Criminal Justice Reform

Ending the War on Drugs Would Unleash Economic Growth

As policy, the war on drugs isn’t just cruel and inhumane. It’s also one of the big reasons that our economy has been stagnating for the past few decades. There are profound negative economic effects to the war on drugs.

While the stock market has been rising and unemployment has been falling, the United States economy is still worse than it should be. Income inequality has been rising for decades (though perhaps less than people think). Income mobility is low and has been for decades, according to economist Raj Chetty. Of those born into the bottom income quintile, more than a third remain there as adults. Overall, median wages have been stagnating. Worse, the United States is creating fewer new businesses every year than we used to. The Brookings Institute, a nonpartisan think tank, finds that the rate of ‘firm entry’ (new businesses being created) fell substantially and consistently from 1978 to at least 2011.

Liberals like to blame this stagnation on the free market, but there’s a different explanation for our decades-long economic slowdown: the drug war. The war on drugs systematically hunts down and imprisons black-market entrepreneurs, meaning that fewer entrepreneurs are around to create new businesses.

The war on drugs rounds up and jails low-income Americans and minorities, which worsens income inequality. Criminalizing drugs means that hundreds of thousands of mostly-poor Americans languish behind bars, sometimes for decades, and can’t find a job when they finally get out. That worsens income mobility.

Ending the war on drugs would substantially reduce all three problems.

Reason #1 to End the War on Drugs: It Punishes Entrepreneurs

One negative effect of the war on drugs is that the US is less entrepreneurial than it used to be, because drug dealing is inherently entrepreneurial.

As a drug dealer, you have to find clients. You have to measure inventory and manage sales and overhead. You have to manage employees. You have to be aware of your competitors in a crowded space and develop your niche. You have to navigate all of that while turning a profit.

In fact, drug dealing is even more entrepreneurial than building a legal company. I’d like to pose a question to the legal entrepreneurs reading this. How would you market your company if you couldn’t let the cops know you existed?

Facebook ads are out. Google ads are out. You can’t just set up a website and sell from there, unless you want to be the next Ross Ulbricht. You can’t even set up a storefront and wait for foot traffic, because that’s a little bit obvious to the cops.

So how do you do it?

It takes a lot of creativity, a lot of ingenuity, and a lot of hustle. All things entrepreneurs need.

Entrepreneurs also worry about their competition, with good reason. How much more worried would you be if you knew that your competitors wouldn’t just undercut you on price, they might threaten your family? And what if you couldn’t go to the police because the police would just throw you in prison?

How would you handle it? You might hire armed guards, but you’d better hire very loyal ones; which takes excellent HR skills. And takes a big chunk out of your profits. (As an aside, ending the war on drugs would reduce how much money flows to armed gangs tasked with protecting dealers.)

Another problem that drug dealers face is customer churn. For almost every business, churn—customers leaving—is a big concern. How much more of a problem would churn be if your clients kept going to prison?

Successful drug-dealing takes a lot of hustle, a lot of risk, and a lot of creativity. These are all things entrepreneurs need. It also takes lots of guts. Legal entrepreneurs fear that their business might fail. Black-market entrepreneurs fear that the police or their competitors might shoot them.

Why should drugs be legal? Because one negative effect of the war on drugs is that smart, entrepreneurial people end up locked up instead of contributing to society.

The entrepreneurial aspect of drug dealing isn’t just theory. When drug dealers become legal entrepreneurs, they thrive. Jay-Z got his start dealing drugs. So did Russell Simmons, former CEO of Def Jam Records, one of the largest African-American-owned media companies in the United States. A lot of entrepreneurs, especially if they grew up on the streets or without access to traditional education, got their start dealing drugs. Ending the war on drugs provides a way for more of these men and women to create their own rags-to-riches story.

Are All Drug Dealers Violent?

To be clear,we shouldn’t endorse violent drug dealers. Violent drug dealers should rot in prison. And they will, regardless of whether or not we end the drug war; because violence will always remain a crime.

But a lot of drug dealers are non-violent, such as the college student who was nice enough to supply my fraternity with regular marijuana. He would drive up every Thursday, sit down on our couch, open his briefcase and show off his products. He had pricing laid out, scales, and appointments for the rest of the day. He didn’t carry a gun. He was just trying to hustle and make it through college without debt.

This was in Colorado, before Colorado legalized marijuana. If he had been caught by police, then he would be in prison right now. That’s the reality for most drug dealers, and it’s a huge reason to end the war on drugs.

We all know how important entrepreneurship is for economic growth. Entrepreneurs create new products like Facebook, Google, and Lyft. They create new services and employ most of us. They’re the reason that our economy has been as dynamic as it has been.

But the US startup rate has been falling for several years. A lot of people find this hard to believe, because giant new companies like Facebook are very visible. But in the startup industry, those are actually called ‘unicorns’ because they’re so rare. The vast majority of startups are mom-and-pop shops or one-man enterprises, and those are getting created at lower rates.

One reason for this decline is a federal policy that encourages police to hunt down, round up, and imprison black-market entrepreneurs. Ending the war on drugs would mean that more entrepreneurs are out creating valuable products, rather than languishing in prison.

Reason #2 to End the War on Drugs: It Destroys Careers

The second way that the drug war hurts economic growth is by wrecking the career prospects of many poor and minority Americans.

Let’s step back for a minute and think about the size of the drug war. In 2015, 469,545 people were imprisoned in the United States for drug offenses. And that doesn’t include anyone who had a gun on them; it’s only people who were imprisoned solely for drug possession or dealing.

That’s a lot of people whose lives are being ruined. If you’re wondering, “why should drugs be legal?” one core reason is to help these people out.

To illustrate how bad our criminal justice system is for one’s career prospects, let’s take a hypothetical:

Marco lives in Detroit and works as a mechanic. Marco lives in a poor neighborhood, but he’s trying to save some money to switch jobs and move into a bigger house in a nicer neighborhood. Let’s say he has $3,000 saved up.

The police arrest Marco for possessing marijuana. As soon as those cuffs clink closed on Marko’s wrists, he knows he’s going to jail. That means a few things:

He’s probably not showing up for work tomorrow, or maybe the next day or the next day. A lot of people think that in America, you only go to jail for a few hours or a day before your trial. That’s not the case. Jail can last for days, weeks, or even months. Kalief Browder, who was 16 when he was arrested for stealing a backpack, spent 3 years in jail without a trial. While Marco is in jail, he’s not going to work. Pretty soon his employer is going to fire him, because the employer can’t be a man down for weeks.

Marco can get out of jail if he pays bail. The problem is that bail is expensive. The average bail for a felony charge is $10,000. How could Marco pay for that? He could take out a loan, but going into debt isn’t ideal. He could hire a bail bondsman, who will pay bail for him. The problem is that bail bondsmen typically charge 10% of bail as their fee.

So right away, best case scenario, just for being accused of a crime, Marco is out $1,000 to a bail bondsman. Worst case scenario, he can’t find a way to pay bail and he loses his job while he’s languishing in jail.

When Marco goes to court, if he’s convicted, he’ll go to prison for many years as a result of the drug charges. The average prison sentence for marijuana is 88 months.

Spending years in prison takes a giant chunk out of Marco’s lifetime earnings. During this time, he can’t put money away into savings trying to buy a new house, or even contribute to Social Security to finance his retirement. He can’t try to save up money for his son’s college. He’s just sitting in prison, cut out of the workforce.

At the same time, while he’s in prison Marco will not be learning new skills. If he has a 7-year prison sentence, then by the time he gets out, his skills will be rusty and substantially out of date.

His career prospects will also be hurt for another reason. Many companies ask candidates if they’ve been convicted of a crime on their job application. Those job applicants who say ‘yes’ go right to the bottom of the pile. Most companies will not hire Marco, either because he’s a convict or because his skills are rusty and out of date. Ending the drug war would mean that the Marcos of the world can spend their best years contributing to the economy and building wealth, not being a drain on taxpayers.

In many states, when you’re out of prison you’re put on probation. Probation is expensive. In 2017, 12 states and the District of Columbia had laws against drug convicts getting a driver’s license. Without legal transportation, Marco is going to have a tough time getting to his job even if someone hires him.The Urban Institute, a leading liberal think tank, performed a study on how access to transportation affects economic opportunity. They found that, “keeping or gaining access to automobiles is positively associated with the likelihood of employment.” Without a car, it’s harder to show up to work on time, because public transportation can be unreliable.

This negative effect of the war on drugs doesn’t get much attention, but the fact is that convicted criminals’ lives are rough even after prison. Ending the war on drugs would dramatically reduce the number of people suffering from probation even after they’ve done their time.

Marco’s network is also going to consist primarily of people he met in prison. This means a large proportion will be gang members or violent criminals, rather than upstanding citizens. If he’s short on money, then he’ll face constant pressure from this network to engage in crime.

All of this means that when Marco finally sees daylight, he’ll have low career prospects, a poor network, and not a lot of potential. This is one of the reasons that the United States’ recidivism rate is so high.

The recidivism rate in the US is 49.3% over 8 years; even once Marco does his time and rejoins society, there’s a 1 in 2 chance that he’s going back to prison within 8 years.

That takes an immense toll on Marco’s career and lifetime earnings, and it’s one of the reasons that people like Marco, who are born poor, so often live and die poor. According to PEW Research Center (a centrist think-tank), 15 percent of never-incarcerated Americans who start life dirt poor end up in the top 20% of income earners. Reducing our system of over-incarceration by ending the drug war is the easiest way to dramatically boost income mobility. Drugs should be legal because once they are, hundreds of thousands more Americans will be free to pursue their own Horatio Alger story.

Why Should Drugs Be Legal?

It may seem naive to ask, “Why should drugs be legal?” After all, hard drugs like cocaine and heroine have ruined a lot of lives; surely we should keep them off the streets. But while we should worry about drug addiction, we shouldn’t ruin hardworking Americans’ lives over what’s often recreational usage.

Reason #3 to End the War on Drugs: It Perpetuates Intergenerational Poverty

Another reason that drugs should be legal is that the war on drugs perpetuates intergenerational poverty. The war on drugs doesn’t punish all Americans equally. When I went to the University of Colorado at Boulder, we weren’t being raided. CU students are primarily white and have rich parents, which meant we didn’t become victims of the war on drugs. The war on drugs focuses on poor and minority communities, and it ravages these communities. A profoundly negative effect of the war on drugs is the impact is has on the children of these communities.

Imagine that you’re a 14-year-old kid in the poor part of Chicago. If your mother or father is taken away by police, then that’s going to have profound implications on the rest of your life. You might experience a lot of anger at government and society and life overall, because someone you loved and admired is now behind bars for a victimless crime. You’ll lack that strong parental role model. You may also get the sense that the police unfairly targeted your family, which makes kids more likely to be lawless. Parents shouldn’t do drugs, but what’s worse for a teenager–a parent who occasionally smokes marijuana, or one who’s behind bars?

Children whose parents are behind bars are more likely to drop out of high school, not go to college, and end up homeless. This is a key reason that drugs should be legal.

One thing conservatives get right is the importance of a 2-parent household. This doesn’t mean two heterosexual parents; but strong parental figures are critical to a child’s development. What should we expect from a policy like the war on drugs that systematically takes these role models away from poor and minority children? Put simply, ending the war on drugs is good for children who won’t have to fear their parents being locked away.

Negative effects of the war on drugs:

  • perpetuates income mobility
  • increases income inequality
  • hampers economic growth
  • keeps poor people poor

Reason #4 to End the War on Drugs: It Pulls Hard Working Americans Out of the Workforce

Here’s another negative effect of the war on drugs. Hundreds of thousands of Americans are behind bars for drug possession or dealing, where they can’t work and contribute to society. These men and women are not allowed to put their skills, services, and intelligence to work to help their companies, clients, and communities.

This takes an immense toll on the economy. Ending the war on drugs would free these men and women to contribute to our economy and grow the economic pie for everyone.

Ending the War on Drugs is Good for America’s Soul

The drug war isn’t just an economic problem; it’s a moral blight. We should end the war on drugs not just to kickstart our economy, but to be fair and just to hundreds of thousands of Americans.

The drug war doesn’t just punish peoples’ careers, it destroys their lives. It’s cruel, inhumane, and draconian.

Many states have “3 Strikes, You’re Out” laws, which were pushed in the 1990s as part of a nationwide tough-on-crime movement. These laws mean that if someone is convicted of three felonies, then they will be thrown in prison for life. This might make sense for some violent felonies, but one of the negative effects of the war on drugs is that this same standard is now applied to nonviolent crimes like possession.

Let’s imagine a 22-year-old mother with two toddlers, a boy and a girl. At 19, she was caught buying an ounce of marijuana. In most states, that’s a felony; so that’s one strike.

She might go to prison for a few years, and get out early for good behavior. But when she’s 22, let’s imagine that she’s busted again; this time with an ounce of marijuana, and a gram of cocaine in her pockets. Neither makes her an addict; she’s a recreational user, similar to someone who might buy a handle of vodka. But the minute the police stop her, frisk her, and find her drugs, her life is over. When those handcuffs clink closed around her wrists and she’s put in the back of the police vehicle, she has lived her last free day.

The cocaine is strike 2. The marijuana is strike 3.

This 22-year-old woman will die behind bars. Once she sets foot in prison, she will never see daylight again. She will live, grow old, and die in a cell. Her children will never know their mother, except for occasional visitation rights.

That’s the inhuman face of the war on drugs. That’s why drugs should be legal.

This isn’t to say that those who advocate for the war on drugs are bad people. Conservatives want good things: law, order, security, and to help poor and minority communities. They think they’re helping these communities by fighting the scourge of drug addiction. Being factually wrong doesn’t make them bad people.

But all of us should care about creating strong families and policies that help poor people to live the American Dream. All of us should oppose a bloated government program that ruins the lives of our low-income and minority countrymen.

And on that front, there’s good news. Momentum is turning towards ending the the war on drugs. A recent poll showed that 61% of Americans support legalizing marijuana. Congressmen on both sides of the aisle are proposing bills to legalize or decriminalize marijuana and even other drugs.

Once marijuana becomes legal, it’s a short step to decriminalizing other drugs.

If we can continue to fight the war on drugs, and work with people on both sides of the aisle, then we can end the war on drugs in our lifetimes and restore liberty.


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