Illegal Drugs Are a $150-Billion-a-Year Business

Washington Free Beacon | 8/21/2019 | Charles Fain Lehman
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Americans spent on the order of $150 billion on cocaine, marijuana, heroin, and methamphetamine in 2016 alone, according to a report.

Researchers at the non-partisan RAND corporation found that illegal narcotics generated as much business as the amusement and gambling industry in 2016 after conducting an exhaustive analysis of drug use and spending data. The report released Tuesday also estimates that there were roughly 30 million chronic drug users in the United States as of 2016, with substantial increases in the number of methamphetamine, marijuana, and heroin users.

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The estimates are based primarily on data from the Arrestee Drug Abuse Monitoring (ADAM) program, an annual survey that tracked drug use behaviors among male arrestees between 2007 and 2013. The RAND team then applied data from other surveys and estimates of drug use—including overdose death figures and rates of drug seizure among police—to bootstrap the national number of chronic users and the amount they annually spend on drugs.

Analysis - Drug - Market - Reason - Buyers

Statistical analysis of the illicit drug market is notoriously difficult, if for no other reason than both buyers and sellers have a personal interest in not being identified. The RAND estimates thus have large confidence intervals, with certainty declining after 2013. In other words, they are just a guess at magnitude, albeit the most certain guess possible given the constraints of data.

Assuming that the RAND approach holds water, it suggests that Americans are spending more on drugs, even as prices on the illicit markets have declined. For context, the $150 billion figure is on par with annual spending on alcohol, and slightly less than half of annual American spending on prescription drugs.

Increase - Spending - Consumption - Spread - Marijuana

The increase in spending and consumption is explained partially by the spread of marijuana use in the wake of legalization at the state level. RAND also...
(Excerpt) Read more at: Washington Free Beacon
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