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Connection to Purpose

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Connection to Purpose Toxico-Economics: “Narconomics” SCOTT PHILLIPS, MD, FACP, FACMT, FAACT WASHINGTON POISON CENTER SEATTLE WA Disclosures Nothing to declare. Drugs for Cash Previously the norm. Cash sniffing dogs have altered the way profits are returned to Drug Producers Drugs Cash Transnational Crime (2017) Drug Trafficking & Transnational Crime Drug dollars are converted into other things of value and are Intricately involved ◦ Art ◦ Antiquities ◦ Coins ◦ Gold and precious metals ◦ Vehicles ◦ Yachts, etc. Retail Price per Kilogram of Substance* Drug Retail Price (kg) Fentanyl $1 Million Heroin $53,000-$85,000 Oxycodone $1,000 Cocaine $120,000 Methamphetamine $45,000-$100,000 MDMA $120,000 *Prices may vary 5 Year Drug Cost for Addiction* Drug Cost/5 year Heroin (10 x day) $318,500 Oxycodone (80 mg daily) $132,405 Cocaine (1 gram a day) $112,840 Cigarettes (1/2-1 ppd) $5000 Alcohol (10 beers per day) $14,000 *Omits associated costs (health care, crime, lost wages, family, etc Data Cautions Reported drug prices vary widely ◦ Source of price estimate ◦ Purity of product with supply chain ◦ Formulation Crack versus powdered cocaine (Crack $20-$80 Powder $20-$100) ◦ Location ((Cocaine powder in El Paso $60 and Dallas $100) Price v Purity ◦ Guatemala $12.70/gm for 80% ◦ US $90.00/gm for 56% ◦ Canada $51.00/gm for 68% Demand Influence Cocaine Price v Purity Source of US Supply of Cocaine Cocaine Production Estimates 1,000,000 kg X $120,000 = $120,000,000,000 Fentanyl analogues Heroin Border entry Heroin Source Heroin Price v Purity over time Fentanyl Path CBP Drug Seizures Transnational cash Flow of Drug Money www.UNODC.org Examples of Drugs of Abuse and Economics Freakonomics The Wire Breaking Bad The Wire (HBO Series 2002-2008) Used at Harvard, Duke and Univ. Montreal to teach Urban Economics and Urban Sociology. Barksdale Organization – Fictional •The Barksdale organization, led by Avon Barksdale with the help of his assistant, Stringer Bell. •Turf wars led to decreasing quality of product, and to loss of territory (Franklin towers), the two characters react very differently. • While Avon seeks to recruit hitmen to enforce control over West Baltimore at any price, • Stringer Bell, on the other hand, embodies the “businessman.” • Stringer Bell is taking an economics class in the show, in order to figure out how to boost the profits of his drug organization (gets an A- on his paper). Freakonomics Crack boom in 1990s gave a positive image of the millionaire crack dealer. A great many crack dealers still lived at home with their moms. Why was that? Steven Levitt’s microeconomics study: Gangs business model is like McDonald’s. If you were to hold a McDonald’s organizational chart and the crack gang’s organizational chart side by side, you could hardly tell the difference Amazon Rank #11,386 Freakonomics Top 120 men on the Black Disciples’ (Chicago) pyramid were paid very well. But the pyramid they sat atop was gigantic. ◦ three officers and 50-foot soldiers -- there were about 5,300 men working for those 120 bosses. ◦ Then there were the 20,000 unpaid rank-and-file members, many of whom wanted nothing more than a chance to become a foot soldier. And how well did that dream job pay? About $3.30 an hour. The three officers didn’t do much better: about $7 an hour. So the answer to the original question -- if drug dealers make so much money, why are they still living with their mothers? -- is that, except for the top cats, ◦ they don’t make much money. They have no choice but to live with their mothers. A crack gang works pretty much like the standard capitalist enterprise: ◦ Must be near the top of the pyramid to make a big wage. ◦ Slinging Crack is a lot more dangerous than most menial labor. ◦ Member for four years covered in the notebooks stood a 1-in-4 chance of being killed. That’s more than five times as deadly as being a timber cutter, which the Bureau of Labor Statistics calls the most dangerous job in the United States. Breaking Bad Walt's fortune built on the premise that he's selling his meth at the modest price of about $60 a gram. Fifth season episode "Hazard Pay," ◦ Walt and his partners sell a 50-pound batch of their high-quality blue meth for $1,379,560, after the dealer’s commission. Walt was holding $80 million in barrels. Not quite accurate (production vs cash) Walt’s large volume meth production because he stole 1,000 gallons of the methylamine from a train. ◦ Walt's partners went to sell the methylamine for $15,000 a gallon, instead of cooking it up into meth. Cash Flow UN Office of Drugs & Crime Global Drug Trends Compensating Differential A “compensating differential” is the increment to wages that a worker requires to leave him indifferent between performing two tasks, one which is more unpleasant than the other. ◦ -sort of like shift differential “Would you stand around here when all this s**t is going on? No, right? So if I gonna be asked to put my life on the line, then front me the cash man” (Black Disciples member) Addiction versus Drug Control Methamphetamine Production & Distribution Malaysian Customs Its not just drugs Medellin Cartel Cocainenomics WSJ & Netflix https://www.wsj.com/ad/cocainenomics At height of power $4 Billion in sales 80% of US supply Treatment v Incarceration Thank you for your attention www.streetRx.com.
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