How Much Money Do Americans Spend on Illegal Drugs?

Last Updated on October 4, 2023

The overall impact of illegal drugs and substance abuse on American society is massive. According to the Centers for Disease Control and Prevention (CDC), drug overdose deaths have risen from 16,849 in 1999 to 70,237 in 2017.¹ In terms of finances, the numbers are just as grim.

The Financial Cost of Illegal Drug Abuse in America

The National Drug Intelligence Center (NDIC) estimates that substance abuse costs an estimated $120 per year in diminished productivity, lower labor force participation, incarceration, premature death, ER and hospital expenses, and treatment programs.²

Although 90 percent of Americans ages 12 and over don’t use any illegal drugs and do not use prescription drugs non-medically, they still pay taxes that contribute to overall substance abuse. For example, in 2007, taxpayers paid more than $193 billion in lost productivity, health care expenses, and criminal justice expenditures due to substance abuse.³

Unfortunately, despite the negative effects of illegal drugs, substance use is a profitable business. Revenues from the sale of alcohol alone reached $253 billion in 2018, an increase of 5.1 percent or $12.4 billion.⁴

People who use drugs in the United States not only suffer from harmful damage to their own lives and health but those effects ripple outward to affect those around them. The overall societal costs of substance abuse in terms of disease, premature death, lost productivity, crime, unwanted and unplanned sex, substance abuse prevention efforts, law enforcement, prosecution, incarceration, and probation far outweigh even the sales revenues of addictive substances like alcohol, cigarettes, and illegal drugs.⁵ Everyone pays these costs, not just the substance user.

However, we often turn a blind eye to the amount of money spent on illegal substances. To get a better understanding of changes in substance abuse outcomes and policies, it’s important to look at the markets for commonly abused illegal substances like methamphetamine, heroin, marijuana, and cocaine. Not only that, but it’s eye-opening to find out how much money Americans actually spend on these drugs and how much is consumed.

We consulted several different reports to find detailed information about the monetary cost of substance abuse in America and here is what we found.

How Many Chronic Drug Users are there in the U.S.?

Although the estimated number of cocaine users in the U.S. decreased from 2006 to 2016, there are now more heroin, methamphetamine and marijuana users in America today than there were over a decade ago. The population of marijuana users, especially, has grown significantly, increasing nearly 30 percent in the six years between 2010 and 2016 alone.⁶

The number of chronic heroin users in the U.S. increased by more than 40 percent from 2006 to 2016. Chronic heroin use has also expanded into rural areas instead of remaining concentrated in urban areas, as it historically has. This can be attributed to the ongoing opioid crisis in America.

How Much Money Do Chronic Drug Users in America Spend on Drugs?

Drug users in the U.S. spent nearly $150 billion on cocaine, heroin, and methamphetamine in 2016.⁶ The marijuana market has grown substantially and is now the size of the cocaine and meth markets combined. The spending habits of heroin users also show that they spend more money annually on heroin than other drug users spend on their drug of choice.

The amount of money daily cocaine users spent on cocaine decreased by 63 percent from 2006 to 2016. Cocaine expenditures of less frequent users also dropped by 55 percent during that time period.

On the other hand, heroin users are spending more. Daily heroin users spent 39 percent more on heroin from 2006 to 2016 and the heroin spending habits of light, weekly, and more than weekly users increased 81 percent from 2006 to 2016.

Methamphetamine expenditures also increased 80 percent by 2016, despite a reduction from 2008 to 2011 due to efforts like the Combat Methamphetamine Epidemic Act of 2005. Less frequent meth users also spent more money on their drug of choice, with a 76 percent increase from 2006 to 2016.

*Estimates are in 2018 dollars

How Much Cocaine, Heroin, and Meth Do Chronic Drug Users in the U.S. Use?

Consumption of cocaine in the U.S. decreased dramatically from 2006 to 2016 while the consumption of heroin nearly doubled from 27 pure metric tons to 47 pure metric tons. With each passing year between 2010 and 2016, heroin consumption increased another 10 percent.

Although opioid use generally claims all the media attention, methamphetamine consumption has skyrocketed to 171 pure metric tons in 2016, compared to just 50 pure metric tons ten years prior.

Efforts to Reduce Spending on Alcohol and Drugs

Aside from making addictive substances illegal and more difficult to obtain, state lawmakers may also impose or raise excise taxes. Of course, this could only apply to legal substances, such as alcohol or cigarettes. Lawmakers may also focus on positive marketing efforts, drug abuse education for teens and young people, and promotion of the skills and tools teens need to stay sober and practice safe use of substances like prescription drugs.

Even still, educating, limiting access to a substance, discouraging people from purchasing it with higher prices, or funneling those purchases to specific locations like liquor stores may help curb alcohol and nicotine abuse, but it won’t prevent individuals from getting their hands on illegal drugs if that’s what they are determined to do.

For those who are already addicted, long-term addiction treatment programs are effective and less expensive than an individual’s overall costs of incarceration, lost productivity, lost property, and medical expenses related to their substance abuse.

Although addiction treatment takes time and continued efforts from all those affected (such as immediate family members), it provides life-altering education, behavioral therapy, skills, and support to help reduce not only the financial burden associated with substance abuse, but also other societal costs like disease, crime, lost productivity, and more.

There is no simple solution to the drug abuse and addiction problem in America, but encouraging addicted individuals to complete a long-term and comprehensive addiction treatment program is one way we can help those who are struggling.

If you or a loved one is suffering from a substance use problem or addiction, please call (512) 605-2955 today to speak with a Nova representative about your treatment options.

References:

1. https://www.drugabuse.gov/related-topics/trends-statistics/overdose-death-rates
2. https://www.justice.gov/archive/ndic/pubs44/44731/44731p.pdf
3. https://www.addictionpolicy.org/blog/tag/research-you-can-use/what-we-spend-on-drugs
4. https://www.thedrinksbusiness.com/2019/01/us-alcohol-sales-increased-by-5-1-in-2018/
5. https://hpi.georgetown.edu/abuse/
6. https://www.rand.org/pubs/research_reports/RR3140.html