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InvisibleveggieM

Registered: 07/25/04
Posts: 17,504
Are Higher Cocaine Prices a Good Thing?
    #7612901 - 11/08/07 09:26 PM (16 years, 2 months ago)

Are Higher Cocaine Prices a Good Thing?
By Bill Piper
November 8, 2007 - The Huffington Post

Here we go again. President Bush's Drug Czar is claiming success in the war on drugs because cocaine prices are rising. Except two recent government reports say cocaine is still widely available; and higher cocaine prices means greater profits for organized crime and greater violence in our communities. So what is the Bush Administration smoking?

Let's assume that a recent report by the Drug Enforcement Administration (DEA) is accurate, and the average price per pure gram of cocaine increased 47% in the U.S. since last October. That hardly means we're winning the war on drugs. Cocaine prices are still lower than they were 30 years ago, and rising cocaine prices will lead to greater trafficking, not less.

As the price of cocaine increases, it becomes more profitable to manufacture and sell cocaine, which means more people will get into the market and more cocaine will be made and sold. DEA Administrator Karen Tandy was just in Europe in May warning that higher cocaine prices there are causing Latin American drug traffickers to ship more and more drugs there. Higher U.S. prices will lead traffickers to ship more drugs here too.

As the Associate Press notes:

Quote:

Even while acknowledging previously announced shortages during the first half of the year, [a] report prepared by the Justice Department's drug intelligence center found "cocaine availability may already be returning to previous levels in some areas."

[...]

The Justice Department report echoes the findings of another study presented to Congress on Oct. 25 by the Government Accountability Office.




Then there is the impact of higher drug prices on our communities. The minority of cocaine users who commit crimes to support their habit will commit even more crimes to pay for higher prices. And the increased profits that come from higher drug prices will spark turf wars between violent drug gangs. In their best-selling book Freakonomics, economist Steven Levitt and journalist Stephen Dubner review the scientific literature and conclude that falling cocaine prices resulted in a 15 percent decline in violent crime in the 1990s. Sustained increases in cocaine prices could drive crime rates back up.

The Bush administration is citing rising cocaine prices as a reason to give Mexico $1.4 billion for supply reduction efforts there. But even if successful, decreasing the supply would just make cocaine more valuable, boosting the profits of major drug cartels and increasing prohibition-related violence on both sides of the border. A more sensible approach would be to spend that $1.4 billion on drug treatment here at home. An estimated 20 percent of cocaine users account for 80 percent of the quantity consumed. Providing treatment to those who need it most could significantly reduce demand and make drug selling less profitable.

Bill Piper is director of national affairs for the Drug Policy Alliance, the nation's leading organization advocating for alternatives to the war on drugs.


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Offlinemebesideme
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Registered: 08/19/04
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Re: Are Higher Cocaine Prices a Good Thing? [Re: veggie]
    #7613761 - 11/09/07 04:24 AM (16 years, 2 months ago)

The higher prices go; wouldn't the amount of crime associated with it increase also? I have read ratios of the amount of crime in an area versus the amount of untaxed trade in parts of high crime cities in America. The general review, IIRC, is that most people involved in larger volume and higher-priced drug trade tend to act more violently to continue that trade.


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Invisiblebadchad
Mad Scientist

Registered: 03/02/05
Posts: 13,372
Re: Are Higher Cocaine Prices a Good Thing? [Re: mebesideme]
    #7613813 - 11/09/07 05:41 AM (16 years, 2 months ago)

An interesting scenario. It also completely plausible that higher prices will decrease use.


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...the whole experience is (and is as) a profound piece of knowledge.  It is an indellible experience; it is forever known.  I have known myself in a way I doubt I would have ever occurred except as it did.

Smith, P.  Bull. Menninger Clinic (1959) 23:20-27; p. 27.

...most subjects find the experience valuable, some find it frightening, and many say that is it uniquely lovely.

Osmond, H.  Annals, NY Acad Science (1957) 66:418-434; p.436


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OfflineSeussA
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Re: Are Higher Cocaine Prices a Good Thing? [Re: badchad]
    #7613846 - 11/09/07 06:01 AM (16 years, 2 months ago)

> It also completely plausible that higher prices will decrease use.

Pretty much anything is plausible. However, historically, prices of addictive substances have very little to do with usage patterns of people that are currently addicted. Look at cigarette smokers in New York for a classic case study. A few people quite smoking because of the higher prices (due to obnoxiously high "vice taxes"), but for the most part, consumption rates remain unaltered.


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Just another spore in the wind.


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OfflinePlok
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Registered: 09/08/04
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Re: Are Higher Cocaine Prices a Good Thing? [Re: veggie]
    #7614605 - 11/09/07 10:57 AM (16 years, 2 months ago)

Quote:

veggie said:
Providing treatment to those who need it most could significantly reduce demand and make drug selling less profitable.




No... that makes way too much sense. Let's continue shoveling sand into the waves crashing on shore, and ONE DAY, with the help of other nations and an increased budget for law enforcement and controlling other nations, we will defeat those EVIL waves.


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Just say NO to the War on Drugs.


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Invisiblebadchad
Mad Scientist

Registered: 03/02/05
Posts: 13,372
Re: Are Higher Cocaine Prices a Good Thing? [Re: Seuss]
    #7614945 - 11/09/07 12:05 PM (16 years, 2 months ago)

Quote:

Seuss said:
> It also completely plausible that higher prices will decrease use.

Pretty much anything is plausible. However, historically, prices of addictive substances have very little to do with usage patterns of people that are currently addicted. Look at cigarette smokers in New York for a classic case study. A few people quite smoking because of the higher prices (due to obnoxiously high "vice taxes"), but for the most part, consumption rates remain unaltered.




Every basic economic model shows that as prices increase, people buy less goods.

As far as NY is concerned I'd be curious to see the data you are referring to. In a one year period (2002-2003), there was a 5% decrease in smoking which was due directly to the effects of cigarette taxes. This amounted to 75,000 quitters, not trivial by any means.

Whats more important is that another 45.3% reported that they had reduced the number of cigarettes smoked, thought about quitting, tried to quit, or quit in response to the tax increase. Strong evidence about the role of taxes, and price in drug use.

http://www.ncbi.nlm.nih.gov/sites/entrez?Db=pubmed&Cmd=ShowDetailView&TermToSearch=15914827&ordinalpos=1&itool=EntrezSystem2.PEntrez.Pubmed.Pubmed_ResultsPanel.Pubmed_RVAbstractPlusDrugs2


--------------------
...the whole experience is (and is as) a profound piece of knowledge.  It is an indellible experience; it is forever known.  I have known myself in a way I doubt I would have ever occurred except as it did.

Smith, P.  Bull. Menninger Clinic (1959) 23:20-27; p. 27.

...most subjects find the experience valuable, some find it frightening, and many say that is it uniquely lovely.

Osmond, H.  Annals, NY Acad Science (1957) 66:418-434; p.436


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InvisibleAhab McBathsalts
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Re: Are Higher Cocaine Prices a Good Thing? [Re: badchad]
    #7615981 - 11/09/07 04:23 PM (16 years, 2 months ago)

Price increases and the amount of change in consumption is called elasticity. Some goods such as cigarettes, alcohol and in this case cocaine, are very close to inelastic.

Therefore, price increases have very little to do with the reduction in consumption in this case.


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"Nobody exists on purpose. Nobody belongs anywhere. Everybody's going to die."


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Invisiblebadchad
Mad Scientist

Registered: 03/02/05
Posts: 13,372
Re: Are Higher Cocaine Prices a Good Thing? [Re: Ahab McBathsalts]
    #7616000 - 11/09/07 04:28 PM (16 years, 2 months ago)

So you're saying that 5% decrease in the number of smokers in one year due to a price increase makes it "inelastic"?


--------------------
...the whole experience is (and is as) a profound piece of knowledge.  It is an indellible experience; it is forever known.  I have known myself in a way I doubt I would have ever occurred except as it did.

Smith, P.  Bull. Menninger Clinic (1959) 23:20-27; p. 27.

...most subjects find the experience valuable, some find it frightening, and many say that is it uniquely lovely.

Osmond, H.  Annals, NY Acad Science (1957) 66:418-434; p.436


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InvisibleAhab McBathsalts
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Posts: 35,107
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Re: Are Higher Cocaine Prices a Good Thing? [Re: badchad]
    #7616030 - 11/09/07 04:37 PM (16 years, 2 months ago)

As a shareholder of altria group, the maker of philip morris brand cigarettes, I would have to say that the reduction of smoking in many markets is not really caused by tax, but by government regulations and that smoking isn't as acceptable in public anymore. The increase in non-smoking workplaces, schools, bars, restaurants etc has had a much greater impact than taxes. This is the case in many european countries as well as north america. But if you look at markets like china, overall cigarette consumption has increased, completely independant of taxes.


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"Nobody exists on purpose. Nobody belongs anywhere. Everybody's going to die."


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Invisibleoso
man
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Registered: 09/27/06
Posts: 158
Re: Are Higher Cocaine Prices a Good Thing? [Re: Ahab McBathsalts]
    #7616247 - 11/09/07 05:55 PM (16 years, 2 months ago)

Drug market is the only true capitalist model, because there are no taxes. Evilnick is right about the relation of cigs and taxes, people pay an extra 3 dollars to buy a pack in a bar, so price (within limits) doesn't affect usage as much as having to go outside in 20degree weather. Cocaine will follow the basic economic model, because without government control there is no price floor or ceiling... Coke price may go up, which may slow demand, but the supply curve will make up for that by increasing production, which will later decrease price due to surplus.


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"When tyranny and oppression come to this land, it will be in the guise of fighting a foreign foe."
James Madison


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InvisibleMontanahunter420
Mushroom Hunter
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Registered: 05/10/06
Posts: 1,188
Re: Are Higher Cocaine Prices a Good Thing? [Re: Ahab McBathsalts]
    #7616680 - 11/09/07 08:09 PM (16 years, 2 months ago)

Quote:

evilnick said:
Price increases and the amount of change in consumption is called elasticity. Some goods such as cigarettes, alcohol and in this case cocaine, are very close to inelastic.

Therefore, price increases have very little to do with the reduction in consumption in this case.





Did you attend my marketing class wednesday night? Very true and sound.


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All of my posts are purely fictional and for hypothetical purposes.


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OfflineDAVID_ALLAN_CEO
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Registered: 10/29/06
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Loc: Grand Casino Tunica
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Re: Are Higher Cocaine Prices a Good Thing? [Re: Montanahunter420]
    #7617543 - 11/10/07 02:53 AM (16 years, 2 months ago)

there was an article posted maybe here? about england encountering increased trafficking because of the price recently too.. the difference with the uk article was that it was just becoming more popular and had always been expensive ... demand necessitates steady supply throw cost to the wind


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