ESTABLISHING A FREE- MARKET IN DRUGS IN CANADA
A free-market in drugs is a social state of affairs where any individual would be free to produce, trade, or consume drugs free of any regulation or taxation and that the sole the purpose of government (in so far as drugs are concerned) would be to protect her in the possession of her drugs (and/or the means of production necessary to produce them) and to mediate any disputes she might have regarding her drugs. In this essay, I explain what it would mean to establish a free-market in drugs in Canada. My explanation has two steps. In the first step, I will outline and defend (to the extent I can in the space that I have) what I take to be the main principles of libertarian moral theory. These include Hobbes’ principle of peace and the three principles of my version of Nozick’s entitlement theory. Those three principles are: acquisition by first use, justice in transfer, and rectification.
The reason for undertaking this first step is two-fold. First, establishing a free-market in drugs involves applying the main principles of libertarian moral theory, especially those of entitlement theory, to the major drug markets in society. As such, it pays to know these principles. Second, justifiably applying the main principles of libertarian moral theory to the major drug markets in society first requires a defence of those principles. In the second step of my explanation, I provide a limited application of the principles of libertarian moral theory to the two major drug markets in Canada, the recreational and religious drugs market both legal and illegal and the legal and regulated pharmaceutical drugs market. The reason my application is limited, as I elucidate below, is that a complete application of the main libertarian principles cannot be applied to one good such as drugs for several reasons, including the alternating uses of holdings. They can only successfully be applied to the total global market for all goods.
THE MAIN PRINCIPLES OF LIBERTARIAN MORAL THEORY
My libertarianism is primarily a blend of the thought of Thomas Hobbes and Robert Nozick. It contains two parts: a) Hobbes’ principle of peace and b) my version of Nozick’s entitlement theory. Nozick’s entitlement theory includes the principles of justice in acquisition, justice in transfer, and justice in rectification. Mine is the same except that I substitute the principle of acquisition by first use for the principle of justice in acquisition. In my brand of libertarianism (b) is deduced from (a). A complete defence of this brand of libertarianism would involve two steps. First, a series of arguments would be presented demonstrating that Hobbes’ foundation for, or his major argument in defence of, his principle of peace is right. I do have such a series of arguments, but, because of space considerations, I cannot present them here. Instead, I can only offer a truncated outline of his foundation. The second step would be to show that my version Nozick’s entitlement theory can be deduced from Hobbes’ principle of peace. I will demonstrate as much here, although not with the rigor that one would find in a longer work.
Let me begin with the abbreviated outline of Hobbes’ foundation for the principle of peace. He begins by asking, albeit implicitly, what moral principles, if any, are justified? He develops an answer by considering what precepts, if any, it would be rational for individuals to accept, given that they need the rational compliance of others, in the state of nature. The state of nature is a hypothetical state of affairs with no government, and consequently, no recognized moral rules. Which principles, if any, it would be rational for individuals to consent to in the state of nature depends on how interactions would play out. Hobbes argues that interactions would develop into a war of all against all for three reasons. The first reason for war is violent competition. He thinks that because individuals are equally prudent and possess the equal the ability to kill, if two of them desire the same object, they will use violence to obtain it. The second reason for war is diffidence, or hopelessness. He maintains that violent competition would leave individuals feeling hopeless about satisfying their desires. To rectify this diffidence, they would begin pre-emptively attacking each other. The third reason for war is the desire for glory, or the desire to be viewed as better than others. He contends that since individuals have this desire, if one person in the state of nature views another as a lesser, the latter will attack the former in order to convince her (and others by the example) that she is superior. The war of all against all, he argues, would result in two significant disadvantages: a short average life span and little in the way of production. Periodic violent attacks would see many people die young. Further, they would prevent individuals from successfully engaging in the types of ongoing activities required for large-return production, e.g. tending a crop. Why sow a field of wheat and then weed and water it if someone who wants it when it is ripe for harvest will take it by force?
Given that interactions in the state of nature would be a war of all against characterized by a limited life and no large-return productive activity, what moral principles would it then be rational for individuals to consent to (given that they need the agreement of others)? Hobbes argues that these two disadvantages that characterize the war of all against all would move individuals to consult reason and discover that it is in their long-term interest to socially contract to abide by the principle of peace, or non-interference (Hobbes 1651). Abiding this principle would be in their long-term interest because it would enable them to live longer and to engage in the types of continuing activities needed for production with large yields. With no periodic violent attacks, individuals would not face the threat of imminent death. Further, without the threat of the fruits of their labour being taken by force, the sustained activities of large-return production would be successful.
From Hobbes’ principle of peace, we can deduce my version of Nozick’s entitlement theory. We can do so by undertaking the following demonstrations: a) showing that the principle of acquisition by first use follows from the principle of peace, b) showing that Nozick’s principle of justice in transfer follows from the principle of acquisition by first use, and c) showing that his principle of rectification follows from the principle of acquisition by first use and his principle of justice in transfer. The principle of acquisition by first use is the idea that the right to exclusive control of natural resources and land are initially established by first utilizing them in ways that require ongoing access. The reason this principle follows from Hobbes’ principle of peace is that you cannot use some bit of nature that I am already using in a way that requires continuous usage, without interfering with my use (i.e. violating the principle of peace). As such, I gain exclusive use of it. I should add that my continuous use must be publically perceivable (e.g. by marking trees surrounding the land I am using). Otherwise the expectation of your non-interference would be unreasonable. Nozick’s principle of justice in transfer is that idea that the only legitimate means of transferring title to what one rightfully holds title are voluntary means, such as exchange or gift. The principle of justice in transfer follows from the principle of acquisition by first use in that if I have exclusive control of some bit of nature by ongoing first use, I can decide, while I am still using it, to let you use some of it or all of it. The principle of rectification is the idea that violations of either the principle of acquisition by first use and/or the principle justice in transfer must be in some way corrected and presumably, though Nozick does not explicitly say so, prevented in future (i.e. punished). The principle of rectification follows from the principles of acquisition by first use and justice in transfer in that these principles would be ineffective if their violation did not come at a sufficiently high cost.
TRANSITIONING TO A FREE-MARKET IN DRUGS IN CANADA
According to our variation of Nozick’s entitlement theory – and, of course, his own version – only a free-market society is morally justified. By a free-market society is meant two things. First, no one, not even the government, may interfere with a person’s property if the person holds title to that property from repeated applications of the principles of acquisition by first use and justice in transfer. As such, all regulation and most taxation on this theory is not only suspect, it is immoral. Second, the only role for government in society is a nightwatchman state that protects property by means of the police and military and that mediates disputes regarding property via the courts. A free-market in drugs would be a limited version of this free-market society. It would be a situation where any person holding drugs by repeated applications of the principles of acquisition by first use and justice in transfer would be free from regulation, taxation, and other interference and that the government would protect them in their possession of those drugs using the police and military, and would mediate their disputes regarding those drugs by providing courts.
What would it mean to establish a free-market in drugs in Canada? Canada has two major types of drug markets in Canadian society, the recreational and religious drug market both legal and illegal and the legal and (heavily) regulated pharmaceutical drugs market. A complete application of the free-market idea to each of the two drug markets would run as follows: first, start with the present distribution of the type of drugs of concern (recreational and religious or pharmaceutical) and then trace those drugs backwards, through all historical transfers, to the point of first appropriation of the resources, in Canada and elsewhere in the world, needed to make them. Second, rectify any injustices that occurred along the way. This task, I suspect, would be impossible for several reasons, including that you could not apply the principle of rectification to drugs without also having to apply it to all other types of goods. This is because not all holdings related to the current distribution of drugs were, from the point of original appropriation to the current distribution, used for drugs (e.g. a field that for years grew berries, then coca, then berries again, then coca again). It seems that a successful application of the free-market idea would have to be global (given trade) and involve all markets, not just those for a given drug market (given alternating uses of holdings). Such an application would not be fully successful, of course, because the available historical information is limited. Given that we cannot undertake a complete application of the free-market idea to each of the two major Canadian drug markets, let me offer a partial application instead. This partial application will involve two steps. First, I will apply the principle of justice in transfer to the market for recreational and religious drugs both legal and illegal and then to the regulated market for pharmaceutical drugs. Second, I will then pursue a historically limited application of the principle of rectification to the illegal market for recreational and religious drugs. This application will involve looking at what the principle demands only of those currently involved in the illegal market for recreational and religious drugs.
Let me begin my application of the principle of justice in transfer to the market for recreational and religious drugs both legal and illegal by first outlining the main argument made by those who currently favour a more liberal distribution of recreational and religious drugs. I do so to establish the distance between the libertarian’s free-market in recreational and religious drugs and the type of market favoured by the average ‘legalization advocate’. Those legalization advocates who agitate for a more liberal distribution of recreational and religious drugs are generally content with the taxation and regulation principle for tobacco and alcohol and wish to see it applied it to those drugs, especially marijuana, that currently fall under the principle of prohibition. Applying the principle of taxation and regulation to marijuana, I suspect, would mean the following: provinces, through cannabis control boards, would licence large-scale marijuana production, centrally control large-scale cannabis distribution, and licence private marijuana retail sales or provide government retail outlets. Provinces would further use provincial legislation to regulate the age at which marijuana could be purchased, the quality of cannabis produced, the public displaying of marijuana, and the smoking of marijuana on publically accessible private property (e.g. restaurants and bars). As well, they would collect sin taxes to discourage use. The federal government, as it (unconstitutionally) does now with tobacco, might restrict marijuana-related advertising and require that warning labels be placed on marijuana Baggies.
Applying the principle of justice in transfer to both the legal and illegal market in recreational and religious drugs, by contrast, would result in a free-market that would be markedly different than the regulated market produced by the principle of taxation and regulation. Consider first the market for currently legal recreational drugs such as alcohol and tobacco. Justice in transfer requires that existing provincial liquor control boards, with their licensing of beer and spirits production, control of wholesale alcoholic beverage distribution, and licensing or ownership of retail sales, be abolished. It also mandates that all provincial legislation regarding alcohol regulation, including the quality of booze produced, age restrictions on purchase, and the collection of sin taxes be rescinded. Further, it commands that provincial legislation regarding tobacco controls, including age restrictions on sales, smoking bans on private property, tobacco taxes, etc. be repealed. The principle dictates that federal government legislation regulating tobacco, including the licensing of tobacco growth and cigarette production, restrictions on tobacco advertising, etc., be abrogated. Consider now what the principle requires for currently illegal recreational drugs, such as marijuana, cocaine, DMT, LSD, etc. In Canada, it prescribes only one government action, viz. repealing the federal Controlled Drugs and Substances Act and replacing it with nothing. The reason the principle mandates the abrogation of all the regulations, bodies, and prohibitions surrounding legal and illegal recreational and religious drug markets is that these governmental hurdles are each a violation of morally legitimate property rights and therefore immoral. According to the principle, the only morally acceptable government involvement in the recreational and religious drug trade, from the processing of raw materials to the point of purchase, would be preventing deceit (e.g. lying about, but not necessarily disclosing, the contents of the drug or its effects). This is because deceit, in preventing people from realizing their intention with regard to their property, is a violation of their property rights.
Let us move to on to applying the principle of justice in transfer to the legal and regulated market in pharmaceutical drugs. If we apply the principle to this market, the most noticeable difference would be the abolition of the prescription system for distributing pharmaceutical drugs by the repeal of all provincial and federal legislation concerning it. Patients would have the final say in all their medication decisions. That means all pharmaceutical drugs would be for sale “over the counter”. With all pharmaceutical drugs for sale over the counter individuals, among other things, would gain the ability to purchase medically safe doses of barbiturates that could be used for an inexpensive and pain-free suicide, the ability to experiment with a cornucopia of drugs to determine which ones best cure their ailments (instead of being subject to the few a doctor is willing to prescribe), and the ability acquire significant amounts of opiates to alleviate chronic, persistent physical pain. Chronic pain sufferers are, at present, hostage to the overregulation of doctor’s prescription pads. The abolition of the prescription system, it should be noted, should not be considered as radical or as disruptive as at first it may seem. As Hamowy points out in his study on Canadian medicine from the end of the 19th Century through the first part the 20th Century, the rationale for the development of the prescription system was the self-interest of doctor’s unions (Hamowy 1984). By requiring prescriptions, doctors could make money off appointments each time a patient needed to visit the pharmacist. Other requirements of the principle of justice in transfer in the pharmaceutical drug market include ending Health Canada’s powers to licence pharmaceutical companies, grant approval to pharmaceutical companies to market drugs, and mandate drug trials by pharmaceutical companies. Still more, the principle commands that the Canadian Agency for Drugs and Technology in Health (which makes recommendations on which drugs provincial public health insurance plans should reimburse), the Patent Medicines Review Board (which controls prices for various pharmaceutical drugs), and the various provincial reimbursement plans for drugs all be abolished. In short, the principle obliges those in authority to abrogate any and all regulatory controls relating to pharmaceutical drugs as they represent unjust violations of property rights. Much like with recreational and religious drugs, from the processing of natural resources to the point of purchase, the only government involvement required by the principle would be preventing deceit.
The free-market in recreational, religious, and pharmaceutical drugs mandated by the principle of justice in transfer is going to raise a litany of common objections. How would we prevent children from obtaining drugs? How would we prevent overdoses from ignorance and rampant drug addiction? How would we prevent quackery? How would the public be protected from dangerous pharmaceuticals that cause Thalidomide babies? How would we stop antibiotics from becoming ineffective? The primary reply from libertarian moral theory is that these concerns, though significant, are not outweighed by each individual’s preeminent right to peace and property. For, once we start violating each individual’s rights, the overall consequences will be worse than if we had not. That reply will seem implausible to many. They will argue, if we can stop pharmacists of ill repute from selling drugs to children by implementing a seemingly minor regulation like an age restriction, why not? Surely such a minor restriction on property rights could not lead to overall worse consequences than if it were not in place. The subsidiary libertarian reply is that allowing minor violations of individual rights will create a slippery slope of steadily growing encroachments over time that will eventually lead to a totalitarian society. Most, admittedly, will find this reply inadequate. It seems implausible that small controls necessarily lead to larger ones. Another libertarian reply is that there exists ample historical and contemporary evidence to suggest that the concerns raised by the above objections would not be nearly as troublesome as first thought. There was some drug addiction when you could order cocaine from a catalog, but it was not any worse than what exists now. Pharmacists were not selling drugs to children prior to legislation preventing it. The quality of doctors, pharmacists, and drugs could very well be regulated by private organizations analogous to the Better Business Bureau or the Canadian Standards Association. The difficulty with this reply is that its speculative outcomes cannot be guaranteed.
RECTIFICATION OF PAST DRUG POLICY INJUSTICIES
Let me conclude with an application of the principle of rectification to the current illegal drug market for recreational and religious drugs. According to the principle of justice in transfer, nearly every aspect of formulation, maintenance, and enforcement of legislation prohibiting certain recreational and religious drugs is a rights violation. Drafting and passing legislation prohibiting any drugs, as well as continuing to support and refusing to rescind such legislation when one has the power to do so, is organizing criminal activity, executing search warrants on drug houses is committing home invasions, seizing drugs (and other property) is engaging in theft, arresting individuals involved with drugs is kidnapping, imprisoning those found guilty of drug “crimes” is unlawful confinement, etc. Because the principle of justice in transfer views actions surrounding the development, maintenance, and enforcement of legislation prohibiting any drugs as rights violations, the principle of rectification requires that those individuals involved in the development, maintenance, and enforcement of the Controlled Drugs and Substances Act – Members of Parliament, Senators, members of the RCMP and the various provincial and municipal police services, provincial and federal judges, crown prosecutors, and jailers, etc. – compensate to those whose rights they have violated and face possible punishment.  By compensation of victims is meant those individuals who have had their drugs or other property taken must have it returned or otherwise be made whole and that those individuals who have been stripped of their liberty must have it restored and somehow be recompensed for time lost. By possible punishment is meant criminal charges, a trial, and, should violators be found guilty, prison or otherwise, until the passage of the Food and Drug Act in 1914. In fact, the only restriction on drug sales was that labels, if provided, could not contain any false information. Further, advertisers were allowed to make specious claims because consumers were expected to use discretion (Szasz 1996). I cannot imagine that Canada – especially at that time – was much different.
There exist, I think, two significant objections to my take on what the principle of rectification implies for the illegal recreational and religious drug market. First, it might be objected that punishing those who currently enforce the law requires the passage of ex post facto laws. Such laws are a violation of the rule of law. My reply is three-fold. First, the base of the rule of law must be some kind of natural, or pre-government (but necessarily theological), law. Otherwise, the rule of law reduces to the rule of rulers. Second, where government law violates natural law, its members are susceptible to punishment by later legislation that reflects natural law. Otherwise, the rule of law is without teeth. Third, there is a long history of arguments in moral and political philosophy defending a natural law that is rather similar to the principles that compose my version of entitlement theory. A second objection to my application of the principle of rectification to the illegal recreational and religious drug market is that it requires compensating nasty, violent drug dealers – an absurd outcome. My reply is not so quick. Violent acts by drug dealers are also rights violations. Those drug dealers who have obtained their fortunes by force (to the extent they have) would have no claim to compensation under the principle of rectification. The likely beneficiaries would be so-called ‘mom and pop’ drug producers and most drug users.
My purpose in this paper has been to explain what it would mean to establish a free-market in drugs in Canada. Such an explanation requires applying the main principles of libertarian moral theory to the major drug markets in Canadian society, the legal and illegal recreational and religious drugs markets and the legal pharmaceutical drugs market. As such, I began by outlining and defending the main libertarian principles required for such an explanation. I then applied these principles to the major drug markets in Canadian society, albeit in a limited fashion.
Michael Cust is an MSc Philosophy and Public Policy student at the London School of Economics. He holds a B.A. in philosophy from the University of Alberta and an M.A. in political science from the University of Waterloo. He has previously held positions with The Fraser Institute, the Cato Institute, the Ludwig von Mises Institute, the B.C. Marijuana Party, and Stockwell Day's Canadian Alliance leadership campaign.
Cust, Michael (2008). “Hobbes’ Foundations for Peace and Property”. Master’s Thesis, University of Waterloo. Digital document available at http://hdl.handle.net/10012/4059
Hobbes, Thomas (1651, reprint 2002). Leviathan. New York, NY: Cambridge University Press.
Hamowy, Ronald (1984). Canadian Medicine: A Study in Restricted Entry. Toronto: The Fraser Institute.
Narveson, Jan (2002). “Property Rights: Original Acquisitions and Lockean Provisos,” Respecting Persons in Theory and Practice. Lanham, MD: Roman & Littlefield Publishers, Inc., pp. 111-129.
Nozick, Robert (1974). Anarchy, State, and Utopia. United States: Basic Books.
Szasz, Thomas (1996). Our Right to Drugs. Syracuse, NY: Syracuse University Press.
1 My reading of Hobbes is influenced by my former supervisor Jan Narveson.
2 It might be wondered why I am basing libertarianism on Hobbes’ principle of peace when it is supposed to be based on the principle of liberty. There is some debate on whether this move is acceptable. My former supervisor Jan Narveson tells me Hobbesian peace is in effect the same as liberty. My current professor Chandran Kukathas, by contrast, has instructed me with certainty that the two concepts are distinct. If Professor Narveson is right, my move is without difficulty. If Professor Kukathas is right, perhaps what I defend should be called something other than libertarianism (or perhaps my reading of Hobbes’ principle is wrong).
3 The reason that I substitute the principle of acquisition by first use for the principle of justice in acquisition is that the principle of justice in acquisition cannot be deduced from Hobbes’ principle of peace. Moreover, the principle of acquisition by first use does not suffer from the fundamental shortcomings that the principle of justice in acquisition does. On this last point, see Narveson (2002).
4 For my defence of Hobbes’ foundation for peace and property, see Cust (2008).
5 For Nozick’s presentation of his entitlement theory see Nozick (1974), pp. 150-182.
6 Narveson is, to my knowledge, the first to show that the principle of first use follows from Hobbes’ principle of peace.
See Narveson (2002) for his derivation and general defense of first use.
7 N.B. The range of states covered by the free-market idea does not allow for the aggressive, heavily armed, and increasingly militaristic policing currently dominant in North America combined with the profligate and meddlesome U.S. military. Both are more often threats to property than they are protectors of it. The median point of the free-market idea is likely a cross between free-trader Sir Robert Peel’s original Bobbies and the Swiss militia and air force.
8 The reason I group religious drugs (e.g. wine, peyote, ibogaine, magic mushrooms, etc.) with recreational drugs is that they tend, save possibly a handful of shamanic herbs, to be the same drugs and, as such, are generally treated
the same in law.
9 I would like to thank Brett Skinner of The Fraser Institute for his help in applying the principle of justice in transfer to the Canadian pharmaceutical drug market and the institutions governing it. Any errors in this paragraph are mine not his.
10 One of C2C’s editors objected to an earlier draft of this paper that the requirements of the principle of justice in transfer for the pharmaceutical drugs market would be “practically impossible for a variety of reasons, including
constitutional ones”. Szasz has shown that the United States had no regulations concerning any drugs, pharmaceutical
11 There is also an open question that I cannot resolve here as to how far responsibility extends. In particular, does it extend to voters? My suspicion is not given the infinitesimal role they play in the process, but this point requires greater
elaboration. If voters are not responsible, taxpayers cannot be expected to aid members of government in compensating the victims of the Controlled Drugs and Substances Act.