Because someone famous died in Manhattan from an apparent heroin overdose on Sunday, The New York Times has a front-page story today about "a city that is awash in cheap heroin." How cheap? The Times says a bag of heroin, which typically contains about 100 milligrams, "can sell for as little as $6 on the street." Yet it also reports that the Drug Enforcement Administration's New York office last year "seized 144 kilograms of heroin…valued at roughly $43 million." Do the math ($43 million divided by 144,000 grams), and that comes out to about $300 per gram, or $30 for a 100-milligram bag—six times the retail price mentioned higher in the same story. So how did the DEA come up with that $43 million estimate? Apparently by assuming that all of the heroin it seized would have ended up in New England, where a "$6 bag in the city could fetch as much as $30 or $40."
In addition to illustrating the creative calculations behind drug warriors' "street value" estimates, the story shows how prohibition magnifies drug hazards by creating a black market where quality and purity are unpredictable:
Recently, 22 people died in and around Pittsburgh after overdosing from a batch of heroin mixed with fentanyl, a powerful opiate usually found in patches given to cancer patients. Heroin containing fentanyl, which gives a more intense but potentially more dangerous high, has begun to appear in New York City, said Kati Cornell, a spokeswoman for Bridget G. Brennan, the special narcotics prosecutor for the city. An undercover officer bought fentanyl-laced heroin on Jan. 14 from a dealer in the Bronx, she said. The dealer did not warn of the mixture, which is not apparent to the user; subsequent testing revealed it. (The patches themselves had turned up in drug seizures in the city before, she said.)
Ultimately, users have no way to be sure what they're buying. "There's no F.D.A. approval; it's made however they decide to make it that day," Ms. Brennan said.
According to the Substance Abuse and Mental Health Services Administration, fentanyl is "roughly 50-80 times more potent than morphine," so it's the sort of ingredient you'd want to know about before snorting or injecting that white powder you just bought. This kind of thing—passing one drug off as another, delivering something much more (or less) potent than the customer expects—almost never happens in a legal market. When was the last time you bought a bottle of 80-proof whiskey that turned out to be 160 proof? The main reason liquor buyers do not have to worry about such a switcheroo is not that distillers are regulated, or even that their customers, unlike consumers in a black market, have legal recourse in case of fraud. The main reason is that legitimate businesses need to worry about their reputations if they want to keep customers coming back. It is hard to build and maintain a reputation in a black market, where brands do not mean much:
The same shipment of heroin may be packaged under several different labels, she said. "At the big mills, we'll seize 20 stamps. It's all the same."…
The Police Department on Monday said detectives were working to track down the origin of the substances Mr. Hoffman used, though a police official conceded it could be difficult to determine. "Just because it's a name brand doesn't mean that anyone has an exclusive on that name," the official said. "Ace of Spades; I would venture to say that someone else has used that name."
The takeaway: After a century of attempts to stamp out the heroin trade, the drug is cheap, plentiful, and much more dangerous than it would otherwise be.