Medical marijuana and suicide

A priori, it's hard to tell what increased marijuana access would do to suicide rates. There's evidence of comorbidity of marijuana use and psychological disorders, but sorting out causality is tough - marijuana can often be a form of self-treatment for those with existing disorders. Similarly, marijuana could attenuate or exacerbate the effects of significant life events that bring on marijuana use.

The University of Bonn's Institute for the Study of Labor (IZA) this year released a working paper (HT: @ColbyCosh) using US panel data to show that medical marijuana legislation is associated with strong decreases in suicide rates.

Our results suggest that the passage of a MML is associated with an almost 5 percent reduction in the total suicide rate.  

When we examine the relationship between legalization and suicides by gender and age, we find evidence that MMLs are associated with decreased suicides among 20-through 29-year-old males and among 30- through 39-year-old males.  This result is consistent with registry data from Arizona, Colorado, and Montana showing that most medical marijuana patients are male, and that roughly half are under the age of 40 (Anderson et al. 2011).  Estimates of the relationship between legalization and suicides among females are less precise, and are sensitive to functional form.  We conclude that the legalization of medical marijuana leads to an improvement in the psychological well-being of young adult males, an improvement that is reflected in fewer suicides.  

Shame Obama's been cracking down on the dispensaries providing product to those with medical marijuana prescriptions; a greater shame that New Zealand doesn't yet allow medical marijuana.

40 Economists Agree

Chicago's Booth School has put together a wonderful resource: a panel of economic experts called on to state their opinions on a variety of policy-relevant questions, along with their confidence in those opinions. I also love that folks can reply that they are highly confident in their response of "uncertain"; sometimes, the data is insufficient to the task, and we can be confident in that we don't know.

So, where do economists agree?

• Technological change affecting differentially the returns to different skills is one of the leading causes of rising US income inequality. Weighted by confidence, 34% strongly agree and 54% agree. Moreover, simply increasing the top marginal tax rate is exceedingly unlikely to make a substantive dent in the deficit, though small increases would raise more money.


• Shifting to a gold standard would worsen price stability and employment outcomes for the average American. Massive consensus here: zero percent of the panel agreed, agreed, or were uncertain, that shifting to the gold standard would make things better. Everybody said it's a bad idea, or a really bad idea. Weighted by confidence, 66% "strongly disagreed" that outcomes would improve.


• Congestion charges are a fantastic idea. Nobody disagreed.


• Carbon taxes are more efficient than CAFE standards for achieving CO2 reductions.


• Shifting from drug prohibition to to legalization and taxation would reduce social costs. Weighted by confidence, 35% strongly agreed, 44% agreed, 20% were uncertain, and 2% disagreed. Bob Hall was the one dissenter, with this justification: "My limited understanding is that there is evidence of harm from cannabis." Of course there is.


• America's policy of preferential tax treatment for employer provided health care causes distortion.


• "Buy American" mandates do not have significant positive impact on US manufacturing employment.


• Getting rid of the home mortgage interest deduction, with compensating changes elsewhere in the tax system, would improve the efficiency of home financing decisions.


• Shifting to vouchers would likely, but not necessarily, improve schooling outcomes. The median respondent, weighted by confidence, was uncertain, but there's more mass on the agree side than the disagree side.

There are other questions at the site; go have a look. 

I'd draw from this that government by technocratic economists would never shift to a gold standard, would immediately implement congestion charging, put in place a carbon tax while abolishing CAFE, abolish the home mortgage interest deduction and preferential tax treatment of employer-provided health care, get rid of "Buy American" mandates, and very likely legalize marijuana and put it under an excise regime like that used for alcohol or tobacco. They'd also likely consider broader trials on vouchers so we could move from uncertainty to confidence.

Dilbert's Scott Adams ought to adopt this set of policies in his independent run for the Presidency. 

Pipeweed

A nation of hobbits likes its pipeweed. Radio NZ and The Press report on a survey published in The Lancet showing marijuana use in Oceania (Australia and New Zealand) is well above international norms. Here's the relevant table from Lancet:

Clicking the image should provide the requisite embiggening. They figure 9.3% to 14.8% of folks in Australia and NZ have used marijuana in the last year while 2% to 2.8% have used amphetamines. The lower bound estimate on both for Australia/NZ is above the upper bound estimate for most other areas. This despite Australia and New Zealand both being islands in the middle of nowhere in the midst of a big useless anti-meth push that has had no effect on meth use but that keeps me from getting decent cold medicine when needed.

Keep digging up, guys. You're doing a heckuva job.

Or legalise marijuana and put it under the same regulatory apparatus as alcohol; make the whole deal politically palatable by taxing it sufficiently to keep retail prices close to where they are now. Turn the deadweight costs of prohibition into tax revenue.

GST and the price of meth

New Zealand's drug warriors laud their successes in the war on meth. Evidence of success? The price of a  gram of P is up from $723 last year to $768 this year.

Year on year CPI increase in the September quarter is 4.6%. But a big chunk of that is the GST increase.

If meth had followed the CPI, the price of a gram would have increased to $756, not $768, so maybe enforcement action pushed the price up a bit (although we ought to be pretty sceptical) . But the more interesting question is whether we should have expected price inflation in illegal markets to incorporate the GST increase.

Obviously, drug dealers don't charge GST on meth. But they do pay GST on a pile of their inputs where those inputs are bought in legal markets. And, they don't get to claim that GST back on quarterly returns either. So they'll have had a GST-related increase in their production costs. Since a smaller proportion of their inputs will be GST-affected, the CPI index for illegal sector goods should be lower than for other goods if we don't net out GST effects from either. So the real price increase is likely a bit bigger than a straight CPI-adjustment would have it.

It's worth noting the large disconnect between Key's rhetoric in the press release and the actual report's findings. Here's Key:

The fourth Indicators and Progress report for the Government's Tackling Methamphetamine Action Plan shows government agencies' work is continuing to contain the growth of methamphetamine ('P') supply networks, Prime Minister John Key announced today.

"This initiative has been in place for two-and-a-half years, and we can see that efforts to crack down on those who are importing, manufacturing and selling P and its precursors are working," says Mr Key.

"Six months ago, there were signs that supply chains were being disrupted, due to the efforts both at the border and domestically. We're now able to see that the dedicated resources on the frontline are continuing to squeeze the P trade."

..."The coordinated action against P by a number of government agencies is producing results," says Mr Key. "This report shows that, over time, the work to contain the methamphetamine trade is achieving the right results. All indicators suggest 'containment' and this should be seen as success.

"Any softening in our hard-line stance against P could undo several years of good work. Those who profit from the misery caused by P should realise we are committed to stamping out the harm this drug is causing New Zealand communities."

Here's the report (prior reports). Relevant findings:

• Purity is down a bit, decline "close to being statistically significant".
• What about availability?

  NZ-ADUM data shows a similar trend as IDMS, in that availability has remained stable/easier over the past two years. (p. 10)

  And, 60% of frequent users report no change in difficulty of getting P; rest split evenly between "easier" and "more difficult". (p. 14)
• Convictions for possession/use up from 1327 in October 2010 data to 1557 in October 2011 data; convictions for supply and dealing more than doubled. But still availability has either not changed or has increased.
• Customs is seizing less pseudoephedrine at the border and is instead seizing more P.
• But, the price of a "set" of ContacNT (pseudoephedrine precursor) hasn't changed since September 2009 (p. 13). Recall that the government only announced plans to make pseudoephedrine prescription-only in October 2009. So despite that none of us can get anything that works for a runny nose, the black market price of pseudoephedrine is unchanged. John Key and Peter Dunne have screwed over every New Zealander with a cold for absolutely no benefit.

Keep digging up, guys. You'll get out of that hole someday.

A lesson in contrasts

American legal scholars debate whether provisions in the latest defence appropriations bill would allow the government to hold citizens indefinitely without charge. Here's the latest summary:

The law provides that indefinite detention without charge may be imposed on anyone who has provided “substantial support” to groups that are “associated forces” of al-Qaeda; but it leaves undefined what constitutes “substantial support” and which groups might qualify as “associated forces.” Thus far, the lower federal courts have upheld detention of al-Qaeda or Taliban members, but not mere supporters, much less supporters of associated forces. And there is much dispute about whether the laws of war permit detention in those circumstances. Now Congress has essentially predetermined that question. Unless this and future administrations construe these provisions as limited by the laws of war, they risk authorizing detention that the laws of war would not. 

See also Volokh and Lawfare. And recall that American drug warriors have argued that marijuana users offer support to terrorist groups.

Meanwhile, in New Zealand, lawyers for the police have advised that sniffer-dog searches in schools breach students' civil rights, and so the police have stopped carrying out such searches, previously requested by the schools, pending further legal advice:

"Police are currently considering the legal implications regarding searches by drug dogs in schools," a spokeswoman said.

"Police understands the Ministry of Education is also working on good practice guidelines for schools so that they can search and confiscate items that may pose a safety risk."

She said police gave other support to schools, such as drug education, arranging counselling and prosecutions. "Where schools detect more serious drug offending, police become more actively involved."

Hutt Valley High School has historically had a police dog team conduct annual searches. But its request was refused this year "on the grounds that the police have no cause to search".

The Marijuana Vote

The age breakdown in the latest US Gallup poll is the best argument for increasing youth voter turnout. Overall support for legalizing marijuana has just passed 50% in the US. But the age breakdown would likely have the median voter still in opposition.

Support for legalizing marijuana is directly and inversely proportional to age, ranging from 62% approval among those 18 to 29 down to 31% among those 65 and older. Liberals are twice as likely as conservatives to favor legalizing marijuana. And Democrats and independents are more likely to be in favor than are Republicans.

More men than women support legalizing the drug. Those in the West and Midwest are more likely to favor it than those in the South.

I wish there were current New Zealand polling data on this one.

Shambolic

What a shambolic disappointment.

I've argued that ACT would do best to return to its classical liberal roots - that there's an unserviced space that's relatively liberal on economic and on social issues. As a right-wing rump to National, more liberal on economics but conservative on social issues, they'd be bound in the spot occupied by the Greens on the left - forever taken for granted by the dominant coalition partner because they couldn't plausibly bring down the government in favour of a coalition led by the main party on the other side. And, I've also thought that staking out a position on marijuana legalization could be a good way of signalling a move to that space. It would confound the usual narrative dominated by right-left thinking and, in so doing, bring a lot of positive press for ACT as it moves into a different space.

So I was really pleased to hear Don Brash musing about marijuana decriminalization over the weekend. Sure, decriminalization hardly goes far enough: if the trade remains illegal but possession legal, production remains split between informal household production among those into gardening, friendly informal supply among friends (albeit with risk that comes with growing more plants than is needed for personal use), and the gangs. Cactus Kate is right: full legalization is better.

In a fully legal and regulated market, we could move to supply under conditions similar to alcohol regulation with age controls and excise taxation to internalize whatever minor external harms come from marijuana use; alternatively, a higher than economically optimal tax could be set if necessary to build the coalition to move from prohibition to legalization - keeping retail price roughly constant but with the deadweight losses of the informal market turned into tax revenues. I've ballparked potential excise revenues at around $100-$300 million if taxes were set to hold consumer prices constant across regime change; actual figures would depend on potential economies of scale in production in a legalized market. If we were to take the $116 million spent by police on marijuana busts and instead devote it to violent crime, we could expect social cost savings on the order of about $275 million.

I'd thought that Brash's trial balloon was floated with his having secured at least minimal support from the Party apparatus. And so I was really optimistic - he had sold the party on a move towards liberalism despite John Banks being the candidate in Epsom. Alas, I must have been smoking something.

In a speech on law and order to party supporters in Auckland yesterday, Brash said he had serious questions about New Zealand's current marijuana laws and gave his personal endorsement to at least a debate over cannabis law reform.

However ACT president Chris Simmons today said decriminalising the class-C drug wouldn't be the party's policy next year, in 2014 or even 2017.

Simmons said the party's board wouldn't support decriminalisation, which was a "step too far." But he said it was important for party members to be asking questions and raising new ideas.

John Banks, the party's Epsom candidate and a former police minister, today said he could not support cannabis decriminalisation.

The party is polling well below the 5 per cent threshold to be guaranteed seats in Parliament, and is expected to depend on Banks winning Epsom.

This weekend also brought the shock resignation of parliamentary leader John Boscawen. Boscawen insisted he wasn't quitting over Brash's speech, but because he wanted to spend more time with his family. He made his decision on Friday.

He said his ''personal views'' on drug law reform weren't important but the issue should be debated, especially the $100m cost to the taxpayer of enforcing the laws. Decriminalisation wasn't ACT policy, he stressed.

Brash tried to pull the Party to the liberal side - a move that makes sense, but is hard given ACT's starting point. It wasn't made easier by that a bunch of people who claim to support marijuana decriminalization started piling on making fun of Brash's policy move. Yeah, you know who you are. It's all hip to make fun of the 70-year-old who's obviously hardly come within smelling distance of pot and pretend that he's a dope-head for advocating policy change. But, as best I understand things, it's that fear of being labelled "the marijuana guy" that effectively stopped Rodney Hide from pushing for greater consideration of the Law Commission's recommendations on marijuana. If the result of pushing for rational policy discussion is to be made a laughingstock even by those who purport to support rational policy, it ain't hard to figure out the likely effect on the supply of rational policy discussion.

The issue's now dead. And ACT probably is too. They could have staked out a defensible position in liberal space. But the conservative side has won. Worse, the party comes out as incoherent on core guiding principles: ACT is the party where economic liberals who are socially conservative get to fight publicly with economic liberals who are socially liberal. And whether or not Banks gets Epsom, that likely dooms the party in the long run.

Meanwhile, the online poll at newspaper site Stuff.co.nz has support for decriminalization ahead at 73% in favour to 27% against.

I really really wish that the NZES folks would include some questions about marijuana law in their 2011 survey. There's no way that the politicians will lead public opinion on this one, but there's good chance they'd follow. If even the pundits who agree with legalization make fun of the politicians who support it, no chance of any kind of policy move until there's obvious public support.

Drug trade and economic development

Turns out that cocaine production is a net earner for Peru. In theory, it could go either way: the dangers associated with the illegal sector could scare off more activity in the legal sector than the cocaine trade is worth, or the displacement effect could be smaller than net revenue generation.

A new IMF paper says the cocaine trade generates more economic activity than it displaces. Shame it's not in the GDP statistics.

Using UNODC data, we have estimated that the production of illegal coca and cocaine represents the equivalent of 0.9 percent of total GDP in 2009. (See table 3 and figure 7 of the appendix for further details.) By comparison, similar calculations for Bolivia based on UDAPE (2010) data imply that coca leaf represents between 1/8 percent and 1 and 1/4 percent of total GDP, and UNODC sources suggest that illicit coca production represented the equivalent of 21 percent and 14 percent of agricultural output in 2008 and 2009, respectively for Bolivia, as compared to values ranging between 3.6% and 8.25% from 1990 to 2008. Similarly, Colombian DANE (2010) data imply that the share of production of coca and cocaine has ranged between ¾ and 3¾ percent of total GDP from 2000 to 2008, declining toward the end of the period as a result of the coca eradication efforts.

Read the whole paper if you want to learn more about the organization of cocaine production in Peru - a fun read despite extensive use of VARs and impulse-response functions towards the end.

More discussion here; HT: @NZDrug