Would cocaine legalization help Colombia?:
Legalizing or decriminalizing cocaine would do much to improve America’s inner cities and it ought to be seriously considered, even if it means more doped-up middle-class white teenagers. But legalization — whether in Colombia or the United States — is not obviously the way out for Colombia.The positive scenario is that legalization eliminates the profits from the drug trade and the Colombian nasties pack up shop and go away. In a legal market, Merck would outcompete the drug barons. Maybe they would grow more coffee.
I see two negative scenarios. First, cocaine production has been a boon to the Colombian economy. It is no accident that Colombia experienced no currency crisis, unlike most other Latin countries. (For contrast, here are some arguments that cocaine has hurt the Colombian economy; I don’t believe it.) The rural Colombian economy might well collapse, taking civil order with it.
Second, the Colombian civil war is 40 years old and it predates the importance of cocaine. Narco-traffickers set up processing labs in Colombia because the government did not control the country in the first place. Legalizing cocaine would devastate their incomes, and probably bring political assassinations and military conflicts into the capitol. It is not clear Colombia can handle it. Keep in mind these same groups once, when threatened with more extraditions, stormed the Supreme Court and almost got away with it. Cocaine profits, however evil they may be, give the guerrilla groups some stake in the status quo.
That said, cocaine legalization probably would have helped Colombia in the late 1970s, before the paramilitaries became so rich. That doesn’t mean the same idea will work today.