Why Purity Has Increased
You may remember the movie The French Connection. It is based on actual events. In the early 1970s, pretty much all of the heroin that was coming into the United States originated in France. Opium, cultivated in Asia, was imported to France (primarily Marseilles), where it was chemically purified and converted into heroin for the world market. This was well know, even by law enforcement who must have taken some offense at this flaunting of international drug law.
The fact that the "heroin trade" was so centralized allowed law enforcement efforts to focus on Marseilles. Most of the time, such law enforcement efforts are useless. But the centralization of the enterprise and probably also a certain cockiness on the part of those involved in the illegal trade, allowed for a rare Drug War victory. The Marseilles operation was pretty thoroughly demolished.
The effect of this "victory" was not what the drug warriors had hoped, but it was exactly what economists would have predicted. It is simple to understand. Black markets are not free markets, and it is possible (especially through the use of force) to acquire a monopoly. And this is exactly what American heroin users were burdened with in the 1960s and early 1970s: a monopoly in the form of the French connection.
The destruction of the French connection allowed competition to enter the market. The French connection didn't stay dead, of course, but there was enough disruption in the market to allow others to enter the market and for alternate distribution channels to emerge. Today, there are three major players in the American heroin trade: France, Mexico, and Colombia.
Heroin users now have a choice and the heroin distributors are acting more like legal businesses. For example, the heroin coming out of Mexico was relatively poor in the late 1980s and early 1990s; it had purity levels in the 20% to 30% range. At the same time, Colombian heroin was coming into America with purity levels averaging above 60%. The Mexicans were losing market share and so they started to increase their purity levels. Today, Mexican heroin has an average purity level above 40%.
In addition to increased purity levels, the heroin being sold throughout the world has come down in price. From 1984 to 1994, the price of a gram of heroin was cut in half (in real dollars).
Many people think that the primary purpose of governments is to provide free and competitive markets (HEROIN helper does not agree; we think markets work best when governments leave them alone). Although this was not the purpose of the attack on the French connection, it was the result.
Governments often attempt to change the laws of nature--as if an act of congress can make the rain fall or the temperature rise. The laws of economics are no less fundamental and immutable than the laws of physics. Governments are bound to fail when they try to stop people from getting the recreational substances they want. But sometimes, in failing, they do some good.