The Frustration of Being an Economist

Years ago when I decided to seriously pursue the profession of economics and enter the Ph.D. program at Kansas State University, I did so to prepare myself to educate young people about the “dismal science.”  I have no regrets.  Economics is an exciting subject and it has been a pleasure to explain it to college students.  Teaching economics is a great pleasure, but being an economist can be mental torture!

The problem with “being” an economist is that we think differently than most others in our world.  We think in terms of efficiency, costs vs. benefits, the importance of properly placed incentives, and “opportunity costs”.  This type of thinking sometimes puts us in conflict with politicians and the laws they pass.  This conflict has a long history.  For example, Britain’s Corn Laws (a tariff on imported grain established in 1815) were eventually repealed in 1846, largely due to the writings of Member of Parliament and economist David Ricardo.

Another thing that sets economists apart from other thinkers is that economics is an “amoral” science.  Amoral doesn’t mean immoral; an economist can be as moral as the next guy.  The term “amoral” means that economics is “outside the sphere to which moral judgments apply.”   For example, economists might look at the effects of government policy on drugs, prostitution, child slavery, abortion, or violent crime.  Our purpose isn’t to cast moral judgments, but to predict how various laws might impact these activities.

I’ll spend the rest of this blog highlighting just one of many examples of why I am frustrated most of the time.  You’ll undoubtedly hear others as the weeks pass.  This week’s topic; ending the prohibition on illegal drugs.

Mexico is a mess.  Last year over 6,000 people died in drug-related violence, as six cartels fight over the lucrative drug business.  Competing drug cartels are warring with each other, often with more firepower than the Mexican Police.  Marijuana represents about 65 percent of the illegal drugs imported to the US through Mexico.  In Afghanistan opium poppies, from which heroin is produced, is by far the most profitable crop grown by local farmers.  The Taliban, whom we fight in Afghanistan and Pakistan, thrives on opium profits, fueled by the demand for heroin in the United States and other countries.

In the United States 50% of all crime is drug-related.  Over 50% of prisoners (most of them black) are not in prison for committing violent crimes, but are incarcerated for selling marijuana, cocaine, heroin or other illegal drugs.

In the roaring 20’s, when alcohol was illegal, the cost of a bottle of booze skyrocketed.  Legitimate breweries closed their doors and only those willing to risk imprisonment produced alcoholic beverages.  Alcohol crime syndicates fought gang wars in America’s cities.  Police departments and the FBI were powerless to stop the crime associated with alcohol prohibition, yet it took a simple slamming of the gavel on December 5, 1933 to put all of the alcohol gangs (and their gang violence) out of business.  Once the prohibition of alcohol was repealed, private enterprise entered to fill the production void.  Predictably, supply rose and prices and profits fell.  Capone and others were out of the alcohol business for good. Maybe it’s time to put Mexican cartels and the Taliban out of business by the same means.

The cover of the March 7th-13th 2009 edition of The Economist reads:  “How to Stop the Drug Wars”.  There is a lengthy and thoughtful examination of why drug prohibition has failed.  I suggest that you read it. You can do so by clicking HERE. The Economist concludes that the end of drug prohibition is the “least bad” solution for this problem.  There will be new problems associated with the legalization of drugs, but they are far less daunting than the problems that will simply vanish if the gavel is pounded.  If that gavel is ever pounded, drugs will cease to be a crime problem and will become what they have always been; a health problem.

For many people even the idea of ending drug prohibition is repugnant.  For me, an economist, the issue isn’t whether drugs are bad or good; they are undoubtedly bad for people.  For nearly 40 years I’ve known the most benign and rational solution to this problem, namely, the end of drug prohibition.  The frustrating part is that during those same 40 years I’ve had to witness ever increasing drug use and violent crime associated with the drug business.

Einstein said that insanity is “doing the same thing over and over again and expecting different results.”  How long are we going to do the same thing over and over again with respect to the drug problem?

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14 Responses to The Frustration of Being an Economist

  1. judy .welch falke says:

    yoo Don– did you not mean Dec.5 1933 instead of 1033?::

  2. Donna B says:

    It makes toooooo much sense, the powers that be will never let it happen.

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