Everybody and their cats and dogs (let's not discriminate) knows absolutely, positively and definitively that drugs are "bad". Everybody knows for sure that governments are doing whatever they can to combat drugs. Everybody knows that thus governments are Drug Dealers' worst foes. And everybody is mistaken.
We have explained in other articles why the development, provision and use of all drugs of any kind inherently clashes against our beliefs as well as against common sense and practicality (see for example Drugs For Everybody ). For most people our principles are so alien as to be akin to an amoeba's language (if they would have one). However, some of them (a few few) have been enlightened, at least partially. For these people freedom means freedom and this includes the total choice of drug use; no restrictions whatsoever… However… and there is always a however… they are of the opinion that drugs should be taxed. This is so, they say, because it is a vice and as such people using vices should pay for them. Some of them are not that puritan and are more practical. For them if a person has the money to buy drugs, it has the money to pay taxes on it.
The rationale is simple: governments (yes, they still believe in them) should tax only luxury items and not necessities. In so doing they will re-distribute wealth from those who can afford it to those who cannot. Neat right?
Well…no.
Actually, very stupid.
All these do gooders operate on preconceptions and myths. One of the largest is that drug manufacturers and dealers operate outside the realm of the "authorities" and as such they must be made pay. Literally.
Now consider this.
With the exception of Drug Lords that operate in far, far lands in the middle of nowhere as away from civilization as it is possible to conceive, the rest operates mostly in developed countries. Why is this? Simple. People in those far, far away lands are far, far away from having any meaningful money. The money, the markets are located in developed countries. It is true that some of that money ends up in the hands of Drug Lords, but a great deal ends up in the pockets of local dealers.
The drug trade is a cash business. Nobody in the entire supply chain would be stupid enough to buy pot with a credit card or crack with a check. But cash is problematic. Think of it this way. If you buy a pack of cigarettes using cash, this is not a problem. Grocery shopping? Sure. How about a fancy suit? Maybe. A round ticket first class to Paris by plane? Would look suspicious. A fancy car? Very suspicious. How about an apartment? Not a chance, all alarms would sound. See what we mean? Although cash is in theory cash, you can't actually use it to do much as you try to purchase more expensive items. The higher the price of the item the less useful cash is. And this presents a serious problem. As a Drug Dealer you have all this cash stashed in boxes meanwhile you are living in a rented one bedroom apartment overlooking the train rails. Not good.
In order to solve this problem, any self-respecting Drug Dealer would contract the services of… let's call it "a specialist". This specialist would take your cash and wash it and rinse it several times through many convoluted off-shore washing institutions… yeah… let's call them that. At the end of the process the money would show up on the other end smelling fresh and "legitimate".
This specialist will do this for a price, of course. But this price (10 to 20% for a first rate service) will also be "legitimate". And this word "legitimate" has a critical implication. What this word implies is that this money will look like the profit from legitimate business. And what does the government do with legitimate profits from legitimate business? You guessed it. They tax it.
All drug money in developed countries is already taxed!
The idea that Drug Dealers can somehow operate on a parallel cash-world-only is ridiculous!
And so the specialist will get his/her percentage taxed. The Drug Dealer will get his/her percentage taxed. As a matter of fact, every person in the loop will get his/her profits taxed. The only possible exception may be the Drug Lord who can insulate his operations from government through violence and bribery. But there aren't that many such people. Most Drug Dealers operate in developed countries. Most Drug Dealers want to actually spend their money in developed countries. Most Drug Dealers get their profits taxed. Most Drug Dealers invest their post-tax money and create wealth which can be further taxed. And herein lies the problem.
The goal for the "War on Drugs" is to destroy all drug operations… yet these operations provide enormous amounts of tax money… which fall in line with the primary goal of governments (politicians): to extract as much tax money as possible from everybody.
And now the dichotomy becomes clear. On one hand the government is supposed to persecute and prosecute Drug Dealers because it is politically expedient to do so (it is a nice political campaign "initiative") but on the other hand, this war consumes money and it is invisible; it does not provide too many photo-ops. Worse. This war is very expensive hence draining the limited resources politicians have to spend and hence maintain themselves in power. This is a problem. A big one. This "War on Drugs" produces a one-two punch to government coffers: on one hand it drains it through expenses but in so doing it puts Drug Dealers out of commission which means far less tax revenue which means lower chances of getting re-elected. Not good.
And so what did politicians do? Have its cake and eat it too.
Have you noticed how all "War on Drugs" efforts are always half-measures? Never full and juicy budgets that may actually make a difference. Never a full commitment. Never full steam ahead. Do you honestly believe that this is by mistake? That such level of incompetence and stupidity over so many decades is just that? Stupidity? Do you honestly believe that this was not engineered? Of course it was! Politicians made a calculation. They funded just enough "law enforcement" people so that they will look good but not too many so as not to impact significantly their source of revenue: tax from drug profits. It is not a coincidence that the "War on Drugs" has been failing from the beginning. The "War on Drugs" was designed to be a failure! Politicians cannot afford otherwise.
But then again, if you believe otherwise, please feel free to let us know why. We haven't had a good laugh in quite some time.
Note: please see the Glossary if you are unfamiliar with certain words.
