July 5th, 2005

Black Markets vs. Free Markets

Many of us would say that we believe in a philosophy of live and let live. Most of us, however, probably aren’t awakened at 3 a.m. on consecutive weeknights by johns leaving a brothel in the apartment next door. Most of us probably don’t happen upon the sale of cocaine in our driveway.

Indeed, it’s one thing to support decriminalizing prostitution and drugs from an ivory tower. But now that I’ve graduated college, and am living on my own, I wonder if the ban on these so-called victimless crimes is, in fact, reasonable?

A libertarian would argue that what’s immoral should not necessarily be illegal. Paying for sex and getting high may be self-destructive, but both are voluntary choices.

To put it another way, freedom is not coextensive with virtue; vices should not be crimes. In fact, vice often permeates a free society, which imposes on each individual the responsibility to tolerate objectionable behavior. Moreover, who’s sleeping with whom and who’s using what neither harms me nor infringes my rights.

Critics respond that the everyday consequences of decriminalization outweigh abstract notions of unfettered liberty. For instance, after promising riches to young women, pimps keep them tethered to the netherworld through blackmail, inflating their back pay, and even old-fashioned coercion. With respect to drugs, toking up marijuana is allegedly a gateway to shooting up heroin.

These concerns are real, yet they only tell half the truth. In short, the concerns largely arise not because of the crimes themselves, but because of the laws that criminalize the said acts.

It’s less complicated than it sounds.

For instance, contrast black markets, under which prostitution and illegal drug use occur, with free markets. Owing to the dearth of competition and the risk of being busted or extorted, black markets are more expensive and more dangerous than free markets. While black markets incubate graft and omertas, free markets encourage written contracts and public scrutiny. While justice in the black market comes at the barrel of a gun, justice in the free market comes in a courtroom.

Specifically, under current law, both prostitutes and clients lack any legal recourse—if, say, she passes onto him a sexually transmitted disease or if he physically abuses her. Similarly, try getting a refund from a dealer who sold you schwag instead of something hydroponic. Decriminalization would make fraud legally enforceable and shine some much-needed sunlight into these no-man’s-lands.

Indeed, if we were to treat sex and drugs as we do booze, then many hookers and pushers would go legit or go out of business. Instead of employing backseats and back alleys, they could conduct their affairs in offices—in fear not of the FBI but of the IRS.

Furthermore, under current law, two-thirds of the federal government’s budget for the war on drugs goes to incarceration rather than treatment. Surely, however, nonviolent users would be better served by spending time with physicians and psychiatrists than doing time with rapists and robbers. In fact, studies show that prison does little to fight addiction, whereas rehabilitation helps the individual to break his dependency—and thus check the aforementioned gateway.

The world’s oldest trade and perhaps its most profitable one have always outwitted attempts at suppression; no amount of legislation has, or will, defeat man’s yen for pleasure. We would do better as a people and a polity if we recognized this stubborn fact.

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