The Benefits of Failure

By Dave Anderson 

Incentives matter. Figuring out veto players and their pay-offs if a policy succeeds or fails is an extremely useful tool in analyzing the probability of success of a policy and program. If a policy's success is highly likely to inflict very high costs on a powerful set of veto or near-veto players, the policy is unlikely to be implemented. Failure of a policy can also produce high pay-offs for a variety of actors so it is always worthwhile to see who benefits from failure.  

Who benefits from failure? Whose position is enhanced, opponents overwhelmed, or pockets lined if a policy fails?

 I'm not a big fan of Stratfor's intelligence service. They are too focused on state-state interactions and disregard non-state actors as merely pawns of various states without agency. This disregard of non-state actors often leads Stratfor down some odd, quasi-conspiratorial paths, but they ask the question of who benefits from failure of the drug war on the Mexican side and come up with an interesting thesis. Nat Wilson Turner at the Agonist summarizes the argument:

 The amazing profit margins on the drug trade mean the drug trade dwarfs every other industry as a generator of cash in Mexico and that money "has to enter the economy through legitimate institutions � banks and other financial entities � and then be redeployed into the economy." 

"From Mexico�s point of view, interrupting the flow of drugs to the United States is not clearly in the national interest or in that of the economic elite."

"Mexico�s policy is consistent: It makes every effort to appear to be stopping the drug trade so that it will not be accused of supporting it. The government does not object to disrupting one or more of the smuggling groups, so long as the aggregate inflow of cash does not materially decline."

Stratfor implicitly suggests that Mexico is on the way to becoming a narco-rentier state instead of an hydro-carbon rentier state. 

The other question, is who does failure in the War on Drugs and the inability to think about embarking on a defensive legalization effort benefit in the United States? 

The current policy path and any expansion of violence in either quality south of the border, or quantity north of the border is a long term threat to a Democratic political order. Violence, or the threat and fear of violence, combined with the exploitable fear of the 'other' in a society whose dominant social-ethnic group is under threat could have the potential of reviving the "Law and Order" coalition and argument that dominated the Nixonian backlash against liberalism. 

Defusing this charge by embarking upon effective legalization and production of at least marijuana would reduce the black-market incentives for violence in the United States border region but legalization or even decriminalization still runs into the law and order penumbra that motivates base conservative voters more than it motivates base moderate or liberal voters.  

Continuation of current trends works wonders for several significant conservative interest groups. The sense of crisis and threat allows for an ever expanding budget and powers to be concentrated in state and federal security agencies who then outsource a significant amount of work and cash to private contractors. More crime leads to more prisons which leads to more prison guards who then have a vested interest in maintaining their jobs and their pensions by maintaining this problem.   

The split that we saw in the Republican coalition when Bush brought up immigration reform between the nativists and the cheap labor business community was brought about because Bush's proposals would have codified reality that the nativists belong in the Republican Party Chump Seat and the cheap labor stream that elements of the Chamber of Commerce depends upon but which competes with the nativist base would be legalized and enhanced.  

Inertia does not illuminate this split and the designation of policy losers. The nativist wing of the Republican Party will continue to be paid off in terms of security spoils with a topping of knowing who they are better than, while the cheap labor contigent of the Republican Party will still have a significant stream of undocumented, unorganized and atomized workers to either hire directly at low wages or to wave as a threat to the US citizen component of the low end labor force in order to force down wages. 

Inertia is a great policy solution as it is not failure if a ten thousand people die in Northern Mexico every year, and American urban neighborhoods function as black markets and bazaars of violence; none of them were going to vote Republican anyway.