Narco Submarines and the Strange Economics of Cocaine Smuggling

Simon uses 'street value' of the drugs to show how much money is being made. If we figure 100% markup at each stage of distribution and you figure 6 or 7 levels of distribution between the producers and the street dealers, then the producers are getting like 1% of the street value, packers and loaders get 2%, shippers get 4%, receivers and national wholesale distributors get 8%, regional distributors get 16% and local distributors and street dealers can fight over the remaining 70%. The last group may be getting the lion's share of the money, but there are zillions of them, their individual volumes are small so each one isn't making all that much money. There is a lot of competition at the retail end of the business which might be why the homicide rate is so high in big cities. I mean, if you have a dispute with another drug dealer, you can't very well complain to the police, can you?

Previous post about submersibles.

Pirates

U.S. Coast Guard Cutter Munro crew interdicts suspected drug smuggling vessel
Action on the high seas! But who are the criminals here? We have drug smugglers in a high speed, semi-submersible boat being pursued by US Coast Guard boats on the high seas. Yes, the USA has laws against importing some things, and the smugglers may be attempting to bring their illicit cargo ashore somewhere in the USA (okay, everyone knows that's what they intend to do), but they aren't in USA territorial waters, so do we have any legal right to stop them? Oh, that's right, we have guns and we are God's gift to the world, so we are right and they are wrong and if you disagree you are a heretic of the first water.

The reason we continue to have laws against recreational drugs is that a sizable fraction of our economy depends on maintaining high prices for those drugs. You can argue about the morality of the law and of the use of drugs, but none of that matters. The only thing that matters is the money. Confiscating drug shipments restricts the quantity available and so helps maintain the prices and profit margins. At least I think that's what's going on.

Via daily timewaster who apparently disagrees with everything I have said.

Update next day, replaced missing video with one from Popular Mechanics. Key question is where this happened.

The crew of the Coast Guard Cutter Munro will offload more than 39,000 pounds of cocaine and 933 pounds of marijuana worth a combined estimated $569 million, which was seized in international waters in the Eastern Pacific Ocean. - United States Coast Guard Media Advisory

It was in international waters, but who's going to complain about the US Coast Guard playing at being pirates?

Quote of the Day

Talking about Columbian drug smuggling semi-submersibles:

Vice Admiral Edgar Cely said that specialized personnel and knowledge are needed to design and build the craft.

Specialized knowledge? Are you kidding me? No, he's probably not kidding. Compared to your average reporter, or your average turnip, turning a wrench or wielding a spatula is specialized knowledge.I mean they are just boats for Pete's sake. People all over the world have been building boats since the dawn of time.

Whoops. Just Googled "Vice Admiral Edgar Cely" and discovered he is in the Columbian Navy. I'm not saying Columbia is a third world country, but maybe it is. Finding someone who knows what a wrench is might be a little difficult.

Does this make me a firstist?

Via a three year old post by Michelle Malkin.