Who “Benefits” From Alcohol and Drugs In America?
Three articles ago we attempted to define the cost of alcohol and drug abuse and addiction in America to be followed by who carries that burden and who benefits. Perhaps that would lead us to a nexus that would direct us toward community action to ameliorate those costs to our society. This week – who “benefits”.
As we began our research in earnest we realized that our effort could be interpreted as blame. That is not our intent. We have written about the role that alcohol plays in our culture and how engrained that role has become. We discussed how America and Europe have proven through legal effort that prohibition is not a reasonable solution. Today 70% of American adults or 180 million people use alcohol at least on occasion and we have shown that more than 100 million do so responsibly almost all of the time. We are rapidly approaching that same acceptance for cannabis. We wrote previously in favor of cannabis legalization for medical purposes. We also discussed the broad public acceptance of cannabis for recreational use and how given use by 16% of American adults there is need to regulate that substance. We came to this conclusion reluctantly as we defined the harmful effects of cannabis, far worse than alcohol, and the imbalance with general, public opinion that the substance is relatively harmless. It is not.
In this cultural and legal landscape it is only natural that supply be made available and in our economic system that occurs at a profit. We would not quickly tumble to the conclusion that purveyors of alcohol or legal cannabis are causing the harm their product produces solely for the sake of their profit. Similarly, we would not conclude that pharmaceutical companies are purposefully driving abuse through pain addiction medicine solely for profit. Alcohol and legal cannabis companies are selling into a cultural phenomenon. Pharmaceutical companies are serving physicians who are making sincere effort to lessen the medical burden of pain. That is not to say that there are no specific instances of abuse. The now famous case of one company has been adjudged guilty and held libel for just such illegal behavior. Certain cigarette (another legal drug) companies have been adjudged and found libel for promotion to underaged markets. It is not our intent, however, to accuse an entire industry with the bad behavior of a few.
Having established our outlook, we can discuss those entities that benefit from the availability of alcohol and other drugs which are abused by a large number of Americans. According to the Bureau of Labor Statistics U.S. households spent $637 each on alcohol in 2023. Given the Census report of the number of households, that equates to $84.2 billion in alcohol sales from all sources including liquor and grocery stores, restaurants and bars. Penn State University reports that alcohol sales declined in the U.S. in 2024 to 58% of individuals who had “at least an occasion to drink” from the prior year of 62% (we reported a higher number from NIH in this and previous articles). Beer sales declined 2.9%, spirits 2.3% and wine 5.3%. As these data are post pandemic, the authors point to a health consciousness trend.
Los Angeles City reported that in 2024 U.S. legal cannabis sales totaled $30.1 billion with ten States seeing total sales in excess of $1 billion. The City of Los Angeles exceeded $769 million on its own.
The Distilled Beverage Council discusses the economic impact of the alcoholic beverage industry. Their 2025 Distilled Spirits Council Economic Briefing projected a national economic impact of $250 billion including 1.7 million jobs in production, distribution and sales of distilled spirits. This does not include economic activity in other areas such as farming as the industry used 2.8 billion pounds of grain in 2023.
According to Marijuana Index the marijuana industry’s economic footprint stretches across agriculture, manufacturing, retail, and a wide range of service providers like consultants, equipment suppliers, and logistics companies, community events, tourism, and hospitality bringing significant spending into local economies. Employees in the cannabis sector further support the economy through their everyday purchases, including housing, transportation, and entertainment. They project direct sales from medical and recreational cannabis will reach about $35.3 billion with an additional $88.3 billion generated through related economic activity such as employment, services, and supply chain businesses.
The Tax Policy Institute reports that State and local government received $8.2 billion in tax revenue from total alcohol sales in 2021. These tax collections accrue from sales taxes, fees, price mark-ups, and net profits. It does not include income taxes paid by employees. According to a Congressional report federal alcohol excise tax collections totaled $11.1 billion in FY2023
The Marijuana Policy Project reports about State tax collection from cannabis products since 2014 when Colorado legalized recreational marijuana. States have generated a combined total of more than $24.7 billion in tax revenue from legal, adult use cannabis sales. In 2024 the 24 States with legal, recreational marijuana generated more than $4.4 billion in tax revenue from adult-use sales, the most revenue generated by cannabis sales in a single year. In 2024, seven states collected over $200 million in adult-use cannabis taxes. Four of those states generated over $500 million in revenue, one of which collected over $1 billion.
According to Mordor Intelligence opioids make up 41.4% of the pharmaceutical pain market with the primary drugs include buprenorphine that accounts for more than 50% of the market, oxycodone, hydrocodone, tramadol and morphine. North America accounts for 42% of the global market. That market totaled $24.84 billion in 2024 and is estimated to grow to $29.8 billion by 2030.
Research Nester estimates the global medical assisted treatment market to be $11.2 billion in 2025 with growth to $26 billion by 2035. North America accounts for 45% of that market. Since buprenorphine is a large part of this market, this estimate of sales no doubt duplicates the opioid pharmaceutical sales noted above.
Estimates of what is spent on illegal drugs in the United States is surprisingly illusory. We found no reliable estimates or serious efforts more recent than 2019. A U.S. Bureau of Economic Analysis from 2020 made an educated estimate. They estimate that imports of illegal drugs totaled $29.9 billion in 2017. Since imported narcotics cannot be the total consumed in the U.S., this is certainly an underestimate of some proportion.
We hesitate to discuss the “benefits” of alcohol and marijuana use by Americans but that it a realistic thought. Note that under the term “benefit” we do not include the debunked notion that there are prophylactic benefits of alcohol. Those “J shaped” curve reports are now understood to be the result of other, salutary behaviors exhibited by moderate drinkers. We have reported previously that of the 70% of American adults who use alcohol at least on occasion, annually, totaling 180 million, that perhaps 100 million use alcohol responsibly with occasional but rare exception. These Americans are enjoying the cultural, social and gastronomic benefits of alcohol use in America. A similar statement can be made for as many as 30 million users of cannabis.
Another group of beneficiaries are those employed in law enforcement, judiciary, corrections, supportive housing, treatment, medicine, and aftercare. We are not so cynical as to include these Americans as “enjoying” the benefit of alcohol and drug abuse. Further, there is clear evidence that this employment category is dramatically underfunded and understaffed. Sadly, these individuals are in little danger of running out of customers anytime soon. Further, and obviously our personal observation, we believe that these professionals are engaged daily in reducing the harms caused to reduce if not eliminate those harms. They would be happy to be put out of business though they have little worry at the moment.
An interesting observation occurs from these last two articles, one on the total cost or burden to America from alcohol and drug use and this on total benefit. Compared solely on economic terms, the benefit of these markets is less than the cost or burden. We must declare again, as we did last time, that we are reporting on the work of others and that we have not applied the rigors that we would in a more academic report prepared for a refereed journal. We have, to be certain, attempted to be faithful to reliable sources and fair treatment of data. That said, we suggested last time that the cost of alcohol and drugs in America exceeded $750 billion. Summing the totals in this article, accounting for direct sales and downstream economic benefits of alcohol and legal cannabis, sales of opioid pharmaceuticals, sales of medically assisted treatment drugs, and tax revenue, the benefit totals less than $500 billion. Regardless the disclaimer above, these proportions seem to indicate that the costs exceed the benefits of legal alcohol and drugs. Since we have excluded nicotine we know that the burden of legal drugs including nicotine and caffeine would clearly skew the equation to the negative.
The benefits of legal alcohol and other drugs, include cannabis and opioid pharmaceuticals includes direct sales, downstream economic benefits and tax revenue. We do not include the economic benefit of illegal drug sales as this can hardly be called a “benefit”. There is also the cultural, social and gastronomic benefit to 100 million Americans who use alcohol and legal cannabis. To be thorough, there is employment from the burden of using these drugs, but we do not include this as a “benefit” of the legal drugs in America. What is surprising, even to us who report on these issues regularly, is that the economic “benefits” of legal drugs in America, including alcohol and cannabis but not nicotine and caffeine, exceed the “benefit”.
Gene Gilchrist
December 2025
