In this clip, Glenn talks with Manhattan Institute fellow Charles Fain Lehman about the drug crisis in the US. Even with 100,000 fatal overdoses annually, the rapid spread of marijuana legalization, increases in methamphetamine use, and widespread teen Adderall addiction, Charles believes that the extent of the problem is under-recognized. He walks Glenn through what he sees as some of the underlying economic issues at work.
This is a clip from the episode that went out to paying subscribers on Monday. To get access to the full episode, as well as an ad-free podcast feed, Q&As, and other exclusive content and benefits, click below.
GLENN LOURY: I want to shift the subject again, because I noticed you've been writing a lot about drug control policy and about alcohol. What are your big think insights in the area of drugs and alcohol?
CHARLES FAIN LEHMAN: How do you think about drugs? It's a huge issue. What I would say at the start is that I think that we are currently in a period of systematically underrating what a problem drugs are. That may seem surprising, because everyone pays lip service to it: “Yeah, this is a drug crisis.”
But we don't really act like it's a crisis. A hundred-thousand, probably 110,000 people died from drug overdoses. That was last year. That's actually the standard of the past two to three years. Drug abuse is an enormous problem. We don't really think a lot about how to address it. We still treat it like it isn't nearly the 100,000 figure. That's a fivefold increase over ten years ago, a tenfold increase over twenty years ago. It's an enormous increase in deaths.
But I think we are also, across the board, much more sanguine about addictive substances than we were thirty years ago. There's a theory that drugs and drug culture go in cycles, and alcohol's involved in this, too. We learn about a drug, we try it, we're really excited about it, we start to experience the adverse harms of it, we swing wildly in the other direction, we ban it, we regulate it away, we become naive, and then we try it again. And you saw the cycle at the start of the twentieth century before we actually prohibited drugs. You saw the cycle again in the '70s with both marijuana and cocaine. Heroin, too, in the '60s.
And then we're, I think, starting to see it again. So you see it in illicit drug use, what I call hard drug use. You see it with the transition to fentanyl, the spread of methamphetamine again, its expansion. But you also see it in growing use of marijuana, you see it in growing use of psychedelics. People are starting to notice that large fractions of our juvenile population is hooked on amphetamines—Adderall—to often seriously debilitating effect.
I just want to ask whether it's appropriate to draw any lines here, hard drugs and recreational and all of that. And Adderall use, which is yet another thing. Are you lumping them all together inappropriately? I just want to get you to address that.
So the answer is yes and no. Every addictive substance is different in the way that it affects users. It's different in what its risks and harms are. For example, take something like cigarettes. Smoking one cigarette, very few acute harms. Your risk of nicotine toxicity is basically nil. Very large chronic harms. Something like amphetamine, your acute harm risk is much higher, but you have a long-term harm risk. Marijuana mixes acute and chronic harms. The point is, when we talk about, “Can you say some drugs are pretty bad and some drugs are not?” what I really like to say is drugs have different risk profiles, and you need to regulate accordingly. That's certainly true.
The other thing I would say is you can extract a general factor of toleration for drugs. You can say the way in which we regard drugs and their tolerability tends to swing together over time. In periods where we are using one substance, we are using another substance as well, and our capacity as a society to respond to substances seems to struggle to differentiate them. So in that regard, I think that it makes sense to say we are in one of these historical periods where we are comparatively more sanguine about drug use across a spectrum. That we try to draw these lines is in part a product of trying to become more sanguine about some substances. We worry about meth use, but we don't worry about recreational amphetamine use, even though they're the same substance. We think about cigarettes and marijuana as being wildly different, even though in many ways they're quite similar. We pick and choose which substances we want to tolerate. But my assertion is, in part, the impulse is towards an increase in tolerance generally, all else being equal.
Now, okay, what role has criminalization of use—the legal system—to play in what's a larger social management problem. If you got Adderall and you got cannabis and you got alcohol—we haven't even mentioned alcohol—that presumably has to be in the discussion. We're not going to go back to the days of prohibition on alcohol, and every jurisdiction has got a referendum now about legalizing cannabis, it seems. Where are you in that debate about criminalization?
So I think that we can say a couple of things. There's the “What should people have the right to do?” conversation which we can get into. But I think that everyone actually has very conflicting intuitions here. The people who are consistent on that front are people who believe that heroin should be legal and sold in vending machines. I know those people. I believe they're consistent and wrong, and nobody's going to listen to them, at least not currently.
Everybody else thinks that there's a balance of costs and benefits that is relevant to play out here. There's some benefit to letting people use heroin. Heroin's fun. But then, on the other hand, there are also lots of costs to letting Walmart sell you heroin out of vending machines, and the costs outweigh the benefits.
What I would say from the perspective of enforcement is that there are different components of enforcement. There is prohibition per se, and then there is how prohibition is enforced. Let me give you an example. Until six years ago, sports gambling—and gambling is addictive—was prohibited in most states. It had been prohibited for about thirty years. Extremely low levels of enforcement. They were fewer than 3,000 arrests a year nationwide for gambling-related offenses.
But also, there was very little what we may call industrialized or commercialized sports gambling. They're little gambling operations. They weren't very efficient. In 2018, the Supreme Court says, okay, we're gonna strike down the relevant federal law. Thirty-plus states now have sports gambling. You can gamble on your phone. If you've ever watched a sporting event, you are barraged with ads about sports gambling. And it's having real harms.
It's very disquieting. I don't like it, to be honest with you. Maybe I'm just an old-fashioned guy. They're telling me to bet on the game while I'm watching the game?
We know that in New Jersey's data, I forget the numbers, but it's something like 60 percent of expenditures come from 5 percent of users. Those are problem gamblers. They will lose all their money. Some of them will do serious harm to their lives. Some of them will commit suicide. This has been the experience in the UK. They legalized sports gambling 15 years ago. It's extremely bad. It's very standard what happens when you let big retailers sell addictive substances.
So prohibition per se makes it hard for businesses to operate effectively, to operate economically. You lose lots of efficiencies when you're prohibited from interacting with the financial system, from advertising. It becomes hard to sell stuff across borders.
Then we talk about enforcement. There's a very wide range of possible levels of enforcement. Between 1970 and 1990, we almost exponentially increased the level of enforcement in the United States, drug enforcement specifically. A number of people were getting arrested, a number of people ended up incarcerated. I think what we can now say from that experiment—and actually, I don't think that experiment was as crazy at the time as we take it to be now. But I think what we can say from that experiment is it it didn't work.
This is the War on Drugs that you're talking about.
This is the War on Drugs. I think the War on Drugs was in ways nobler than we give it credit for. It comes down to elasticities. So, for the benefit of your listeners, elasticities are if you increase the price of something by one percent, what is the percentage change in consumption of that price? If you increase the level of enforcement, you will have an effect on the level of a prohibited good. And we have a good empirics now to say that the elasticity of consumption for addictive substances depends on whether or not you're addicted.
So what we saw is that in the '80s, there's a big burst of enforcement, and the number of people who consume actually craters pretty substantially between the late-1970s to the late-1980s. There were many fewer people consuming drugs. And then it flattens out, and measures of the total number of drugs consumed basically remain flat.
What that tells you is that casual users have a fairly elastic response to enforcement. They stop using. That's good. But then once you've convinced all the casual users to stop using, adding additional enforcement, you're trying to target people who are addicted to the substance, and they have a fairly inelastic demand for drugs. And so mostly what you are doing with that population is cycling them through the jail system without actually taking the steps you need to reduce their use. So you're not making the problem any better.
So what I end up saying—I have a paper coming out about this in a couple of months—is prohibition is beneficial in general for substances you want to control. Some level of enforcement is important for controlling the extent of casual use. After a certain level, you hit diminishing marginal returns pretty rapidly, and you need to start thinking about other more public health-oriented strategies.
That was a very long answer.
No, that's good. You're back to your extensive margin, intensive margin point.
This is a question of Sin... a question of moral behavior and the role of limits and tolerances...an age-old question of the perpetual tension between the Rational and the Irrational / Reason and Madness.
It has never been one which is easily or permanently answered because the answer, always, is Balance and human balance, it seems, is temporary at best..
Drunkenness, intoxication, the urge of appetite and indulgence; this then the Wine: "and the blessings of life's flowing juices.... His blood (Dionysius), the blood of the grape.... lightens the burden of our mortal misery. Though himself a God, it is his blood we pour out to offer thanks to the Gods. And through him, we are blessed..." "life's liberating force... He is release of limbs and communion through dance.... He is laughter, and music in flutes.... He is repose from all cares -- he is sleep! When his blood bursts from the grape... and flows across tables laid in his honor... to fuse with our blood... he gently, gradually, wraps us in shadows... of ivy-cool sleep.”
Be it alcohol, meth, heroin, marijuana, ecstasy, LSD, whatever....it takes us away from ourselves. It loosens the bindings, removes the masks (or substitutes some other); it is escape & forgetting, and becoming something beyond the petty and the painfully real, and so we have pursued this riotous abandonment pretty much forever.
But civilizations don't run on Bacchanals. And so we bounce, slowly, back & forth between the two extremes, crafting more laws, more rules, more prohibition, and control (Just Say No) ... only to reverse ourselves, years later, and remove all contraint, restraint, and common sense. We err, consistently, by being excessive in both directions. Now we count the annual tally of 100K OD'd dead and call it crisis. Before we counted the 100K Incarcerated and called it insane.
The underlying problem, of course, is the diminishment of any kind of real moral sensibility that would moderate & self-control consumption by allocating & limiting the space and time and context in which the Irrational has priority...and by attaching to that 'drunkenness' a moral cost that many would refuse to pay because everything is NOT permissible.
Instead, today, we embrace the 21st century version of, 'If it feels good, do it'.... 'Who are we to judge'...
'Everything is relative'.... And we see the result in the West's embrace of what is increasingly just more chaos, more death, and more corruption.
If you trace it back, the death rate due to all causes began to rise , life expencynat age of 50 began to drop mainly in midwestern industrial states surrounding the Great Lakes. The cause of this was not clear, but it started shortly after the NAFTA treaty and the rise in addiction. The bankruptcy and bailout of the SS survivors trust fund, was the result of these increased deaths,. came after about 5 years. By 2010 the American gross life expectancy began to drop. Now we
know this was all due to drugs.