President Trump’s wall will increase the power of the most dangerous drug cartels, it will contribute to the introduction of more dangerous variants of drugs it makes in short supply, and it is unlikely to pay for itself because the unforeseen side effects of its construction will almost certainly increase, rather than mitigate, the costs of the opioid crisis. Good economics teaches us to look “not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.” Here, the immediate consequences of stemming the flow of illegal immigration and the flow of illegal drugs run up against the longer effects of increasing profit opportunities in the black market for these illegal drugs, and the chasing of these profits by the most dangerous and violent suppliers.
This is all an example of a concept that has been known to economists and other social scientists for decades: the bootleggers and Baptists problem, as coined by the economist Bruce Yandel. The term describes phenomena where Baptists and other conservative evangelical Christians fought for the same restrictive or outright prohibitory alcohol laws as were favored by major bootleggers. More generally, it is used as shorthand to describe the study of interest group politics and the prediction that successful coalitions will form between groups with otherwise contradictory interests, in pursuit of rules favored by all in that group. Typically, while these coalitions agree on the rule being proposed, they disagree completely as to the desired effects. As it relates to bootleggers and Baptists specifically, the two groups had very little in common, and never explicitly or overtly worked together in pursuit of their mutual goal; however, unforeseen (to some) economic consequences still managed to combine with a puritanical morality to produce alcohol prohibition in the early 20th century.
History rarely repeats itself, but it quite often rhymes. Rather than bootleggers and Baptists, President Trump’s border wall has created a de facto coalition of soccer moms and Sinaloa. In a piece in the New York Times last year, an interview with a Sinaloa smuggler documents the drug cartel’s glee at the idea of a border wall that drives up the cost of smuggling people and drugs across the southern border. The smuggler, who goes by the alias Flaco, described how when he was 15, in 1984, he showed a couple how to pass through a hole in the border fence for a tip of $.50. Today, the cost can be as much as $5,000 a head. Why? Paradoxically, the increased profits are caused by the fact that the journey is increasingly difficult. As the cost of crossing the border increased commensurate with its difficulty, the only organizations with the resources and infrastructure to support a smuggling trade were the largest and most violent cartels, like Sinaloa. As these cartels gained in market share, a de facto oligopoly formed in the black-market trade and smuggling operations south of the border. The result? In Flaco’s words: “As the prices went up, the mafia, which is the Sinaloa cartel, took over everything here, drugs and people smuggling.”
Once again, none of this speaks against the efficacy of building a border wall for the purpose of keeping out illegal immigration. A wall will certainly do just that, and it will probably be extremely effective at doing so. The purpose of the above analysis is to show that a border wall will have secondary consequences beyond what is intended by its proponents. Conservatives, many of the most vocal of whom are staunch supporters of building the wall, should also be well aware of the law of unintended consequences; or, in the language of the free market economics with which they should ostensibly be familiar, conservatives should understand that good economic analysis looks to the unseen, long-term consequences of a particular policy, rather than accepting its stated, short-term goals as gospel. And the otherwise unforeseen consequences of the border wall will be these: black market prices for illicit drugs will increase, more dangerous suppliers will corner the market, and more dangerous substitutes will proliferate.
If this is a trade-off the president is willing to make, then he should build his wall. But if he only builds his wall and fails to deal with the secondary effects that are sure to directly result from its construction, then he will own the consequences.
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