Southeast Missouri State University

It is extremely difficult, if not impossible, to compute the total dollar loss associated with methamphetamine.  Although the financial losses are significant, we must not overlook many of the other related costs.  Some of the personal costs include injury or death, family disruption, and life chances and reputation to name a few.  In addition, we often overlook public costs related to such issues as pollution and clean up, legal fees, imprisonment and treatment.  We begin this section with a brief discussion of the economics of meth manufacturing and distribution.  We will then move to an examination of human, financial and environmental costs.

The Economics of Meth

Cost to the User and User's Family

Cost to the Public (Taxpayers)

The Economics of Meth

Like any other manufactured product, the economy of scale affects both manufacturing and distribution costs.  The materials presented in this discussion are relevant to smaller clandestine labs in the Midwest. Larger labs and labs in other portions of the country may generate different costs in manufacturing and distribution.

Assuming the precursor materials are purchased, except the anhydrous ammonia, the total investment needed for a 1 oz. cook of meth is approximately $200.  The finished product is then diluted, cut or “stepped on” and becomes two to three ounces to be sold for somewhere between $1,200 and $1,600 an ounce.  As you can see, the profit margin in meth production is tremendous, however, many cooks are users themselves and sell off a portion of the cook to live on and to purchase precursor ingredients for the next cook. The user/cook is influenced by his or her drug to cook on a regular basis and seldom realizes the profits associated with cocaine or heroin production. Remember some cooks steal precursor ingredients or trade off finished product for the precursor agents and to obtain an even greater profit margin.

On the street, meth is commonly sold in ¼ gram, ½ gram, 1 gram and 3.5 gram increments.  To better understand how much meth we are talking about, go to your cupboard and examine an individual packet of sugar substitute.  The little packages of sugar substitute weigh approximately one gram.  If the packet were filled with meth it would sell for approximately $100 on the street. Meth distributors frequently sell “eight balls” of meth that is 1/8 of an ounce or 3.5 grams and sells for approximately $250. The ¼ gram portions sell for $25-30 and the ½ gram bags run $50-60.  The smaller portions are seldom weighed and the purchaser is most likely buying a smaller amount of meth than what he or she actually paid for.

The daily costs for meth users vary according to personal tolerances and frequency of use.  Heavily addicted users indicate they spend as much as $400 a day to meet their habit.  Obviously, they will have periods where they “crash” and will not use but if we modestly assume they are using ½ of the month they need $5,000 to $6,000 to purchase their meth.

The obvious question becomes where do they get their money?  Very few can afford that kind of habit and even fewer can afford it without changing their lifestyle.  Meth addiction generates property crime and thus costs the public in terms of losses and increased enforcement.  Families also bear some of the costs associated with use and addiction.  Users will deny themselves and their family basic necessities to liberate income for their addiction.

Although the profit margins associated with meth are huge, the users and cooks operate under the false assumption that they won’t be caught and/or they are only hurting themselves.

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Cost to the User and User's Family

In our discussion of health risks, we noted the potential for fires, explosions and toxic fumes during the manufacture of meth.  Many meth cookers have inhaled toxic fumes, incurred serious burns and some have been seriously injured or killed as a result of meth-related explosions.  The injuries and deaths take their toll in human and financial costs to those involved and their families.  Direct medical costs, lost wages and funeral costs are frequently passed on to the cooker’s family.  Some meth dealers are involved in violent confrontations during meth transactions or during capture.  Physical injuries with related financial and human costs are quite likely, given the behaviors associated with meth use.

Our ability to calculate costs associated with meth is further complicated by the number of accidents meth users experience and the costs related to those accidents. The effects of meth on motor skills places users at high risks during activities such as driving, operating machinery or in the performance of other activities that require acute motor perception. In addition, we previously noted that meth users and cookers are also prone to heart attacks, strokes, kidney damage, premature death, and overdose. Like the accidents, several financial and human costs are associated with meth-related illnesses.

The last category of health related medical costs is the involuntary or accidental consumption.  There are documented cases where children have been severely poisoned by unknowingly consuming meth or drinking liquids they assumed to be soda but were acids stored in plastic 2 liter bottles used in the manufacturing process.  Treatment for these types of accidents can be expensive and can necessitate long hospital stays.

Meth users, dealers, and manufacturers who are apprehended, convicted and imprisoned generate human costs for themselves and for other family members.  The imposition of a prison sentence not only takes year’s out of the criminal’s life, it leaves him or her with a permanent criminal record and strongly impacts the ability to legally carry or own a firearm, join the military or to pursue desired professional careers. Under some conditions, personal assets, such as vehicles, houses and other personal valuables, obtained through meth profits may be confiscated and sold at public auction.

A convicted meth offender will also undergo the embarrassment of having his or her name in the newspaper, on the air waves or having crime scene tape or crime stickers placed on their house. Some contend the meth criminal is unconcerned about such embarrassments. Unfortunately, those same embarrassments are shared with family members despite the meth criminal’s lack of feeling or remorse.

Another identifiable human costs associated with conviction and imprisonment is the cost of family disruption.  In some regions, manufacturing in the presence of children is deemed child endangerment and the children are removed from the household immediately and a hearing on the suitability of the parents will be initiated.  In other instances, one or both parents are convicted and incarcerated and the children are placed with other family members, in foster care or are put up for adoption.

The costs, both human and financial, affiliated with meth are far reaching.  One must question if the euphoria from use or the financial gains from manufacturing are sufficient to negate all of the other costs mentioned in this discussion.

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Cost to the Public (Taxpayers)

Meth, cooks, users and dealers pass on other meth-related to costs to law-abiding taxpayers.

For over forty years, states have been required to provide legal counsel to indigents charged with a felony.  Many defendants charged with meth offenses do not have adequate financial resources to hire a private attorney.  As a result, hundreds if not thousands of meth-related defendants utilize the services of a public defender or a court-appointed attorney.  In either instance, budgets for such representation result from tax revenue and the law-abiding public bears those costs.  The costs incurred by taxpayer’s increases with imprisonment.  States vary in their reported annual costs of imprisonment but estimates of $30,000 to $40,000 per year are reasonable.   Again, most states budget a significant portion of tax revenues to their Department of Corrections and those not directly involved in the meth industry bear the costs of meth use.

In some cases, meth users will be mandated to undergo treatment as a condition of probation, incarceration or diversion. The highly addictive nature of the drug requires long-term treatment by professional counselors.  As previously mentioned, most meth criminals are legally indigent and the costs for mandated treatment is third-partied to the general public.

Some scholars contend the meth industry increases prices of precursor ingredients for the law-abiding public.  As previously noted, many of the precursor ingredients are conventional household materials with legitimate uses.  The increased demand resulting from the production of methamphetamine gives the legitimate manufacturers justification to increase retail prices. Others contend the theft of anhydrous ammonia and ephedrine-based cold medicines also drives prices upward.  Retailers frequently increase consumer prices to offset losses incurred from shoplifting and internal or external theft.

The clean up costs of clandestine meth labs and illegally disposed waste products are also tremendous.  Most states have established budget items or funds specifically earmarked for meth clean up.  Many law enforcement officials report these funds are insufficient to cover the annual costs associated with meth clean up.  The toxic nature of the labs necessitates federally mandated safety precautions in the clean up and disposal of clandestine labs.  Like the legal fees, prison costs and treatment fees, most of the cleanup costs are paid through general tax revenues.

The meth industry also takes a high cost on the environment.  Meth fires, explosions and the dumping of waste products are threats to environmental conditions.  The illegal dumping of chemicals pollutes ground water and later attacks the food chain through hunting and fishing.  If you remember from out earlier discussion, there are approximately six pounds of waster for every pound of manufactured methamphetamine. The larger clandestine labs produce hundreds of pounds of toxic waste and can affect rivers and lakes if dumped improperly.

In 2005, the United States Department of Health and Human Services announced 11 new, three-year grants (over 16 million dollars) to provide treatment for meth abusers in rural communities.  Since 2002 many states, like Arkansas, Oklahoma, and Iowa,  have seen a nearly 20 percent increase in the number of meth abusers seeking treatment.  The purpose of the grants awarded by HHS' Substance Abuse and Mental Health Services Administration is to provide needed treatment for this growing population. All these grant moneys are appropriated through the federal government via the taxpayer.

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