16-17 18-20 21-25 26-29 30-34 35-39 40-44 45-49 50-64 65+
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
13
Drug Usage among Students, 2000
Percent Reporting Use of “Any Illicit Drug”
Source: Monitoring the Future Study
26.8
45.6
53.9
19.5
37.2
41.4
11.7
22.7
25.7
0 10 20 30 40 50 60
8th
10th
12th
30-DayAnnualLifetime
14
Consumer Expenditures on Illicit Drugs, 2000
U.S. Users Spend $63.2 Billion Annually
Billions of Dollars (Projections for 1999)
2.31.6
10.411.9
37.1
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
Cocaine Heroin Marijuana Meth Other
Source: ONDCP Paper, What America’s Users Spend on
Illegal Drugs
15
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….
• Incarceration as deterrent
16
Cocaine and Heroin Prices: 1981-2010
17
Arrests for Drug Abuse Violations, 2000
9.3%
5.6%
4.1%
40.9%
24.2%
15.8%
Sale/ManufactureHeroin/Cocaine
Sale/ManufactureMarijuana
Sale/ManufactureOther Drugs
Possession Marijuana
PossessionHeroin/Cocaine
Possession otherDangerous Drugs
Reasons for Drug Arrests, 2000
Source: Uniform Crime Reports, FBI.
18
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
6. Challenges to sovereignty—e.g., invasion of Panama 1989
7. Process of “certification” (now modified)
19
20
Cultivation (Mexico): 2000-2009
21
22
QUESTIONS OF PUBLIC POLICY: WHAT ARE THE ALTERNATIVES?
INTRODUCTION
1. What might be desirable? Or feasible?
2. What are the prospects?
23
ARE THERE ALTERNATIVES?
1. Continuation (or acceleration) of current policy:
Increased budgets
Establish coherence
Long-term durability
24
2. Legalization:
Regulation, not legalization
Decriminalization?
Partial or complete?
25
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
Terminate/ignore certification?
ENLIGHTENMENT IN LATIN AMERICA!
• Marijuana personal use is decriminalized in :– Argentina– Brazil (depenalized)– Colombia– Costa Rica– Mexico– Peru– Uruguay (now broadly legalized)– Venezuela 26