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The Harvard Plan for Drugs
A Review of Against Excess: Drug Policy

for Results. By Mark A. R. Kleiman. New York:
Basic Books, 1992.

s the casualties from the war on drugs mount, the appeal for

moderation in the title of Mark Kleiman’s latest book on

drug policy is most welcome. However, make no mistake
about it, this is no case for legalization. Rather, the author makes a
case for a technocratic solution to our drug-abuse and drug-policy
problems. As the most recent and sophisticated defense of prohibi-
tion, it is worthwhile reading for everyone interested in drug policy.
In view of the victory of the Clinton regime, Against Excess could
serve as the blueprint of future drug policy.

This is the latest version of what I call the Harvard approach to
drug policy—a hodge-podge of policies and programs designed to
“rationalize” drug policy and to professionalize drug war manage-
ment. While it has been said that Harvard hates America, I have
found this simply not true. Harvard profits from America. What
Harvard (not Kleiman) hates is that Americans still remember and
still have some attachment to the Jeffersonian concept of self-govern-
ment. It is this attachment and this concept that gets in Harvard's
way of controlling and profiting from Americans through more gov-
ernment power and greater control over the individual's daily life.
Not only is Kleiman’s case for the drug war based on the lack of self
government, his recommendations would create employment oppor-
tunities for yet another army of drug policy and law enforcement
experts.

The basic Harvard argument on drug policy goes as follows:
America is a liberal society; the liberal society relies on the self-gov-
ernment of individuals; drugs are different from other consumer
goods in that drugs undermine the ability of drug takers to self govern
and often create external harm for people who don’t take drugs;
therefore we need a special policy for drugs.

The Review of Austrian Economics Vol.7, No. 1 (1994): 147-150
ISSN 0889-3047

147


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148 The Review of Austrian Economics Vol. 7, No. 1

However, not only are drugs different from other consumer goods
but drugs differ from one another with respect to their effects and the
harm that can occur from their abuse. As a result, the Harvard
approach requires that each drug or group of drugs have a specially
designed policy in order to minimize the costs of both drug abuse and
drug policy.

Kleiman proposes, or rather endorses, the neo-prohibition of
alcohol and tobacco that is sweeping this nation. Higher taxes, more
regulations and restrictions, infringements on the right to free speech
(advertising), and more government is the answer here. The benefits
of alcohol, although widespread and well established by nearly a
century of research and thousands of years of experience, are treated
by Kleiman with skepticism—as if the latest research on the health
benefits of alcohol was actually the first!

He accepts the neo-prohibitionist Gospel that the problems of
fetal alcohol syndrome and second-hand smoke are highly significant
when in the first case it has been blown out of proportion and in the
second case it has yet to be scientifically verified. No doubt this
proposal will be like sweet music (or fine red wine) to the army of
bureaucrats, government researchers, and agencies that have been
created and prospered from neo-prohibitionism.

Kleiman proposes to decriminalize marijuana. Marijuana would
be highly taxed and regulated like alcohol and tobacco. This is the
lone bone he throws to the supporters of legalization and will no doubt
get some positive reception at High Times and N.O.R.M.L. I can
sympathize with the author’s insistence that public policy towards
dangerous drugs convey a warning to consumers, but frankly the
average purchaser of beer, wine, spirits, cigarettes, and freon knows
that the average politician is collecting excessive excise taxes not out
of concern for the consumers’ health or environment, but out of
concern for tax revenue. Nevertheless, this is a worthwhile section
and I would also recommend Kleinmen’s 1989 book on this subject,
Marijuana: Costs of Abuse, Costs of Control (Westport, Conn.: Green-
wood Press).

The author would continue the prohibition of narcotics, although
attention would be shifted away from arrests and towards “inconven-
iencing” black-market participants. Drug-involved offenders would
get free drug treatment and would be drug tested when on bail,
probation, or parole. He also wants more government methadone
maintenance, education, tighter controls on prescription drugs and
federal control over treatment facilities. The clincher in Kleiman’s
program against excess is his recommendation for adding $20 billion to
the war on drugs—a tripling of resources! Therefore, while Kleiman


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Book Review 149

18 preaching for moderation in drug policy he is actually promoting a
massive shift in resources, power, and rights away from the people to
the central government. In his recent address to the Drug Policy
Foundation, Nobel Laureate economist Milton Friedman warned us
that the war on drugs was really a war against people by the govern-
ment and that government is the problem. This important issue is
completely neglected by Kleiman.

The conclusions and proposals in this book are based on the
author’s understanding of the perfectly rational consumer, an eco-
nomic model that allows some economists to translate human action
(however imperfectly) into mathematics. For Kleiman, it is this
nearly perfect, rational consumer that is the prerequisite of the
classical liberal society. The application of this model is both inappro-
priate and incorrect. First of all, the classical liberal society is not
based on the methods of liberal welfare economists or on the presump-
tion that all citizens are “rational” in all respects. Rather, it is based
on the ideas of people who fought for freedom and the documents that
represent their legacy such as the Magna Carta, the Declaration of
Independence, the Articles of Confederation, and the Bill of Rights.

Second, the author does not fully understand the workings or
limitations of the model. He notes that to have rational time prefer-
ences requires an individual to apply the same rate of discount to all
decisions. His example of an irrational individual is one who is willing
to lend money to a bank at an interest rate of 8 percent while at the
same time borrowing money from the credit card company at an
interest rate of 20 percent. Here he fails to realize that people also
have liquidity preferences (the preference for cash on hand) as well
as time preferences. An individual's liquidity preference will out-
weigh time preference under certain conditions, resulting in this very
type of “irrational” action. The fact that individuals have limited
information and have many different types of preferences (time,
liquidity, leisure, risk, sex, etc.) makes it difficult, if not impossible,
to describe any action as irrational in the typical economic sense.

One of my favorite pieces of “evidence” that Kleiman uses to
support his contention that habit and addiction are stronger than the
rational individual comes from a study based on personal interviews.
A certain percentage of individuals regret having started various
habits or for not quitting those habits. This evidence is pure after-
the-factism (post hoc reasoning). Naturally, people will “regret” ac-
tions where most or all of the benefits have been received, but the
costs have yet to be paid. Eating hot and spicy food, having unsafe
sex, and buying on credit are just like smoking cigarettes or getting
drunk—you get the benefits immediately, but you incur future costs.


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150 The Review of Austrian Economics Vol. 7, No. 1

It is human nature that we are willing (at the time of choice) to pay
more later to get benefits now. If we are truly worried about time
preferences and short time horizons, then the war on drugs is no
answer. Prohibition destroys individual responsibility towards drugs
and it is individual responsibility and maturity that instill a future
orientation where drug abuse and other risky activities are avoided.

Kleiman has several remaining issues that undermine the viabil-
ity of his policy recommendations. He is apparently worried that the
costs drug abusers inflict on others would be greater under legaliza-
tion, yet he seems unwilling to make users pay the costs themselves.
In fact, he would offer free drug treatment and rehabilitation to all
takers. (One might even suspect that the odds are good that Mr.
Kleiman also supports some form of national health care system that
would increase the “free rider” and “moral hazard” problems, thereby
contributing to the irresponsible use of drugs.) He also bases his
support for prohibition on the fact that the criminal justice system
does not do a good enough job of preventing drug-related crime. Most
informed observers, however, trace many of the problems in our
criminal justice system to the burden and corruption placed on it by
narcotics prohibition. Finally, I would note that even Mr. Kleiman
realizes that only a small percentage of the population develops abuse
problems with any specific drug and that we do not know what makes
a given person have an abuse problem with a given drug. Why then
does he recommend a nationwide policy that is oppressive, imper-
sonal, and ineffective?

Mark Thornton
Auburn University