The Economic Impact of Drug Abuse

(TFC) – Many are the ravages hard drugs have put society through. From America’s affair with heroin in the 1970s, to crack cocaine’s tragic spate in poor neighborhoods during the 1980s, to the ecstasy affliction of the 1990s and into today’s pharmaceutical problems and recent heroin relapse, we are a nation with a problem.

The human cost of abusing these substances is more than one can possibly quantify. These drugs ruin the lives not only of their users, but throngs of people around them.

But what about the monetary costs associated with drugs? As a society, we spend millions upon millions of dollars helping cure addition, fighting drug trafficking and cleaning up accidents that result from abuse. What have taxpayers spent on a situation almost entirely out of their hands?

Putting a Number on America’s Drug Problem

A whopping $422 billion — that’s the estimated bill taxpayers foot for misused prescription drugs, illicit drugs and alcohol. As you may have guessed, alcohol abuse contributes to the number significantly. However, a 2011 Justice Department report found drugs alone run up a tally of nearly $200 billion.

Factors taken into account for the study include costs absorbed through the health care system in the form of special treatments and hospitalization of drug users, costs incurred on the community as the result of crimes committed by drug abusers and productivity lost when those affected don’t make it to work or become incarcerated.

Hurting America’s Productivity

Of the three categories, loss of productivity is the most impactful on America’s economy. Drug abuse affects just under 9 percent of the population, which doesn’t sound like a large number, but if nine people in a company of 100 are habitual drug users who can’t do their work, their colleagues are likely to hit some snags.

Any large business can expect to suffer serious losses because of drug abuse in their workforce, and while many companies perform screenings before hiring employees, the effectiveness of such tests is questionable when applicants know they’ll be subject to testing.

The Cost of Incarceration 

Someone who truly has a problem often ends up contributing to the $175 billion worth of crime committed every year by those under the influence — but the hits don’t stop there, because keeping someone behind bars isn’t cheap.

Liberal groups have campaigned for the removal of Reagan-era sentencing policies that attach draconian mandatory sentences to drug possession, and while some of these laws have been repealed, many remain on the books. The cost of keeping these people locked up tops $51 billion per year, according to the pro-reform organization Drug Policy Alliance.

A look at the U.S. prison population reveals disproportionate numbers of minorities, with one in 36 Hispanic males over the age of 18 and one in 15 African-American males of the same age incarcerated at least once during their lifetime.

It is well-documented how the drug epidemic spreads in these communities because of the oppression they face from society through mechanisms like lower wages and inhumane immigration policies. We are paying into a system that helps keep the underprivileged down.

The American War-on-Drugs Machine

But even those numbers pale in comparison to what we spend trying to keep drugs out of our country.

The same group that evaluated the costs associated with incarceration reports the “war on drugs” racks up an astonishing $1 trillion annual cost to American taxpayers. And yet, we are still sending people to prison at a greater rate than nearly any other nation on the planet, largely for drug-related issues.

It seems the government is beginning to see the light on the topic of marijuana, a misclassified substance that is now becoming legal in many U.S. states. We’ll never recoup the money wasted on trying to control what many people rely on for medicinal use, but what other foolish spending is being committed under the banner of the war on drugs?

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Thinking Outside the Box

In Portugal, all drugs are legal. It’s definitely not a perfect solution, but tinkering with some of our classifications, particularly with drugs like marijuana that show very little potential risk to the user, might be a viable option. Portugal reports three overdose deaths for every 1 million citizens. Only Romania has a lower percentage of deaths from overdose.

Not only does decriminalization reduce the incentive to use, it also eliminates the need to pay for incarceration, reduces the costs incurred on law enforcement agencies and anti-drug operations and allows the government to tax legal drug sales. The tax revenue we could generate by legalizing some drugs is nearly $50 billion — enough to pay for all those people we have in prison today.

Sometimes it’s necessary to take a step back and stop doing things just because that’s the way we’ve always done them. Outdated drug policies aren’t the only fix to our drug problem, but changing them could impact our bottom line in a positive way and potentially transform our way of life.