The Perfect Free Enterprise Model: Organized Crime & Drugs

As part of my involvement with the Law Enforcement Against Prohibition, I had a radio interview today with David Rutherford who is with the Corus Radio Network.

Before the interview, my Wiki check on Rutherford and his program made me aware that he is a populist “conservative” and  appeals to those listeners with ideological leanings to the right. Conservatives generally support Stephen Harper, inasmuch as they believe he represents for PDF: privatization, de-regulation and free markets.

Rutherford attempted to redirect the LEAP platform as something that includes government regulation, government involvement, government distribution of psychoactive drugs. His voice intonation was quite revealing: government is a bad thing and the free market could, by implication, handle drug distribution much more effectively than can government.

I reminded him that the private sector sold and marketed tobacco under a banner of misinformation and lies. It took governments to expose the tobacco industry for the criminal cartel it has become (see The Tobacco Conspiracy). The Canadian federal government imposes regulations regarding to whom (no minors) this narcotic can be sold, and under what conditions must be included on the packaging (warnings that cigarettes can kill you along with disturbing images of tobacco effects).

After the commercial break, I drew attention to Rutherford’s pro-free enterprise advocacy and pointed out that organized crime is a perfect free enterprise model.

Powdered cocaine emerged as an innovative packaging and distribution solution to the problems with shipping raw coca leaves in bulk from Columbia and Bolivia. The same privatization model is evident where the powder is further refined to make crack cocaine so distributors can extract even greater value from their product.

Organized crime deals with competition by eliminating it, or by forming massive drug cartels for particular marketing strategies. These organizations go to battle for market share or distribution rights in highly populated areas where consumer demand is highest. They outsource thousands of support staff and pay them well, relative to what workers can earn in the local free market. And, just as we see in Mexico, drug distributors “lobby” local law enforcement authorities to support their business activities, often making them offers which they can’t refuse.

Drug distribution by organized crime is the perfect free enterprise model but not without its “negative externalities”, a term coined by economist Milton Friedman, the priest of free enterprise thinking. That’s economist-speak for the unintended consequences of business activities, and in this case it means addiction, violence, degraded neighborhoods and billions wasted on prohibitionist policies.

Isn’t it about time we gave government a chance to take over drug regulation and distribution? The private, free enterprise model made possible by prohibitionist policies over the past 100 years has completely failed us.


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