By Chet Yarbrough
Written by: Tom Wainwright
Narration by: Brian Hutchison
“Narconomics” is about the business of illegal drugs. Tom Wainwright notes drug cartels are modern businesses that benefit one-percenters while liberally rewarding middle class managers with money, power, and prestige. However, these one-percenters brutally terrorize employees and kill their customers. These business moguls systematically bribe and brutalize the public.
The manufacture and sale of illegal drugs is a growth industry, diversifying its practices and products while becoming global enterprises. An irony of Wainwright’s story is the ugliness and economic success of an illegal business is abetted by governments that support the war on drugs. The substance of Wainwright’s book is that cartels are run with many of the fundamental principles (aside from terror and murder) that make international companies like Wal-Mart richly successful.
Wainwright’s point is that like Wal-Mart, drug cartels have become so dominate in the market that they can dictate terms to suppliers and buyers. Cartels have a monopoly that controls pricing and distribution of a coveted product. The size of the Cartels allows control of prices at both ends of the business cycle. They can dictate what they will pay farmers to produce. They can sell at what consumers are willing to pay. Cartels are able to victimize both producers and buyers. Their dominate position in the illegal drug market allows them to globalize their business. Like Wal-Mart, they are using the world wide web to expand their market.
Though policies like the war on drugs and alcohol prohibition were meant to save people from themselves, Wainwright suggests they failed. Human beings naturally desire money, power, and prestige in varying degrees. When desire for money, power, or prestige is unmet, humans compensate with drug use; or other escapist behaviors. Wainwright analyzes “Narconomics” to show how it capitalizes on fundamental human drives and weaknesses. He goes on to suggest how drug cartels can be destroyed.
Wainwright argues that understanding drug cartel business practices will show how their industry profits can be disrupted. Wainwright suggests changing the focus from a war on drugs to a policy for treating, educating, and rehabilitating users. Rather than spending billions to militarize national police forces and prisons, Wainwright suggests those dollars be spent to treat, rehabilitate, and educate accused and/or incarcerated users. In destroying the drug cartel’s consumer base, they lose profit. Without profit from customer purchases there is no money, no power, and no prestige. There is only a failed business model.
The appointment of Jeff Sessions as Attorney General of the United States does not bode well for Wainwright’s capitalist idea of attacking the drug industry at its core.
Wainwright goes on to suggest that drug use be decriminalized and regulated by the government. This is no panacea but history shows that the war on drugs is a failure. The heart of success for drug cartels is its adoption of business practices that generate profit. Several drug cartels have become phenomenally successful. Sadly, the reality of the fundamentals of well-run business organizations is that they do not disappear. Remove the source of profit and businesses fail or change. Wainwright implies well-run drug cartels will change.
Wainwright explains that the business of illegal drugs is a global enterprise. A global level of government cooperation is needed for effective elimination of drug cartels. No single nation can eradicate cartels because of globalization. One nation’s success in the drug war only compels cartels to move to neighboring countries. The solution lies in treating, rehabilitating, and educating drug users. Only with decriminalization, user medical treatment, and public education will the source of profit for drug cartels be cut off.
The fact that drug cartels are run like businesses reveals an infrastructure that allows diversification. Once profits are reduced for drug manufacture and distribution, well-run cartels will change to survive. Wainwright notes that drug cartels have already diversified; i.e. they are human traffickers, and extortion consortiums. The glimmer of hope is that human trafficking and extortion do not pander to the human desire for escape offered by drugs. Government agencies and the general public are equally repulsed by human trafficking, murder, and extortion. Governments and the general public are more likely to cooperate in eradicating that type of criminal activity; less so with drug addiction.
Wainwright offers a compelling argument for attacking drug cartels by removing the source of their profits. The source of profits is the consuming public; not the illegal drug manufacturers and distributors. The illegal drug manufacturers and distributors are just the cost of doing business; not the source of profit.
Decriminalize drug use, cure the public of its need for drugs, or at least treat the addicted, and drug cartels have no motive to be in the business. There is no simple or cheap alternative to “the war on drugs” but there is a history that shows war on manufacturers and distributors of illegal drugs does not work. As long as the consumer wants the product, manufacturers and distributors will figure out how to supply the demand. Consumer demand is the driver behind the wheel of “Narconomics”. Treat the drug addicted, decriminalize and govern the use of drugs, and educate the public on the consequence of drug use. These actions, like the ban on smoking in public areas, will not end addiction but it will change the drug cartel industry into a criminal enterprise that most will recognize and despise.