I have been paying a slight bit of attention to federal and state drug policies for most of my life, starting with DARE in middle school. And I have noticed a trend in policy: while some measures are occasionally taken to focus on the “demand” side of the drug problem, most resources are deployed on the “supply side.”
When you hear the phrase “supply side,” you probably think of Reagonomics and “trickle down theory.” And if you are on the left, you’ve probably observed that it doesn’t really work. As an economic stimulus policy, “supply side economics” is the idea of stimulating the economy by lowering taxes for the sellers of products and services, in hopes that it will “trickle down” in the form of various kinds of spending that results, in terms of pay to workers and supply chains, in more people getting paid. It doesn’t work, though, because economics doesn’t work that way. People who have money choose to invest based on demand, not based on their own resources. Lowering costs does not lead to producers producing more, it just increases the surplus that they can save. They still behave as rational econs, producing only as much as they can profitably sell, and selling it at whatever price the market will bear. All economists know (but many won’t say out loud) that stimulative economic policies are more impactful when the money is given to poor people, who always spend it all back into the economy.
In terms of drug policy, when I say “supply side” what I mean is that the efforts of law enforcement are more focused on trying to disrupt the supply chains of harmful products, rather than focusing on measures to reduce the demand for them. For example, they spend money on policing the national borders for potential drug imports, and on policing regional and local drug dealers to break supply chains. These efforts don’t work in terms of economics, though, for a simple reason: supply follows demand. When they consumer still wants the product but a supplier has been disrupted, the consumer will just go to another supplier. If the volume available for sale is decreased, then the remaining suppliers will raise their prices, and the rise in price will increase the incentive for someone new to start producing or importing. The market self-corrects, and the supply chain is always restored after the momentary disruption. The only real effect is that a few individuals suffer along the way. But the effort never actually leads to “less drugs in circulation” in the long term. Instead, it just increases the magnitude of the school to prison pipeline, as “drug dealer” remains the most lucrative opportunity for many young people. The supply side approach to drug enforcement is ultimately a jobs program; it keeps the turnover rate high among drug dealers, such that the economy is always hiring for that position, and also gives police officers and prison guards, who might otherwise be violent criminals themselves, justification to be employed by the government.
If we as a society actually cared about drug abuse as a systemic problem and wanted to really solve it, we would be better served to address the demand side, which means a few things that we don’t want to talk about. Of course we start with treatment programs and alternative medications like Methodone, to give addicts a physical pathway out of addiction. But what we should really be doing is addressing root causes. There are really two main causes of substance abuse and they are poverty and medical problems. We could fix many substance abuse problems by giving people a worthwhile reason to stay sober, like a good job or academic opportunity; and we could solve many more by giving people easy access to quality healthcare to actually troubleshoot and treat causes of chronic pain or mental illness, rather than leaving people to self-medicate in potentially harmful ways. Of course, solving our national mental health crisis is not as simple as just passing a funding bill to put one extra therapist in every town free of charge. Our mental health crisis isn’t from a lack of therapists (though that exacerbates it). It’s from a culture of scarcity, competition, and relentless demands on our energy. It’s from social media and pop culture that inundates us with fake connection and makes it harder to get our basic needs for love and belonging actually met. It’s from cultural messaging that gives people endless reasons to feel inadequate or unworthy, and too few pathways to meaningful fulfillment. Unfortunately, none of these things is trivial to solve, or even to show progress within a single elected term of office, so our system of “accountability” that punishes politicians who engage in long term policy planning prevents us from even trying.
Incidentally, all of this applies to guns as well as drugs. While some categories of gun crime can be reduced by adding friction to the purchase process, determined criminals are seldom deterred by a mild inconvenience in having to seek a different supplier, and as long as the demand is unchanged, a black market will always arise to fill that demand. This is especially true when supply constraints are only regional, such as restricting gun purchases in New York but not in adjacent Vermont, or Illinois but not adjacent Indiana and Iowa. We would get more consistent results if we turned levers on the demand side and reduced the number of people seeking these harmful objects and their willingness to pay higher prices for them, than by essentially just moving the supply curve to increase the equilibrium price.
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