Heroin “Subeconomy” In Baltimore Estimated At $165 Million Annually


In Baltimore, where heroin has a long-entrenched history, the drug has created a thriving subeconomy, providing funds for dealers who buy mansions in the suburbs or simply help family members with rent and grocery money, reports the Baltimore Sun. The size of the subeconomy is not easily calculated. Nationally, experts estimate heroin users spend about $27 billion a year on the drug. In Baltimore, where there are an estimated 19,000 heroin users, including 9,500 chronic users, annual spending on the drug is estimated at least at $165 million. Such estimates, derived from Mayor Stephanie Rawlings-Blake’s 2015 heroin task force and a 2014 study by the RAND Corp., are imprecise given the nature of the drug market and the difficulty of surveying heavy heroin users. Experts say the actual valuation is likely much higher because of money spent by occasional users.

When the brothers of one local kingpin were kidnapped, he came up with $500,000 for ransom. When investigators searched a stash house and home of another dealer, they found $464,283 and $74,980, respectively. As in the legitimate economy, such wealth is largely limited to those at the top levels of the heroin trade. At the bottom, the so-called “corner boys” who sell on the street can be making as little as minimum wage, according to economists who have studied the market and those who have plied the trade themselves. There seems to be an unending supply of mostly young men willing to do this entry-level work, however low-paying, illegal, and dangerous. Among them was Freddie Gray, the 25-year-old whose death in police custody in April triggered protests and rioting in Baltimore and led to criminal charges against six police officers.

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