Can the profit motive in free markets lead to disastrous outcomes when it comes to addictive substances like marijuana? We explore this vital question with Charles Lehman from the Manhattan Institute, who brings a compelling analysis of the economic and societal impacts of marijuana legalization. Charles discusses the tension between individual rights and community well-being, emphasizing how addiction can significantly distort rational self-interest. We also shine a light on the often-overlooked societal costs, such as increased emergency services and workplace accidents, that accompany marijuana legalization.
In our conversation, we unravel the complexities of addiction and the predictable failures of rationality it involves, using the opioid crisis as a striking example. We delve into Mark Kleiman's innovative ideas on marijuana regulation and the challenges of prohibition versus legalization. Political motivations behind marijuana pardons and changing public sentiments towards legal cannabis are also dissected. Tune in for personal reflections on marijuana use and insights from those in recovery, shaping a broader understanding of drug policy and addiction.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Yes or no?
Do you believe nicotine is notaddictive?
Speaker 2 (00:02):
I believe nicotine is not addictive.
Yes, Congressman, cigarettesand nicotine clearly do not meet
the classic definitions ofaddiction.
Speaker 1 (00:11):
I don't believe that nicotine for our products are
addictive.
Speaker 2 (00:14):
I believe nicotine is not addictive.
I believe that nicotine is notaddictive.
I believe that nicotine is notaddictive.
Speaker 1 (00:21):
Hello everyone, happy Monday.
This is Luke Niferatos.
I'm your host of the TDRpodcast.
I want to thank our twosponsoring organizations SAM,
smart Purchases of Marijuana, aswell as the Foundation for Drug
Policy Solutions or FDPS.
And also, you know, for thoseof you who don't get our
twice-weekly newsletter, pleasecheck out thedrugreportorg where
(00:42):
you can sign up for ournewsletter.
You can see our website withall of our various articles and
editorials we have and catch upon all the latest stuff on drug
policy.
Well, today I'm really excitedto have Charles Lehman from the
Manhattan Institute here joiningme.
Charles, thank you for joiningme on the show.
Speaker 2 (00:59):
I'm glad to be on.
Thanks for having me.
Speaker 1 (01:01):
That's great.
Well, I wanted to have you onbecause, for those of you who
are following the drug policyspace, charles has been very
actively writing a ton of justreally high quality literature
and written works on theseissues, but really is on a tear.
Just in the last couple ofweeks, you had a really amazing
long form piece on the outcomesof legalization in New York that
(01:22):
was published in the New YorkTimes, and then you followed
that up.
As if that wasn't enoughwriting, you followed it up with
a great one in the dispatch onthe outcomes of marijuana
legalization more broadly aswell.
Both of these were really greatpieces, and so I actually want
to just jump right into it.
So I'm going to read an excerptthat jumped out at me as I was
reading your New York Timespiece.
(01:43):
So here we go.
I've also come to think thatdebating whether individuals
should use marijuana obscuresthe harms that come when we let
businesses sell it, and while I,as a conservative, think that
free markets do enormous good, Ialso think that combining
addiction with the profit motivecreates perverse incentives,
letting corporations compete tohelp people ruin their lives.
(02:05):
I just thought that was areally profound statement,
especially for somebody who's aprominent conservative thinker.
So what brought you to thatconclusion?
Speaker 2 (02:17):
Yeah, and ultimately I think the answer is to stick
with the.
I'm a conservative theme andI'm sure not all of your
listeners are, but I hopethey'll hear me out from that
perspective.
It is thinking economisticallythat really got me to that
position and thinking about not.
(02:37):
When you talk about the disputeof marijuana being an
individual dispute, we'retalking about basically is it
moral or is it not to usemarijuana?
And my response is look, somepeople use marijuana fine,
healthily, or certainly not in away that is actively
destructive to them, and somepeople use it not so healthily.
(02:57):
But that's really, I think, whenyou think on the individual
level, you're missing a wholeset of dynamics.
You're missing the way in whichthe profit motive, which is a
great tool for creating value,wealth and well-being in society
, aligns the interests of thebuyer and seller, insofar as
(03:18):
both are rationallyself-interested, and that
addiction and addiction tomarijuana or really to any other
addictive substance, affects abuyer's rationality vis-a-vis
his consumption, that the morehe consumes of the thing that
he's addicted to, the worse forhim it is.
But there is no particular checkon the seller.
It's in the rationalself-interest of the seller to
(03:41):
keep giving him the thing thatis harmful to him.
And to scale that up, you startto recognize features of
markets in the district of goodsthat 10% to 20% of the
consumers will do 80% to 90% ofthe consuming.
That they will be focused onpotency and price.
That that will drive up thepotency of the product and
out-compete other concerns likequality or safety.
(04:02):
These are not just like, thesearen't market failures.
This is the market workingrationally, as we understand
markets to work, and so my viewis addictive substances
generally, and marijuana as aspecies of addictive substance
has these have these specificqualities as goods, and so we
need to think about the marketsin them in particular, ways that
(04:24):
distinguish them fromnon-addictive substances or
non-addictive goods.
Speaker 1 (04:27):
Very good.
So you're saying if Adam Smithwere alive today, it would be
the invisible green hand?
Speaker 2 (04:33):
Well, right, you know it's exactly the attitude
inside.
It's not, I feel, not of thebeneficence of the butcher, the
baker, the rest of the life ofthe wealth of nations.
But it's exactly that.
It's about aligning interest,even when what is short-run in
your interest is very harmful toyou.
Speaker 1 (04:51):
Yeah, and so I think it's really interesting because,
yeah, like you're getting at afew different key philosophical
touchstones of this debate,particularly with marijuana
legalization, where you know theindividual and their rights
versus the community and theimpact on the community.
And so what I'm hearing fromyou is you know, I think there's
and this is something that youknow is evident with all of drug
policy where you know, like yousaid, typically it's a very
small number of people who makeup most of the consumption.
(05:13):
So you know, when we're doingthese, when we're having these
debates about legalization, it'smaybe not the full story, not
the full argument to say, well,you know it affected X, y and Z
people and it really didn't.
You know it didn't impact themthat negatively.
But what about the sliver ofthe population where it really
has a very negative impact, andnot only is it a negative impact
on them, it's a negative impactthat can be quantified on the
(05:36):
society you know more broadly,whether it's emergency services,
road deaths, workplaceaccidents, things of that nature
workplace accidents, things ofthat nature.
Speaker 2 (05:44):
Look, I mean, this is the trade-off in talking about
drug prohibition generally oraddictive substance control
generally.
Right Is that the bestestimates are something like
between 20% and 40% offirst-time heroin users will end
up addicted, which means if Itried heroin, I have a three in
five, four in five chance of notgetting addicted to heroin.
(06:06):
Heroin is just a pretty fun.
I'm not encouraging yourlisteners to try heroin, to be
clear.
But the point is, you know,there's some number of noodles
lost by the fact that we don'tlet people buy heroin at the gas
station.
Right, we don't do that, andthe reason for that is that for
the 20 to 40% of the populationwho tries heroin, who does end
up addicted, it's reallylife-alteringly bad and we see
(06:31):
no intention, there's atrade-off and we say the
trade-off is not worth making.
What is?
The harms that accrue to theaddicted person are not worth
the benefits that go to everyoneelse.
Speaker 1 (06:42):
Right, and I think you know it's funny, because I
think a lot of people in thiscountry think well, these drugs
that are considered to be harddrugs are just, you know, like
heroin, for example, you know,or crack, or whatever meth you
are just going to be addicted tothem right away.
That's why you know we prohibitthem and that's not why A lot
of people use these drugs.
They don't become immediatelyaddicted.
Some people don't evenexperience the tremendous, awful
(07:05):
hardships.
It's that at a population level, when you have normalized this
use, then you're talking abouttens of millions, if not
hundreds of millions, ofAmericans that end up using this
at scale.
And then what are the odds ofall the various downstream
consequences?
And I think that's an importantconsideration to make.
Speaker 2 (07:23):
One of the dynamics you talk about in public
policymaking is concentratedbenefits, diffuse costs, which
is how you end up gettingregulatory capture.
Somebody benefits from theregulation in a big way, some
business or whatever, andthey're sort of small diffuse
costs to everybody else.
With addiction, you see theopposite.
You see concentrated costs,diffuse benefits, and so it is
very easy to sort of wave awaythose costs, even though they
(07:44):
are quite large in absoluteterms, because they happen at
the population level.
This is why I like to say drugsare risky, right, their harms
are not obtained in everycircumstance.
It's hard for people to reasonout risk.
We really struggle with it.
This, by the way, is like partof why, when you talk to
teenagers, you know you want tobe informed, but like part of
the challenge to talk toteenagers, they don't really get
(08:05):
the risk concept.
Part of the utility of likestarting from the perspective of
discouraging kids from usingdrugs, is that they aren't well
equipped to reason about this isrisky.
This is not.
Speaker 1 (08:14):
Right, and actually that's a great point, so I'm
springing this on you.
I didn't prep you for this, soif you didn't read it, that's
fine.
Did you read the BritishColumbia health report from last
week?
Speaker 2 (08:22):
I haven't read I haven't actually read the full
report.
I've seen the.
I've seen the recommendations.
Speaker 1 (08:27):
So, yeah, so basically for those, our
listeners and for your benefit,essentially, they came out and
said we, the, the government ofBritish Columbia, in Canada,
their health department came outand issued a large report
saying we should treat all drugsexactly like grocery store
items and basically inform usersso they can make informed
(08:48):
purchase decisions, just like weexpect them to do with grocery
stores and food products andother such things.
And that's what we should do.
And they referred to the quote,unquote iron law of prohibition
which, just for the record, isnot an iron law, but that's
referenced and cited in thereport and it brings that to
mind.
As you're talking about thisidea of having rational purchase
(09:09):
decisions being made in thismarketplace when addiction and
other things are getting in theway is, you know, there's this,
this just I called it Alice inWonderland in our press release
an Alice in Wonderlandconception of how drug
purchasing and drug use work.
And it's this idea that we caneducate people and then they're
going to make informedconsumption choices and we can
mitigate the damages.
(09:30):
What do you make of that?
Yeah, what do you think?
Speaker 2 (09:33):
about that.
It is not merely, you know,sort of unrealistic, it's out of
line with decades ofunderstanding of behavioral
economics as a discipline.
Right, we know that people arenot merely not perfectly
rational, but irrational inpredictable ways.
There are lots of.
I try very hard not to wadeinto the fight over what is
addiction, because it's a big,thorny fight and nobody can
(09:54):
agree.
But I think a useful.
All models are wrong.
Some models are useful.
A useful model is that addictionis a particular failure mode in
decision making where eachinstance, in the short run, it
is irrational for you tocontinue to do something that is
long run irrational.
It's almost like being trappedin a bad equilibrium where it is
(10:19):
always slightly rational totake the next dose, even though
the compounding effects oftaking a lot of doses are going
to harm you.
So it is not.
You know.
The failure there is that theproblem is not one of knowledge,
and you see this, by the way,with fentanyl use in the United
States too.
It used to be the case thatpeople were not using fentanyl,
thought they were buying heroin.
They were getting fentanyl.
They didn't realize they gothooked on fentanyl.
(10:39):
It were getting fentanyl.
They didn't realize they gothooked on fentanyl.
It is now the case that peopleactively seek out fentanyl and
the harm reduction.
People will tell you this thatfentanyl is a superior product
and people prefer the superiorproduct.
People who use drugs are notstupid, but they are subject to
the same challenges torationality that the rest of us
are and the limits ofrationality that the rest of us
are, and the predictablefailures of rationality.
(11:00):
And so if your mental model isjust like people are, simply
ill-informed you are.
You are stuck in the 1960s.
Speaker 1 (11:10):
I'm sorry, we have a better model of how humans think
than we used to right.
It's just, it's really wild.
And I just was struck by lookreading that report when they
compared it to grocery storeitems and I thought, you know,
we have an obesity crisis inmost of the parts of the world
and it's you know.
We put nutrition facts andlabels and warnings and
education campaigns.
And WHO is doing all thisinternationally?
And yet people still make verypoor purchase decisions based on
a whole wide variety of factors.
(11:31):
And so this idea that withthese very deadly drugs, where
you know if you misuse a verysugary product, you know your
worst outcome is some healthissues, maybe some weight gain,
something of that nature.
But if you misuse a drug you'resupposed to be informed about
using, the consequences could bedeath, could be addiction,
could be so many more extreme,you know catastrophic outcomes.
(11:53):
And so I think coming to termswith the fact that this just
can't be treated like any othercommodity out there is really, I
think, important, and I thinkit gets at the center thesis of
what a lot of your writing overthe last few weeks has been
getting at.
Speaker 2 (12:07):
Yeah, and I think the other component there is the
properties of that commodity areparticularly attractive for
again, are particularlyattractive for business, while
at the same time being harmfulto consumers, being harmful to
the people who business isselling to.
So you talk about the iron lawof prohibition.
(12:27):
This is the Richard Cowan idea.
It's a marijuana legalizer,nice guy.
Actually.
The Richard Cowan idea thatprohibition causes concentration
, and this is true duringalcohol prohibition.
I think it's unclear if this isIncreasing potency.
Speaker 1 (12:40):
That's what this report said.
Yeah, with prohibition thatmeans they get more potent.
Speaker 2 (12:43):
It creates the fentanyls, it creates all these
problems which is preposterouson its face for a couple of
reasons, not least of which thatwe had almost 100 years of
opioid prohibition beforefentanyl suffused the market.
That's right.
There was no phase change.
Speaker 1 (12:58):
With marijuana.
Marijuana got way more potentafter they commercialized it.
Then the potency was driven up.
Speaker 2 (13:04):
Our mutual friend, the drug policy researcher John
Calkins, observes thatpersuasively to me that the
annual prohibition probablyexplains a partial effect.
It's probably the case that oneeffect of prohibition is that
that happens, but that effect inthe aggregate is probably
swamped by other things, isprobably swamped by other things
, most notably in the case ofmarijuana, when you permit, when
you end prohibition, legalizeretail sale, or when you
(13:27):
commercialize the innovationthat is brought to bear on the
quality of that product.
People want to buy potentproduct.
It's because it's morereinforcing.
You will have much moreinnovation in the production of
potent product under a legalregime where you can pay people
with expertise to actually getinvolved, make a lot of money
off of it.
Then you will under aprohibited regime and so that
(13:48):
ends up dominating.
That affects the dominating.
The point being, the profitmotive is a powerful tool for
seeking optimal outcomes.
This is what you miss when youtalk about it like the grocery
store.
The profit motive producesoptimal outcomes.
In the grocery store, like, wehave better produce than any
human being has ever had inhuman history.
It's great.
It's not great when it's asubstance that can seriously
(14:11):
harm or kill you.
Speaker 1 (14:12):
That's right.
That's right.
So Jonathan Calkins hementioned we had a great
interview on the podcast a fewepisodes ago For those of you
listeners who want to hear whatJonathan Hawkins has to say.
With his latest study on THCand the usage, daily use, we had
a great, great interview onthat.
So thank you for bringing himup.
So you mentioned in your piecesthat you had at one point used
marijuana in your life and youreally kind of had a somewhat, I
(14:35):
guess, libertarian, so to speak, view of it.
So what would you say is kindof you know what was your kind
of come to, you know, I guess,road to Damascus moment, if you
will like, where you kind of youknow thought, okay, well, you
know what, maybe this isn't justan individual issue Like what
really tipped the scale for you.
Speaker 2 (14:51):
I mean, the actual answer is that I'm a huge dork,
um, because, uh, is that you tryto put front and center the
experience of people in recovery, people who have been harmed by
marijuana, who've dealt withdisorders.
I am not that, um, I, you know,I've tried marijuana a handful
(15:13):
of times in my life.
It's not really.
For me, it's fine, um, and Ithink that's true of a lot of
people.
Uh, I don't.
But what actually changed mymind?
The genuine answer is readingthe works of Mark Kleiman, who
is, for the listeners who don'tknow, an extraordinarily
influential drug policycommentator who was an advocate
later in his life of marijuanalegalization.
What I think persuaded me isthat Kleiman basically he's a
(15:37):
professor.
He talks about if we would.
He lays out many of thearguments I'm laying out.
A lot of immigrants come fromhim and he says, look, there are
ways to regulate the marijuanamarket, to obviate these
concerns, we could design aroundthis.
And he's talking about, like wecould have mail, we could have
government run mail ordersystems right for who gets low
potency marijuana.
(15:57):
That is simply not whathappened.
It's not what was ever going tohappen.
Speaker 1 (16:04):
And it's never happened.
Speaker 2 (16:04):
One of the realities, yeah, Inconceivable.
Um yeah, so I found hisarguments persuasive and then I
sort of looked at what happenedwhen his approach, when he tried
to agitate, when he tried tosay publicly here's how we
should do this, what a failurethat was.
And I was like it kind of seemslike prohibition was the better
solution.
Speaker 1 (16:23):
Right, and it's interesting because and a really
good point about the bettersolution versus the solution I
noticed you were careful withthe words there, and I think
it's fair, because there is noeasy, complete, total panacea
solution to this.
And I think that's where thedebate really goes awry, because
there are people that say lookat the war on drugs it failed.
Look at marijuana prohibitionit failed.
(16:43):
People use it all the time.
So they say, therefore weshould legalize it to solve this
problem.
But legalizing it comes withthen a whole other set of
problems.
And so you know, I always pointto you look at prevalence of
use, and it's so much less thanour legal or, excuse me, yeah,
it's so much less prevalence ofuse of our illegal drugs.
Marijuana included, from afederal perspective, is a
(17:04):
fraction of a fraction of theprevalence of our legal drugs,
obviously, and so I think thatyou look at that and that's
where you start with thecalculus, at least through my
own heuristic.
Speaker 2 (17:13):
You look at that and that's where you start with the
calculus, at least through myown heuristic.
Yeah, I mean this is a classicKleinman point.
He always said drug controlpolicy, you can never have a
policy without problems.
The question is always choosingyour problems.
Which problems do you want tohave?
Which is the optimal set ofproblems?
You know, I think that in thecase of marijuana there are ways
(17:34):
to sort of mitigate some of theharms of prohibition.
There's a broad spectrum I talkabout it in the New York Times
piece a broad spectrum of policyoptions.
The reality is something like13 states decriminalized
marijuana in the 1970s.
Basically it turned out fine.
There was some evidence of aslight increase in usage.
It basically washes out afterfive to 10 years.
(17:58):
I am less persuaded that by thelate 1990s or the 2000s we
really were incarcerating a lotof people for marijuana.
We kind of weren't.
But look, I'm not inert to theharms of simply arresting lots
of people for marijuana, even ona pretextual basis.
We can go back and forth onthis, but the reality is you can
sort of settle that majorconcern the criminal justice,
(18:18):
violence and prohibition withoutcreating a legal recreational
market Right.
Speaker 1 (18:24):
And that's what Sam's always advocated is this third
way approach of dealing withpossession, very low-level
possession.
Obviously we don't want to getinto dealing and all those
things, but low level possession, expungements and stuff.
And so in your dispatch pieceyou wrote about Governor
Westmore's pardons and kind ofhow he's trying to make that a
really big deal.
But to your point, they're justno, you know and they even had
to acknowledge this in thefollowing coverage that nobody
(18:45):
got out of prison from this,that very few people were
actually impacted.
Now there were some and thatwas great.
We supported that.
But what was also interestingto us is that it was two years
after they got the commercialmarket online that they then
thought, ok, well, let's startdoing the pardons, which we
thought was really interesting.
Speaker 2 (19:01):
Yeah, and you know Wes Moore is to read the
political tea leaves.
You know he wants to be seen asa rising star in the Democratic
Party and 10, 15 years ago,being at the vanguard on
marijuana was a great way to dothat.
And I think that that is youknow.
All of the low-hanging fruithas been plucked there and the
(19:21):
public is going.
Hang on a second.
There are costs to this right.
It's important to remember that.
You know, absence makes theheart grow fonder.
We are a population that is,you know, even since the
beginnings of legalization underquote-unquote medicalization,
essentially legalization forretail use with some
restrictions.
(19:42):
Even from the beginnings, manymillions of Americans did not
have any exposure to what livingwith legal weed was like.
It was only recently themajority has experienced it, and
so I think we are starting tosort of cool towards it, and you
know efforts like Moore's are away to say no.
Really, it's still a great blowfor justice to legalize weed,
(20:02):
we promise.
And it's like I don't think youcan catch the fire a second
time.
Speaker 1 (20:07):
Yeah, I agree especially with all the issues
of you know all the problems,health problems, psychosis and
other issues which, speaking ofthat last question, I forget
which one of the two pieces itwas, but in that piece you said
marijuana can increase yourchances of schizophrenia, but so
can owning cats.
I thought, okay, I haven'theard that one before, so I
wanted to give you a chance toexpound a little more on that
(20:29):
one.
Right, the first one, and thisis, I think, disputed in the
literature, but the balance saysit's true um cats carry a
parasite called toxoplasmosisgondii, which exposure to, I
think, sounds like shrooms to me, some sort of mushroom drink
that's coming down the line umsignificantly raises your risk
for schizophrenia down the line.
Speaker 2 (20:51):
Um, like like there is some scientific basis to the
quote unquote crazy cat ladystereotype that cats can.
Again, this is a little bitdisputed, but the balance of the
evidence says it's moreplausible than not, and my point
there, by the way, is like thisis part of why marijuana's
addictiveness matters.
We do let people do thingswhich are harmful to them.
(21:11):
We let people skydive, we letthem drive really fast cars, and
to me the relevant question isowning a cat is something that
does not inhibit my ability toreason about costs and benefits
and about the short run versuslong run.
Being addicted to marijuanadoes inhibit my ability to
reason, so I am ultimatelysomebody who's wary of
government regulation and, as aconsequence, I think it matters
(21:33):
that we carve out and say thisparticular quality is dangerous
enough in a specific way.
It causes a market failure in aspecific way.
That is right for government tostep in.
In a way that I don'tultimately support government
cat control, even though thereis a risk that we have at least
plausible evidence to believe isassociated with increased risk
(21:55):
for schizophrenia.
Speaker 1 (21:56):
Trevor Burrus Jr.
Okay, very interesting.
I hadn't heard that one before,but thought that was
interesting.
I'm almost certain your chancesof getting schizophrenia from
using marijuana are much higherthan cat ownership, peter.
Speaker 2 (22:06):
T.
It would be a surprise, TrevorBurrus Jr.
This is a good warning.
Speaker 1 (22:07):
This is a good warning.
Peter T yeah, trevor Burrus Jr,I only own a cat for about six
months of my life, so I think mychances are hopefully pretty
diminished.
Speaker 2 (22:15):
I believe it's really about handling the litter.
Ah, okay, it's where theparasite resides.
Speaker 1 (22:23):
Interesting, interesting, okay, very good.
Well, that was a great response.
I was not expecting that one.
That was very good, charles.
Well, thank you for joining uson the TDR podcast.
It was a great discussion.
You're writing fantastic piecesout there, so where can folks
connect with you, follow yourworks that you have out there?
Speaker 2 (22:40):
Yeah, absolutely.
I'm on the artist, formerlyknown as Twitter.
I'm at Charles F Lehman,l-e-h-m-a-n and you can also
find me.
I work for the ManhattanInstitute.
We're Think Tank.
I'm there and I'm at ourflagship publication, city
Journal.
That's city-journalorg, and Ihave a sub stack which is called
the Causal Fallacy, which islike-.
Speaker 1 (22:58):
I love that one.
Speaker 2 (23:00):
It's about James Q Wilson.
You can read the wholeexplanation.
I'm just a huge dork.
Is like the explanation of mostthings that I do.
Speaker 1 (23:06):
It's very good.
Well, you're a very smart dorkand you got good views on this
issue, so keep up the great workand thanks again for joining us
.
Thanks, have a good one.
Yes or no?
Do you believe nicotine is notaddictive?
Speaker 2 (00:02):
I believe nicotine is not addictive.
Yes, Congressman, cigarettesand nicotine clearly do not meet
the classic definitions ofaddiction.
Speaker 1 (00:11):
I don't believe that nicotine for our products are
addictive.
Speaker 2 (00:14):
I believe nicotine is not addictive.
I believe that nicotine is notaddictive.
I believe that nicotine is notaddictive.
Speaker 1 (00:21):
Hello everyone, happy Monday.
This is Luke Niferatos.
I'm your host of the TDRpodcast.
I want to thank our twosponsoring organizations SAM,
smart Purchases of Marijuana, aswell as the Foundation for Drug
Policy Solutions or FDPS.
And also, you know, for thoseof you who don't get our
twice-weekly newsletter, pleasecheck out thedrugreportorg where
(00:42):
you can sign up for ournewsletter.
You can see our website withall of our various articles and
editorials we have and catch upon all the latest stuff on drug
policy.
Well, today I'm really excitedto have Charles Lehman from the
Manhattan Institute here joiningme.
Charles, thank you for joiningme on the show.
Speaker 2 (00:59):
I'm glad to be on.
Thanks for having me.
Speaker 1 (01:01):
That's great.
Well, I wanted to have you onbecause, for those of you who
are following the drug policyspace, charles has been very
actively writing a ton of justreally high quality literature
and written works on theseissues, but really is on a tear.
Just in the last couple ofweeks, you had a really amazing
long form piece on the outcomesof legalization in New York that
(01:22):
was published in the New YorkTimes, and then you followed
that up.
As if that wasn't enoughwriting, you followed it up with
a great one in the dispatch onthe outcomes of marijuana
legalization more broadly aswell.
Both of these were really greatpieces, and so I actually want
to just jump right into it.
So I'm going to read an excerptthat jumped out at me as I was
reading your New York Timespiece.
(01:43):
So here we go.
I've also come to think thatdebating whether individuals
should use marijuana obscuresthe harms that come when we let
businesses sell it, and while I,as a conservative, think that
free markets do enormous good, Ialso think that combining
addiction with the profit motivecreates perverse incentives,
letting corporations compete tohelp people ruin their lives.
(02:05):
I just thought that was areally profound statement,
especially for somebody who's aprominent conservative thinker.
So what brought you to thatconclusion?
Speaker 2 (02:17):
Yeah, and ultimately I think the answer is to stick
with the.
I'm a conservative theme andI'm sure not all of your
listeners are, but I hopethey'll hear me out from that
perspective.
It is thinking economisticallythat really got me to that
position and thinking about not.
(02:37):
When you talk about the disputeof marijuana being an
individual dispute, we'retalking about basically is it
moral or is it not to usemarijuana?
And my response is look, somepeople use marijuana fine,
healthily, or certainly not in away that is actively
destructive to them, and somepeople use it not so healthily.
(02:57):
But that's really, I think, whenyou think on the individual
level, you're missing a wholeset of dynamics.
You're missing the way in whichthe profit motive, which is a
great tool for creating value,wealth and well-being in society
, aligns the interests of thebuyer and seller, insofar as
(03:18):
both are rationallyself-interested, and that
addiction and addiction tomarijuana or really to any other
addictive substance, affects abuyer's rationality vis-a-vis
his consumption, that the morehe consumes of the thing that
he's addicted to, the worse forhim it is.
But there is no particular checkon the seller.
It's in the rationalself-interest of the seller to
(03:41):
keep giving him the thing thatis harmful to him.
And to scale that up, you startto recognize features of
markets in the district of goodsthat 10% to 20% of the
consumers will do 80% to 90% ofthe consuming.
That they will be focused onpotency and price.
That that will drive up thepotency of the product and
out-compete other concerns likequality or safety.
(04:02):
These are not just like, thesearen't market failures.
This is the market workingrationally, as we understand
markets to work, and so my viewis addictive substances
generally, and marijuana as aspecies of addictive substance
has these have these specificqualities as goods, and so we
need to think about the marketsin them in particular, ways that
(04:24):
distinguish them fromnon-addictive substances or
non-addictive goods.
Speaker 1 (04:27):
Very good.
So you're saying if Adam Smithwere alive today, it would be
the invisible green hand?
Speaker 2 (04:33):
Well, right, you know it's exactly the attitude
inside.
It's not, I feel, not of thebeneficence of the butcher, the
baker, the rest of the life ofthe wealth of nations.
But it's exactly that.
It's about aligning interest,even when what is short-run in
your interest is very harmful toyou.
Speaker 1 (04:51):
Yeah, and so I think it's really interesting because,
yeah, like you're getting at afew different key philosophical
touchstones of this debate,particularly with marijuana
legalization, where you know theindividual and their rights
versus the community and theimpact on the community.
And so what I'm hearing fromyou is you know, I think there's
and this is something that youknow is evident with all of drug
policy where you know, like yousaid, typically it's a very
small number of people who makeup most of the consumption.
(05:13):
So you know, when we're doingthese, when we're having these
debates about legalization, it'smaybe not the full story, not
the full argument to say, well,you know it affected X, y and Z
people and it really didn't.
You know it didn't impact themthat negatively.
But what about the sliver ofthe population where it really
has a very negative impact, andnot only is it a negative impact
on them, it's a negative impactthat can be quantified on the
(05:36):
society you know more broadly,whether it's emergency services,
road deaths, workplaceaccidents, things of that nature
workplace accidents, things ofthat nature.
Speaker 2 (05:44):
Look, I mean, this is the trade-off in talking about
drug prohibition generally oraddictive substance control
generally.
Right Is that the bestestimates are something like
between 20% and 40% offirst-time heroin users will end
up addicted, which means if Itried heroin, I have a three in
five, four in five chance of notgetting addicted to heroin.
(06:06):
Heroin is just a pretty fun.
I'm not encouraging yourlisteners to try heroin, to be
clear.
But the point is, you know,there's some number of noodles
lost by the fact that we don'tlet people buy heroin at the gas
station.
Right, we don't do that, andthe reason for that is that for
the 20 to 40% of the populationwho tries heroin, who does end
up addicted, it's reallylife-alteringly bad and we see
(06:31):
no intention, there's atrade-off and we say the
trade-off is not worth making.
What is?
The harms that accrue to theaddicted person are not worth
the benefits that go to everyoneelse.
Speaker 1 (06:42):
Right, and I think you know it's funny, because I
think a lot of people in thiscountry think well, these drugs
that are considered to be harddrugs are just, you know, like
heroin, for example, you know,or crack, or whatever meth you
are just going to be addicted tothem right away.
That's why you know we prohibitthem and that's not why A lot
of people use these drugs.
They don't become immediatelyaddicted.
Some people don't evenexperience the tremendous, awful
(07:05):
hardships.
It's that at a population level, when you have normalized this
use, then you're talking abouttens of millions, if not
hundreds of millions, ofAmericans that end up using this
at scale.
And then what are the odds ofall the various downstream
consequences?
And I think that's an importantconsideration to make.
Speaker 2 (07:23):
One of the dynamics you talk about in public
policymaking is concentratedbenefits, diffuse costs, which
is how you end up gettingregulatory capture.
Somebody benefits from theregulation in a big way, some
business or whatever, andthey're sort of small diffuse
costs to everybody else.
With addiction, you see theopposite.
You see concentrated costs,diffuse benefits, and so it is
very easy to sort of wave awaythose costs, even though they
(07:44):
are quite large in absoluteterms, because they happen at
the population level.
This is why I like to say drugsare risky, right, their harms
are not obtained in everycircumstance.
It's hard for people to reasonout risk.
We really struggle with it.
This, by the way, is like partof why, when you talk to
teenagers, you know you want tobe informed, but like part of
the challenge to talk toteenagers, they don't really get
(08:05):
the risk concept.
Part of the utility of likestarting from the perspective of
discouraging kids from usingdrugs, is that they aren't well
equipped to reason about this isrisky.
This is not.
Speaker 1 (08:14):
Right, and actually that's a great point, so I'm
springing this on you.
I didn't prep you for this, soif you didn't read it, that's
fine.
Did you read the BritishColumbia health report from last
week?
Speaker 2 (08:22):
I haven't read I haven't actually read the full
report.
I've seen the.
I've seen the recommendations.
Speaker 1 (08:27):
So, yeah, so basically for those, our
listeners and for your benefit,essentially, they came out and
said we, the, the government ofBritish Columbia, in Canada,
their health department came outand issued a large report
saying we should treat all drugsexactly like grocery store
items and basically inform usersso they can make informed
(08:48):
purchase decisions, just like weexpect them to do with grocery
stores and food products andother such things.
And that's what we should do.
And they referred to the quote,unquote iron law of prohibition
which, just for the record, isnot an iron law, but that's
referenced and cited in thereport and it brings that to
mind.
As you're talking about thisidea of having rational purchase
(09:09):
decisions being made in thismarketplace when addiction and
other things are getting in theway is, you know, there's this,
this just I called it Alice inWonderland in our press release
an Alice in Wonderlandconception of how drug
purchasing and drug use work.
And it's this idea that we caneducate people and then they're
going to make informedconsumption choices and we can
mitigate the damages.
(09:30):
What do you make of that?
Yeah, what do you think?
Speaker 2 (09:33):
about that.
It is not merely, you know,sort of unrealistic, it's out of
line with decades ofunderstanding of behavioral
economics as a discipline.
Right, we know that people arenot merely not perfectly
rational, but irrational inpredictable ways.
There are lots of.
I try very hard not to wadeinto the fight over what is
addiction, because it's a big,thorny fight and nobody can
(09:54):
agree.
But I think a useful.
All models are wrong.
Some models are useful.
A useful model is that addictionis a particular failure mode in
decision making where eachinstance, in the short run, it
is irrational for you tocontinue to do something that is
long run irrational.
It's almost like being trappedin a bad equilibrium where it is
(10:19):
always slightly rational totake the next dose, even though
the compounding effects oftaking a lot of doses are going
to harm you.
So it is not.
You know.
The failure there is that theproblem is not one of knowledge,
and you see this, by the way,with fentanyl use in the United
States too.
It used to be the case thatpeople were not using fentanyl,
thought they were buying heroin.
They were getting fentanyl.
They didn't realize they gothooked on fentanyl.
(10:39):
It were getting fentanyl.
They didn't realize they gothooked on fentanyl.
It is now the case that peopleactively seek out fentanyl and
the harm reduction.
People will tell you this thatfentanyl is a superior product
and people prefer the superiorproduct.
People who use drugs are notstupid, but they are subject to
the same challenges torationality that the rest of us
are and the limits ofrationality that the rest of us
are, and the predictablefailures of rationality.
(11:00):
And so if your mental model isjust like people are, simply
ill-informed you are.
You are stuck in the 1960s.
Speaker 1 (11:10):
I'm sorry, we have a better model of how humans think
than we used to right.
It's just, it's really wild.
And I just was struck by lookreading that report when they
compared it to grocery storeitems and I thought, you know,
we have an obesity crisis inmost of the parts of the world
and it's you know.
We put nutrition facts andlabels and warnings and
education campaigns.
And WHO is doing all thisinternationally?
And yet people still make verypoor purchase decisions based on
a whole wide variety of factors.
(11:31):
And so this idea that withthese very deadly drugs, where
you know if you misuse a verysugary product, you know your
worst outcome is some healthissues, maybe some weight gain,
something of that nature.
But if you misuse a drug you'resupposed to be informed about
using, the consequences could bedeath, could be addiction,
could be so many more extreme,you know catastrophic outcomes.
(11:53):
And so I think coming to termswith the fact that this just
can't be treated like any othercommodity out there is really, I
think, important, and I thinkit gets at the center thesis of
what a lot of your writing overthe last few weeks has been
getting at.
Speaker 2 (12:07):
Yeah, and I think the other component there is the
properties of that commodity areparticularly attractive for
again, are particularlyattractive for business, while
at the same time being harmfulto consumers, being harmful to
the people who business isselling to.
So you talk about the iron lawof prohibition.
(12:27):
This is the Richard Cowan idea.
It's a marijuana legalizer,nice guy.
Actually.
The Richard Cowan idea thatprohibition causes concentration
, and this is true duringalcohol prohibition.
I think it's unclear if this isIncreasing potency.
Speaker 1 (12:40):
That's what this report said.
Yeah, with prohibition thatmeans they get more potent.
Speaker 2 (12:43):
It creates the fentanyls, it creates all these
problems which is preposterouson its face for a couple of
reasons, not least of which thatwe had almost 100 years of
opioid prohibition beforefentanyl suffused the market.
That's right.
There was no phase change.
Speaker 1 (12:58):
With marijuana.
Marijuana got way more potentafter they commercialized it.
Then the potency was driven up.
Speaker 2 (13:04):
Our mutual friend, the drug policy researcher John
Calkins, observes thatpersuasively to me that the
annual prohibition probablyexplains a partial effect.
It's probably the case that oneeffect of prohibition is that
that happens, but that effect inthe aggregate is probably
swamped by other things, isprobably swamped by other things
, most notably in the case ofmarijuana, when you permit, when
you end prohibition, legalizeretail sale, or when you
(13:27):
commercialize the innovationthat is brought to bear on the
quality of that product.
People want to buy potentproduct.
It's because it's morereinforcing.
You will have much moreinnovation in the production of
potent product under a legalregime where you can pay people
with expertise to actually getinvolved, make a lot of money
off of it.
Then you will under aprohibited regime and so that
(13:48):
ends up dominating.
That affects the dominating.
The point being, the profitmotive is a powerful tool for
seeking optimal outcomes.
This is what you miss when youtalk about it like the grocery
store.
The profit motive producesoptimal outcomes.
In the grocery store, like, wehave better produce than any
human being has ever had inhuman history.
It's great.
It's not great when it's asubstance that can seriously
(14:11):
harm or kill you.
Speaker 1 (14:12):
That's right.
That's right.
So Jonathan Calkins hementioned we had a great
interview on the podcast a fewepisodes ago For those of you
listeners who want to hear whatJonathan Hawkins has to say.
With his latest study on THCand the usage, daily use, we had
a great, great interview onthat.
So thank you for bringing himup.
So you mentioned in your piecesthat you had at one point used
marijuana in your life and youreally kind of had a somewhat, I
(14:35):
guess, libertarian, so to speak, view of it.
So what would you say is kindof you know what was your kind
of come to, you know, I guess,road to Damascus moment, if you
will like, where you kind of youknow thought, okay, well, you
know what, maybe this isn't justan individual issue Like what
really tipped the scale for you.
Speaker 2 (14:51):
I mean, the actual answer is that I'm a huge dork,
um, because, uh, is that you tryto put front and center the
experience of people in recovery, people who have been harmed by
marijuana, who've dealt withdisorders.
I am not that, um, I, you know,I've tried marijuana a handful
(15:13):
of times in my life.
It's not really.
For me, it's fine, um, and Ithink that's true of a lot of
people.
Uh, I don't.
But what actually changed mymind?
The genuine answer is readingthe works of Mark Kleiman, who
is, for the listeners who don'tknow, an extraordinarily
influential drug policycommentator who was an advocate
later in his life of marijuanalegalization.
What I think persuaded me isthat Kleiman basically he's a
(15:37):
professor.
He talks about if we would.
He lays out many of thearguments I'm laying out.
A lot of immigrants come fromhim and he says, look, there are
ways to regulate the marijuanamarket, to obviate these
concerns, we could design aroundthis.
And he's talking about, like wecould have mail, we could have
government run mail ordersystems right for who gets low
potency marijuana.
(15:57):
That is simply not whathappened.
It's not what was ever going tohappen.
Speaker 1 (16:04):
And it's never happened.
Speaker 2 (16:04):
One of the realities, yeah, Inconceivable.
Um yeah, so I found hisarguments persuasive and then I
sort of looked at what happenedwhen his approach, when he tried
to agitate, when he tried tosay publicly here's how we
should do this, what a failurethat was.
And I was like it kind of seemslike prohibition was the better
solution.
Speaker 1 (16:23):
Right, and it's interesting because and a really
good point about the bettersolution versus the solution I
noticed you were careful withthe words there, and I think
it's fair, because there is noeasy, complete, total panacea
solution to this.
And I think that's where thedebate really goes awry, because
there are people that say lookat the war on drugs it failed.
Look at marijuana prohibitionit failed.
(16:43):
People use it all the time.
So they say, therefore weshould legalize it to solve this
problem.
But legalizing it comes withthen a whole other set of
problems.
And so you know, I always pointto you look at prevalence of
use, and it's so much less thanour legal or, excuse me, yeah,
it's so much less prevalence ofuse of our illegal drugs.
Marijuana included, from afederal perspective, is a
(17:04):
fraction of a fraction of theprevalence of our legal drugs,
obviously, and so I think thatyou look at that and that's
where you start with thecalculus, at least through my
own heuristic.
Speaker 2 (17:13):
You look at that and that's where you start with the
calculus, at least through myown heuristic.
Yeah, I mean this is a classicKleinman point.
He always said drug controlpolicy, you can never have a
policy without problems.
The question is always choosingyour problems.
Which problems do you want tohave?
Which is the optimal set ofproblems?
You know, I think that in thecase of marijuana there are ways
(17:34):
to sort of mitigate some of theharms of prohibition.
There's a broad spectrum I talkabout it in the New York Times
piece a broad spectrum of policyoptions.
The reality is something like13 states decriminalized
marijuana in the 1970s.
Basically it turned out fine.
There was some evidence of aslight increase in usage.
It basically washes out afterfive to 10 years.
(17:58):
I am less persuaded that by thelate 1990s or the 2000s we
really were incarcerating a lotof people for marijuana.
We kind of weren't.
But look, I'm not inert to theharms of simply arresting lots
of people for marijuana, even ona pretextual basis.
We can go back and forth onthis, but the reality is you can
sort of settle that majorconcern the criminal justice,
(18:18):
violence and prohibition withoutcreating a legal recreational
market Right.
Speaker 1 (18:24):
And that's what Sam's always advocated is this third
way approach of dealing withpossession, very low-level
possession.
Obviously we don't want to getinto dealing and all those
things, but low level possession, expungements and stuff.
And so in your dispatch pieceyou wrote about Governor
Westmore's pardons and kind ofhow he's trying to make that a
really big deal.
But to your point, they're justno, you know and they even had
to acknowledge this in thefollowing coverage that nobody
(18:45):
got out of prison from this,that very few people were
actually impacted.
Now there were some and thatwas great.
We supported that.
But what was also interestingto us is that it was two years
after they got the commercialmarket online that they then
thought, ok, well, let's startdoing the pardons, which we
thought was really interesting.
Speaker 2 (19:01):
Yeah, and you know Wes Moore is to read the
political tea leaves.
You know he wants to be seen asa rising star in the Democratic
Party and 10, 15 years ago,being at the vanguard on
marijuana was a great way to dothat.
And I think that that is youknow.
All of the low-hanging fruithas been plucked there and the
(19:21):
public is going.
Hang on a second.
There are costs to this right.
It's important to remember that.
You know, absence makes theheart grow fonder.
We are a population that is,you know, even since the
beginnings of legalization underquote-unquote medicalization,
essentially legalization forretail use with some
restrictions.
(19:42):
Even from the beginnings, manymillions of Americans did not
have any exposure to what livingwith legal weed was like.
It was only recently themajority has experienced it, and
so I think we are starting tosort of cool towards it, and you
know efforts like Moore's are away to say no.
Really, it's still a great blowfor justice to legalize weed,
(20:02):
we promise.
And it's like I don't think youcan catch the fire a second
time.
Speaker 1 (20:07):
Yeah, I agree especially with all the issues
of you know all the problems,health problems, psychosis and
other issues which, speaking ofthat last question, I forget
which one of the two pieces itwas, but in that piece you said
marijuana can increase yourchances of schizophrenia, but so
can owning cats.
I thought, okay, I haven'theard that one before, so I
wanted to give you a chance toexpound a little more on that
(20:29):
one.
Right, the first one, and thisis, I think, disputed in the
literature, but the balance saysit's true um cats carry a
parasite called toxoplasmosisgondii, which exposure to, I
think, sounds like shrooms to me, some sort of mushroom drink
that's coming down the line umsignificantly raises your risk
for schizophrenia down the line.
Speaker 2 (20:51):
Um, like like there is some scientific basis to the
quote unquote crazy cat ladystereotype that cats can.
Again, this is a little bitdisputed, but the balance of the
evidence says it's moreplausible than not, and my point
there, by the way, is like thisis part of why marijuana's
addictiveness matters.
We do let people do thingswhich are harmful to them.
(21:11):
We let people skydive, we letthem drive really fast cars, and
to me the relevant question isowning a cat is something that
does not inhibit my ability toreason about costs and benefits
and about the short run versuslong run.
Being addicted to marijuanadoes inhibit my ability to
reason, so I am ultimatelysomebody who's wary of
government regulation and, as aconsequence, I think it matters
(21:33):
that we carve out and say thisparticular quality is dangerous
enough in a specific way.
It causes a market failure in aspecific way.
That is right for government tostep in.
In a way that I don'tultimately support government
cat control, even though thereis a risk that we have at least
plausible evidence to believe isassociated with increased risk
(21:55):
for schizophrenia.
Speaker 1 (21:56):
Trevor Burrus Jr.
Okay, very interesting.
I hadn't heard that one before,but thought that was
interesting.
I'm almost certain your chancesof getting schizophrenia from
using marijuana are much higherthan cat ownership, peter.
Speaker 2 (22:06):
T.
It would be a surprise, TrevorBurrus Jr.
This is a good warning.
Speaker 1 (22:07):
This is a good warning.
Peter T yeah, trevor Burrus Jr,I only own a cat for about six
months of my life, so I think mychances are hopefully pretty
diminished.
Speaker 2 (22:15):
I believe it's really about handling the litter.
Ah, okay, it's where theparasite resides.
Speaker 1 (22:23):
Interesting, interesting, okay, very good.
Well, that was a great response.
I was not expecting that one.
That was very good, charles.
Well, thank you for joining uson the TDR podcast.
It was a great discussion.
You're writing fantastic piecesout there, so where can folks
connect with you, follow yourworks that you have out there?
Speaker 2 (22:40):
Yeah, absolutely.
I'm on the artist, formerlyknown as Twitter.
I'm at Charles F Lehman,l-e-h-m-a-n and you can also
find me.
I work for the ManhattanInstitute.
We're Think Tank.
I'm there and I'm at ourflagship publication, city
Journal.
That's city-journalorg, and Ihave a sub stack which is called
the Causal Fallacy, which islike-.
Speaker 1 (22:58):
I love that one.
Speaker 2 (23:00):
It's about James Q Wilson.
You can read the wholeexplanation.
I'm just a huge dork.
Is like the explanation of mostthings that I do.
Speaker 1 (23:06):
It's very good.
Well, you're a very smart dorkand you got good views on this
issue, so keep up the great workand thanks again for joining us
.
Thanks, have a good one.
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