Plan Colombia: A $5 Billion Failure?

The U.S. has spent more than $5 billion on military and anti-narcotics aid for Colombia in recent years. In a new article for Slate, Ray Fisman points to a new paper that analyzes conflict and coca production in areas with and without Army bases to determine the impact of all that aid. The researchers found that U.S. military aid is associated with increased paramilitary attacks and fewer anti-narcotics operations. “There’s also some evidence that U.S. dollars may have been channeled to paramilitaries to intimidate voters and keep its government allies in power,” writes Fisman. “Greater U.S. aid is associated with a decline in voter turnout, concentrated in municipalities with Army bases.” (HT: Daniel Lippman) [%comments]

Susan Goding

Don't expect facts to challenge anyones beliefs.

Some people talk about the Iraq and Afganistan wars draining our budget. The "war against drugs" is another pointless, voluntary war that enriches the military industrial complex while robbing our's and our neighbors' children's future.

I heard on French TV that 20% of drugs bound for the US were transited through Haiti. Look what is happening in Mexico. We need to legalize drugs now. This drug war is a costly failure. Good governance would have accepted that the costs far outweigh the benefit. Unfortunately, good governance is not the point of our legislators who have done their own cost benefit analysis and found that wars, any wars, benefit them and damn the costs to us.


> to determine the impact of all that aid

Sorry to be picky but meteors, teeth, bombs and other disasters impact things. I sure hope development aid affects things and doesn't impact them.

Just because 'to effect' and 'to affect' are a little confusing to distinguish is no reason resort to 'to impact' for everything.


Just read yesterday of (I think) Vancouver's attempt to reduce criminality, etc., by giving heroin addicts fixes each day.

I"ve never been an addict, but I once had to take hydrocodone for some complications...and I can tell you that I honestly began to question why anyone would want to withhold this from the rest of the world!

I also noticed something else....

So long as I had plenty of pills in the bottle, ready to combat my pain as it arose, I was confident and happy. But when I was running low, thinking that maybe I wouldn't have enough to combat the terrible pain I was then experiencing, or wondering if my doctor might cut me off, well, to be honest, I experienced anxiety.

I thought it was informative that one of the heroin addicts that is receiving fixes each day implied that that now that he no longer has to keep thinking of where his next fix is coming from, he has actually started to think about his life in a bigger way.

Further, the expenses associated with heroin addiction were GREATLY reduced simply by giving these people a fix.

We hate that, don't we? We feel like we're giving in to something bad. But the truth is that these people are GOING to search out heroin--legally or illegally. Somehow, they got themselves entangled and cannot just quit--even with various treatments. So maybe in such cases we ought to do something counter-intuitive?

If opiates were legal, a lot of the crime around it would go away.

I'm a conservative, fundamentalist Christian (almost), and yet I have to honestly wonder, WHAT'S WRONG WITH EUPHORIA?

It is our criminalization of euphoric drugs that makes these people criminals. If we criminalized beer, we'd have a lot more criminals.

I simply think that, AT LEAST IN MY EXPERIENCE, it would be nice to use such medications (I don't any longer, though) to "cool down" after a long day. And the fact that you could get more at any time, with no hassle, well, that takes the criminal element out of it.

Further, wouldn't it be nice if the high-crime areas of our nation could freely have drugs that calm the emotions, enhance many positive feelings, and so forth?

Believe me, I know the arguments. We've seen that what we've been doing is not working particularly well.

Those who WANT drugs--or have to have them--will usually find a way, usually illegal. Those who don't, well, they won't be affected by the decriminalization, I don't think.

There will ALWAYS be abusers. Some folks drink whiskey and it makes for a good conversation and so forth. Others abuse it and wind up in the gutter. Some people will abuse drugs...most won't. If abuse is the issue, then we have no reason not to go back to Prohibition days regarding whiskey.



Of all the economics blogs I read, "Freaconomics" is the only one in which I never expected to see such a post.

First of all, it's extremely missleading to the uninformed reader. I don't mean to ignore the (many) problems that Colombia has with paramilitaries at the moment, but this post will probably leave most people with the feeling that U.S. military aid has been almost exclusively used to mantain a paramilitary regime in power. Regardless of what one's feelings of Uribe's presidency are (and, I must add, mine are mostly negative), his presidency AND U.S. military aid definetly helped to ensure that Colombia did not become a failed state in the 1990s.

The costs and benefits of "Plan Colombia" are harder to measure than what the article, the paper and the post let on. Granted, cocaine production hasn't decreased, but mainly because coca crop productivity has increased greatly and (as always) demand has not budged. But, in part thanks to U.S. aid, the threat of the FARC (one of the biggest and most powerful guerrillas) taking over the government (very real a decade ago) has subsided and kidnappings and terrorist attacks have greatly decreased. As a result, the general sentiment towards the U.S. in Colombia is way, way better than the regional average. Quite honestly, I think it's even easier to justify U.S. military aid to Colombia than to many other countries, say, Israel for example.

I agree that the world must reconsider its war against ilegal drugs, but that's a different matter. As writters in a very popular blog, you guys should be a little more careful on giving a much more global perspective on a very complicated, and very controversial, issue.



Pondering on my previous comment, I remembered a paper written by two professors of the Universidad de los Andes in Bogota that use a game theory model to deal with the different objectives that Colombia and the U.S. have with Plan Colombia.

Basically, the U.S wants to reduce the amount of drugs that arrive to its shores, and Colombia wants to reduce the overall costs of its own war against drugs (including winning its fight against illegal armies).

It took me a while to find a link (see below) but the paper does help to illustrate my point that the problem with Plan Colombia is not that drug production hasn't decreased, but that its success cannot be measured exclusively in that sense.

The link:


I wonder how a $5b subsidy on an alternative crop might've provided an incentive to grow something else?

Colombian farmers grow coca because they earn a living on it. But if some non-narcotic alternative were commanding a better rate, say bamboo or sugarcane, who knows what might happen to coca production?


Evidence demonstrates that U.S military aid is not overly helping Colombia with its internal military and drug conflicts (although explicit analysis should be made to reveal any confounding variables to eliminate any chance of a type 1 error).

Assuming the evidence is substantiated, a simple cost-benefit analysis would show that the U.S should back out from Colombia. The opportunity cost of the money spent in Colombia is huge, it can easily be argued that such taxpayers' money can be used to improve something else, something directly involving, and improving taxpayers' lives.

Then why stay in Colombia?
The U.S army probably hold on to the fact that there -IS- a lurking variable in the evidence, and it is something else that is preventing Colombia's problem to be solved. Also, the U.S has somewhat created a responsibility of an older brother, as to protect allied countries from harm. Such allies hold the idea of democracy dearest, the very most important principle of the United States.


Mark S.

I thought the basic premise for Plan Colombia was to ultimately reduce drug related street crime in the USA. The rationale and approach may have been uneconomical and counterproductive but the desired result has actually been achieved. Thanks to competition from Mexican produced Meth and Taliban produced Heroin, Cocaine and other drugs are cheaper than ever before in history and not worth having violent drug wars over. $5 billion aid is cheap compared to what we will have spent in Afghanistan to stop a drug empire that is much larger to begin with.

Steve Jones

"There's also some evidence that U.S. dollars may have been channeled to paramilitaries to intimidate voters and keep its government allies in power..."

There's the answer to the question in your headline. In that light, it's not a "failure." It's what TsaiCMS called the "responsibility of an older brother." Imperialism, in other words. Which is why the US has lost so much influence in the field of promoting democracy.

Iraq's government: bought and paid for with our dollars. Afghanistan's government: when Burnahuddin Rabbani, past president of Afghanistan, offered to run the country again after our 2001 invasion, we discouraged him by having an F-16 drop a missile in the street next to his home. He got the message - Karzai was Our Boy. Pakistan: we helped keep Pervez Musharraf in place long past his sell-by date.

Colombia is a strategic location on what Thomas PM Barnett called "The Pentagon's New Map." Unfortunately, Hugo Chavez has used the threat of our partnership with Colombia to keep himself in power past his own sell-by date.

Democracy? I'm afraid not. As a nation, we support or oppose the Big Man, and care nothing for what the people think. It's simpler that way.


Mojo Bone

@#6, Kevin: what most reputable studies show is that in the subsidy scenario, production simply moves elsewhere; it's driven by market demand-any farmer anywhere that's not subsidized can take up the slack, so long as growing conditions are favorable. The statistics quoted in the article seem to show something they really don't; need I remind anyone that correlation does not equal causation? I should expect that there would be more guerrilla activity in regions where army regulars are stationed, for example-if you want to blow up or kidnap an Israeli, you don't camp out in the Bahamas and wait for one to stroll by. As to the efficacy of the drug war itself, one of the great fallacies of modern conservative thought is that if we give addicts free drugs, everyone will want to become an addict. (we'll no longer have working people to exploit!) Emotion trumps all, "Not MY kid!" is the cry, "Give us the Nanny State!". yet, if compassion for the addicted children of others is invoked, the cry is, "Let 'em rot!', when every last one of them could be treated and educated at university for what we spend warehousing them as prisoners. The question isn't, "How do we stop drug abuse?", but, "How do we reduce the harm?"


Mark S.

Separate point on Colombia's political conflict: they precede all others in South America & the Caribbean. Fidel Castro personally witnessed the first riots and uprisings in the early 1950's in Bogota, Colombia and studied on how not to go about overthrowing a govt before he took on the Cuban govt.

Jess HB

I work in Colombia and have been following Plan Colombia since it began in 2000. Plan Colombia's attempt to use spray planes to eradicate our way out of coca production in Colombia was destined for failure. A federal government-commissioned 1994 Rand Corporation study, Controlling Cocaine, concluded that source country eradication was 23 times less cost effective than domestic drug treatment, prevention and law enforcement strategies. Furthermore, the spray program is devastating to the local environment, legal farming and may be causing human health problems.

You can watch a short documentary on this program at


I am a US citizen and live in Colombia.
I completely disagree that the Plan Colombia has been a was of money. Twenty years ago the government was overpowered by drug financed gangsters. After the Medellin cartel was eliminated (most of the leaders killed) the narcotics moved to the rural areas and, allied with FARC, made most of the country uninhabitable. Only with a concerted effort, of which US aid was an important factor, did the government regain control of the country.
Narcotics trade has not been eliminated, but Colombia is a much safer place. In this respect I think the money was well spent.


Obviously this aid isn't working out. The plan is not efficient. What they are trying to do is give out money to the Colombian military and anti-narcotics so that crime reduces, but Americans did wrong in believing that cash will just magically vanish a nation that relies on corruption and is powered by all the drug lords in Colombia. Americans gave them a hand, but Colombia reached for the arm. A corrupt nation will use foreign money to fuel more corruption. It's all played wrong by the United States. They should have done a cost benefit analysis, in which this case in order to give out money the benefits of doing so will exceed the costs. Another problem is that tax payers must be annoyed, since the money they pay on tax is being used to fuel corruption in Colombia. Taxpayers are glad paying tax money that will contribute for their well being, but I doubt that the way the U.S. spent 5 billion dollars contributed to improving any American citizen's lifestyle.



From what we see here, all the money being out into Colombia by the U.S isn't helping as expected. If over 5 billion dollars were used on fighting drugs, then why do we see less anti-narcotic operations? And why does the U.S still give that kind of money to Colombia?

If the U.S were to analyze the situation, they would discover that the opportunity cost of using all that money on this issue, is far greater than the outcome, and that money could possibly be used on something domestic, since after all that is the Americans people tax money. It would be economically wise for the U.S to leave Colombia, but at the same time, if this were to happen then the amount of narcotics coming into the U.S would definitely increase. At the same time, other countries any were in between the U.S and Colombia, like the Dominican Republic, Panama, or Mexico, would probably also suffer from an increase in narcotics imported into the country, because the coca plains rarely make a full flight from Colombia to the U.S.

It seems that right now there isn't much that can be done about this situation. The U.S either spends those 5 billion dollars in Colombia and try to fight the problem at its source, or its spends as much or possibly more money on surrounding countries, which could eventually have the same problem as Colombia. So as the situation presents, the total utility of spending 5 billion dollars will be greater than not spending those 5 billion dollars on narcotic control.



When the United States deals with Latin America, it probably foresees a loss that may arise from political corruption. It is the way it is. If the United States would have made a decision based on the effectiveness of their method they would still be debating. If the analysis of the economic and social effect was done to simulate the effects of the withdrawal of the United States and its anti-drug budget in Columbia, it would probably demonstrate that it would cost more in the long term since more social economic problems would arise at home and in neighboring countries.

If the United States pulled out, the risk of farmers getting caught would decrease thus the supply of cocaine and other drugs would rise because competitors would enter the market to win profits. With the amount of drug dealers increasing the amount of product moved in the United States would increase. As a result this would increase the amount of criminals and drug dealers in the US. There is already a problem to contain and suppress the major drug dealers. In jails about 80% of inmates are in jail because of drug related offenses and some jails are forced to release minor violence offenders to induce drug related criminals. The withdrawal of United States would mean the construction of many more jails in many states and counties, (construction of jails and providing jobs is expensive when the DEA has a limited budget). In addition, reinforcing the borders would suddenly cost outrageous amounts of money because the activity of the drug trade in all of the neighboring countries has increased.

In the short-run, the United States could reallocate 5 billion dollars into other branches of the government for social services, medicaid. However, by doing so, the United States would probably loose an ally, look poorly under the eyes of other economic powers and the long run the problems arising from the increase of drug traffic would elevate the cost of containing and capturing drug dealers.

What the United States should try to do is cut the middle man or trying to reduce the amount of the people who make the transactions happen. If the reallocation of the 5 billion dollars would be concentrated on the research and checking of every vehicle through the air, water, and land. This would work because the price of drugs would increase greatly reducing the quantity demanded which would reduce the supply of drugs.



for young researchers a mention on a popular blog like Freakonomics is a wonderful thing. In find it therefore really annoying that the blogpost mentions Mr. Fisman, but doesn't bother to name Oeindrila Dube and Suresh Naidu who actually wrote the paper. The paper received quite a bit of attention a couple of months ago, when earlier working paper versions of this circulated.

Howard J Wooldridge

The Prohibition of Drugs Policy & its sidekick The War on Drugs has been the most destructive, dysfunctional and immoral policy since slavery & Jim Crow.

And oh, BTW, it costs our economy about 200 billion a year to chase Michael Phelps, Whitney Houston and their suppliers.

My profession, police, fight repeal w/ all they have here in DC. Cops are addicted to the good overtime.

Wren Elhai

Thanks, Sebastian, for giving credit to Dube & Naidu for their work (and for calling on the Freakonomics team to be better web citizens!). For those interested, you'll find an interview with Oeindrila Dube, focusing on this paper, here:

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