Opponents of the War on Drugs sometimes argue that the artificially elevated profits — because of artificially elevated drug prices — that drug dealers enjoy thanks to criminalization have caused all kinds of havoc, particularly in minority neighborhoods. Young kids get the wrong kind of role model, etc. Yet at the same time, drug prices have indeed fallen dramatically. A reader writes:
Now most people – even if they don’t buy into the entire Austrian tradition – at least believe in some version of the laws of supply and demand. The fact that a black market good is anywhere near cost-comparable with a perfectly legal good indicates that efforts to eliminate or reduce supply are pretty much epic failures. In many clubs, in fact, one can purchase illegal drugs faster and more easily than one can get a drink from the bar (although drug dealers don’t take American Express. Well, they might – just not in the way that you’d like). Again, any respect at all for supply and demand should quickly generate a giant WTF with regards to the efficacy of the war on drugs.
Here are some decent “back-of-the-envelope” numbers for a night’s … err… nightclub entertainment for two people (cover charges may also apply):
Beer – $60
Hard liquor-based drinks – $150
Now these things are not necessarily contradictory, but does anyone have a coherent story to tell that weaves all this together?