“The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.”
John Maynard Keynes
Ever since I first learned about the ideas of “global warming” and “climate change” in school, I quickly came to regard anyone who didn’t agree with this “scientific consensus” as uneducated, insincere (having conflicting financial interests, etc.), or simply crazy.
Yet today, some of the people I know and respect most, are vehemently skeptical of the “climate change” paradigm.
Perhaps, these “climate change deniers” suspect that the mainstream “climate change” narrative, implicitly places anxiety and blame on the public, for what is, in reality, a structural root problem: the fact that there is a financial incentive to exploit the natural world for profit.
It is hard to miss the irony in the idea of fighting “climate change” by raising taxes (in other words, raising revenues) that flow to the governments that have been responsible (though hardly held accountable) for taking effective measures to reduce our abuse of the earth.
Although it is quite clear that most ordinary people who identify with stopping “climate change” generally have wonderful intentions; I struggle with the simplicity of the “climate change” narrative. It is perfectly divisive, yet always light on meaningful solutions that cut to the root of the cause.
Who is to blame for this? Certainly not the average person. Nor is it the person who calls “bullshit” on what they fairly might perceive as the fear-inciting, divisive political agenda of climate change; based upon the decades of “green politics” talk that has never amounted to anything that actually improved the mainstream narrative of doom and gloom. This, perhaps, despite the massive amount of money in technology, and the hype about humanity’s supposed quantum leaps in our ability to solve environmental problems with advanced next-generation-after next-generation solutions.
The blame falls upon the small group of people, across modern history, who, using physical domination and power, designed, built, implemented and have run the global capitalist economy.
We often fail to realize, that the acceptance of the profit motive – let alone its celebration – is a relatively new concept in terms of history.
It may strike us as odd that the idea of gain is a relatively modern one; we are schooled to believe that man is essentially an acquisitive creature and that left to himself he will behave as any self-respecting businessman would. The profit motive, we are constantly being told, is as old as man himself.
But it is not. The profit motive as we know it is only as old as “modern man.” Even today the notion of gain for gain’s sake is foreign to a large portion of the world’s population, and it has been conspicuous by its absence over most of recorded history.
From The Worldly Philosophers by Robert L. Heilbroner
It’s hard to believe that these kings and generals and presidents and bankers, were completely unaware that the modern financial system places zero value upon stewardship of the earth.
“Brains are wealth and wealth is the chief aim of man.”
U.S President Calvin Coolidge
Indeed, it is hard to argue with the notion that it is the capitalist system itself, that is the single greatest cause, and continued enabler, of environmental and social exploitation.
Anyone who challenges the canon of climate change, is roundly branded anti-science, stupid, or dangerous – perhaps even deserving censorship.
I have respect for everyone who genuinely desires truth and aims to live life with love, compassion and gratitude.
This is not about right-versus-wrong; it is about taking responsibility, and objectively examining the simplified ideological identities that we think give us meaning and fulfillment.
Modern “climate change” issue, has become a polarizing political dichotomy obscuring the complex and critical issue of environmental well-being.
Let’s just decide that no one is stupid, or worth blaming; and decide to create a new (way of looking at the) system, that will incentivize environmental stewardship and ecological harmony.
Note : We at C.C are unequivocal in our belief that it is our duty as human beings, to take responsibility for and protect the magical nature of earth; the plane(t) upon which we came into and are living this existence. Our goal is to seek the truth as a means of liberation and source of sovereignty and compassion.
You may have noticed that our namesake “Conscious Capital” was conspicuously missing from my “9 Forms of Capital” post.
I omitted Conscious Capital, Because I consider it a higher order concept; comprises, runs through, and is connected to, each of the nine forms of capital.
The closest related concepts in modern language, might be “qi” (essential life force); “karma”; or, in the parlance of modern science, “quantum interconnectedness.” Conscious Capital is the tangible force generated and directed by the (sub)conscious thoughts, beliefs and perspectives, of human beings.
It is my view – indeed, the inspiration for this blog – that Conscious Capital, is the great secret of humanity; the key with the power to unlock our true and greatest potential.
We have all experienced, benefited from, and suffered as a result of conscious capital, whether we are aware of it or not. Any time it pops up in the mainstream, it is “explained away”, as if the case has been open-and-shut. An example, would be the “Placebo effect”. Why is it that people who are deeply religious, or have faith in God, have been observed to have demonstrably greater capacity and success rates, in terms of recovering from life-threatening major trauma, terminal illness, etc? Why is it that the people who are most confident and optimistic, seem to attract good things – while the most pessimistic, the self-described “unlucky”, seem to attract more strife and suffering?
The notion of manifestation the consciousness is hardly new. But Conscious Capital is far more than a personal visualization or live-improving technique. It is and evident quality that pervades every facet of human life.
For example, let’s look at the topic of “what other people think of us”, as individuals. It is considered wisdom, and good advice, that “that we shouldn’t care what other people think (of us).” And for most of my life, I have believed in this; I’ve been described as different, for often consciously choosing authenticity, over being practical or calculating and strategic. This one difference in life outlook, has been the source of many of the most incredible, beautiful, and magical moments of my life. It has also been a source of great challenges, in my relationships with others and myself, and in the process of operating in our modern capitalist society.
Yet, after spending years of my life exploring this concept, both experientially and intellectually, I have come to realize that it is literally the collective consciousness of humanity – our collective Conscious Capital – that, alongside physical human action (“doing”), that determines how life and events on earth unfold. And because it only requires mental flexibility, focus and time, it is in many ways far more accessible – and powerful – than human action.
This is my thesis: the intentional exploration of this topic, from an experiential, collaborative, objective and non-judgmental standpoint – rather than a “leave-it-to-the-scientists” shoulder shrug – is the missing keystone in the great arc of modern human history.
Few discussion topics can more reliably gloss over a listener’s eyes, than the vague, confusing lexicon of modern mainstream finance.
At the same time, many of us have a sense that capital is the fuel upon which the modern economy runs. Money makes the world go round, we learn, and eventually just repeat without thinking too deeply on it. Although less often found in plain sight (or in plain language), we’re aware that the masters of capital exert a substantial influence across our plane(t)s of action.
As such, the purpose of this post is to allow more people to connect the fascinating, mysterious side of capital, with language and concepts that give us greater specificity, simplicity, and agility of meaning. (If you haven’t, feel free to read my last post, “Part I” in my series on capital.)
What is this thing we call ‘capital’, anyways? Is it just financial-jargon for ‘money’? Or is it a more nuanced, multifaceted concept, used to define all manner of important things (like capitol cities; capital letters; financial and social capital; etc)?
Now that we mention it, what is a human supposed to do with capital? Do we just follow the conventional wisdom, the “money specialist” talking heads on CNN or Fox News, and invest in an adult-sounding 401k plan, allocated 60%/40% across mass-market ETFs and corporate bondage? What does that even really mean? Are there other forms of capital (and thus, other forms of investment)?
In “Part II” of my series on the past, present and future of capitalism, I offer a framework that aims to add meaning, depth and functionality to the expansively vague concept of “capital”.
Until we can actually understand, and collectively agree upon, the definition of “capital”, even our most perspicacious discussions about the evils and miracles of capitalism are mere exercises in futility.
Many of us have been led to believe that finance and investing is the most challenging, confounding science; one that should be left only to those who are “properly qualified”.
Our capacity for cognitive dissonance allows us to look past the red flags in this logic. Such as, the fact that the same bankers or masters that caused the Recession, are brazenly still in power and control. Or the fact that the greatest financial con man of our era, Bernie Madoff, was one of the masters of the modern economy, even serving as leader of regulatory authorities and industry-leading bodies (Chairman of the National Association of Securities Dealers (NASD); was the non-executive chairman of NASDAQ; etc) before it became obvious that he was running a massive Ponzi scheme that had lured in some of the world’s savviest investors.
In reality, investing is, in many ways, simply another word for living life. What do we pour our energy into? Most of us pour the majority of our energy into a job, in order to earn money, to survive; and whatever we do from there, is called “investing”. So I just want to make this clear – this thing of ours, “investing”, is something that concerns all of us. Indeed, the very nature of our future, depends on our understanding of, proactive engagement with, and participation in, the many-faced beast known as investing.
Impact: The Counterculture Revolution of Finance
Impact investing is predicated upon the realization that any given financial investment, inevitably generates non-financial results and outcomes (known as “externalities”, in the jargon). In many ways, “impact” as a discipline entered the mainstream collective consciousness via the “triple bottom line” (or “people planet profit”) framework.
In short, this easy-to-grasp framework is based upon examining and evaluating investments and investment outcomes in financial, social and environmental terms (rather than in solely financial terms, as per traditional “business school capitalism”, summed up in the notion of “maximizing shareholder profits”). To be sure, the creation and dissemination of this framework marked a watershed moment in the birth and expansion of the impact investing movement.
I began learning about “impact” circa 2015, at the time when I was becoming disillusioned with my egocentric desire to become richer than my peers, as a means of finding purpose and feeling self-worth. I became fascinated, thanks to many incredible mentors such as Mike Mathieu, Joel Solomon (The Clean Money Revolution), Marjorie Kelly (Owning Our Future), John Perkins (Confessions of an Economic Hit-Man). I began working with a dear friend and colleague, Jenae Poe, who had a proper background in what I soon realized was a thriving ecosystem, the world of impact investing, aka “impact”. She schooled me in the establishment basics, as I traded my knowledge of traditional capitalism in return.
After about a year of working to incorporate this framework into our investment approach – our epic vision for an integrated impact investment company, a financial powerhouse that would rival the Goldman Sachs’ of the world, in terms of power and influence, yet be run with a proper conscience – I felt like there were crucial pieces missing to the existing framework, that were required to truly understand the interplay among the myriad facets of capitalism. After much arguing, I got JP to agree with me that ownership (of financial capital, notably), was a critical component that didn’t neatly fit into the triple bottom line model.
And so, the following framework is the conceptual brainchild of our wild journey down the rabbit hole, in search of meaning, answers and power in the complex world of modern finance. May it serve us as we begin to realize the imperative, of evaluating and understanding the many forms of capital; and the reality that money, is not even close to the most important thing in the world.
1. Material Capital
This is anything that exists in the physical world. Cars, clothing, tools, buildings, are all examples of material capital. Things that are defined today in financial terms – such as the earth (“real estate”) – would fall under the umbrella of Material Capital.
2. Financial Capital
Perhaps the most straightforward, financial capital refers to modern (fiat) money.
3. Social Capital
I like to describe Social Capital as the feminine counterpart to financial capital. While financial capital is all about numbers, logic, and crystal-clear specifics; Social Capital is far more numinous, less tangible, rooted in trust, emotions and relationships. We could say that, someone who had a reputation among his/her community for being generous and compassionate, has cultivated social capital, that (s)he can draw on in the form of favors, support, etc.
4. Experiential Capital
This is the knowledge and wisdom of experience. Many of us realize that, although understanding things conceptually can be helpful, it is not the same as actual, “real-world” experience.
5. Intellectual Capital
Intellectual Capital consists of things we might learn in a classroom, a (text)book, or via word of mouth.
6. Cultural Capital
The word “heritage” speaks to the idea of cultural capital. This includes wisdom, worldviews and understanding, that is specific to, and passed down via, particular cultures. We might also refer to this as, “ancestral capital”. An example of cultural capital, would be traditions passed down from our predecessors.
7. Spiritual Capital
Spiritual Capital consists of anything that speaks to, connects with or facilitates the innate human desire to connect with spirituality. What is the meaning of life? What are the unseen forces that shape our experience on Earth? Spiritual Capital may consist of literature, oral wisdom, ceremonial wisdom; and may have some overlap with cultural capital.
8. Living Capital
Also known as environmental capital, this is a catch-all for anything that is imbued with (or that is a source of) the gift of life. Plants, animals, bacteria, soil, microorganisms; also, the sun, the oceans, the mountains.
9. Political Capital
This is a modern concept, relevant in our world that is largely run by governments and the politicians that lead and operate them. Political capital can be viewed as a form of social capital, specific to the phenomena of modern government. Because the idea of “owning” something, on this planet we were born into, cannot really exist without the context and framework of contemporary government, political capital (like financial capital, thanks to Citizens United, etc), plays an incredibly powerful role in shaping how resources and capital get allocated amongst humanity.
The above framework borrows loosely from a presentation (“The 8 Forms of Capital” by Gregory Landua) that was recently shown to me by a dear friend who is an expert in the permaculture space. (I found it quite strange that, the day after I was shown the video and began writing this post, it was mysteriously deleted from YouTube and the PermacultureVoices website where we’d found it. If anyone manages to find this video, please share and I’ll add a link in the post).
As someone who has spent the last decade working as an investment advisor, I was an avid champion, and supporter, of capitalism.
However, like many in the industry, I eventually became disillusioned. Making money for the sake of money, after all, is quite hollow. While some are building companies, or buildings, or offering services; my life as a small-time hedge fund manager left me feeling like little more than a bougie, aristocratic gambler, toiling my days in front of a screen playing the stock market.
The time has come for me to set the record straight. I do not believe in taking an absolute stance on capitalism, at this point in history; it has become too intertwined, too complex, too dependent upon the will of key players and legislators, to be summed up as “good” or “bad”.
The reality is, that the future of capitalism – and the fate of humanity – remains in our hands. As such, the following piece is an intro to the multifaceted world of finance and capitalism.
So what is the point of this piece? Anyone can attack the many flaws of capitalism, and denounce those facets that brazenly (or sneakily) hold us back from reaching our true potential, a world in which every human being has the right to be free.
But it takes a nuanced and balanced perspective, to call attention to those facets of capitalism, that may actually present us with the chance to change the course of history, for the better.
Stock Market: The Longest Con
In many ways, the stock market is one of the two most harmful systems at the core of capitalism.
Of course, at the individual actor level, there are exceptions to this. Any company that is run by good, honest people; and is not destroying the environment, or the lives and livelihoods of stakeholders, customers or innocent civilians, may be one of the “good guys”, in a system that, on the whole, is completely broken. Examples of good companies, might be 4Front; Iroquois Valley Farm; Nordstrom; etc. Likewise, I know and have worked with many honorable, trustworthy investment advisors and professionals.
But back to the bigger picture.
The line between con artists, and financiers, has always been a blurry one. If this sounds crazy, consider that Bernie Madoff – the greatest con man of our era – was the CEO of NASDAQ. Jay Gould and Big Jim Fisk – two of the most famous financiers of the 19th Century – were con artists (who conned Commodore Cornelius Vanderbilt into attempting to corner the market for shares in the Erie Railroad, by simply printing more and more stock, so as to make the market uncornerable). So was Daniel Drew (who sold bloated cows to Henry Astor). Enron – hailed as one of the most successful stocks of the late 20th century – was essentially a con. Dick Cheney was the CEO of Halliburton, while he was Vice President of the United States – and successfully advocated for a costly, destructive war in Iraq, that would enrich him beyond belief.
So why is the stock market a con? First of all, it is controlled by a small number of people. Every boom cycle has historically ended in a bust; and during the bust phase of the cycle, the average American becomes poorer, loses land or assets to the banks; while the top 0.1% (notably, those in control of and in bed with banking institutions) get richer.
Second of all, the stock market perpetuates the status quo, giving an incredible advantage to incumbent firms. In this day and age, everyone knows Monsanto, Lonmin, Seaworld, McDonald’s, Texaco, Halliburton, are evil; so why are these players still around? Because they are part of the Fortune 500; they are owned by every investor, rich and poor, who owns an index fund like SPY or QQQ. Furthermore, the stock market, with its functioning like a giant digital casino, effectively separates us from our money to such an incredible extent, that most of us have no idea where our money is actually invested – and thus, what it is actually supporting.
I’m still working on this piece; but I include the title, to call attention to the fact that what we call “real estate” – or the earth we live upon – is the common denominator that underlies all human activity.
By investing in real estate (ideally without leverage, unless we can afford to repay bank loans rather than get foreclosed on), we are directly contributing to building the future we wish to live in.
The Unique Phenomena of Greed in Modern Capital(ism)
Modern Capitalism, like any system, is generally characterized by its fundamental structure. It has no emotions; and thus, it has both redeeming qualities, and harmful characteristics.
On the bright side: capitalism is a system for encouraging human productivity. It allows humans to interact with each other across the world.
On the down side: It’s generally impractical, counterintuitive, and grating to the soul, to be greedy with anything natural: food, land, resources, love, compassion, nature. These are things that will go to waste, if hoarded; or if owned by a tiny fraction of the population. The sharing of these things, creates positive feedback loops of happiness and human productivity.
Along with the stock market, the other facet of capitalism that I consider most problematic, and anti-human, is fractional-reserve banking, and the concept of interest (not so long ago, uniformly called “usury”, and banned by nearly every major religion). Interest, in its current form; combined with the fact that money, is the only thing in the world that defies the natural law of decay; encourages greed and perpetuates increasing economic inequality. This is not the fault of people who ask for interest; that is only normal today. It is the structural acceptance of interest, as a fair mechanism for underpinning modern capitalism, in our era of increasing economic inequality, and massive conflicts of interest that exist between big business, and the condition of the environment and the average human on earth.
On the down side:
Money is the only thing that defies this convention.
Colombia is no stranger to the mass-scale production of “illicit drugs” for the purpose of sale, transportation and distribution abroad. Its magical mountainous climate, at the equator, straddling the northern tip of the South American continent, offers some of the world’s best natural conditions for the production of photosynthetic organisms, from coffee and roses, to coca and cannabis.
Thus, it comes as little surprise that Colombia has recently legalized, and is developing the legislation to regulate, cannabis production.
“When the industry starts to move toward commoditization over the next decade,” says Paul Henderson, of Salinas, CA-based Grupo Flor, “Colombia is the only place that makes sense.” Grupo Flor is preparing to plant its first crop a couple of hours outside the Colombian city of Cali.
Colombia allows the production of medical cannabis oil and extracts, both the psychoactive form as well as the nonintoxicating cannabidiol (CBD) used in CBD products.
Growing (in) Pesos
Just as many of our consumer goods in the West are built in low-cost mega-factories in Asia, the cultivation of cannabis in Colombia carries fraction of the cost compared to the in United States. In Colombia – where the only foreign currency that can be legally wired into the country, is United States Dollars (USD) – land, wages, and licenses all cost less. The Colombian Peso (COP) has depreciated precipitously against the dollar over the last year, strengthening the purchasing power of USD in Colombia.
To any Colombian looking over the last half decade, ten thousand pesos is still ten thousand pesos; but to someone from the U.S., in dollar terms, today ten thousand pesos is only $2.91, compared to $4.54 just four years ago.
Just as we’ve seen in the State of Washington, I foresee a substantial first-mover advantage, to those groups able to assemble the best teams, attract sufficient capital, and get involved quickly.
Tilray had a production cost per gram of cannabis of $5.67 USD for 2018 ($7.54 CAD) (excluding sales of accessories and food products). In Colombia, one would expect a production cost per gram of $0.10 to $0.50 USD.
The major risk, is that trade barriers continue to come up, and international export markets are closed (or made more expensive by tariffs) to Colombia.
Nevertheless, the potential from industrial hemp and CBD alone – the non-psychoactive, yet versatile and in-demand components of cannabis – remains tantalizing to any investor or company with a global vision for cannabis and the desire to participate in its unfolding.
Although we endeavor to examine the uncomfortable facets of our reality; we commit to staying positive, optimistic, and cognizant of the power of our own consciousness. At Conscious Capital, this is what we are about.
Our Intention: to spread wisdom, love, truth and expanded consciousness (i.e. transcending fear & greed); and encourage the leveraging of our social, conscious & financial capital in order to create a new paradigm of co-creative and harmonious human prosperity.
Our vision: a world in which humans are fully empowered to realize and embody their highest potential, as conscious individuals intentionally co-creating the reality we experience.
“The most important thing for your company…is your internal culture….We are at the dawn of a new era, in which emotional intelligence, is about to become the single most important trade.”
Yes, we have concerns about the structure of the global financial system, and the incentives it creates. But at the end of the day, it is the PEOPLE – not money – who possess the power of consciousness and the keys to the future.
It strikes us, that truth-seeking entrepreneurs, investors and advisors are some of the most sorely-needed people in the world today. Action – not arguing – will change the world and inspire a new paradigm.
At a time when which doubt, division and disillusionment seem entrenched; we need more risk-taking, results-oriented, authentic, and truthful visionaries to boldly explore and lead new ways of interacting with each other and the world.
To be an entrepreneur, an impresario, is to engage in the multifaceted challenge of creating, selling, implementing and refining a vision that attracts attention and resources. In our economic system, it is the entrepreneurs and business owners with the unique privilege and honor of creating and supporting the (financial) livelihood of employees.
In our complex world, the future will be won by recognizing and embracing the secret depths of our inherent connection to the people around us and the world we live in.
We must rid ourselves of a few blatantly limiting aphorisms, like “nice guys finish last,” and “gotta feel it to believe it.” Nice guys do not finish last, they finish best. You don’t need to feel it to believe it; but often, you need to believe it, in order to feel it (aka the placebo effect). Without faith in each other, faith in the Process, all we are left with is doubt.
SO – May we be clear in our intentions; confident in our abilities; loving in our interactions; and bold in our behaviors.
And remember, just because we explore an idea, does not mean we certainly endorse it; we encourage each individual to refine and use their own skills of intuition and discernment. Only take what is useful. We believe it is more important to openly, objectively and collaboratively examine what we (can) see and have been shown; than to merely believe what we are told.
Working in impact investing has improved my hopes for humanity’s ability to transition off its current crash course, towards a generative future that involves peacefully and productively co-existing with each other and the world around us.
Yet, until recently, I couldn’t say that I’d come across any political movement that seemed to genuinely understand the gravity of our current world’s economic / government-financial situation; and at the same time, propose a viable alternative, with plenty of specifics and an action plan.
Before I go further, allow me to state clearly for the record: the proposed system of Contributionism, is hardly a tested or proven concept; it is completely new to the (modern) world. I thus cannot claim it is a panacea, or the magic thing that will single-handedly and miraculously save the world. Michael Tellinger, the founder, may be completely wrong on nearly all fronts; however, it is hard to underestimate the importance of alternative viewpoints on history (which by definition, is written from the perspective of the victors of war).
But it’s one hell of a start, if you’re into systemic level change and are prepared to fearlessly explore the wormholes of (unspoken) ancient history and the origins and desi of the world economy.
Now that I’ve finished the book, and listened to some of his longer videos on Youtube, I’m excited to share the Contributionist movement; its ethos, nature, and vision for the future. Over the last year, this has been a concept that has been gelling in my consciousness, something I could feel growing as a possibility; certainly an “out-there” one – but sat the same time, one that could not be more urgently needed. When I found his book, I was surprised to find a proposed solution – not just more doom and gloom – that addresses all of the challenging, elephant-in-the-room issues that shape, and are the architecture of, the world we live in today.
As a finance professional and amateur historian / political philosopher, contributionism resonates deeply with me, as an integrated, historically-informed socioeconomic worldview and real-time approach to creating, building and ushering in a new paradigm of human prosperity from within the broken capitalist system we currently live in.
I say capitalism is broken, because:
Capitalism is founded upon a conflict of interest; it incentivizes extracting value from people and nature, for profit, without regard to social or human rights implications
It is a system that perpetuates inequality (interest rates make those with capital, wealthier), and incentivizes hoarding – rather than investing (as a stamp-scrip or demurrage currency)
Ten years after the crisis, our banks are doing the same thing and supposedly expecting different results (Source: Sovereign Man)
So, in what ways does capitalism work and in what ways has it failed? Capitalism has liberated us. It has generated incredible new technologies and wealth — I love the idea of a robot doing all the chores. But at the very same time, out of the same kind of proverbial production line, it has generated the most spectacular horror and depravity. It’s remarkably contradictory.
This doesn’t mean that capitalism is done; it just means that, in its current form, it isn’t going to achieve anything that most ordinary people would want (greater prosperity, freedom, and quality of life).
At its heart, Contributionism is about creating self-sustaining, loving, trusting, open and free societies, in which each person, in order to be in a community, must in return contribute 3 hours per week, plus their own desired “Labor of Love” (or passion), involvement (if any), towards the collective good. Here is the Manifesto for their “One Small Town” initiative.
He realizes that this will not happen overnight; rather, it will require a deliberate, cunning utilization of the current financial and government systems; starting grassroots, ground-up local change as a demonstration and validation of the concept; and leverage the growing global movement around it, to build support and initial financial backing / political support.
Contributionism is founded in response to understanding and analysis of the history of money and economics, the building blocks of modern society and capitalism; and at its most fundamental, represents a model for society that is built by the people, for the people, with full respect and acknowledgement of human rights and the imperative of caring for the world we live in. It represents a transition, from our current money-based system, to a “free society,” in which members contribute to the community (or communities) based on their unique talents and abilities, in exchange for support of the community.
It’s easy to think, this is a bit too rosy and peaches; until you realize that this guy has done his homework, x,1,000; and is a genuine, caring, inspiringly intelligent human being, extremely passionate about what he’s doing. His plans for creating the first Contributionist societies, all across the world, as little microcosms to validate and demonstrate the movement, are extremely detailed, open, and inviting collaboration and, of course, contribution from those who resonate with the movement.
From tips on how to deal with the complexities of the US Legal & Justice systems; to a step-by-step guide on how to bring and implement Contributionism in your town or city; to a fascinating selection of historical resources and current events (including references to “Confessions of an Economic Hit Man”, by John Perkins, also on my book list), the book is a quick and engaging read.
Nothing but respect for Michael Tellinger, who has no problem discussing any topic pertaining to government, history, or finance, regardless of how taboo it is; if he ever makes it to political office, he will be the realest politician in modern history. Yes, he has certain views that are far out; just remember, when some things he says sound unbelievable, it is just him exploring a potential opinion, his own personal understanding of the “truth”. I firmly believe that no topics should be off limits from respectful, objective, logical debate. If we cannot pursue and demand and love the truth, we are not truly free.
From the back of his book:
The path that brought us here as a species is not only filled with lies and deception of unimaginable proportion, but also with continuous manipulation of the human race that goes back thousands of years – all controlled by money. Michael Tellinger is proposing a blueprint for the emancipation of the slave species called humanity. Tellinger exposes the previously misunderstood origins of money and the rise of the royal banking elite that have controlled the world for millennia and continue to do so today through the modern banking families. He points out that money did not evolve from thousands of years of barter and trade, but that it was maliciously introduced to the human race as a tool of absolute control. Tellinger makes a strong case that if we do not understand our human origins, we cannot come to terms with why the world is so messed up in the 21st century. He demonstrates that our current situation presents us with a unique opportunity to change the course of our destiny. Michael Tellinger describes how the ancient African philosophy of UBUNTU will allow us to seamlessly move from a divided, money-driven society, to united communities driven by people, their passion for life and their God-given talents. Coming to terms with our enslavement as a species is critical to discovering the path to full enlightenment. UBUNTU Contributionism presents a solid foundation for a new social structure to take us into a new era of true freedom from financial tyranny and real prosperity on every level of human endeavour.
Stock options have always fascinated me. The idea that, if done properly, your returns would be measured in orders of magnitude, not mere percentage points.
Why Options Matter
There is always lots of talk about changing the world or saving the environment. However, if our individual or collective understanding of reality is not comprehensive and accurate, our efforts are misguided (if not pointless).
“Stock options”, may sound like a complex and dull topic. But upon closer examination, I see the following benefits to understanding the world of financial options and derivatives:
For the ordinary “non-Accredited” investor (i.e. non-multi-millionaire), options offer one of the greatest avenues for gaining access to leverage leverage.
Understanding options trading – and the larger ecosystem that is the wormhole of the global financial markets – gives us a higher vantage point from which to see the shortcomings of our existing system; as well as the ways in which it could improve.
There are few places where an individual can wield as much immediate power, or leverage, as within the world of stock options.
Intro to Options
Imagine you are investing in the stock market. Let’s say buying shares of a medium- to large publicly traded company. Let’s use the example of Amazon. Buying 100 shares, at $1,780 per share, will cost you $170,000.
Now let’s consider making the same investment, using options.
For $30,000 ($300 per share), we can buy a “call option” that gives us the right – but not the obligation – to buy 100 shares of at today’s price ($1,780 per share) for the next two years. If Amazon takes off, then we make as much money as normal investors who forked over the whole $170k.
We can also invest in a stock indirectly, by selling options. By selling a “put option”, on Amazon, we earn $26,400; and in exchange, we may be forced to purchase 100 shares of Amazon, between now and June 2021, at today’s price of $1,780. If Amazon’s share price takes off, the option expires worthless, and we get to keep the $26,400.
What is the nature of this sorcery? I’ve had to explain it so many times, that I’ve decided to simply publish a quick overview of options trading.
Stock options allow an investor or fund manager to manage risk & liquidity; leverage capital; and generate income; in ways inconceivable to most investors. In short, stock options are like term insurance contracts that offer a specific contractual benefit – the right (but not the obligation) to purchase or sell a given stock – for a fixed period of time, and are sold for a “premium” (i.e. price).
Call Option: the right to buy stock (100 shares per call option)
Put Option: the right to sell stock (100 shares per put option)
When you buy a put option, you are “long” puts;
When you sell a put option, you are “short” a put.
As a seller (or holder of short) put options, we say someone “gets put” with stock (when the put buyer exercised the right to sell, and you as the option seller were forced to buy the shares)
All options are purchased, and pertain to, a “round lot”, or 100 shares. Thus, any standard option, call or put, pertains to 100 shares
“Underlying”: the stock to which a given option pertains (the “underlying” stock)
Exercise: to “exercise” or execute an option, means to use your contractual right to buy stock (if you own a call option) or sell stock (if you own a put option)
Strike Price: the price at which the option can be exercised. To exercise a call, you would buy the shares; to exercise a put, you would sell the shares
Expiration: the date until the option expires
Premium: the price per share per option. A premium of $7, means that the option costs $700 ($7 premium multiplied times 100 round lot)
“Long”: “Long” stock, call options or put options refer to stock, calls or puts that you own. This is reflected by a positive quantity, such as “6 AMZN $1,780 June 2021 Call Options”
“Short”: “Short” stock, call options or put options refer to stock, calls or puts that you sold (i.e. that you “are short”). This is reflected on your brokerage or trading statement, as a negative quantity; “-6 AMZN $1,780 June 18, 2021 Call Options”, means that this account holder has sold six such call options; and thus can be said to be “short” these six options
Bull: “Bull” is used to refer to any strategy that has a net-long position on a given stock or security (i.e. is banking on its gain).
Bear: A “Bear” position or “bearish” strategy, is one that has a net-short position on a given stock or security (i.e. is banking on its decline).
“Naked” trading means the sale of uncovered options (in other words, selling call options without owning the underlying stock; or selling puts without being short the underlying stock). This is obviously a dangerous strategy, often referred to as “picking up pennies in front of a steamroller” (with the exception of “high-moat put writing”, i.e. writing puts on stocks you want to be buying regardless).
Spread: A Spread, is any combination of options trades on the same underlying security. Because of the leveraged nature of options, most people who sell options, cover their losses by using a “Spread,” in which they buy options that partially-cover the downside of their strategy.
Options Chain: The Options Chain is the list of options available. Generally, this is shown in a list format, with a selection at the top or bottom to choose which expiration you’re looking at.
Evaluating an Options Spread
Options are often used as “Spreads”. If I sell an Amazon put with a strike price of $1,780 (for a premium of $264 per share, or $26,400 per each option); and I buy a put with a strike of $1,400 at the same expiration (for a premium of $96.70, or $9,670 per option); I have entered into a “Bull Spread”.
In this scenario, I’ve created a maximum loss and maximum gain; I break even if Amazon ends up at $1,487 or above come June 2021. Based on the information I’ve given, you should now be able to understand everything below (with the exception of Implied Volatility, or IV, which I will get to later).
Underlying: AMZN Created on Aug 29, 2019 Days to expire: 470 Interest rate: 0.05 Stock IV: 27.77% Strategy Cost: credit $16,730.00
As of Aug 29, 2019 Underlying price: $1,786.40 Est. P/L: $4,348.40
Short 1 contract @ 264.00
Jun 18, 2021 1780.00 put
Long 1 contract @ 96.70
Jun 18, 2021 1400.00 put
Intro to Options: Basic Use Cases
To cover existing stock positions
A protective put, is a put option purchased for the purpose of protecting a long stock position against a decrease in value. If you bought 1,000 shares of Amazon at $1, and now have over $1m, you may not want to sell; but you may care to protect your investment against a market crash
To retain upside if you need liquidity, and have equity in a publicly traded firm
This is one of my favorite scenarios to help people with. There is always a way to generate income and/or cover your downside using options; these involve sacrificing degree of upside (by selling covered calls),
If you have spotted a solid short candidate.
A friend of mine was pitching his company to me, and told me about a stock called Massroots that was trading at a $70m valuation, with zero revenue (and a $250k monthly burn rate). I shorted this stock and did well; if it was optionable, I would have made a killing
Introductory Concepts for Options Trading
Long-dated (LEAPs) options offer the greatest potential for returns (especially for those who aren’t day trading or swing trading). For high-volume stocks and major market ETFs (QQQ, SPY, etc) you can generally buy options up to around 700-1,000 days out; for smaller stocks, there may often only be options 6-24 months out.
For a given stock, the rate of return on options, is generally highest for out-of-the-money (OOTM) options. An OOTM call option has a strike price above the market price of the underlying stock; an OOTM put option has a strike price below the market price of the stock. Because they are OOTM, they are lower in price; thus, they are high-risk (the stock must make substantial movement in the right direction in order for you to be “in the money”), and high reward. Let’s say XYZ Stock is trading at $85 today. If you buy 100 XYZ $70 1/1/2020 put options, priced at $0.50, that is going to cost you (($0.50 x 100) x 100) = $5,000. These 100 options correspond to 10,000 shares (100 x 100). If the stock goes “in the money” on an option of this price (ie, below $70), then each dollar the stock falls below $69.50, corresponds to $10,000 in profit (one dollar, per share of optionable stock, net of the $0.50 per share premium). Thus, if XYZ stock went to $59.50, you’d have an unrealized gain of $100,000, on a $5k investment. And that’s assuming that the option is at or near expiration; if the option doesn’t expire for months or years out, you’d probably be sitting on at least a few extra dollars of gains from the increase in the premium (the option may now be worth $4, up from $0.50, meaning your total profit would be around $135,000 if you sold it while it was still far from expiration)
Thinly-traded options can be hard to sell; thus, for these, prepare to exercise
Implied volatility provides a solid indicator of relative option price (higher the IV, higher the price of the option)
“The Greeks” (Delta, Vega, Theta and Gamma) are a series of quantitative metrics that measure options’ sensitivity to changes in price (delta and gamma), time (theta) and volatility (Vega). However, thanks largely to sophisticated modeling tools, one can become an intermediate-level or proficient and effective options trader, without mastering these; as long as you can begin to understand how they are conceptually relevant. For me, learning
Stock splits (and reverse stock splits) can cause a ton of problems for option holders, because your options are now “special circumstance” options, with a certainly lower market for resale. Even for an experienced trader, dealing with these has been a challenge. This is especially relevant for investments/trades concerning leveraged ETFs, which often split frequently
Brokerage terms and the characteristics of a specific account type, and how it is configured, with what permissions, etc, will greatly impact your ability to trade. “Margin” and “portfolio margin” accounts are generally most effective for leveraged or higher volume options trading
Given the once-in-a-lifetime nature of the cannabis legalization movement in each country, there is more than enough excitement in the wild world of cannabis stocks.
Here is a quick snapshot of two cannabis stocks, Tilray and 4Front Ventures (formerly Cannex Capital). One has a much greater valuation; the other has a much greater cannabis production track record. Both have annual profit for 2018 between $5-15 million.
Based on the assumption that, as it stabilizes, the universe of cannabis stocks will become more appropriately valued, I predict the following: Tilray is positioned for a stagnant or declining stock price; and 4Front is positioned for (stock price) growth of over 100% over the next few years.
Tilray produced 6,478 kilograms of cannabis flower and derivative products in 2018. In 2017, Tilray produced 3,024 kilograms. Total Sales for 2018, were $43.1 million. Tilray’s market cap, as of August 2019, is $2.59 billion. Total revenue for 2018, was $43.13 million, with gross profit of $14.27 million.
Cannex (now 4Front Ventures), on the other hand, produced over 15,000 kilograms of cannabis flower and derivative products in 2018. 4Front’s market cap as of August 2019, is $82.69 million. Total Revenue for 2018, was $11.9 million; Gross Profit was $8.56 million. Trailing twelve month (ttm) revenue is $13.94 million.
The opportunity to write my senior thesis on the ‘War on Drugs’ permanently altered the course of my life.
It was a chance to dive deep, into a wormhole that few others have the time or energy to delve into properly.
Via the link below, you can download my 58-page thesis as a simple PDF (includes detailed footnotes and references). I’ve also included the text and major figures from my thesis it in the post below, without references.
REVISITING RAND’S 1994 STUDY: THE MILITARIZATION, POLITICAL MANIPULATION AND CONTINUED FAILURE OF THE UNITED STATES’ WAR ON DRUGS
Submitted to Professor Jennifer Taw & Dean Gregory Hess
By Mateo Blumer
For Senior Thesis Spring 2010 April 26, 2010
Many academic experts, political leaders, and economists have leveled the assertion that the United States’ War on Drugs has failed. In this assessment, which to a large degree accepts and supports these assertions of the drug war’s failure based upon the empirical evidence regarding the ineffectiveness of the programs that comprise it, we focus upon the reasons for the United States’ continued implementation of drug-control policies (specifically, “supply-control” programs, which still represent two-thirds of our nation’s drug-control spending) that have failed consistently over the past three decades, using a groundbreaking government-commissioned 1994 RAND study as the primary benchmark for assessing the efficacy and development of drug policy.
Although trillions of taxpayers’ dollars that have been spent in Latin America and Afghanistan to combat the drug trade, U.S. drug demand, consumption, and global production have remained stable, while drug production in countries in which the U.S. is involved in international drug-control has increased significantly.
In South America, the “contradiction between U.S. counternarcotics policies and the economic tenets of neoliberal development” remains obvious to objective observers, as the U.S. increasingly uses the War on Drugs as a politically-viable means of achieving a variety of non-drug-related military, strategic, and diplomatic goals (such as the establishment of a strong military presence in Colombia in response to a perceived threat of anti-U.S. elements, such as Venezuela’s President, Hugo Chavez).
In Afghanistan, where the U.S. is currently involved in a full-scale anti-insurgency occupation, we are seeing the inverse of the situation in South America; rather than being implemented as a political tool for non-drug related agendas, in Afghanistan the War on Drugs has been encompassed by the “War on Terror,” and is actually being under-utilized as a political tool.
Since September 11th, 2001, the “War on Terror” has transcended the War on Drugs in terms of political popularity and public support – despite the empirical evidence demonstrating that drug-production in Afghanistan is directly related to the success and financing of terrorist and insurgent organizations (such as al-Qaida and the Taliban).
While the War on Terror has caused a divergence in the formulation of foreign drug-control policy with regards to the Americas and Afghanistan, there are several common themes underlying the United States’ “War on Drugs:” the consistent absence of accountability, the lack of evidence-based policy formulation, and insufficient (or inexistent) actual concern for diminishing U.S. drug consumption.
Overall, the United States’ War on Drugs has become an enormously powerful and politically-feasible vehicle for pursuing political goals, both drug- and non-drug-related, abroad. The United States’ failure and reluctance to respond politically to the findings of the 1994 RAND study illuminate the power of the War on Drugs as a political tool used to pursue a variety of goals and agendas, often unrelated to actually decreasing U.S. drug consumption, while operating on under the auspices of drug-control.
While diplomatic and political measures being taken abroad to ensure the security of the United States are certainly well-warranted given the increasing threat posed by non-state actors (such as terrorist organizations), the deliberate use of the War on Drugs as a vehicle for achieving non-drug related goals is not only misleading and politically immoral, but also potentially dangerous, as the actual threats posed by the drug trade remain unaddressed and our failed policies and programs continue to be funded without question.
U.S. Drug Control: Supply vs. Demand Programs and the 1994 RAND Study
In this assessment, I will be examining the role and formulation of drug-control policy over the past two decades, specifically with regards to a groundbreaking (but widely ignored) study commissioned by the RAND Corporation in 1994 titled, “Controlling Cocaine: Supply Versus Demand Programs.” According to the study, all U.S. anti-narcotics efforts fall into one of two categories: “supply-control” programs and “demand-control” programs.
“Supply-control” programs, which seek to curtail the supply of drugs, aim to raise the costs to drug dealers by seizing drugs, assets, and making arrests. The resulting increases in production costs raise retail drug prices, and thus indirectly (and theoretically) reduce consumption. The most prevalent “supply-control” programs employed by the United States are interdiction, source-country control, and domestic enforcement.
Over the past fifteen years, “supply-control” programs have represented the bulk of our drug-control efforts; in 1992, these “supply-control” programs accounted for 93% of the estimated $13 billion spent on drug control. “Demand-control” programs, on the other hand, aim to reduce consumption directly, without going through the aforementioned “price-mechanism.” The two main “demand-control” programs employed by the United States are treatment and prevention, which in 1992 (treatment) received only 7% of the U.S.’ drug-control budget.
Overall, the RAND study asserted with confidence and empirical evidence that the U.S.’ War on Drugs expensive supply-control programs and policies, formulated during the twenty years prior to 1994, are wasteful and ineffective at best.
I will begin examination of the War on Drugs at this point in time primarily because this 1994 study produced some of the most objective and rational empirical analysis regarding drug-control to be commissioned by the U.S. government. By 1994, the ‘War on Drugs’ had to a great extent outgrown its nascent stage of infancy; our drug-control policies (and their failures) could no longer be attributed solely to a small handful of influential leaders, such as Nixon. Rather, by this point, the War on Drugs had become a twenty year-old policy precedent, with consistent bipartisan support in all branches of government, and a high degree of public exposure.
Though the War on Drugs has created externalities that politicians have been able to use for their own political benefit since its unilateral inception in 1973, by 1994, U.S. politicians’ and leaders’ experience and familiarity with the interplay of drug-control policy formulation and the achievement of political agendas had matured significantly. Unfortunately, this increase in our leaders’ experience regarding the politics of the War on Drugs has not translated into the implementation of more effective policies, let alone the overhaul or reassessment of failed or questionably-founded drug-control policies.
In essence, the first twenty years of the United States’ War on Drugs were relatively unprecedented and highly experimental, and the (causes of) policy failures that occurred during the drug war’s infancy are far more obvious than the (causes of the) U.S. drug war’s more recent failures. Reasons for this include relative increases in accountability, government transparency, and cooperation with third-party institutions.
As I will briefly address, the U.S.’ War on Drugs during its first twenty years of existence was a farce. Policy was formulated on the basis of irrational fear, racist ideology, and individual political considerations; empirical evidence and expert considerations had almost no bearing whatsoever. Examining the flaws and failures of the U.S.’ War on Drugs during this period is more appalling than insightful, as a very brief overview will sufficiently acquaint the reader with the drug war’s outlandish and tenuous foundations.
Thus, examining the War on Drugs from 1994 onward will allow us to evaluate not only the effectiveness of our drug-control policies, but also the political considerations that have helped shape these policies, along with the alarming divergence between empirical evidence of drug- control effectiveness and actual policy formulation.
Background: The Nixon Administration and the Foundations of the War on Drugs
Over the past four decades, the United States’ War on Drugs has become a firmly entrenched component of American domestic and foreign policy, representing over $2.5 trillion in government spending.8 Since the establishment of the Drug Enforcement Agency under President Nixon’s administration in 1973, American leaders have consistently embraced the precedents of federal “drug-control” spending set before them, despite blatant evidence that many of the foundational policies underlying the War on Drugs were formulated by individuals (such as President Nixon) on the basis of racist personal ideology or in pursuit of political gain:
“Let’s look at strong societies. The Russians. God damn it, they root them [homosexuals and drug users] out…Dope? Do you think the Russians allow dope? Hell no. Not if they can allow, not if they can catch it, they send them up. You see, homosexuality, dope, immorality in general: These are the enemies of strong societies. That’s why the Communists and the left- wingers are pushing the stuff, they’re trying to destroy us…you know it’s a funny thing, every one of the bastards that are out for legalizing marijuana is Jewish. What the Christ is the matterwith the Jews, Bob [Haldeman, Nixon White House Chief of Staff], what is the matter with them?”
President Richard Nixon, 1971
“We understood we could not make it illegal to be young or poor of black in the United States, but we could criminalize their common pleasure. We understood that drugs were not the health problem we were making them out to be, but it was such a perfect issue for the Nixon White House that we couldn’t resist it.”
John D. Ehrlichman, Assistant to President Nixon for Domestic Affairs
“President Nixon emphasized that you have to face the fact that the whole problem is really the blacks. The key is to devise a system that recognizes this fact while not appearing to.”
H.R. Haldeman, Nixon Administration White House Chief of Staff
“If we hyped the drug problem into a national crisis, we knew that Congress would give us anything we asked for.”
Egil “Bud” Krogh, Nixon Administration Aide Convicted in Watergate Scandal
Even after twenty years of U.S. War on Drugs political experience and the surfacing of such appalling revelations regarding its foundations (and founders), our nation continued to wage the war on drugs as a political tool, with actual drug-use results preceding ideological agendas and foreign military considerations. During these twenty years since its inception, our nation spent the vast majority of its “drug-control” spending on “supply-control” programs, which are those that aim to decrease drug consumption by attacking drug producers and traffickers and incarcerating domestic dealers and users.
Contemporary scholars attribute these policies to a variety of causes. Some blame Regan’s “predilection for supply-side strategies and tactics,” and consider his decision to “get tough” on the war on drugs and label it an urgent “national security” issue as a means of garnering political support and attracting attention among counterculture-weary conservatives across party lines. Many others, however, see the policies of this era as more than just politically motivated; one scholar describes the U.S. War on Drugs policies during the Nixon and Reagan Administrations as “a stunningly comprehensive and well- designed system of racialized social control.”
The Ghost of Jim Crow: The Persistence of Racial Disparities in U.S. Drug-Law Enforcement
Although the subsequent U.S. Presidential administrations have become more tolerant and less bigoted, the effects of Nixon’s racially-motivated drug-control policies have certainly lingered. In the words of Jamie Fellner, senior counsel with Human Rights Watch’s U.S. Program, “Jim Crow may be dead, but the drug war has never been color-blind.”
These statistics demonstrate not only the detrimental and lasting effects of our nation’s racially-motivated foundational drug-control policies, but also the extent to which U.S. leaders have failed to address such inherent and blatant flaws as time progressed.
By the twentieth anniversary of the war on drugs, “the U.S. was losing the war on virtually every front,” as illicit drugs of all types…were more readily available and cheaper in the U.S. in January 1989 than they had been at the outset of the Reagan presidency in 1981.”
By 1994, the United States was still consistently spending over 90 percent of its drug-control funding on the “supply-control” programs created and touted by Nixon and Reagan, despite the overwhelming evidence of their ineffectiveness and detrimental unintended consequences. By 2003, “relative to the population, blacks were 10.1 times more likely than whites to be sent to prison for drug offenses.”
The Status Quo of the U.S.’ War on Drugs
Although trillions of taxpayers’ dollars have been spent in Latin America and abroad to combat the drug trade, U.S. drug demand, consumption, and global production have remained stable; “Marijuana, cocaine, and heroin are still widely available in the United States…and at lower prices than in previous decades.”
“In spite of our efforts [with regards to the war on drugs],” remarked a U.S. Congressman this year, “the positive results are few and far between.” The detrimental and often unintended effects of the war on drugs, however, have recently proven infinitely more significant than any positive impacts our drug-control programs are having on U.S. drug consumption: In Mexico, for instance, drug-related violence has surged to unprecedented heights (with 7,000 drug-related deaths in 2009 alone), despite increased levels of funding to Mexico’s military for drug-control over the past three years.
As even Secretary of State Hillary Clinton admitted that “decades of U.S. anti-narcotics policies have been a failure and have contributed to the explosion of drug violence south of the border,” it is becoming increasingly clear that our historic drug-control policies are in dire need of reassessment. The parallels between our current situation and the conditions of the 1920s, when the U.S. Congress outlawed alcohol and effectively created a lucrative black market that enriched and empowered violent criminals like Al Capone, are increasingly difficult to ignore. In the words of one scholar, “After 40 years of defeat and failure, America’s War on Drugs is being buried in the same fashion as it was born – amid bloodshed, confusion, corruption, and scandal.”
As the U.S. continues to fund these same programs (which include eradication, crop spraying, and military assistance), and we continue to see no significant change in U.S. drug consumption that can be accredited to our multi-billion dollar drug-control spending, it has become increasingly clear that our War on Drugs has expanded its reach far beyond the realm of narcotics and drug consumption. As our nation has recently become engaged in full-scale wars in Afghanistan and Iraq, focus and scrutiny have “naturally shifted away from the war on drugs,” with many experts asserting that “the mandate for counter-narcotics enforcement has become muddled.”
The clearest implication to be drawn from this shift is that transparency, accountability, and evidence-based policy formulation regarding the U.S. War on Drugs have diminished (or have simply failed to develop sufficiently alongside changes in leadership and increased evidence regarding the effectiveness of historic U.S. drug-control policies). Most Americans are far more interested in the outcomes of the economic recovery and the “Wars on Terror” in Iraq in Afghanistan than they are in the outcome of the War on Drugs. Given the past and current performance of the War on Drugs, however, the average American’s lack of interest in the war on drugs isn’t unwarranted – drug use in the U.S. has remained relatively stable over the past fifteen years, while narcotics production in countries where the U.S. is intervening militarily for drug-control purposes continues to grow. In a recent government report, the U.S. Justice Department’s National Drug Intelligence Center said that “overall, the availability of illegal drugs is increasing,” and that “the overall threat posed by illicit drugs will not diminish in the near term.” To most Americans, the notion of someday declaring “victory” in the War on Drugs has increasingly become something of a pipe dream.
Capitalizing upon the lack of sufficient accountability and transparency regarding the War on Drugs, U.S. leaders have enjoyed extensive autonomy and impunity in their formulation of drug-control policy, demonstrated by the United States’ continued funding of programs that have failed blatantly and consistently in the past and that continue to perpetuate a high degree of “racial disparities in U.S. drug-law enforcement.” As “broader foreign policy objectives have encompassed narcotics control,”the War on Drugs has become a politically-feasible means for implementing policies (both drug- and non-drug-related) in any region where our leaders have decided that “drug production is posing a threat to U.S. security” – despite the fact that, increasingly over the past ten years, public opinion, foreign and domestic leaders, and expert findings asserts that the United States’ War on Drugs has failed. Though our nation has spent over a trillion dollars in “drug-control” funding since the War on Drug’s inception, few positive results have been seen domestically and abroad.
“Controlling Cocaine” – Reassessment of the 1994 RAND Study Findings and the Sustained Divergence of U.S. Drug-Control Policy and Evidence-Based Research
Then and Now: The Cost Effectiveness of Supply vs. Demand Control Programs
While the roots of the U.S.’ drug-control policy failures can be traced back as far as Prohibition and the Nixon Presidency, in this study we will examine our nation’s drug policies over the course of the past twenty years, relative specifically to a RAND Corporation study prepared for the Office of National Drug Control Policy in 1994 titled “Controlling Cocaine: Supply Versus Demand Programs.”
According to the study, all anti-narcotics efforts fall into one of two categories: “supply-control” programs and “demand-control” programs.34 “Supply-control” programs, which seek to curtail the supply of drugs, aim to raise the costs to drug dealers by seizing drugs, assets, and making arrests. The resulting increases in production costs raise retail drug prices, and thus indirectly (in theory) reduce consumption.
The most prevalent “supply- control” programs employed by the United States are interdiction, source-country control, and domestic enforcement. Over the past fifteen years, “supply-control” programs have represented the bulk of our drug-control efforts; in 1992, these “supply-control” programs accounted for 93% of the estimated $13 billion spent on drug control. Today, these “supply-control” programs represent 65% of our nation’s $14,844 billion Federal Drug Control spending (in 2009).
“Demand-control” programs, on the other hand, aim to reduce consumption directly, without going through the “price-mechanism.” The two main “demand-control” programs employed by the United States are treatment and prevention, which in 1992 (treatment) received only 7% of the U.S.’ drug-control budget. In 2005, demand-control programs reached their peak of funding relative to supply-control programs, representing nearly 45% of the United States’ annual drug- control budget.
Although these figures represent a slow yet consistent growth of funding for “demand-control” programs in relation to their “supply-control” counterparts throughout the 1992-1995 period, over the past five years we have seen this shift towards increased “demand- control” funding level off; in 2009, prevention and treatment received 35% of our nation’s Federal Drug Control budget, representing consecutive annual declines in demand-control funding during the latter years of the Bush Administration and the beginning of the Obama administration.
The RAND study, which will serve as a benchmark for analyzing the efficacy and intent of drug-control strategy and policy since 1994, sought to determine the effectiveness of these different methods (principally “supply-control” programs versus “demand-control” programs) in terms of the “cost of a given reduction in U.S. consumption of cocaine.”
The findings of the study were surprising: to achieve a one percent consumption reduction, the U.S. would have to spend $783 million on source-country control, $366 million on interdiction, $246 for domestic enforcement – or $34 million for treatment.
Thus, RAND found that in 1994, even the least costly supply-control program (domestic enforcement) “costs 7.3 times as much as treatment to achieve the same consumption reduction.” Even when the study evaluated the effectiveness of supply-control and demand-control programs using different criteria, it found that “the cost- effectiveness ranking of the control programs… [was] the same whether one evaluates the programs in terms of their effects on consumption, the number of users, or societal costs of crime and lost productivity due to cocaine use… in all cases, the supply-control programs are more costly than treatment programs per unit accomplishment.”
Particularly shocking were the findings regarding the effectiveness of drug-control programs in terms of “reductions in the societal cost of crime and lost productivity:”
15 Years Later: An Assessment of Policy Shifts and Political Response to the 1994 RAND Study
Throughout the past fifteen years since the RAND study was released, the U.S. has allocated more and more of its budget to demand-control programs; the U.S. currently spends one-third of its drug-control budget on treatment and prevention, as opposed to a mere 7% in 1992.
Nevertheless, in many regards the 1994 RAND study has failed to affect policy sufficiently, as we are still spending approximately $5 billion annually on interdiction and international drug control operations, which “have met with mixed success when considered as specific case scenarios, but represent an overwhelming failure taken as a whole.”
After so many years of failure in our efforts to stem the supply of drugs through interdiction and “source- country” control, it is obvious that there are certain underlying, non-drug-related motives for continuing to fund such ineffective programs. While such motives, such as political and economic gain and the establishment of key military alliances in volatile regions, are perhaps in our nation’s best interest, it is time to address the War on Drugs directly, reevaluate its strategies, and discontinue its use as a vehicle for legitimizing otherwise-infeasible political and military goals abroad.
Even in regions where the intentions of U.S. drug-control policy are more transparent (such as Afghanistan, where the War on Drugs has become but a mere component of the broader War on Terror), we are seeing the use of our favored supply-control programs resulting in failure – and not just with regards to drug-control, but with regards to our broader, strategic interests such as stability and democratic peace.
While the majority of the current evidence and analysis regarding the effectiveness of supply-control programs versus demand-control programs in decreasing U.S. drug consumption suggests that supply-control programs are still (after the increase in allocation for these programs from 7% in 1992 to approximately 34% in 2009) less cost-effective than demand control programs, some disagree.
Not surprisingly, some of the strongest proponents of “supply-control” programs as a means of decreasing the demand and consumption of illicit drugs in the U.S. are Congressmen or lobbyists.
Paul McNulty, Chief Counsel of the Subcommittee on Crime of the U.S. House of Representatives, maintains that dedicating two-thirds of our nation’s drug budget to interdiction and law enforcement and one third on treatment and prevention is “the appropriate ratio,” arguing that, “the premise of treating drug prevention and drug interdiction as separate and comparable options is inherently flawed. Since too many of our fellow citizens will be tempted to abuse their bodies with illegal drugs, the best way to prevent drug use is to stop the flow of this poison to our streets…[the federal government] must remain focused on interdiction because that is the mission for which it is best suited and solely responsible.”
His argument, clearly lacking tangible facts, suggests that supply-control programs deserve twice as much funding (and are thus twice as effective as demand control programs), “since too many of our fellow citizens will be tempted to abuse illegal drugs.” Nowhere in Mr. McNulty’s multi- paragraph response does he address actual U.S. drug consumption statistics, nor does he offer any comparative statistics regarding the effectiveness of supply-control versus demand control programs in decreasing U.S. drug consumption.
In comparison, the contrary evidence (that we are spending too much on supply-control programs) seems unassailable. “Source-country control” programs (those that attack production in the source countries), which have consistently represented hundreds of millions of dollars of our annual drug-control spending, have failed to have any significant impact upon U.S. drug consumption, regardless of the location. In this report, we will compare drug-control policy, spending, and programs with actual levels of drug cultivation and production primarily with regards to three major drug-producing regions: Central America, the Andean region of South America, and Afghanistan.
As Rydell and Everingham pointed out in the 1994 RAND study, the purpose of “supply-control” counter-narcotics programs is to curb U.S. drug consumption and demand indirectly by raising the costs of cultivation, production and trafficking to suppliers (assuming that the increase in drug prices will lead to a decrease in U.S. demand for and consumption of drugs).
Therefore, examination of actual U.S. drug consumption statistics will often be precluded, as the majority of recent evidence indicates that the U.S.’ “supply-control” anti-drug programs actually have no impact upon drug cultivation and thus the global supply of drugs, and in some cases actually lead to an increase in drug production and global supply.
While the theoretical foundations of our nation’s “supply-control” anti-drug programs may have appeared plausible in the past, it is now becoming increasingly evident that the relationship between U.S. drug consumption, global drug production, and costs to drug producers is far more complex than our policymakers would like to admit; domestic forces, such as rising prescription- drug abuse and a lack of treatment-based and demand-reduction programs, are largely ignored, while drug production abroad is painted by politicians as the real target (and threat to the U.S.) with regards to the war on drugs.
Nevertheless, with each additional year of increasing “supply- control” spending (which ostensibly aims to ultimately reduce U.S. drug-consumption), we are seeing that the stable and largely unaddressed U.S. demand for drugs has far greater influence upon drug production and consumption abroad than all types of (U.S.) attacks upon the global narcotics supply chain; in Canada, for instance, “we recently observed that a 100-kilogram heroin seizure, Canada’s largest in history, had no impact on the supply of heroin” in the country. Among a variety of other independent studies asserting the uselessness of supply-side drug-control programs, a recent World Customs Organization report found that, “even the post- September 11th security and drug-control measures have had a ‘negligible’ impact on the influx of illicit drugs into the U.S.
Close to Home: A Domestic-Level Examination of the War on Drugs and the Politics that Sustain It
The most recent evidence regarding domestic drug use is politically unaddressed to an appalling degree, and, like the evidence regarding our drug-control programs abroad, is blatantly inconsistent with our government’s drug-control funding decisions. While it may come as no surprise that prescription drug use is up among Americans, a recent West Virginia University study has found that hospitalizations for widely-abused prescription drugs (specifically, opioids, sedatives, and tranquilizers) in the U.S. have increased by 65% from 1999 to 2006.
“Deaths and hospitalizations associated with prescription drug misuse have reached epidemic proportions,” asserted the study’s lead author, Jeffrey H. Coben, M.D., pointing out that poisoning is now the second leading cause of unintentional injury death in the United States.
While the United States government is spending billions of dollars abroad to attack coca growers and foreign drug producers, under the pretense that this will ultimately cause a decline in U.S. drug consumption as the drug prices rise, it seems that our domestic pharmaceutical companies are stepping in to fulfill any unmet demand; in 2006, in a survey of teenagers, 62% said prescription pain relievers (such as the notorious Oxycontin) were “easy to get from their parents’ medicine cabinet,” while a similar analysis concluded that “admissions to federally-supported treatment programs for prescription opioid abuse increased 342% from 1996-2006 – a comprehensive problem that is also estimated to cost insurance companies tens of billions of dollars a year.”
Despite this grim and ominous increase in domestically-produced drug consumption, detailed heavily by the aforementioned studies regarding the decade-long period ended 2006, we have seen a consistent decrease in domestic- and demand-control drug funding in the four years that have followed.
Although widely-abused prescription drugs are posing an increasing threat to our nation’s well-being, and furthermore appear poised to fill any supply- shortage that may possibly (although thoroughly unlikely) be caused by the U.S.’ extensive supply-control programs abroad, our nation has decided to continue funding indirect and ineffective programs in countries like Colombia and Afghanistan rather than to actually address this increasingly pressing domestic narcotics threat.
Between 2009 and 2010, U.S. Drug Control funding for prevention programs fell from $1.815 billion to $1.514 billion, while funding for international drug-control funding increased from $2.082 billion to $2.288 billion.
Given the consistent lack of success regarding the U.S.’ drug control programs, the domestic political rationale behind the War on Drugs is somewhat unclear; considering the evidence, one might ask, why do we keep electing leaders in Congress and the White House who continue to fund historically-useless drug-control programs? As we will continue to discuss in our examination of the War on Drugs abroad, U.S. politicians have a variety of strategic and diplomatic reasons for promoting drug-control policies that have proven to fail at reducing U.S. drug consumption and availability.
The U.S. public, on the other hand, by-and-large has more to benefit from the implementation of successful drug-control policies, as the U.S. loses tens of billions of dollars per year in “societal costs” (from cocaine use alone), which can be defined as the “estimated cost of crime and lost productivity due to drug use.” If this is the case, how is it that the American public hasn’t demanded comprehensive drug-control reform?
Perhaps the main reason that we haven’t seen a united and forceful grassroots-level movement promoting the reevaluation and reform of drug control laws is that drugs are a highly politicized, polarizing, and even taboo subject to many Americans. Among conservatives and proponents of civil obedience, many draw little or no distinction between “drug use” and “criminal activity;” this U.S. demographic is usually behind reform measures, such as President Reagan’s, which seek to “get tough” on drugs, by promoting measures such as harsher sentencing for drug-related convictions.
This demographic was to a great extent behind the establishment of draconian laws for possession of crack cocaine, “which set a mandatory minimum five-year federal prison sentence for possession of only five grams” of the substance (which many consider an inherently racist policy, as crack cocaine use is more prevalent among blacks, while powder cocaine use is more prevalent among whites). Conversely, to receive the same five-year mandatory sentence, one must be in possession of 500 grams of powder cocaine.
On the other hand, there is the more liberal demographic in the U.S., which favors more lenient drug-possession laws and decriminalization of marijuana – this demographic often cites the fact that thousands of Americans are currently in jail for the possession of a substance (cannabis) that has been proven to be less harmful than alcohol in practically every way.
Thus, to a great extent, the issue of drug-law and drug legalization or decriminalization is a very divisive and polarizing issue to many Americans; this is a very clear impediment to quick and evidence- based drug-policy reform, as “pro-drug” advocates cite health-facts and evidence of structural racism within the framework of drug law, while “anti-drug” advocates often hold deep-seated, conservative views that associate drug use with criminal activity (and, given the destructive power of drugs like heroin and methamphetamine, have plenty of evidence to counter the evidence posited by liberals).
Overall, the grassroots-level political pressure required to implement significant reform to United States drug policy requires change in social norms and incentives. While the process of changing social norms takes time, it is possible; after decades of marijuana being illegal and thousands of people imprisoned and convicted for possessing marijuana, the U.S. is finally starting to see grassroots-level changes in political sentiment, often in direct defiance to federal laws, that represent the slow but steady change in social norms (such as in California, which has at the state level legalized marijuana use for medical purposes).
Such development in social norms has created a powerful grassroots movement whereby a wide range of Americans, both poor and wealthy, are pressuring politicians to address their drug-policy concerns and implement their desired changes in drug-control policy. Such pressure can be applied in a variety of ways; direct funding of politicians in support of a given cause, by public demonstration, or by old- fashioned civil disobedience. This pressure, which can contribute the success or failure of a politician in certain regions polarized by drug-control policy, has the potential to change politicians’ incentives regarding drug policy – most members of Congress would rather adapt to changing social norms among their constituents than lose their seat to a more publicly-receptive competitor.
Thus, we can attribute our nation’s relatively stagnant and outdated drug-control policies to this dynamic between slowly-changing social norms and our leaders’ political (and thus career-related) incentives; while more and more people are beginning to realize that our drug-control policies in South America have had almost no impact upon U.S. drug use and availability, it will take quite some time before social norms change to the extent that they begin to influence the incentives of our nation’s leaders and policymakers.
South and Central America: Shadow Diplomacy, Unintended Consequences and the Militarization of the War on Drugs
In South America, the War on Drugs has to a great extent become a vehicle for U.S. shadow diplomacy and militarization. We continue to generously support Colombia, our strong diplomatic ally and oil exporter (in 2004, Colombia was the 15th largest supplier of oil to the U.S.), which also happens to border the oil-rich and increasingly anti-American country of Venezuela.
After a decade during which approximately $8 billion dollars of U.S. “drug-control” funding went directly to Colombia, drugs are still being produced in the country at the same rate, but we now have a strong diplomatic and military alliance with Colombia.
While the drug-production statistics (Colombia saw a 27 percent increase in coca production in 2009 alone63) represent a drug-control failure, “defenders of the drug war point out that the military-led strategy clawed back territory from armed groups and stabilized Colombia,” suggesting that the War on Drugs nevertheless helped achieve a diplomatic and strategic victory for Colombia and the U.S. with regards to non-drug related agendas.
In the words of Aldo Lale-Demoz, the head of the Bogota headquarters of the U.N. Office on Drugs and Crime: “It’s not fair to say there has been no progress. We are not winning and we are not losing. We are controlling.”
Nevertheless, the U.S.’s militarization of the War on Drugs for the achievement of both drug-control and non-drug related goals can have powerful unintended consequences as well. While our efforts in Colombia have led to a tangible increase in the nation’s stability and have diminished the power of the major cartels that once ruled the country, it seems that the U.S.’ war on drugs has simply pushed drug-trafficking (and the consequential empowerment and enrichment of ruthlessly violent cartels) into other countries; Mexico, for example, has seen a surge in its death toll from drug-related over the past three years (from 2,700 in 2007 to 5,600 in 2008 and 6,600 in 200966).
With the current situation in Mexico reminiscent of Colombia’s during the reign of Pablo Escobar in the 1980s and 1990s, former U.S. drug czar Barry McCaffrey recently stated that “Juarez [Mexico] is vastly more dangerous than Baghdad or Kabul…The Mexican Army has confronted the cartels, but often the police have been scared or bought off.” According to experts and critics, this “balloon effect” can be explained by our heavily-funded efforts to disrupt supply chains; “this [supply-control funding] is not spent effectively…because new suppliers will always pop up so long as domestic demand exists in the United States.”
In Afghanistan, where the U.S.’ War on Drugs has become inextricably intertwined with our war against the Taliban, al-Qaida and anti-Western insurgents, our supply- control policy precedents (notably eradication) have generated “vastly counterproductive effects with respect to not only counternarcotics efforts, but also counterinsurgency, stabilization, and state building.”
Overall, the United States’ War on Drugs has become an enormously powerful and politically-feasible vehicle for pursuing political goals, both drug- and non-drug-related, abroad. The United States’ failure and reluctance to respond politically to the findings of the 1994 RAND study illuminate the power of the War on Drugs as a political tool used to pursue a variety of goals and agendas, often unrelated to actually decreasing U.S. drug consumption, while operating on under the auspices of drug-control.
While diplomatic and political measures being taken abroad to ensure the security of the United States are certainly well-warranted given the increasing threat posed by non-state actors (such as terrorist organizations), using the War on Drugs as a vehicle for achieving non-drug related goals is not only misleading and politically immoral, but also potentially dangerous as the actual threats posed by the drug trade remain unaddressed and our failed policies and programs continue to be funded without question.
Andean Region Favored-Nation Status: Rewarding Drug-Control Failure in Colombia
In “a culture that looks to Tom Clancy for solutions to public policy problems,” the use of military might has “always had a peculiar glamour and attraction” to U.S. policymakers, often preceding the analysis of empirical evidence. Compare, for instance, the recommendations made by Peter H. Reuter in 2001 with the drug-control policy decisions made in the following five years.
In 2001, Reuter (the same author of the 1994 RAND study) asserted that “source-country programs for cocaine are doomed from the start because the price of coca leaf is a negligible fraction of the retail price of cocaine in the United States.” While the retail price of a kilogram of cocaine (at the time) was $150,000 in the U.S., the cost of the coca leaf required to produce one kilo cost only about $300 in the source country.
Thus, even if “eradication efforts lead to a doubling of the price of coca leaf,” so that it now costs $600 for the leaf required to produce a kilogram, “the change in retail price, assuming the cost is passed along, will be negligible. Indeed, leaf prices have varied enormously over the last decade, while the retail price of cocaine has steadily fallen.”
Now compare this expert, empirically-based policy assessment to the actual formulation of drug policy: Between 2001 and 2006, American spending on drug control increased 34.4 percent. During this period, there was a 136.7 percent increase in U.S. drug- control spending abroad, and a 20.9 percent decrease in spending on domestic prevention programs – a shift that starkly contrasts with the recommendations and findings of the 1994 RAND study. Experts said that these numbers “reflect a return to a ‘1980s-style’ model, where the bulk of spending was focused on international and interdiction programs; the U.S. government took a different angle, asserting in the Program Summary of the National Drug
Control Strategy that “Through eradication, interdiction, and alternative development the United States supports the fight against narcoterrorists and helps secure democracy, extend security, and restore economic prosperity in the region.
Nevertheless, by 2006, the consensus among experts appeared to have changed very little: “cracking down on drug supply is mostly useless until we learn to squeeze demand.” According to a former senior adviser to four U.S. drug czars, “as long as there’s a demand, there will be a supply. People will figure out how to get this stuff in because it’s so profitable.”
Today, source-control programs are still being funded, and are still failing miserably. Between 2000 and 2008, under “Plan Colombia,” the U.S. spent over $4.5 billion in aid to the country. While the plan sought to achieve several objectives, such as weakening the FARC, “neutralizing the drug economy,” “strengthening state presence and improving security,” and “fighting corruption,” “the counternarcotics and counterinsurgency focus dominated the U.S. assistance,” as training and equipment for Colombian armed forces and for drug eradication and interdiction lay at the core of Plan Colombia.
Though the Plan “succeeded in the counterinsurgency/security objectives,” it “failed in its stated counternarcotics goals.” In 2000, at the start of Plan Colombia, 136,200 hectares of coca were cultivated in Colombia; its estimated cocaine hydrochloride production potential was 580 metric tons. In 2006, “despite the largest aerial spraying ever and increasingly substantial manual eradication,” 157,200 hectares of coca were cultivated in Colombia, and the country’s estimated cocaine production potential was 610 metric tons.
The statistics for 2007 demonstrate “an even greater failure to achieve the stated goals and make a significant dent into Colombia’s drug production and trafficking.” Despite the progress (in terms of stability) that has been made within Colombia’s borders, “little effect has been had on the overall drug war – due to the persistence of American demand, other countries, namely Peru and Bolivia, have moved to fill the supply vacuum.”
Despite having spent $11.3 billion to fight drugs in Latin America and the Caribbean between 1980 and 2008, good outcomes have been “few and far between,” as “drug trafficking and addiction in the U.S. have not dwindled and drug-related violence in Mexico and Colombia is on the rise.”
In 2006, as the U.S. continued allocating millions of dollars in federal drug-control funding to Colombia for its consistently-failing supply-control programs, a United Nations study found that “the level of overall cocaine production [in Colombia and the Andean Region] is practically unchanged from the levels of a decade ago.”
The Politics of Failure: Unintended Consequences of the Political Manipulation of the War on Drugs in Colombia, 1994 – Present
Although the majority of evidence indicates that the U.S.’ war on drugs is funding supply-control programs proven to fail time and time again, it is not my argument that our increasing military presence in South America and Afghanistan is necessarily a “failure” or an absurd policy decision; using the War on Drugs as a political tool to pursue non-drug related security interests can sometimes have positive results.
Rather, I assert that our nation’s Congress and leaders must stop spending $15 billion per year on “drug-control” unless they actually plan to fight the problems our country faces that are caused by illicit-drugs and drug-related crime and homicide; the first step in doing so would be to acknowledge that our “supply-control” tactics have failed to produce any tangible evidence of succeeding in decreasing U.S. drug consumption, regardless of strategic or national security objectives that have been fulfilled as a result.
Some of the “positive” impacts of U.S. military and counter-drug aid are certainly clear, especially when viewed from the broader U.S. national security perspective. When “Alvaro Uribe first took office, in 2002, Colombia was overrun by leftist rebels, right wing paramilitary groups, and drug lords.” Between 2000 and 2008, the U.S. gave Colombia over $4.5 billion in military and counter-drug assistance.
Today, Colombia is “now relatively stable and safe,”and negotiations are currently underway between the U.S. and Colombia to “establish at least seven [new] U.S. military bases in Colombia.”
Given these recent developments that have arisen at least partially from the U.S.’ drug-control policies, it is now more so than ever blatantly evident that broader, non-drug-related U.S. political goals and interests impact our policy and spending decisions with regards to the supply versus demand drug control.
On the other hand, a recent evaluation of U.S. aid to Colombia asserts that neither American nor Colombian interests were well-served by U.S. military and counter-drug financing. The authors find that “rather than bringing stability, increases in military aid caused spikes in violence from Colombia’s infamous paramilitary organizations and had no impact whatsoever on coca production.”
In this elaborate study, economists Oeindrila Dube and Suresh Naidu “analyze how conflict and cocoa production were affected by the level of U.S. military aid during the years 1988-2005,” comparing regions with and without military bases, and incorporating overall U.S. foreign military funding trends across the globe to reflect “broader American foreign policy objectives rather than reactions to Colombia-specific events.”
The results further support the notions that the U.S. foreign drug-control policy has failed and continues to do so, and that drugs are no longer the main focus of the infamous “War on Drugs.”
According to the study, “U.S. military aid leads to differential increases in attacks by paramilitaries (who collude with the military), but has no effect on guerilla attacks. Aid increases also result in more paramilitary homicides [in areas with Army bases] during election years” – but not in regions without bases, where the study found that increases in U.S. military aid cause “no significant effect upon guerilla attacks.”
The economic-political analysis in the study suggests that the “average increase of 92% in military aid to Colombia is associated with 138% more paramilitary attacks per year in base regions, relative to non-based regions,” based upon “highly disaggregated conflict data” from the period between 1988 and 2005.
Furthermore, despite the “explicit focus of [Plan Colombia] aid on reducing drug production,” Dube and Naidu “found an actual decline in anti-narcotics operations by the Colombian military in response to greater U.S. aid, with coca production continuing unchanged.”
The study even finds evidence that “voter turnout falls more in [U.S. Army] base municipalities when U.S. military assistance rises,” interpreted as a “consequence of increased military capacity to intimidate voters and reduce electoral participation.”
Thus, U.S. source-country (supply- control) programs in Colombia have not only failed to curb narcotics production, but have additionally undermined Colombia’s democratic political institutions and contributed to the “well-documented collusion between the Colombian military and paramilitaries,” despite the U.S.’ knowledge of the paramilitaries’ strong record of horrific human rights abuses in Colombia.
In a similar but unrelated study regarding the interaction of narcotics and conflict, experts found empirical evidence suggesting that, “where a pre-existing drug production exists, the conditions of armed conflict boost narcotics production and enable insurgents to become involved in the drug trade to finance their struggle, thereby increasing their capabilities and the challenge they pose to states. In some cases, involvement in the drug trade also seems to affect the motivational structures of insurgent groups, creating an economic function of war and vested interests in the continuation of armed conflict.”
Therefore, not only should the U.S. consider diminishing its use of supply-control programs abroad due to their ineffectiveness, but additionally because of their documented contribution to violence and political corruption within nations in which the U.S. is ostensibly trying to achieve democracy and stability.
Unintended Consequences: The “War on Terror” Overshadows the War on Drugs in Afghanistan, 1994-Present
In Afghanistan, which in 2006 accounted for 92% of the world’s supply of heroin, we are seeing a similar degree of failure with regards to U.S. supply-control drug programs. Despite consistent U.S. military intervention in Afghanistan since 2001, over the past “five years, the Afghan opium harvest has accounted for as much as 50 percent of the country’s GDP, and provided the prime ingredient for over 90 percent of the world’s heroin supply.”
During this same period, opium cultivation has supported 500,000 Afghan families, representing nearly 20 percent of the country’s estimated population. In addition to opium cultivation, with which Afghanistan has long been associated, Afghanistan has recently surpassed Morocco as the world’s largest cannabis (marijuana) producer; in 2009, the United Nations Office on Drugs and Crime estimated Afghanistan’s annual cannabis cultivation at 10,000 to 24,000 hectares.
Examining these facts in conjunction with the U.S.’ allocation of its multi-billion dollar drug- control budget, Afghanistan’s meteoric increase in drug production appears hardly surprising: although Afghanistan has become the world’s largest supplier of both heroin and cannabis, the U.S. annual drug-control funding request for “Afghanistan Counterdrug Support” programs in 2009 was a mere $336 million, compared to the $601.9 million requested to continue supporting our failed “Andean Counterdrug Programs” in South America.
Over the past five years, Afghanistan has maintained (and furthered) its position as the world’s largest producer of opium, and has also become the world’s largest producer of cannabis and hashish; total U.S. drug- control funding to Afghanistan during this period, however, has represented less than 20 percent of our nation’s international drug-control spending.
Just as in South America, the complex history of past U.S. involvement in the region makes the current situation (especially with regards to narcotics) in Afghanistan extremely difficult to address.
Over the past 30 years, three major conflicts have occurred in Afghanistan that have elicited U.S. military intervention: “the CIA covert warfare of the 1980s, the civil war of the 1990s (fueled at its start by $900 million in CIA funding),” and our counterinsurgency involvement and occupation since 2001.
“In each of these conflicts,” writes one scholar, “Washington has tolerated drug trafficking by its Afghan allies as the price of military success – a policy of benign neglect that has helped make Afghanistan today the world’s No. 1 narco- state.”
It should hardly come as a surprise that, in terms of public support and perceived importance, the “War on Terror” in the Middle East quickly transcended and overshadowed the War on Drugs in the Middle East after the tragic events of September 11, 2001. With regards to U.S.-Middle Eastern foreign relations in general, contemporary Americans are more interested in hearing about the U.S. military death toll, the status of the war on terrorism, or the tangible threats posed by al-Qaida and other fanatical groups. In Colombia, the “militarization” of the war on drugs was more of a conscious choice on behalf of our policymakers.
Notably, the relationship between drug-production and conflict has proven indissoluble: during the latter part of the 1990’s, the Taliban, “which had taken power in most of the country, lost any chance for international legitimacy by protecting and profiting from opium – and then, ironically, fell from power only months after reversing course and banning the crop.”
Since the inception of U.S. military intervention in 2001, the dramatic increase in narcotics cultivation and production (with regards to opium and cannabis) “has corrupted the government in Kabul while empowering a resurgent Taliban whose guerillas have taken control of ever larger parts of the Afghan countryside.”
Thus, no matter how much money the U.S. spends on the “War on Terror” and capturing al-Qaida militants, Afghanistan will never achieve our nation’s desired level of political stability unless U.S. policymakers acknowledge and address the nation’s utter dependence upon narcotics cultivation.
As in Colombia, the unintended consequences of the war on drugs in Afghanistan have in many regards proven far more detrimental than our leaders could have ever fathomed; given that the current National Drug Control Strategy is still devoted to the same supply-control programs that have failed over the past twenty years, it is obvious that our leaders are not formulating policy solely on the basis of empirical evidence and expert findings.
As the “War on Terror” has essentially pushed the Afghan War on Drugs out of the political and public spotlight, we are seeing U.S. drug-control programs being operated and orchestrated militarily with near impunity. In a country where “the high rate of return on investment from poppy cultivation has driven an agricultural shift…from growing traditional crops to growing opium poppy,” the U.S. has employed a strategy similar to that of the war on drugs in South America, which consists of the following “five pillars: alternative livelihoods, elimination and eradication, interdiction, law enforcement and justice reform, and public information.”
Not surprisingly, the majority of funding for our nation’s “five-pillar” strategy in Afghanistan has gone towards supply-control programs such as eradication, elimination, and interdiction – incredibly similar to our multi- faceted supply-control strategies (with minimal funding for demand-control programs) employed in Colombia.
Just as our extensive funding of supply-control programs in the Americas has done little to curb source-country drug production (let alone U.S. drug consumption or demand), the counternarcotics strategy in Afghanistan “has been ineffective in curbing opium cultivation and production in [the country].”
The parallels between our drug-control spending in the Americas and Afghanistan continue further, as politicians proudly point to large figures of drug seizures and eradication, while ignoring the overall trend of increasing production in the country despite these efforts.
In 2005, the Counternarcotics Police of Afghanistan (CNPA), working together with the DEA, succeeded in seizing 47.9 metric tons of opium and 5.5 metric tons of heroin; the Afghan Special Narcotics Force (ASNF) destroyed 100 metric tons of opium and 30 tons of heroin in the same year.
Overall, while 15,300 hectares (approximately 10 percent) of Afghanistan’s opium crop was eradicated by counternarcotics forces, “the overall levels of opium poppy cultivation, opium production, and heroin processing still dramatically increased in 2006 and 2007.”
Another recent study has not only affirms these findings, but offers empirical economic analysis regarding the ineffectiveness of our war on drugs eradication campaigns in Afghanistan: “The [study’s] results also imply that, all else being equal, the cessation of crop eradication would result in only modest increases in opiate production (with estimates ranging from 1.6 percent to 9.6 percent).”
Beyond Drug-Control: U.S. Political Motivation for Continued Funding of Ineffective and Harmful Supply-Control Programs in Colombia’s War on Drugs
Perhaps the most blatant example of how the U.S. government has used the War on Drugs as a vehicle for achieving strategic diplomatic alliances and military strength abroad is our relationship with Colombia, which receives hundreds of millions of dollars in U.S. drug-control funding annually. Between 2000 and 2006, following the creation of “Plan Colombia,” the U.S. gave over $3.8 billion to the Colombian government for military and counter-narcotics operations.
During that same time period, however, cocaine production in Colombia increased 4 percent, and the “decline in [U.S.] illicit drug use….since the mid-to late-1990s leveled off.” Despite the blatant ineffectiveness of our drug-control efforts in Colombia, and extensive evidence that “cracking down on drug supply is mostly useless until we learn to squeeze demand,” the U.S. continues to give the Colombia hundreds of millions of dollars in aid for the same programs.
Thus, the role of politics is undeniable; while it has become increasingly clear that the billions of dollars in military aid to and spending in Colombia has had almost no impact upon U.S. drug consumption and the associated societal costs, funding Colombia appears to be a politically lucrative investment, as negotiations are now underway to establish at least seven U.S. military bases in the country.
While the Obama Administration’s stated goals for the proposed military facilities in Colombia are to expand counter-narcotic operations in the region and to “fill…the gaps left by the eventual cutting of [military] aid in Plan Colombia,” there are clearly other considerations involved that raise serious questions about our supposed “drug-control” strategy. For example, none of the locations of the bases under negotiation are on the Pacific Ocean, an area where drug traffic has shown a significant recent rise. Furthermore, three of the bases “are clustered near each other on the Caribbean coast, not far from existing U.S. military sites in Aruba and Curacao – and closer to Venezuela than to the Pacific Ocean. Why are U.S. negotiators apparently forgoing Pacific sites,” one expert asks, “if counternarcotics is still part of the U.S. military mission?”
Further casting doubt upon the veracity of stated U.S. drug-control goals and the effectiveness of our South-American anti-drug spending is a recent Government Accountability Office report (commissioned by then-Senator Joe Biden), which concluded that the “Plan Colombia failed to meet its goal of halving illegal narcotics production in the Andean region.”
Today, the United States remains the world’s largest consumer of cocaine, Colombian heroin, and Mexican heroin. Nevertheless, in the 2009 National Drug Control Strategy Budget Summary, the U.S. Department of State requested $406.8 million in funding for Andean Counterdrug Programs, representing an increase of $86.9 million compared to 2008.
If the U.S. Government Accountability Office acknowledged in 2008 that the “source-country” supply- control programs implemented in Colombia had blatantly failed, why is the Department of State requesting a 27 percent increase in supply-control funding for the Andean Region of South America?
There are a variety of legitimate answers to this question, most of them regarding the United States’ use of the War on Drugs as a politically-viable vehicle for pursuing non-drug- related strategic national military and security interests. At the center of a more recent sign that U.S. “supply-control” anti-drug strategy will continue to pour cash and military aid into Colombia’s coffers for such non-drug-related security interests (regardless of their known ineffectiveness in combating drug production), are the recent allegations leveled by a Spanish judge that Venezuela “helped [the] Basque separatist group ETA and Colombian rebels’ plot to kill Colombia’s president Alvaro Uribe in Spain.”
In a case based “largely on information found on the computer of Raul Reyes (the FARC’s former second-in-command who was killed in Ecuador in March 2008 during a Colombian military operation)”, Spanish High Court Judge Eloy Velasco alleged “Venezuelan government cooperation in the illegal collaboration between FARC and ETA” with regards to an assassination plot coordinated between the FARC and ETA that sought to kill Colombian President Uribe and other Colombian officials while in Spain.
According to Judge Velasco, the focal point of this “cooperation was ETA member Arturo Cubillas Fontan, who was named to a post in Venezuela’s agriculture ministry in 2005 and whose Venezuelan wife, Goizeder Odriozola Lataillade, is an official in the leftist government of President Hugo Chavez.”
Given the United States’ strong diplomatic and mutually-beneficial relationship with Colombia, the security threat posed by Venezuela indicated in the article offers all the more reason for U.S. militarization of the War on Drugs in Colombia – the chances of the Congress appealing to the American public to engage in yet another openly-militarized conflict are slim at best.
At this point, it should be clear that the United States’ drug-control policy has been and is being formulated to suit or promote a variety of non-drug-related political and diplomatic objectives. Although the War on Drugs as we know it has become somewhat farcical, it is undeniable that anti-American sentiment is growing in the Andean Region (excluding, for the most part, Colombia) of South America. Venezuela’s President, Hugo Chavez, conveys open hostility towards the United States, and has even severed diplomatic ties with Colombia in response to a U.S. deal with Bogota allowing U.S. forces to run anti-drug operations from Colombian bases.
Throughout history, the U.S. has often involved itself in the relations of oil- rich countries, and Venezuela is no exception; a nation run by an openly anti-American, volatile, and totalitarian president is certainly on the United States’ security radar.
Although our serious military involvement in Afghanistan and Iraq comprise the majority of open political discussion regarding the use of military funding abroad, there are ostensibly a variety of reasons why the U.S. would benefit from “militarizing” the war on drugs to attain certain non-drug related political and diplomatic achievements; the most (and perhaps only) politically-feasible means of ensuring our military presence and dominance in the region at this point is by using the War on Drugs as a political guise.
Rewarding Failure, Punishing Success: The U.S. War on Drugs in Bolivia
Over the past fifteen years, Colombia has enjoyed “favored-country” status in the Andean region. One prominent example of this unusually and often-unwarranted generosity towards Colombia is shown by U.S. relations between both Bolivia and Colombia. By the mid-1990s, “Bolivia had become a showcase of Washington Consensus orthodoxy; democracy seemed well- established, inflation was low, and growth was solid.”
In 1997, Bolivia elected as president Hugo Banzer Suarez, an individual who had clearly demonstrated to the U.S. “his desire to remove Bolivia from the coca/cocaine circuit.” Through Banzer’s “Plan Dignidad,” announced in early 1998, Bolivia was able to achieve unprecedented successes in the eradication of coca cultivation and cocaine production, as Plan Dignidad offered tangible economic incentives to coca farmers such as coca por desarrolo (coca in exchange for investment in alternative crops).
This program, however, was based heavily on outside funding, primarily from the United States, and was (in theory) conditional upon Bolivia’s drug-control performance. Given the Banzer Administration’s success with Plan Dignitad and programs like coca por desarollo, “Bolivia had…become one of Washington’s most compelling success stories in the perennially frustrating war on drugs.”
During the four years of his presidency, his campaign had reduced illegal coca production by 40,000 hectares and substituted 115,000 hectares of alternative crops. Thus, it Banzer was quite confident that Bolivia would receive the $21 million in funding the U.S. had agreed to conditional upon the success of his coca-eradication strategy.
Strangely enough, however, in the same year, Banzer found out that his $21 million in funding for the successful and promising program had been halved to $12 million (the $11 million in funding stripped from Bolivia’s Plan Dignidad instead was used to provide Colombia, our favored nation in the Andean Region, with two brand new Blackhawk helicopters, despite Colombia’s failure to effect any diminishments in cocaine cultivation and production).
From this point on, the United States had solidified its position regarding source-country control and the U.S. foreign drug policy in general: drug use, production, availability, and consumption are not the main focus of the War on Drugs.
The global drug trade has recently been called the “most important” of all world “agricultural” markets, worth over $320 billion per year on the street. While it is a global issue, however, the United States plays a disproportionately large role in driving and paying the costs of the overall drug trade. According to Congress, the United States accounts for five percent of the world population, but is home to 17.5 percent of the world’s drug addicts, and in 2006 accounted for 60 percent of the world’s demand for illegal drugs.
One might find this surprising, as the U.S. government has spent over one trillion dollars on the War on Drugs since it was declared as such by President Nixon, and today spends approximately $15 billion per year in overall federal drug control spending. However, upon closer examination of the underlying causes of the booming drug trade, the findings of independent (and government- commissioned) studies, and our nation’s anti-drug spending decisions, it becomes clear that the vast majority of U.S. drug control spending has been misused, if not entirely wasted.
Over the past 15 years, specifically, U.S. policymakers have consistently allowed our government’s international and domestic political agenda to dictate our counter-narcotic strategies at home and abroad, as we continue to pour billions of dollars into supply-control programs and international drug-control operations shown to have no significant effect upon domestic drug demand, consumption, and global drug production.
Our nation’s leaders have even used the War on Drugs as a political guise to further establish a global U.S. military presence and create strategic alliances abroad; in Colombia, for example, the U.S. has spent billions in military and drug- control aid, yet Colombia’s (and South America’s total) cocaine production has steadily increased. Overall, the existing evidence and analysis of our drug-control spending suggests that we should be spending less on supply-control programs and more on demand control programs, as supply control programs have failed consistently to diminish U.S. drug consumption.
While the vast majority of the evidence gathered over the past 20 years suggests that supply-control and military programs have no impact upon drug production and cultivation in the Andean region and Afghanistan, the U.S. government continues to promote these programs, often without even mentioning demand-control programs or addressing the historic ineffectiveness of supply-control programs.
Notable politicians and leaders often openly acknowledge this conundrum; in March of 2009, when asked about her views on U.S. drug policy, Secretary of State Hillary Clinton responded, “Clearly, what we’ve been doing has not worked,” adding that the United States’ own “insatiable demand for illegal drugs fuels the drug trade.”
While this statement acknowledges our failed policies, it also subtly continues to promote them. First of all, U.S. demand for drugs is far from “insatiable;” “it’s relatively stable and predictable.”
Furthermore, while Secretary Clinton admitted that “U.S. policies on curbing drug use, narcotics shipments and the flow of guns have been ineffective,” she made these statements during a trip to Mexico, the entire point of which was to continue supporting the same policies that she admitted had failed: later that week, in Mexico, Clinton announced that “the Obama administration is seeking $66 million in new funding for extra helicopters for the Mexican police,” and also “pledged further unspecified steps to block the movement of guns.”While Secretary Clinton implied that the U.S. will be employing new strategies (as opposed to past, “ineffective” policies), her solution is the same as her predecessors’: more supply-control and military programs.
Secretary Clinton’s (and many other policy makers’) fatal error in judgment is attributing the violence of the drug trade as a direct consequence of the U.S.’ demand for drugs; in reality, the violence stems “not from the demand itself, but from the idiotic and counterproductive war on drugs.”
Throughout history, the illegalization or prohibition of a good with a consistent demand creates a black market for the good, which can only be enforced through violence and illegal activity. The prohibition of alcohol in the early 20th century, while short-lived and morally-guided, spawned an entire era of gangsters who made millions of dollars bootlegging alcohol.
Given the overwhelming evidence, the U.S. government understands the ineffectiveness and failure of our supply-control drug policies in South and Central America. Nevertheless, the U.S. has decided to continue funding such programs for political and strategic reasons.
In Afghanistan, where the War on Drugs has largely become encompassed by the broader War on Terror in the region, the U.S.’ political and diplomatic goals are certainly more transparent than they are with regards to the Andean Region, yet we continue to see U.S. implementation of the same ineffective and detrimental programs (such as eradication) that have failed historically across the globe.
Domestically, the U.S. ostensibly seeks to curtail drug-use and its associated harms, as funding for demand-control programs has increased to approximately one-third of the national drug-control budget, compared to seven percent in 1994.
Furthermore, the strategy of formulating drug-control policy to promote and enforce racial inequality is one our nation would like to say it has abandoned, as racial equality and tolerance appear to have increased significantly during this period (our nation recently elected its first non-White President, for example).
Nevertheless, our government continues to spend the majority of its drug control resources on supply-control programs (primarily domestic law enforcement and interdiction), despite these programs’ historic inability to decrease drug consumption, and despite the undeniable evidence that these programs continue to promote alarming “racial disparities in U.S. drug-law enforcement” (the ratio of black adult drug arrests per 100,000 blacks to white adult drug arrests per 100,000 whites in the U.S. was 3.6 in 2007, compared to 2.9 in 1980).
Despite these regional disparities in the transparency and intent of U.S. drug policy, however, our nation’s collective drug-control policy (both domestically and abroad) represents a continuous underlying theme of the U.S. War on Drugs: the consistent lack of evidence-based policy formulation with regards to controlling drugs and their associated harms.
As the U.S. foreign drug-control strategy has remained relatively unchanged since the mid- to late- 1980s, it has become the norm, a staple of our annual budget; as such, it enjoys an unusual degree of political feasibility and government discretion. Although the United States’ militarization of the War on Drugs blatantly contradicts the tenets of economic neoliberalism that experts such as Reuter have advocated, our nation continues to pursue policies in Mexico, Afghanistan, and the Andean Region that have failed miserably with regards to drug-control in the past.
Furthermore, as our nation’s strategic military considerations have become increasingly intertwined with the U.S.’ war on drugs, we are witnessing a growing amount U.S. drug-policy formulation based upon non-drug-related goals and agendas (such as attaining military strength in the Andean Region in response to perceived threats from countries such as Venezuela and Bolivia).
In Afghanistan, as the War on Terror has transcended the drug war in terms of importance and attention, the results of our failed drug-control strategies receive utterly insufficient scrutiny and attention; far more importantly, as our involvement in Afghanistan has become an official military conflict (as opposed to the “militarization” of the War on Drugs as we have seen in South and Central America), our leaders, while perhaps well- and clearly-intentioned, have dramatically failed to acknowledge, let alone address, the undeniably crucial link between Afghanistan’s drug production and the funding of anti-Western insurgent groups. “You can’t win this war [in Afghanistan],” said one U.S. Embassy official familiar with the country’s opium- producing regions, “without taking on drug production.”
In Mexico, which has recently witnessed an alarming and unprecedented surge in drug- related violence reminiscent of Colombia in the 1990s, U.S. and internal military funding has seemed to only make matters worse. It is true that the militarization of the war on drugs in Colombia certainly contributed to improvements in the nation’s stability, despite the fact that it blatantly failed to impact drug production and U.S. drug consumption, adding further credibility to the empirically-supported “balloon” theory of drug production.
While U.S. policymakers are perhaps hoping that the war on drugs in Mexico will work similarly as in Colombia (to ultimately increase stability and diminish the power of narcotraffickers), however, it seems as if the U.S. has reached the end of the “balloon;” we have pushed drug-trafficking and the consequential empowerment of powerful cartels out of Colombia northward along the route to the U.S., squeezing the balloon from the bottom up – and the problem has arrived at our nation’s doorstep, literally (Juarez, the current capital of drug-related violence and lawlessness in Mexico, is less than 50 miles from the U.S. border).
In Colombia, the power and wealth of the drug lords wasn’t diminished because drug production declined, but rather because our nation’s intense military pressure made it easier and less costly for traffickers to operate in countries along the U.S. drug-corridor that didn’t have a U.S.-backed military presence like Colombia.
As we continue to fund the militarization of the war on drugs in Mexico, it seems as if U.S. leaders actually believe that Mexico is the “end of the balloon,” ignoring the absurdity of the assumption that U.S. drug demand will decline if the Mexican drug lords are finally overpowered. As long as the U.S. continues to largely ignore domestic demand and the forces that drive it, our nation will be ensuring the enrichment of foreign criminals and businessmen who step in to fill the demand in place of Mexico – just as the Mexican cartels did after increased militarization of the drug war in Colombia allowed them to step into the insanely-lucrative drug-trafficking industry.
In conclusion, with regards to the United States’ War on Drugs, the establishment and maintenance of strategic military alliances (in countries like Colombia) and the assertion of military power in potentially-unstable or threat-perceived regions (such as Afghanistan and Mexico) has to a great extent become more important than actually decreasing U.S. drug demand and consumption.
Unfortunately, as we have seen in Afghanistan, the complete “militarization” of the War on Drugs can not only have negative unintended consequences, but it can completely lead us astray from the main purpose (even if the main purpose is not reducing drug consumption or production); no amount of troops, guns, or military funding will solve the volatile situation in Afghanistan until we call it what it is: A Drug War.
Despite its blatant failure to actually impact drug use and global cultivation, the War on Drugs is still being waged because it has become a politically-feasible means of exerting U.S. dominance and promoting national security and diplomatic interests abroad; thus, although “demand-control” spending has crept up over the past two decades, it is clear that our nation’s drug-control policy remains as inefficient, illogical, and contradictory as it was in 1994, when the RAND study asserted that “supply-control” and “source-country” drug-control programs are essentially useless.
Moreover, as the war on drugs approaches its 40th anniversary, it has far outgrown its “experimental” and developmental stage; drug-control policies that once seemed arbitrary are appearing increasingly deliberate, yet to a great extent still fail to address U.S. drug use and its associated harms. Furthermore, as more and more evidence becomes available regarding our War on Drugs tactics, it has become clear that many of our supply-control programs are not only useless, but counterproductive and detrimental as well.
Eradication, for instance, has proven to be not only useless in terms of decreasing drug production, but has also been shown to cause serious environmental damage and the alienation of populations that we are seeking to establish closer ties with (such as the opium farmers in Afghanistan) in order to preclude the strengthening of terrorist or drug-trafficking organizations.
The United States’ failure and reluctance to respond politically to the findings of the 1994 RAND study illuminate the power of the War on Drugs as a political tool used to pursue a variety of goals and agendas, often unrelated to actually decreasing U.S. drug consumption, while operating on under the auspices of drug-control.
While diplomatic and political measures being taken abroad to ensure the security of the United States are certainly well-warranted given the increasing threat posed by non-state actors (such as terrorist organizations), using the War on Drugs as a vehicle for achieving non-drug related goals is not only misleading and politically immoral, but also potentially dangerous as the actual threats posed by the drug trade remain unaddressed and our failed policies and programs continue to be funded without question.
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