Let’s consider private crime first.
1. Prohibition raises the prices of drugs. Non-addicts, both poor and not, will as the first effect lessen their consumption. But poor addicts will find their real wages reduced greatly and may choose to engage in criminal activities, such as robbery.
2. The costs of doing business to a midlevel drug boss consist not inconsiderably in the risk of being imprisoned by the state or killed by rivals or underlings. This cost is largely the same whether the drug dealer controls a larger territory or smaller. (In addition, a business cannot evenly rotate for long: it ether grows or shrinks. Our drug dealer needs to go up, if he wants to stay ahead and stay alive.) Since the costs are fixed, the profits can be dramatically enhanced by a capture of a neighboring drug lord’s territory.
3. Both users and dealers of drugs are already outlaws as far as the state is concerned; the step from a non-violent outlaw to violent one is much smaller than from a respected businessman to violent outlaw, so the people’s moral restraint is weakened.
4. The state’s role here is not to protect transactions between drug dealers and their customers but on the contrary, to disrupt them. One dealer cannot sue another one in a court of law and have the executive branch of the government enforce the verdict. Enforcement is “private,” which leads to greater violence overall.
5. In the illegal drug industry, creative advance is limited. Innovation is deterred. (1) There are high costs or even impossibility of advertising. (2) There is the difficulty of finding decent scientists who would agree to work illegally. (3) There is little quality control: I cannot look for customer reviews of drug retailers and their goods on the web. (4) The business favors highly concentrated and very potent drugs, because they are easier to smuggle, but those are hardly the most fun or safe drugs. (5) I cannot order online but must shop at the local market. Since prohibition makes it harder for drug producers to compete with each other for customers by continuously offering to the them better and cheaper products, it becomes so much more lucrative to go to war.
Now to government crimes.
1. Both drug producers and consumers are essentially peaceful individuals who hurt nobody. When the state imprisons then, it commits a grave injustice.
2. The money used to finance drug enforcement activities is transferred from enforcement of property crimes; so the latter increase via being deterred less efficiently.
3. There is more corruption of government officials under prohibition.
4. Taxes are raised in order to pay for drug enforcement, which is a crime, insofar as taxation is theft.
5. Asset forfeiture, nighttime police raids, draconian punishments are monstrous violations of civil rights.
As an unholy combination of the two, there is lessened respect for the law as a whole, since anti-drug laws are so obviously wicked. Some people may come cynically to despise all law — even good law, and turn to crime for that reason.