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Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

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Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#21

Post by Symmetry »

tomrod wrote: post #16
Symmetry wrote: post #13

Earlier quoted context omitted.

If they're truly profit-maximizing they're already exploiting other drugs, guns, smuggling, "coyotes", or legitimate enterprise as hard as they can already and we should expect them to lose money if one of the markets they work in goes away.

Diseconomies of scale and scope can prevent action in each of these industries, in a static analysis. It may prove to be more profitable to focus on a single industry (e.g. marijuana) than seeking at the present moment to dominate or even enter other industries (e.g. opiods) until market conditions change. As things evolve, they may naturally enter other industries. Heck, even become legitimate. EDIT: Fixed second pa…

Sure, but I'd expect that there's some agent already in those niches and that agent would have experience new agents would lack. Then, uh, non-linear returns to expertise at violence do complicate the issue in ways I can't predict but the empirical observation that violence has gone down would tend to support the the observation that profits have done down and argue against the idea that marijuana cartels are now violently displacing heroin cartels.

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#22

Post by eric_h »

sigstoat wrote: post #12
tomrod wrote: post #10

The "Drug Trafficking Organizations" are the cartels. It is important to remember they don't exist to traffic drugs, they exist for the top leader(s) to obtain and maintain power, like a state-in-waiting. As other activities become more profitable, they switch over to those. Marijuana loses its profitability, they can switch to other drugs, guns, smuggling, "coyotes", or legitimate enterprise. This is what unfettered…

> This is what unfettered capitalism (anarcho-capitalism) looks like. I like capitalism, generally, but divorcing morality (or, alternatively, failing to separate socially-contracted power to coerce action) from economic gain results in the violence and brutality. no. the cartels are what you get when you actively block organizations that are serving huge needs (recreational drugs), from access to peaceful means of c…

> no. the cartels are what you get when you actively block organizations that are serving huge needs (recreational drugs), from access to peaceful means of conflict resolution and contract enforcement.

That’s how cartels get power in the first place, but once they’re there, they’re in the business of preserving revenue streams and territory and thus power.

Once they’re large enough, their raison d’être is no longer simply fulfilling a market need but maintaining and expanding revenue and power, creating market need as required to keep the machine running (e.g. protection rackets)

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#23

Post by tomrod »

Symmetry wrote: post #21
tomrod wrote: post #16

Earlier quoted context omitted.

Diseconomies of scale and scope can prevent action in each of these industries, in a static analysis. It may prove to be more profitable to focus on a single industry (e.g. marijuana) than seeking at the present moment to dominate or even enter other industries (e.g. opiods) until market conditions change. As things evolve, they may naturally enter other industries. Heck, even become legitimate. EDIT: Fixed second pa…

Sure, but I'd expect that there's some agent already in those niches and that agent would have experience new agents would lack. Then, uh, non-linear returns to expertise at violence do complicate the issue in ways I can't predict but the empirical observation that violence has gone down would tend to support the the observation that profits have done down and argue against the idea that marijuana cartels are now vio…

One complicating factor is that the cartel can't use the traditional monetary system (as I understand it), thus allowing a quick pivot of assets (as they pull their money out from under their mattresses). Hence, if they _do_ decide to enter an industry, then can enter quickly, pay high wages, get a foothold, then undercut the existing market. Much like Google, Apple, and other tech companies with massively large cash piles they sit on.

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#24

Post by tomrod »

clavalle wrote: post #19
tomrod wrote: post #10

The "Drug Trafficking Organizations" are the cartels. It is important to remember they don't exist to traffic drugs, they exist for the top leader(s) to obtain and maintain power, like a state-in-waiting. As other activities become more profitable, they switch over to those. Marijuana loses its profitability, they can switch to other drugs, guns, smuggling, "coyotes", or legitimate enterprise. This is what unfettered…

I don't think morality has much to do with it. Taking violence out of transactions by simultaneously making the consequences of violence very expensive and the alternatives to violent dispute resolution relatively inexpensive is what makes non-violent markets work. But I agree: a market in violence rather than a People controlled, pre-agreed upon rules-based government monopoly on violence would lead to and an explos…

I don't disagree here. My point was more along the lines of the power brokers coupling coercive force with economic gain, which a strict morality would (in my view) speak against. But yes, the argument against the nature of the cartels does not require moral arguments.

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#25

Post by philipkglass »

kurthr wrote: post #6
Donzo wrote: post #2

I must admit I only read the headline, but I'm sure the organizations are making due with the thin, tight-margins off black market cocaine, heroine, and methamphetamine sales.

Well, the article is barely more than a headline and a bunch of mediocre comments itself, although it links to a paper behind a paywall. http://onlinelibrary.wiley.com/doi/10.1111/ecoj.12521/full I would guess though that meth (a la Breaking Bad) is too easy to make inside the US for import competition, while heroin has been hit by the dual availability of Pharma delivered Oxy and China delivered Fentanyl/Carfentanil…

It's relatively easy to make from ephedrine or pseudoephedrine, but the over-the-counter decongestant pills containing those precursors have had their availability drastically curtailed in the US over the past 20 years. I think that Breaking Bad showed how much hard work it was to have a bunch of straw-purchasers buy pills up to each person's legal limit, so you could gather enough of them to make wholesale quantities of the drug.

Cartels can run large labs supplied with drums of industrial chemicals instead of taking the "easy" but difficult-to-scale route that starts with OTC pills. And if they used to be able to turn a profit on smuggling product with a mass-to-value ratio as low as cannabis, they should surely be able to manage the same with methamphetamine.

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#26

Post by jedberg »

Donzo wrote: post #9
simonh wrote: post #5

Earlier quoted context omitted.

I'm really sorry for being pedantic, I'm uusally not like this, but I have seen this frequently on HN. It's making do, not making due.

In all seriousness, I greatly appreciate corrections like this in a way that so few people do.

Technically your "that" is superfluous. ;)

> In all seriousness, I greatly appreciate corrections like this in a way so few people do.

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#28

Post by jzig »

Symmetry wrote: post #13
tomrod wrote: post #10

The "Drug Trafficking Organizations" are the cartels. It is important to remember they don't exist to traffic drugs, they exist for the top leader(s) to obtain and maintain power, like a state-in-waiting. As other activities become more profitable, they switch over to those. Marijuana loses its profitability, they can switch to other drugs, guns, smuggling, "coyotes", or legitimate enterprise. This is what unfettered…

If they're truly profit-maximizing they're already exploiting other drugs, guns, smuggling, "coyotes", or legitimate enterprise as hard as they can already and we should expect them to lose money if one of the markets they work in goes away.

What is a coyote?

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#29

Post by ryan_j_naughton »

eric_h wrote: post #22
sigstoat wrote: post #12

Earlier quoted context omitted.

> This is what unfettered capitalism (anarcho-capitalism) looks like. I like capitalism, generally, but divorcing morality (or, alternatively, failing to separate socially-contracted power to coerce action) from economic gain results in the violence and brutality. no. the cartels are what you get when you actively block organizations that are serving huge needs (recreational drugs), from access to peaceful means of c…

> no. the cartels are what you get when you actively block organizations that are serving huge needs (recreational drugs), from access to peaceful means of conflict resolution and contract enforcement. That’s how cartels get power in the first place, but once they’re there, they’re in the business of preserving revenue streams and territory and thus power. Once they’re large enough, their raison d’être is no longer s…

Here is an example of that with avocados:

[1] http://www.foxnews.com/world/2017/11/03/mexican-cartels-exto...

[2] http://www.newsweek.com/cartels-kidnap-avocado-farmers-69630...

[3] https://www.dailykos.com/stories/2016/7/12/1546610/-Avocados...

Re: Is Legal Pot Crippling Mexican Drug Trafficking Organisations?

#30

Post by openasocket »

jzig wrote: post #28
Symmetry wrote: post #13

Earlier quoted context omitted.

If they're truly profit-maximizing they're already exploiting other drugs, guns, smuggling, "coyotes", or legitimate enterprise as hard as they can already and we should expect them to lose money if one of the markets they work in goes away.

What is a coyote?

People who smuggle other people across the Mexican border. Generally associated with cartel groups, and range from merely expensive to downright exploitative.
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