BPR Interviews: Jeffrey Miron Talks Drugs

Dr. Jeffrey Miron is a senior lecturer and director of undergraduate studies in the Department of Economics at Harvard University. He is known for his work on libertarian economics and on the economics of black markets. Dr. Miron describes himself as a consequentialist libertarian, in that he thinks libertarian policies prove to be preferable on consequentialists grounds. We discuss his case for legalizing all drugs.

Nick: I’d like to begin by asking you to layout your consequentialist case for drug legalization.

Jeff: Sure, so the consequentialist case for drug legalization has roughly two pieces: The first piece is that prohibition doesn’t seem to have a major effect on the amount of drug use. Whether you think drug use is good, bad, neutral, or some mix of those things depending on who does it when, there’s still just not much effect of prohibition in changing or reducing drug use. So, that can’t enter into the calculation to a large degree, because the effect is small. Second, the consequentialist claim is that by outlawing drugs, we create a bunch of unintended and undesired consequences, including increased violence, because people in underground markets resolve disputes with violence, corruption, because black markets tend to breed corruption, and infringements on civil liberties, because it’s hard to enforce a victimless crime unless you use very aggressive criminal justice tactics like no-knock warrants and aggressive search and seizures. There are significant effects of prohibition on making quality control much more difficult because, because in an underground market, you don’t necessarily know for whom you’re buying, so you don’t have a good idea of the purity or whether there’s been any adulteration. So, people have much worse health effects from consuming drugs in underground markets than they would if they bought the same drugs in a legal market. That’s the essence of the consequentialist case.

Nick: Do you think there’s any effective way that the government could lower the demand for drugs?

Jeff: First, I would say that it’s not obvious that the government should be trying to lower the demand for drugs. It’s plausible that some people use drugs in ways that are bad for themselves or possibly bad for others, such as driving under the influence of drugs. But, of course, some people misuse a huge range of commodities and we don’t try to reduce their overall usage. We, in some cases, reasonably try to address the misuses of those particular substances, such as with laws against driving under the influence of alcohol or drugs. Even if you think that, overall, we should be trying to reduce the use of drugs, it’s unclear whether there are policies that do so in a way that makes overall sense from a consequentialist or freedom perspective. So, you could consider a moderate sin tax on drugs similar in its rate to what we have on alcohol. That will discourage drug use to some degree depending on the response of the drug use to the price. That will partially adversely affect people who use drugs without harming themselves or others, so that is a cost of having that sin tax. It may discourage use by some people who misuse drugs, so that is potentially a benefit of having that tax. Thus, it’s a logical thing to consider. There are a few other things which certainly deserve serious consideration. Minimum purchase ages would be an obvious one. When those get too large, those can have unintended side effects as well. But, a minimum purchase age that is in a reasonable range is probably something that doesn’t do much harm, even if it doesn’t do much good.

Nick: Your first comment reminds me of Gary Becker’s model of rational addiction. Do you think that model describes, in a literal way, the reasons for which people use drugs?

Jeff: In rough terms, yes. But to say it a little bit more explicitly, many people use drugs because they perceive that they get benefits of one kind or another from those drugs. Those benefits might include that they enjoy being high, that they enjoy being under the influence, that they enjoy the pain relief from opioids or the rush from cocaine or whatever it is. It might be a more medical approach. They believe that their mental state will improve. Or, it might be they do drugs to look cool. It might be they do it because their friends are doing it. Regardless of the exact motivation, they perceive some benefit to their drug use. And, there’s no reason that society should not accept that benefit any more or less than accept the benefit that people perceive they get from eating apples or going to the movies or anything else. It’s only when people are significantly adversely affecting others that there’s potentially a role for policy to try to protect innocent bystanders from the misuse of drugs, such as in the aforementioned case of driving under the influence.

Nick: How does addiction factor into that question of perceived benefits when we’re discussing truly addictive drugs like opiates and benzodiazepines?

Jeff: Well, first, I have to note that addiction gets used in two fairly different ways by different groups of participants in this discussion. For the medical community, addiction automatically implies something bad is happening as a result of the use of a substance. For economists, addiction just means regular use brought on either by getting into the habit of using a substance or because of the physiological properties of the substance. So, it’s perfectly reasonable to describe people as being addicted to caffeine — a huge fraction of the planet is addicted to caffeine via coffee, tea, Diet Coke or whatever. It’s not obvious that those addictions cause any harm whatsoever. Moreover, the negative aspect of addiction that the medical community and the public health community refer to in the context of drugs are often almost entirely due to the fact that the drugs are prohibited. So, you spend a lot of time and money trying to be able to purchase the drug. That’s because the drug is prohibited. If it were legal, it would be easy to go to the corner store and purchase it. Another harm might be because you get adulterated doses. That is an artifact of prohibition, not of the use of the substance per se and not an artifact of addiction per se. So “addiction,” in the way that economists would define it as habitual use, should play zero role in this discussion because people are addicted in that sense to billions of things: To exercise, to their spouse, to particular TV shows, and a lot of substances beyond the currently illegal drugs.

Nick: How do you think of the opioid crisis in light of that sort of reasoning?

Jeff: I think the opioid crisis is completely consistent with that reasoning. We have lots of people who perceive that they would get some benefit from continuing to use opioids or starting to use opioids. That benefit might be standard pain relief for a bad back or cancer treatment or whatever. That benefit that people perceive might be that they just like the feeling of being under opioid. Whatever that perception is, they can not, as a rule, just go down to the CVS, the corner drugstore, and purchase opioids. They may be able to get it for some period of time via prescription, but they will typically be cut off after a few weeks or months by their doctor from getting prescription access. That’s occurred more and more over the last several years as states and cities and the federal government have restricted access to prescription opioids further. If those restrictions weren’t there, then people who want to continue consuming opioids because they don’t want to go through withdrawal would simply be able to continue using those opioids with little, if any, demonstrable negative effects, so long as they’re not accidentally consuming black market opioids like fentanyl, so long as their not getting too high dose, so long as they’re not getting an adulterated doses, so long as they’re not injecting it via dirty needles, which again is an artifact of prohibition, not of drug use per se.

Nick: Should we think about demand-driven by peer effects as different in any way than demand that is more internal to a particular drug user?

Jeff: Well, peer effects can be positive or negative. Some people’s peers may look down upon using drugs. Some people’s peers try to encourage their friends and people to be responsible, to get an uber rather that are driving when they have have been drinking and so on and so forth. Of course, the peer effects could be negative, in some cases, but that’s true of a huge number of things beyond drugs. Maybe peer effects get you to drive too fast or get you to exercise excessively and cause yourself physical injury. Peer effects get you to not do your homework or stay in school or things like that. So, depending on one’s peers and one’s own reaction to that, there’s a huge range that doesn’t have anything specifically to do with drugs.

Nick: How do you think about traditionally psychiatric drugs like SSRIs and benzodiazepines in the context of legalization? Are there any special considerations for them?

Jeff: As best I can tell, no. We should be treating all of these drugs with one possible exception in a similar way; that is, we should be allowing people to purchase them without restriction, without even prescription rules or anything like that. Of course, most people will tend to do that in consultation with their doctor or other health care professionals. And, of course, some people will make bad choices. But, that’s true now and the consequences of making that those bad choices are worse if you go to the black market to access these substances.

The possible exception to the idea of having a free market at all drugs is antibiotics because, with antibiotics, there’s potential for a fairly significant negative externality: Breeding disease-resistant bacteria. And, though that’s one case where I think even the most hardcore libertarian would be open to the possibility that we should have some system that tries to moderate the use of antibiotics. Now, whether such a system would be effective in practice, whether it would do more good than harm in practice, that is complicated. It depends on exactly what that system would be. But, at least there’s a pretty convincing a priori argument for considering restrictions in the case of antibiotics.

Nick: What about something like so-called “study drugs” on college campuses? Do you think that if they were legal colleges would have problems establishing strong rules about their usage?

Jeff: Colleges currently face rules about their usage, whether they’re legal or not. Colleges are going to have a hard time enforcing any such rules because whether they’re legal or not, students will get access to them or they will get access to other things which are legal, which accomplish more or less the same thing. You can go and drink 20 cups of coffee. You can buy NoDoz from your local pharmacy. So, the college rules may possibly suggest to some students that it’s not a great idea to use study drugs, but they certainly are not going to prevent people who want to do it from doing it. So, I think they’re sort of irrelevant.

Nick: What do you think about the current atmosphere surrounding e-cigarettes?

Jeff: I think there’s a huge amount of misinformation and confusion around e-cigarettes, vaping, and all the related activities. We do not have a legal market for all vaping products. We have essentially sort of a legal market, de facto legal market, for the tobacco products. And so far, as best I can tell, the lung illnesses and the deaths have not been linked to the legal products. Instead, it seems that the vast majority of the illnesses are linked to vaping of THC products and disproportionately THC vaping products sold in states where recreational marijuana is not legal. So that again is completely consistent with the general perspective I offered earlier, that when you make something illegal, people still try to get it in one way or another from black market forces and those black market products are more dangerous because of adulteration than the legal version. Now, in the case of the THC vape products, what seems to happen is that the black market suppliers added an ingredient, which is probably not good for you today. But, they didn’t do it deliberately to harm people. They just didn’t realize what they were doing. Of course, they didn’t want to kill off their customers or sicken their customers. But, because it was all behind, you know, in the shadows, in the black market it took more time to figure that out. It made it harder for people in those states where it’s not legal to access the products sold through a legal establishment that had a normal dispensary and they were retail poor and so on. So, again, it’s prohibition creating the problem, not the product.

Nick: Do you think there is any role for public health besides antibiotics and the possibility of driving under the influence of drugs?

Jeff: That there may be a role for public health efforts to provide information. If what public health is doing is trying to teach kids in junior high school or high school that there are potential risks of using alcohol and various drugs or potentially risks of unprotected sex and so on and so forth, certainly that’s a reasonable thing to do. Sometimes the public health sources seem to want to throw out the baby with the bathwater, to take such an extreme stance against drugs or alcohol that I think they discredit their message because they make it sound as though any use of these products is almost always hugely detrimental to the user. And, teenagers figure out that that’s not true, which discredits the message that they perceive and make them less likely to pay attention to a more moderate and sensible message. But is there some role for public health information campaigns? Probably

Nick: You mentioned sin taxes earlier. How would you think about incorporating the externalities of drug use into their price in a legal market?

Jeff: Well, I think it’s a very hard thing to figure out what the right sin tax is. And, I’m sort of tempted to think that, while it would be much less bad than prohibition, sin taxes, whether for drugs or for alcohol, are not such a great idea because the magnitude of the sin taxes is going to end up reflecting public opinion and people’s preferences. That might lead to sin taxes detached from any sort of objective or scientific assessment of which drugs are the most damaging and least damaging. Now, that said, as long as the sin tax on legalized drugs is sufficiently moderate that it doesn’t recreate the black market ( perhaps 5, 10, or 15 percent of the price), the evidence we have from observing sin taxes on cigarettes and alcohol is that such a tax would not recreate the black market. It would discourage inappropriate use a little bit, probably. Probably not by very much, but maybe a little bit. So I wouldn’t want to take a really strong stand against the moderate impact, except that moderate taxes don’t always stay moderate. They sometimes get larger, which recreates the black market. Then, you’re back to where you started. So, as a political compromise, accepting moderates sin taxes makes perfect sense. But, if we were really designing it all from scratch with a benevolent dictator, it’s not obvious that we should have sin taxes.

Nick: Finally, how do you imagine drugs being sold in your ideal drug regime? 

Jeff: Libertarians don’t want to try to say what the model will be or should be, other than that there should be no legal impediments to whatever model the market ends up producing. So, plausibly, if they were fully legal, legalized drugs will be sold in pharmacies, grocery stores, liquor stores, over the Internet, or whatever, but that’s for the market to figure out. And, of course, as long as there are not federal regulations and only modest state regulation, some cities are, of course, going to have zoning rules such that certain products aren’t sold in their cities, or at least in certain areas. Those rules probably don’t have much impact. But, they’re also probably innocuous because they have very, very small effect sizes. So, we would almost certainly end up with something that looks similar to the current models for alcohol and tobacco, which in the libertarian view, are not perfect, but they’re not horrible either.

SUGGESTED ARTICLES