Sunday, October 4, 2009

Mexico's Hopeless Drug War

Mexico's Hopeless Drug War
Mexico's decriminalization is an admission that things aren't getting better.

Mexico announced recently that it will decriminalize the possession of "small amounts of drugs"—marijuana, cocaine, LSD, methamphetamines, heroin and opium—"for personal use." Individuals who are caught by law enforcement with quantities below established thresholds will no longer face criminal prosecution. A person apprehended three times with amounts below the minimum, though, will face mandatory treatment.

For the government of President Felipe Calderón, which has spent the last three years locked in mortal combat with narcotrafficking cartels, this seems counterproductive. Is the government effectively surrendering to the realities of the market for mind-altering substances? Or could it be that the new policy is only a tactical shift by drug warriors still wedded to the quixotic belief that they can take out suppliers?

The answer is that it is a bit of both. But neither matters. Mexico's big problem—for that matter the most pressing security issue throughout the hemisphere—is organized crime's growth and expanded power, fed by drug profits. Mr. Calderón's new policy is unlikely to solve anything in that department.

The reason is simple: Prohibition and demand make otherwise worthless weeds valuable. Where they really get valuable is in crossing the U.S. border. If U.S. demand is robust, then producers, traffickers and retailers get rich by satisfying it.

Mexican consumers will now have less fear of penalties and, increasingly in the case of marijuana, that's true in the U.S. as well. But trafficking will remain illegal, and to get their products past law enforcement the criminals will still have an enormous incentive to bribe or to kill. Decriminalization will not take the money out of the business and therefore will not reduce corruption, cartel intimidation aimed at democratic-government authority, or the terror heaped on local populations by drug lords.

Nevertheless, Mexico's attempt to question the status quo in drug policy deserves praise. Unlike American drug warriors, Mexico at least acknowledges that it is insane to repeat the same thing over and over again and expect a different outcome.

Because so many Americans like to snort cocaine, that business has flourished over four decades. Most of the traffic once went through the Caribbean, but a crackdown on the sea routes caused suppliers to shift to paths over land through Central America and Mexico. In just two decades Mexican drug capos took over the industry, adding other drugs to their product lines. By paying their employees in kind rather than in cash, they also grew the business at home; lower-level "mules" have to push locally to turn their salary into money. Now Latins have become consumers. In other words, demand and prohibition up north have poisoned the entire region.

As their revenues exploded, the drug lords took over large swaths of Mexican territory. Government officials who couldn't be bought with silver were eliminated with lead. When Mr. Calderón took office in December 2006, he pledged to restore order. By all accounts his "war" is being waged on the belief that a free society cannot be held hostage by organized crime, not on the belief that supply can be defeated. Mexico seeks to raise the cost of trafficking so that the flows go elsewhere.

Almost 1,150 law enforcement agents and military have been murdered in the last three years in this war. Having staked his presidency on restoring Mexico's rule of law, Mr. Calderón has had an incentive to claim that his blitz is working. And there is no doubt that it has had an effect. Wherever the army has moved in, extreme lawlessness has subsided. Thousands of criminals have been killed, either by law enforcement or by rival gangs who now fight over shrinking turf. Drug shipments have been confiscated, traditional supply lines for imported chemicals used to manufacture methamphetamines have been disrupted, and corrupt officials have been outed.

Yet the war rages on. Dead capos are replaced, new supply lines for making meth—most recently discovered coming from Argentina—crop up, and corruption persists. The racketeers kidnap, rob and trade in weapons. They are also innovators. Semi-submersibles are now used to move drugs by sea.

By decriminalizing consumption, Mexico is admitting that things are not getting better. It says its hope is to concentrate limited resources in going after producers, traffickers and retail distributors. According to the Mexican Embassy in Washington, another goal is to end the corruption that comes from the "free interpretation of what constitutes 'retail drug-dealing.'" The aim is to reduce police graft while going after big fish, not little ones.

The war on supply is a failure, something any first-year economics student could have predicted. But this plan is unlikely to reverse the situation. It is demand north of the border that is the primary driver of organized-crime terror. And that shows no signs of abating.

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