Former junkie writes a fascinating street-level description of the heroin drug trade off of Pulaski. He takes us on a giddy trip to cop, describes how shorties claim territory and the development of using Xanax to cut dope. He also gives me something I can cite about upstream/downstream market impacts. In Chicago, the efforts to boost profits simply result in dealers doing more stepping on the bags (diluting the product) as each player in the supply chain tries to extract the maximum value from his segment. New York City distributors have become more vertically integrated, so when a large buyer on the East Coast makes, say, a $150,000 purchase of heroin, it is often delivered to him already bagged up and in bundles (bundles out east are what jabs are here in Chicago, that is a dozen single doses, known as blows). This decreases the likelihood that dealers lower down on the chain will step on the product in the East Coast, so it has the bonus effect of increasing quality control all the way down the chain of command. Potential for innovation at each link in the chain is greater the less integrated links are. For instance, the vertically integrated Pacific Power buys its coal fuel from its sister company PacifiCorp Energy to burn in its coal generation plants. Assessing a carbon tax at the mine would increase the cost of downstream generation, as it should, but more than it might if the coal provider was independent and did not have a captive buyer. Pacific Power is beholden to buying coal that it might prefer to switch off of in favor of lower-carbon fuels. It wants to step on a few jabs, nawmean?
Posted on: Fri, 22 Nov 2013 22:09:04 +0000
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