Opium economics

From a news story on American frustration with the drug war in Afghanistan:

KABUL – After several years of steady progress in curbing opium poppy cultivation and cracking down on drug smugglers, Afghan officials say the anti-drug campaign is flagging as opium prices soar, farmers are lured back to the lucrative crop and Afghanistan’s Western allies focus more narrowly on defeating the Taliban.

That combination adds a potentially destabilizing factor to Afghanistan at a time when the United States is desperate to show progress in a war now into its 10th year. The country’s Taliban insurgency and the drug trade flourish in the same lawless terrain, and are often mutually reinforcing. But Afghan officials say the opium problem is not receiving the focus it deserves from Western powers.

“The price of opium is now seven times higher than wheat, and there is a $58 billion demand for narcotics, so our farmers have no disincentive to cultivate poppy,” said Mohammed Azhar, deputy minister for counternarcotics. “We have gotten a lot of help, but it is not enough. Afghanistan is still producing 85 percent of the opium in the world, and it is still a dark stain on our name.”

via As opium prices soar and allies focus on Taliban, Afghan drug war stumbles.

The article suggests that the campaign against opium production has failed.  But it seems to have succeeded too well.  If the price has shot up, that means that the supply has become much smaller.  Also, high prices could be expected to mean a drop in the use of heroin and other opium-derived illegal drugs.

But what we are seeing are the unintended consequences of the program to curtail opium production.  Eradicating all of those poppies now just means that the product is even more valuable than it was before.  Now more Afghanis have an incentive to get into the drug business.  And heroin users who support their habit via crime now have to commit even more crimes to service their addiction.

The laws of the marketplace operate no matter what.  The only way to curtail drug production is to reduce demand, and that requires a cultural and moral change in OUR country, not Afghanistan.