New Afghan war strategy....Defeat Taliban through trade.....Drug trade.

Strange are the ways of super powers. Sometimes their line of thinking seems so bizarre and so strange that you would not be prepared to believe. Same thing is happening in the American and allies’ brains. After realizing their helplessness at the hands of Taliban insurgency, the brilliant military minds have come up with a strange idea; in order to help puppet Afghan government and break the Taliban momentum, don’t fight drug trade. This was reported by the Financial Times, in its recent publication.

The paper has reported that change in command in Afghanistan may not lead to any change in strategy in spite of the fact that after nearly a decade of war, the goal of breaking the Taliban’s momentum seems no closer. Yet on one point there remains near-consensus among policymakers. Since Afghanistan’s drug trade contributes to the strength of the Taliban and the weakness of the government, fighting the drug traffic is agreed to be integral to fighting the insurgency. Alas, this intuitively appealing idea is almost precisely the opposite of the truth. Yes, the drug trade helps the Taliban and harms the Afghan government. But efforts to fight drugs strengthen the insurgency rather than weaken it. Counter narcotics policies reward those who remain successful drug-dealers, concentrating those rewards in the hands of the Taliban, warlords and corrupt officials.

Anti-drug policies run into the law of unintended consequences and, more brutally, the laws of supply and demand. Afghanistan has a virtual lock on world opium production: it is both the incumbent and by far the lowest-cost supplier. Extensive inventories, estimated at two years’ worldwide consumption, preclude shortages. Retail demand for the heroin produced from Afghan opium is only slightly sensitive to export prices, because most of its retail price consists of distributors’ mark-ups rather than the raw material price.

Therefore, even large price increases in Afghanistan will lead to only small decreases in exports. Counter drug efforts, meanwhile, only push poppy production from one region to another. Due to the efforts of the Afghan government and its allies, including the US, 27 of the 34 provinces of Afghanistan are now virtually poppy-free. But total production and exports have not decreased. The seven remaining poppy-growing provinces are all in the Pashto-speaking south, where the Taliban’s writ runs. Our policies have given the insurgency the ability to tax virtually the entire world supply of illicit opium.

The Obama administration has largely ceased the eradication of opium crops – a practice that angers local farmers However, the alternatives – developing other crops and attacking high-level traffickers – also drive up opium prices, increasing funds to the Taliban. Completely eliminating the Afghan opium trade would eliminate Afghan opium revenues. But the relationship is not linear: smaller reductions in production drive drug revenues up rather than down, through large price increases and small decreases in volume.

To some extent, enforcement can target those dealers most closely aligned with the insurgency, and the US military and other agencies are doing their best to concentrate on traffickers with direct links to military targets. But all the main Afghan heroin traffickers – including some of the Northern Alliance warlords who helped force the Taliban from power in 2002 – still happily export drugs produced in Taliban areas.

The development of alternative crops seems like a civilian-friendly substitute for eradication. Yet insurgents and warlords can also exact an extortion “tax” for all economic activity in their zones of control, not just poppy cultivation. Money that leaks from efforts to promote alternative crops buys the same guns as money extracted from drug dealers.

Not all counter drug policies are futile or perverse in their outcomes. Officials corrupted by the drug trade should be swiftly removed from seats of power, to bolster confidence in the government. Drug treatment to address Afghanistan’s horrendous heroin abuse problem can help to reduce demand. Encouraging consumer countries (including Iran and Russia) to step up domestic drug enforcement and drug treatment could act to shrink the revenues of Afghan traffickers.

Yet it would be foolish to expect much in the way of improvements from any of these approaches. There simply are not many feasible drug-control activities in Afghanistan that do more good than harm. This is a case where less really is more: since the natural tendency of counter drug efforts is to help our enemies, we should pursue those efforts as little as possible. As a first step in breaking the Taliban’s momentum, we might stop filling its coffers.