The overall costs from drug abuse in the United States total out to staggering and shocking amounts.  It is estimated by the National Institute on Drug Abuse that the yearly cost of drug abuse exceeds $740 billion (2020).  The following table summarizes the yearly costs associated with the use and abuse of various drugs in the United States.

Total Cost of Drug Abuse in the United States

The costs associated with use and abuse of drugs can be divided into many categories.  Here I have outlined just some of the costs that are associated.  Drug use and abuse leads to lost productivity (“How Illicit Drug Use Affects Business and the Economy,”  2007). According to the National Drug Intelligence Center (NDIC) the loss of productivity comes from those unable to be in the workforce due to reasons like, treatment participation, death, incarceration, illness, and other outcomes from drug use (2011).  The NDIC estimates that lost productivity costs the United States over $120 billion per year. In addition, it is estimated that the healthcare costs resulting from drug abuse total $11 billion annually (NDIC). Healthcare costs can include anything from treatment programs to emergency care for an overdose.  The use and abuse of drugs can also contribute to crime (NDIC). Criminal justice costs are estimated to total around $61 billion dollars annually (NDIC). In addition to costs associated with crimes committed on U.S. soil, the predicted cost also includes costs associated with interdiction (NDIC). It is evident that drug use uses up an immense amount of economic resources each year.

Opioids

Opioid use has been on the rise for over a decade and has led to an increase in the number of overdoses (fatal and non-fatal) in this same time period (“Understanding the Epidemic,” n.d.).  It is estimated that in 2003 the health care costs associated with opioid abuse was $28.9 billion (Florence et al., 2016). The Council of Economic Advisors estimates the cost of fatalities related to opioid use in 2015 to range from $222.1 billion to $549.8 billion dollars (CEA, 2017).  The Council estimated the cost of non-fatal opioid use to be around $72.7 billion dollars in 2015. The United States Council of Economic Advisors not only takes into account the costs from prescription abuse, but costs from illicit use as well.  From 2015 to 2019 the Opioid Crisis has cost about $2.5 trillion dollars (White House Council of Economic Advisers, 2019)! While street heroin overdoses are going down, prescription opioids are rapidly increasing to where 45.8% of people in the US took some opioid prescription pills in the last 30 days in 2016. This huge over perception caused an overwhelming number of people addicted to these pain meds which is why overdose rates have skyrocketed since the 90’s. This crisis is causing a huge economic disaster and the government has estimated a loss of 3.4% of GPD in the last 4 years. Trump is trying to deal with the opioid crisis and according to the White House Council of Economic Advisers, the CEA estimates that 30,000 lives were saved from 2017-2019 if the opioid crisis kept increasing at the same rate as it was in 2016. This means that the CEA believes that from 2017 to 2019 the opioid crisis would have cost $326 billion higher than the estimated cost if the opioid crisis was left untreated. The opioid crisis is still increasing, but the rate is slowing decline, but that does not mean we can stop focusing on this huge economical problem.

Cocaine and Methamphetamine

Cocaine and Methamphetamines cause $193 billion (Gans MD, 2020) in a total loss in the nation’s economy including medical costs, criminal justice costs, divorce and loss of work productivity, and all factors that reduce America’s economic value. The costs also include the cost of spreading HIV and AIDS through these drugs. This is why it has become a huge problem of today coining the term “The War on Drugs”. In fact, 54% of people in jail/prison are in due to crack/cocaine and 24% are in due to Methamphetamines (Bureau of Justice Statistics, 2015). The healthcare system is also filled with people overdosing on these illicit drugs that overall cost about $166.5 million in total per year (Gans MD, 2020). These extremely high costs could be due to the fact that there are no sufficient rehab places and many people are sent straight to jail where they never cure their addiction. This is why America has a huge drug problem and the largest prison system in the world. We are not helping the addicts, but instead sending them away. We are hiding our problems and not dealing with them which is costing us billions of dollars.

Uncertainties with Legalization

There are many people who want to legalize all drugs due to these high costs and instead use the money for treatment. A lot of people believe that if the government regulated drugs, people would be taking pure drugs rather than drugs cut with something else and the government would be making a lot more income. The problem is that we as a society do not for sure know the outcome of legalizing all drugs. There seems like there would be fewer people in jail for drug crimes, but there could be more crimes like robbery and murder because more people would be on drugs. Legalizing all drugs could also change the way drugs are viewed as a society. With a dramatic change in the stigma of drugs, more people may be willing to try drugs which would cause more people to be addicted. Being addicted to a drug or drugs makes people do unexpected things so there is no real way of knowing what exactly would happen if all drugs were legal. There could be fewer people dying over drug overdose because there would be more medical research and there would be less excitement for using drugs. We have to take into account that the numbers and information provided does not prove any which way for legalization, but shines a light on a huge drug problem that America has. There are many different ways people are trying to think of how to save money and get more treatment for those who need it, but is the legalization of all drugs the answer? There still needs to be more case studies of other countries around the world and more research on the effects before anything can change.

An Economic Cost Benefit Analysis Of Marijuana In Colorado

Using Colorado as our case, we conducted an economic cost benefit analysis of the legalization of marijuana.  We focused on the effects that the legalization of marijuana has on the economy when conducting the analysis.  

Background

 In November of 2000 Colorado legalized marijuana for medical use (Monte et al., 2015).  The legalization of recreational marijuana began in November of 2012 with Amendment 64 (Monte et al., 2015).  Amendment 64 made the sale, possession, and purchase of marijuana legal for those over the age of 21 (Monte et al., 2015).  However, it wasn’t until January of 2014 that dispensaries were able to sell recreational marijuana (Monte et al., 2015). Since the legalization of marijuana, there have been noticeable effects on the state’s economy (Monte et al., 2015).  Below is a cost benefit analysis of the economic effects of marijuana legalization with Colorado as the case.