The War on Drugs Is Wasteful, Oppressive, and Dumb

By David Stockman  |  December 20, 2018

If you’re going to kick authority in the teeth, you might as well use two feet..

― Keith Richards, Keith Richards: In His Own Words (1994)

You can’t appreciate the insanity of the Donald’s Border Wars without knowing one cardinal truth.

Virtually all of the crime and violence the Tweeter-in-Chief forever demagogues is caused by Imperial Washington’s War on Drugs.

Note that immigrants have far lower crime rates than native-born Americans.

The way forward from here is to separate the issues of “illegal drugs” and “illegal immigrants.”

Indeed, under the guise of “law and order,” the Donald is aggrandizing the state and shrinking the sphere of liberty. He’s also imperiling the nation’s economic future.

Of course, the basis for the false association between immigration and crime is not hard to understand.

It’s an easy conclusion to reach based on the inherent violence and mayhem of Mexican cartels bringing illegal drugs across the borders and U.S.-based syndicates and gangs distributing them throughout the land.

Yet that brutal underworld is not remotely a product of undocumented aliens roaming the streets of America.

Folks, it’s the handiwork of the Nanny State.

Agents of officialdom wage a destructive, relentless, and futile war against a market with a $100 billion annual retail value, at minimum.

Our foolish drug warriors systematically inflate already hideously high drug prices. That’s the compensation the drug underground gets for production, security, and “slippage”… to law enforcement.

The truth of supply and demand will out: That’s the “law” that matters here. Government interventions like these make that absolutely obvious.

The War on Drugs is the prototypical exercise in futility.

The rate of drug addiction in the U.S. is essentially unchanged since Richard Nixon declared it during the run-up to his 1972 reelection campaign.

It was about 1% to 2% of the adult population then. And it remains about 1% to 2% half a century later

By contrast, the federal “drug war” budget soared from zero in 1970 to $20 billion by 2010. It was $32 billion for fiscal 2017.

The U.S. prison population – a direct and indirect product of the War on Drugs – has exploded from 200,000 to more than 2.3 million.

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Here’s what we’ve got to show for the $1.5 trillion we’ve spent on the War on Drugs over the last 48 years:

  • A vast network of brutal criminal enterprises to distribute the artificially expensive contraband;
  • A penal system flooded with (mainly) small-time offenders, drug runners, and users, where they spend five to 10 years in “graduate school for criminals.”
  • A widespread false association between the 45 million law-abiding, hard-working, foreign-born residents of the U.S. contributing meaningfully to our economic future and the few tens of thousands involved in an underworld drug market fostered by the Nanny State.

All that societal cost, for what…  a drug addiction rate that’s flatter than a pancake!

At the end of the day – even if done efficiently – it’s simply none of the government’s business.

On Thousand-Point Swings…

Bubblevision – which now includes the opinion page of The Wall Street Journal – begged the Federal Reserve to stop “normalization” now.

Indeed, it’s hopes got so high the Dow Jones Industrial Average floated up nearly 400 points on them just before the Fed announced its decision yesterday…

It’s clear now that only Wall Street matters – inside the Acela Corridor it is the economy.

Jerome Powell didn’t exactly cave; the Fed made its move, but it did “soften” somewhat its language about the global economy.

But it wasn’t enough. The Dow turned immediately, giving up all of its gains and then some.

As of mid-afternoon Thursday, it’s down more than 400 points, heading toward minus 500…

Markets are corrupted by monetary central planning. They’re confused. And the road back to “normal” is going to be treacherous.

We’re looking at a major re-pricing for all financial assets. And thousand-point intraday or day-to-day swings are part of that equation. Those can be frightening… for “buy and hold” investors.

I have a different approach, one that combines strategy and tactics into a plan flexible enough for you to survive and thrive amid the coming chaos. It’s called “The Stockman Model.”

All we’re after is a little stability, perhaps a chance to pocket a windfall when opportunity presents…


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David Stockman

P.S. Interested in a deeper probe into the Deep State? David Stockman’s Contra Corner is the place to go.

Contra Corner is an independent, original, facts-figures-and-charts-based take on the ongoing corruption of American Liberty by Wall Street and Imperial Washington.

And it’s all based on my 40 years working at both ends of the Acela Corridor. Click here to learn more…

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David Stockman

David Stockman is the ultimate Washington insider turned iconoclast. He began his career in Washington as a young man and quickly rose through the ranks of the Republican Party to become the Director of the Office of Management and Budget under President Ronald Reagan. After leaving the White House, Stockman had a 20-year career on Wall Street.MORE FROM AUTHOR