typical for cocaine and crack retailers, and if all this profit
is income in kind spent on the retailer's consumption, then
estimates based on dollar transactions might be multiplied by
0.66 to 0.33. However, the dealers interviewed by Williams did
not take their profits primarily in the form of crack: "All the
Kids snort cocaine regularly. This is accepted, but the use of
crack is generally frowned upon: those who snort are thought to
have more control and discipline than those who smoke crack or
freebase. Most dealers see crack smokers as obsessive consumers
who cannot take care of business; crack users, they say, tend to
become agitated, quickly lose control and concentration, and take
one dose after another at the expense of everything else."'"
Skolnick,^^ who examined crack sales by gang members in
California during 1988, reports two tyjjes of dealers: one who
sells for profit and one who sells to buy drugs. Interestingly,
Skolnick also reports that 75 percent of street sales will be
returned to the middleman, a figure consistent with that reported
by Williams in New York.
' T. Mieczkawaki. 'Geeking Up ud Thrawing Down: Heroin Street Life in Detroit,' Criminology 24, iio.4. (1986): 645-^65.
' D. Altschuler ud P. Brounsieu. 'Patterns of Drug Use, Drug TiafGcking, and Other Delinquency amcng Inner-City
Adolescents in Washingtoo, D.C,' paper prexnted at the Annual Meeting of the Ameiican Society of Oiminology, Reno.
Nevada, 1989, 9 and Table 3.
' T Willianu, The Cocaine Kids: The InsidU Slory of a Teenage Drug Ring (Keading, Massachusetts: Addison- Wesley
Publishing. 1989), 36.
" Winiami, The Cocaine Kids. 47
" 1 Skolnick, The Social Smiciure of Street Drug Dealing (BCS PORUM. Office of the Anorney General, Sute of Califotnia.
undated).
A8
413
Waldorf and Lauderback interviewed 558 members of 86
different ethnic gangs in San Francisco."^ They reported that
only 16 percent of the crack sellers used crack during the month
before the interview, although about one-half of the cocaine
sellers and about three-fourths of the heroin sellers used those
drugs during the month before the interview. The gang members
explained that intoxicated sellers did not make reliable dealers
and that drug dependence Impaired the gang member's ability to
defend the gang. Waldorf and Lauderback reached similar
conclusions to Chin*^ (Chinese gang members who sold heroin did
not use it) and Vigil.'*
Mieczkowski, on the other hand, reports that crack sellers
in his Detroit sample "appear to conform closely to the 'classic'
or 'hustler' view of the drug user."" Nearly two-thirds of the
respondents said that they sold crack to get money for their own
crack consumption.
The important point is that many of the drugs consumed by
heavy users are sold by individuals who do not use drugs heavily.
The ability of heavy users to support their own use through
dealing is necessarily limited. Consequently, the amount of
drugs that heavy users receive as income in kind cannot account
for much of the cocaine and heroin consumed.
Data are not sufficient to support precise estimates. It
seems that a street dealer might be able to retain about one-
fourth of the drugs that he markets and that profit dealers
(those taking their profit in cash rather than in kind) are more
numerous among cocaine dealers than among heroin dealers. We
assume that two-thirds of the cocaine dealers and one-third of
the heroin dealers are profit dealers.
Assume that a cocaine retailer must return S3 for every S4
of crack or powdered cocaine that he sells. Also assume that
two-thirds of all retail dealers are profit dealers and one-third
are users. This means that every SI spent on crack and cocaine
would result in 31 x 0.33 x 0.33 - SO. 11 in income in kind,
suggesting that the estimates should be inflated by 0.11. This
inflation figure equals the 11 percent income in-kind figure
derived from Reuter and colleagrues ' study.
" D Wildorf ind D LudertMck. Tkmt Be Yob Omrm Be* Qiaoma — Drug Ux of Su Frudsco Ethnic Gu( Dni(
ScUcn.' Crime. Law and Soaat ChOHgt — Am Mt<>iMi>.— f Jotntal. 19 (1993): \-\i. The pubUihrd anide wu buexl CB •
populMioa o< 300. bowevct. u apdaied vchkb â– iinryid 368 (ing membcn.
" K. Chin. 'OiiocK Thid Sodeticx. Toogi, Orguized Oime ud Soeei Gangs id Asia tod tbe Uuted Suiei.' unpubijihed
PhX) diSKfUUoii. Uuveniry o< PcimsyKrtaa, niltdclpku. Pcaasylvinit. 1986.
" I Vipl, Barrv Gangs Sirttt Life and Mcmrr ■• Sat^tent Califorma (Atmin. Teut. Univoiiry d Tcus Prt«. 1988)
" T MieczkowUi. 'Qack Oumbuboa a Deooa.* Comamponrf Drug Problems {Spnjti 1990) 23-24.
A9
414
Second, assume that a heroin retailer must return $3 for
every S4 of heroin that he sells. Also assume that one-third of
the retail dealers are profit dealers. This means that every SI
spent on heroin would result in a maximum of SI x 0.33 x 0.66 =
SO. 22, suggesting that the estimate should be inflated by 0.22.
This inflation figure is lower than the in-kind figure derived
from Johnson and colleagues' study but is more consistent with
observations that not all those who sell heroin are heavy users.
We assume a somewhat higher estimate for in-kind income. We
assume that SO. 25 worth of heroin is retained as in-kind income
for every SI of heroin sold. For cocaine, we assume one-half
that amount, or SO. 125, for every SI sold.
Choosing the Median As the Typical Expenditure
If weekly expenditures on drugs were reported with perfect
accuracy, there would be little Justification for using any
number other than the mean. After all, regardless of how the
data are skewed, the mean is the average expenditure, and total
expenditures will equal the average expenditure multiplied by the
number of heavy users.
However, another interpretation seems more reasonable. Sup-
pose that the average expenditure is about the same for everybody
who uses drugs on a specified number of days a month, but that
the amount spent on drugs is reported with great inaccuracy.
From this view, the median is the best measure of the average ex-
penditure.^' Some other sources suggest that the median
expenditure is more accurate for our analysis.
Other reports of expenditures on drug use
Other studies, primarily of heavy users involved with the
criminal Justice system, estimate expenditures on heroin and
cocaine that are broadly consistent with the median reported here
(Table A2 ) .
Johnson and colleagues^^ interviewed 201 subjects who were
street-level heroin users in East and Central Harlem; all were
involved in some form of criminality and spent most of their time
on the streets. Subjects were interviewed for five consecutive
days and then were interviewed weekly for the following four
weeks. About 132 of these subjects were interviewed four more
" An asalogy bel|B nuke this poiitf. Suppcae thai a giocery «or dak were to ting 1,000 $1 candy ban individually on
his register. SuppoM thai be was inaocnMc boi imbiased as ke occasiaoally registered too maay or too few tena: 100 ban were
phOBd II SO.IO, 800 were peioed ai $1, and 100 were priced ai SIC. The loul ezpeadioire oo candy ban would be SIJIO, or
an avenge d S1.81 per candy bu. Here the deik's random enon do not balance ouL
" B Johnson ei al.. TaUttg Can of Bustneu The Ecatamicj of Crime by Htmm Abmtrs (Lenngloa, M isiarhtmtir
Lexingtao Books, 1985).
AlO
415
times at three- to six-«onth intervals. The average user spent
34,203 a year on heroin. These users often sold drugs, and when
they did, payment was usually in the form of drugs as income in
kind. When income in kind was taken into account, these users
spent about 35,986 a year on heroin. Daily users directly
purchased 37,601 worth of heroin a year, but when income in kind
is taken into account, they spent about 313,189. Regular users
(those who used at least weekly but less than daily) made cash
payments of 34,019 for heroin over the course of a year, but with
income in kind payments, their annual expenditures were 36,431.
These estimates are comparable with those based on the median
responses in the DUF data, which suggest that heavy users of
heroin spend about 312,000 a year on heroin.
Johnson and Wish" recruited 105 male New York "hard-drug
abusers' who had committed one or more relatively serious non-
drug crimes (such as robbery, burglary, grand larceny, or
assault) in the past 24 hours. Those who had committed recent
robberies spent an average of 352 a day on illicit drugs. Those
who had committed other crl«es spent an average of 332 a day.
Thus, for those who had Just committed crimes, the expenditure on
drugs was 3224 to 3364 a week.
For those who bought both heroin and cocaine, daily
expenditures totaled 3259 to 3357 a week. Those who bought only
cocaine spent 3175 to 3231 a week on cocaine. Those who bought
only heroin spent 3154 to S252 a week on heroin. It is notable
that 86 percent of these subjects reported using some illicit
substance on 28 of the past 30 days, so the majority could be
considered heavy drug users. These figures seem to be high
estimates of consumption, however. Because all these users had
recently coounitted serious crlotes, they had money available for
drugs from illegal sources. Nevertheless, the average
exp>enditure3 were about the same as those based on the median
values from the DUF data.
Reuter and colleagues report results based on interviews
with 186 males on probation in Washington, D.C. who had sold
drugs during the mid-19808. About one-half reported purchasing
drugs for their own use. Ttvls half had a median expenditure of
3400 a month; the mean was $1,596. However, about 40 percent of
the respondents consumed soae of the drugs that they acquired for
dealing, representing income in kind spent on drugs; about 10
percent reported that they consumed one-half the drugs that they
acquired by dealing. The median and mean are much smaller than
their counterparts in DUF, but the Reuter subjects are not
necessarily heavy users.'*
" B Johnjon and E. Wish. Tbt RoMxrr-Hatl Dni ConDcaioa: Eto Robben and R£>bbchei Influence O iinin il Returns
ud Cocainc-Herota Pvuchiaet,' paper preaeaud â– Ike Oimiaok>gy Sccood o( ihc Amencao Sociological AuoaatiOD. Augul
17. 19«7.
" P Reuia a al.. Money from Crame: A S^y of *e Uatomtcs of Dntg Dtalatf vi Wastungton, D C (Saaia Momca.
Califonua Rani Corpotauoa. 1990) Raad rvbbcauam fL-39H-UI, p.61.
All
416
Miec2kowski^° asked 190 "chronic users of crack cocaine" in
Detroit about their crack consumption by appending questions to
the DUF interview. About one- fourth of these users consumed four
or fewer rocks'^ a week ( S40 or less a week ) ; most of the others
clustered at 10 to 20 rocks a week ($100 to S200 a week) and 40
to 50 rocks a week (S400 to S500 a week). Only 5 percent used
over 100 rocks a week. Mieczkowski speculated that the upper
range included dealers who could not distinguish between their
own consumption and what they sold, as well as individuals who
were sharing with friends.
This additional evidence is consistent with the conclusion
that the median values based on DUF data typify spending patterns
for those arrestees who admitted using cocaine or heroin on at
least 11 days during the past month. However, some of the
studies described below report larger expenditure patterns.
Mieczkowski^^ reports on interviews with "100 self -reported
dealers and user/dealers of crack cocaine" who were In
residential treatment facilities in Detroit. All can be
considered to be heavy users. The amounts reported on weekly
drug usage were highly skewed. The estimates were: S937 mean;
S877 trimmed mean; S600 median; S544 M-estlmator. These
estimates are considerably higher than those we report, although
they are not inconsistent with estimates for the very heaviest
users . One explanation of this variation may be that these users
had especially high use patterns, as evidenced by their seeking
treatment.
Other studies of treatment populations Indicate that
expenditures can be much higher for the typical heavy user than
is assumed here. Schnoll and colleagues^^ report on
expenditures by 172 men and women who received treatment for
cocaine abuse in Chicago primarily during 1982 and 1983. Average
expenditures were reported as SBOO a week.
" T. Mieczkowski. 'Click Disaibution in Detroit,' Comanporary Drug Problons (Spring 1990): 18-20.
" Oack is made by heiting powdered cocaine until i( crystallizes 'Rocks* are (hen broken off (be chunk of aack pnxluoed.
Oack is often bought by the rock. Although this purchase unit varies in weight and size, rtxks tend lo be fairly snail and
inexpensive.
" T. Mieczkowski. The Econooiic Dintensions of Oack Use and DiSnbution: Some Preliminary Data,* paper pteseiited lo
the American Society of CrimiDOlogy Annual Meetings, Reno, Nevada, November 1989.
° S. SchnoU et al., 'Charactehsiics of Cocaine Abusers Presenting for Treatmem,' in Cocaine list in Aimtrica:
Eptdemiologtcal and Oianical Penpeatves. ed. N. Kozel and E Adams (Kockville, Maryland: National Institute on Drug Abuse,
1985). NIDA Research Monograph 61, 171-181.
A12
417
Gawln and Kleber'* describe heroin use In a sample of 30
consecutive admissions to a cocaine treatment program In New
Haven. Thirteen Intravenous drug users used an average of 5.6
grams a week, six smokers used an average of 9.1 grams, and 11
who snorted used an average of 5.3 grams a week. If these users
paid SlOO a gram, they must have spent S500 to S900 a week for
cocaine prior to entering treatment.
Although the latter studies, all of which are based on a
population In treatment. Indicate that heavy users spend more on
cocaine than Is assumed In this study, users in treatment
probably have use patterns that are atypical of heavy users in
general. As Waldorf and colleagues" report, most heavy cocaine
users are able to control their consumption, avoiding the ruinous
expenditure patterns that often drive other users — those who
have the least control — into treatment.
Evidence from the NHSDA
Additional evidence comes from the 1991 NHSDA. Sixty- three
individuals admitted using cocaine on 11 or more days during the
month before the interview and reported how much they had spent
on cocaine. Average expenditures were S140 a week. Although
estimates based on the NHSDA are much lower than those based on
DUF, analysis of both data sets shows that heavy users in the
NHSDA data are different from heavy users in the DUF data.'*
Estimates based on aaiount consumed
Another way to validate the median as a measure of expendi-
tures is to infer how much hard-core cocaine and heroin users
could spend given their consumption patterns.
It is difficult to shoot heroin more frequently than four
times a day, and many DUF respondents used heroin less often than
dally.'' According to Division of Substance Abuse Services
(DSAS) street units in New York City, a heavy user might use one
to two bags of heroin a session, and each bag would cost $10.
" F Cnvu tad H lOeba 'Cooiac Die la i Tiutmieai Popnlauan: Pmerai ud DiufDoadc Diiujiciiott.* ia Cocaine Uit
in AMtnca Efudemtoioftcal aitd Ckamcal /Vnprcavcj. ed. N. Kozel lod E. Ailuu. 182-192.
" D. Waldorf a *L. Cocam* Otamgci The Liptrmcts ofUting and Qumtng (FUlulelphu: Temple Univcniry Prca. 1991).
" D. Huai ud W Rkodc*. Ahi Asaoojies Idc.. 'C^wacunflLiCi d Huvy Cocaiac Uicn, Inriitding Polydnig Uie, Qiminil
Aoiviiy, aad Hulih Rijlu,' papa prepared (or ONTXTT. Deoeaber 14. 1992.
" Kjiha reports u avaige ai three txa t day (or 453 dieaa bclore ibeu paiuapauao is a aactbadoDC mainicnaace ptopam.
Oaly 16 percca Ol hu dicaa reponed biotc (haa (out (ixa daily. AafUa reports (ha< dunag iJk 12 nxnths before cauxiag
cnauaal juhjcc wpcrviBoa. 279 kerou addKia (wbo had beea ideaiificd thtougb a mnktAunt miininianoe prx>tTaiD m the early
19701) had uigecied heroui aa average o< Z7 nmca a day R. Kaha. The FrequcBCy ol Nareouc Uk Before aad Aha AdBisuoe
lo a Methadone Maiaienajicc Ptogram.' hotrnaaonal Jomal of*e Addtcooni 14 (8) 1157 M Aaglui a al 'EAects ci Legal
Superviiion on Narcouci Uie aad Oiouaai Behavior over (he AddicuOB Career.' Crimutoiogy, sutxmned.
A13
418
These approximations suggest that a heavy user could not spend
much more than S420 a week.
Although $420 is close to the mean expenditure estimated
based on the DUF data, even those heroin users who are heavy
consumers cannot shoot heroin every day, four times a day.
Clearly, S420 a week should be considered more as an upper limit
than an average for weekly expenditure on heroin.
Cocaine is different. Vfhile heroin seems to be self-
limiting (the user's craving can be satisfied much as a diner is
satiated after a full meal), cocaine is notable because it
immediately engenders a desire for more cocaine. As discussed
earlier, there are reports of very heavy consumption patterns
Just prior to seeking treatment.
Nevertheless, cocaine consumption has two limitations. The
first is physiological. Binge use exhausts the body, so rest is
necessary before binge use can recur. The second is that heavy
cocaine use can quickly exhaust financial resources. One way to
check estimates of drug spending patterns for cocaine is to
assess the user's income from legal and illegal sources^
Estimates based on financial resources
One way to assess the practical upper limit for cocaine use
( excluding the minority of users who drain personal resources
prior to entering treatment ) is to estimate the amount of money
that heavy users have available to spend on cocaine.
According to DUF, most heavy users who are arrested and
questioned have limited legal incomes. Much of their earnings
comes from crime. How much do such individuals earn from
combined sources?
As would be expected, it Is no easier to estimate the amount
of money earned from crime than It is to estimate the amount of
money spent on drugs. There are, however, a few studies of
earnings from property crime. Johnson and colleagues, in a study
described above, report that dally heroin users earn an average
of $8,825 a year from non-drug criminal activity, and regular
users earn $6,283 a year. Total criminal income, including drug
income In kind, is $18,820 for dally users and $11,203 for
regular users. After living expenses are subtracted from these
incomes, the amount available for heroin expenditures could not
be much greater than is assumed In this report.^*
" B Johnson a il., Takmg Care of Busintss: Pie Economics of Crime by Heroin Abusers, (Lexugtoo. Mauicbuseai:
Lexington BookA, 198;).
A14
419
Anglln and colleagues" describe the income of 279 male
heroin addicts who were selected from those who had first entered
a methadone program between 1971 and 1973. The period of time
described is the 12 months prior to their first period of legal
supervision. Chicano respondents averaged S6,708 in illegal
income a year (not counting S924 a year from drug dealing), and
whites averaged SB, 580 a year (not counting 31,320 a year from
drug dealing). Legal incomes were SI, 984 to S2,672 a year.
Even when inflation is taken into account, these incomes could
not support drug use habits far in excess of what is assumed in
this paper.
Reuter and colleagues report results based on interviews
with 186 males on probation in Washington, D.C. who had sold
drugs during the mid-1980s. They report an average income of
S2,863 a month, all but S849 from illegal activity, mostly drug
sales. However, most of this income was spent on ex[>enses other
than drugs — drug expenditures averaged S883 a month. '°
ConclusionB
The evidence is not compelling, but it seems best to assume
that the median expenditures on cocaine and heroin — as measured
from DUF data — provides the best basis for computing dollar
expenditures on cocaine and heroin. The uncertainty surrounding
this assumption is best handled through sensitivity analysis,
which we execute in the main report.
The evidence in support of the percentage of drugs earned as
income in kind is also meager. We assume that for every dollar
spent on cocaine another SO. 125 of cocaine is consumed as income
in kind. We assume that for every dollar spent on heroin another
SO. 25 of heroin is consumed as income in kind.
" M.D Aa^lui a tL, *Efleca ol Lc(aJ SupcrvuioB od Nareoocs Vte uuj OimiaiJ Beluviai Ova the AuUiaiao Otna.'
lot Angclct. CaUoraiA. UCI> [)nig AbuK RciUfd) Group. Dcocmbci 1988. TMc 3.
' P Rcuta a il . Monrv from Oime A Study of the Ecaiamicj of Dnig Dtalinf in Waihingion. D C (S*nu Mania,
CAlifornu fluid Cofpoauoo. 1990). Ilud PuUjcauoo R-3894-RF. p. 61.
A15
WITNESSES
Page
Brown, Dr. L.P 247
McPhail, Weldon 1
Reuter, Peter 211
Wray. H.R 1
(i)
INDEX
General Accounting OflRce 1
Addressing Production of Drugs 52
Authority of the Drug Czar to Coordinate Activities 38
Changes in Drug Control Efforts 36
Changing Attitude of Public 51
Conclusion 54
Coordination of Efforts 37
Coordination of the Drug Control Budget 56
Coordination of the Strategy 57
Cost-Effectiveness Measures 55
Effectiveness of ONDCP 38
GAO Report concerning Measuring Drug Use 51
High Intensity Drug Trafficking Areas 36
Household Survey of Users 41
Impact of Lack of Resource 47
Impact of ONDCPs Staffing Level on Effectiveness 40
International Activities 50
Introduction 1
Leadership of ONDCP 43
Measuring Effectiveness 47
Measuring Effectiveness of ONDCP 44
Need to Develop Performance Measures 37
Outlook for Future Drug Control Efforts 42
Performance Measures 55
Size of the Coca-Cocaine Industry 53
Summary Statement of Mr. Wray 2
U.S. General Accounting Office and Office of Technology Assessment
Reports Dealing with International Narcotics Matter 53
U.S. Strategy and Evaluating Its Success 50
Peter Reuter, Rand Corporation 211
Change in Attitude About Drugs 243
Effectiveness of ONDCP 229
Effectiveness of ONDCP Strategy 241
Enforcement Versus Treatment 236
Future of ONDCP 242
Household Survey 228
Introduction 211
Local Funding Versus Federal Funding 233
Measurement of Success 228
Measuring Success 232
Measuring Success in HIDTA's 240
Problems Associated With Measuring Success 234
Problems With Measuring Success 239
Reducing Number of Users through Treatment 242
(iii)
iv
Page
Peter Reuter, Rand Corporation — Continued
Summary Statement of Mr. Reuter 212
Use of Drugs in Prison 243
Office of National Drug Control Policy 247
Budget Review of Drug Control Effort 280
Community Policing 307
Conclusion 310
Coordinating Council for Drug Effort 280
DEA Interview-Leadership on Drug Policy 297
Developing Measurements 293
Drug Policy Budget 294
Effectiveness of Coordination Efforts 279
Effectiveness of ONDCP 273
Effect of No Illegal Drugs on Violence 304
Expenditures for Publicity and Research 300
Funding Drug Control Efforts 296
High Intensity Drug Trafficking Areas 309
Impact of Smaller Staff in 1994 281
Interim Strategy 293
International Efforts 295
Introduction 247
Manufactured Versus Naturally Grown Drugs 304
Measxiring Drug Usage 303
Measuring Effectiveness 282
Measuring Success of Strategy 292
Oversight of All Illegal Substances by ONDCP 301
Role of Director of ONDCP 296
Seciuity of Director of ONDCP 284
Social Costs Associated with Illegal Activities 302
Statement Submitted by Mayor Robert Patrick 286
Strategy: Ban on Assault Weapons 281
Strategy Focus on Hard-Core Users 305
Success of Eliminating Illegal Drugs 285
Summary Statement of Dr. Brown 249
o
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