Cocaine: A Changing Landscape - Part Two

Latin America Correspondent Jon Bonfiglio digs into the history of cocaine.

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Transcript

Hello cocaine, how we’ve missed you. Ahhh, but you never really went away. Really, you were always, always there, and it’s this which makes the drug specific to the region of the world where it - exclusively - comes from, because of course cocaine is always first the coca leaf, and the coca leaf has a long, historic, social and cultural history across Peru, Bolivia and Colombia. 

For many people across these countries, it is the insatiable thirst for drugs innate to modern, affluent societies which has taken a traditional crop and driven it to criminalisation. For these same people, millions and millions of them, the original users of the coca, the leaf is a heritage plant, and the plant and its cultural importance have ended as collateral damage to the so-called war on drugs. 

With all drugs, facts, and context, are important, but with cocaine, it’s perhaps more relevant than most, so let’s go back in time a little.

The coca plant is scientifically known as Erythroxcylon coca, and is native to South America. Historically, Andean peoples chewed the leaves for medicinal, nutritional and ceremonial purposes, often to combat hunger and cold, and also as a painkiller. When the Spanish arrived, the practice was considered irreligious, and banned, but then they found that productivity among their indigenous slaves reduced, so they allowed its reintroduction, albeit under taxation. 

God is the theoretical apex, of course, but above God there is a higher summit to another belief system, namely, money-making. 

Over time, the coca leaf would be used to treat a variety of ailments, and considered to be something of a cure-all. As modern medicines evolved, cocaine - the active substance - would be split from the plant and start to be used in distinct remedies. It was also used in late nineteenth-century versions of Coca Cola, the clue being in the name. For a period of time, Sigmond Freud recommended its use to treat depression, until its addictive and toxic effects became understood. By the early twentieth century, products were mandated to list cocaine as an ingredient, and it became increasingly regulated. By 1914, in the USA, its use was effectively illegal, and it sort of faded away from public consciousness, until half a century on, when it emerged again as the hip drug of the seventies and eighties, and the emerging cartels of the time started to understand the market potentials of the plant which had been growing untamed and unfettered in their back yards since time immemorial. There is a decent argument to be made, in fact, which says that cartels as we conceive them today grew to maturity alongside the emergence of cocaine into global markets. It’s a chicken and egg argument, but both basically emerged hand in hand into commercial and cultural consciousness, in the last quarter of the twentieth century. 

Soon after that, in the eighties and nineties, cocaine prices would see their first crash, as - based on the success of the product - production became industrialized and economies of scale and organization were accelerated. The papi of all cocaine cartels was probably Pablo Escobar’s Medellin Cartel. That’s where it all began. With the hippos, at Hacienda Napoles, in Medellin. There’s always been an element of Star Wars lore to the drugs trade, of which cocaine has arguably always been first among equals - you can never kill them; you only make them stronger. Escobar’s group was hugely powerful, but not a dime on what exists today. 

Thereafter the price stayed fairly steady for two or three decades. What changed was the purity of the product. Much as with the chocolate bar at the corner store, it’s often commercially more productive to keep the price the same and just change the product by 5%, make it a little smaller, or add in a little filler. It’s a truism of capitalism that what people notice first is the price, and the product second. 

The other way in which the prices could be controlled was by that word favoured by economists: Monopsony. The economy of the single buyer. Just as Walmart does with its producers, buy cheap, at scale, control the cost by being the only buyer, so the same is true with cartels, dictating low prices to farmers - because, who else can you sell to anyway.

Interestingly, a recent strategy of the Gustavo Petro administration has been to fight exactly that - to cease eradication strategies, and offer competitive prices for the coca plant which would go into parallel - none-drug-based - economies. Not destroying the economy, which is a traditional crop, especially to indigenous communities, but offering alternatives to cut away at the cartel market, as well as helping elevate growers out of poverty. Coca chocolate, coca coffee, coca tea, coca bread, coca wine, coca paper, coca wine, coca marmalade, coca wine…. - wait, did I mention that already? Yes, three times, I think. Clearly that sounds like an interesting option to me. 

But back to Petro, and what has come to be known as the Oxygen and Asphyxiation Strategy. The Oxygen refers to farmers, for whom, as well as incentivizing and diversifying legal uses for the coca leaf, also offer voluntary crop substitution programmes with plants like coffee and cocoa, and support growers with payments for environmental protection in lieu of growing coca.

The asphyxiation, well that refers to targeting the dealers, in particular moving the fight to the high-value elements of the drug trade and away from poor farmers, in particular targeting finances of major known crime figures and infrastructure. The problem with this, of course, is that by this stage of the game these people and organizations are so wealthy and evolved that they are no longer just crime groups, they are fully - as we previously said about the cocaine industry as a whole - stress proofed. What we think we know is just the tip of what we can’t see. 

Which is exactly what we’re going to talk about next time, on the changing landscape of cocaine, what we can’t see: in other words, everything that lies beneath.