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Would they make enough money from cocaine sales to offset the aid loss?

by cle 6y ago

dragonwriter 6y ago
Well, for one-sig-fig approximations US street prices are apparently in the ballpark of $100/g (understated because this is usually not pure, but that just makes the case stronger), or $100M per metric ton; their current production potential without any expansion in cultivation (and it would rise radically if they weren't actively eradicating it in an arms race with producers) is about 1,000 metric tons, so the street value that they can produce with current cultivation is about $100B annually. Now, clearly, wholesale costs are going to be lower and the government revenue share lower still, but you'd only need 0.5% of that to offset the entirety of US aid to Colombia. Prices from: https://www.addictioncenter.com/drugs/how-much-do-drugs-cost/ https://www.addictioncenter.com/drugs/how-much-do-drugs-cost... Production capacity from: https://apnews.com/article/0aa6474b944f4ff8eb9e7e9cffffce87 https://apnews.com/article/0aa6474b944f4ff8eb9e7e9cffffce87
- irscott 6y ago
  I've never heard of cocaine going at $100/g even for really clean stuff. $60/g is much more realistic.
  - dragonwriter 6y ago
    > I've never heard of cocaine going at $100/g even for really clean stuff. $60/g is much more realistic. Given the range cited in the article (US prices of $25/g-$200/g, with an average of $112/g), I would assume that there is enormous variation by locality, over time, and by other factors, and that people that aren't specifically involved in analyzing it nationally are at best going to have experience that is narrow and/or intermittent and usually decidedly nonrepresentative for that reason. But even if the price was $50/g, that only means it goes from 0.5% to 1% of the street value of the potential output that needs to be captured by Colombia to fully replace the value of US aid. (And only part of that needs to be recovered in actual tax revenue from cocaine itself, some of it can be recovered in additional tax revenue from other businesses that stop being inhibited by cartel vs. government violence, and some of it can be recovered by reduced government suppression expenditures.)

Would they make enough money from cocaine sales to offset the aid loss?

by cle 6y ago

Would they make enough money from cocaine sales to offset the aid loss?

Well, for one-sig-fig approximations US street prices are apparently in the ballpark of $100/g (understated because this is usually not pure, but that just makes the case stronger), or $100M per metric ton; their current production potential without any expansion in cultivation (and it would rise radically if they weren't actively eradicating it in an arms race with producers) is about 1,000 metric tons, so the street value that they can produce with current cultivation is about $100B annually. Now, clearly, wholesale costs are going to be lower and the government revenue share lower still, but you'd only need 0.5% of that to offset the entirety of US aid to Colombia. Prices from: https://www.addictioncenter.com/drugs/how-much-do-drugs-cost/ https://www.addictioncenter.com/drugs/how-much-do-drugs-cost... Production capacity from: https://apnews.com/article/0aa6474b944f4ff8eb9e7e9cffffce87 https://apnews.com/article/0aa6474b944f4ff8eb9e7e9cffffce87

irscott 6y ago
I've never heard of cocaine going at $100/g even for really clean stuff. $60/g is much more realistic.
- dragonwriter 6y ago
  > I've never heard of cocaine going at $100/g even for really clean stuff. $60/g is much more realistic. Given the range cited in the article (US prices of $25/g-$200/g, with an average of $112/g), I would assume that there is enormous variation by locality, over time, and by other factors, and that people that aren't specifically involved in analyzing it nationally are at best going to have experience that is narrow and/or intermittent and usually decidedly nonrepresentative for that reason. But even if the price was $50/g, that only means it goes from 0.5% to 1% of the street value of the potential output that needs to be captured by Colombia to fully replace the value of US aid. (And only part of that needs to be recovered in actual tax revenue from cocaine itself, some of it can be recovered in additional tax revenue from other businesses that stop being inhibited by cartel vs. government violence, and some of it can be recovered by reduced government suppression expenditures.)