Drug Policy

T
his week's arrest of nine Australians in Bali on heroin-trafficking charges is a success for law enforcement. But such would-be narcotics entrepreneurs are also responding to the profit opportunities created by past successes in seizing heroin and arresting key distributors.There are only two policy stances that make much sense in dealing with narcotics: zero tolerance or full legalisation. Once drugs are banned, one immediately gets the predictable effects of a black market.
First, uncertain quality. You (or your heirs) cannot sue your heroin dealer. There is no quality endorsement certificate they can aspire to. Illegality means the strength of a dose, and what might be added, is made much more uncertain.
Second, violence. If narcotics are illegal, they represent wealth without legally enforceable property rights. It is wealth up for grabs by the stronger and the more violent.
Being illegal also imposes a risk premium. People will only risk jail terms or worse to supply an illegal market if the potential return is high. High prices for addictive substances invite property crime by addicts to support their addiction.

If narcotics are illegal, giving any sort of permitted (tacitly or otherwise) social space for them to operate just spreads the ill effects of being illegal in addition to the problems inherent in narcotics. If we are going to ban drugs, then we need to be serious about the ban.
Attempts to restrict the flow of heroin into Australia have apparently been successful in recent years. Since Christmas 2000, there has been a heroin "drought" in this country. Deaths from heroin overdoses have dropped dramatically. The time it takes to score heroin is longer and prices are higher. Heroin purity is down.
Better border control and enforcement seem to be a central part of the story. In 1993-94, about 50kg of heroin was seized in Australia. In 1998-99, more than 500kg was seized and about 270kg the following year. There was a wave of arrests of prominent drug distributors. Drought (of the water variety) in Myanmar's opium-growing areas may have helped, although the overthrow of the Taliban in 2001 has greatly increased opium production in Afghanistan.
Clearly, just as with border control for illegal entrants, successful border control for drugs involves co-operation with neighbouring states. Clearly, also, if prices are up, so is the potential profit.
The Bali Nine represent these things coming together. High prices mean high profits and this in turn tempts would-be drug entrepreneurs: precisely the sort of people any zero-tolerance policy wishes to most discourage. Helping the Indonesians to arrest them in Bali sends lots of messages. It gives the Indonesian authorities a big win. It shows co-operation is real. And it does so in a way that maximises publicity. How much this was serendipity from catching them when proximity and evidence were most convenient and how much calculation is a question for others.
What is striking reading two online publications on the heroin drought by the NSW Bureau of Crime Statistics and Research (The Australian Heroin Drought and Implications for Drug Policy, and The Impact of the Australian Heroin Shortage on Robbery in NSW) is that heroin users do respond to the rise in the price (including more diluted strength) and cost (increased search time) of heroin. Higher prices and longer search times mean less heroin use.
Which means successfully restricting the supply of heroin can genuinely reduce heroin usage. A definite plus for a zero-tolerance policy.