[Drug Nation]⑪Enough to Develop Four Spacecrafts... The 'Bill' Reaches 10 Trillion Won a Year

■ Chapter 3. National Economy Shaken by the Drug Economy


Sungsoo Park Updates Research on “Social Cost”

Equivalent to Funding the Next-Generation Launch Vehicle Project Four Times

Per-Person Cost Approaches 6 Billion Won Consideri

The social cost that South Korea pays each year due to drug-related crimes is estimated to approach 10 trillion won. This amount is more than enough to develop the next-generation launch vehicle—currently a national project aimed at becoming a space powerhouse—four times over. The bill reflects not only crime response, punishment, and correctional enforcement, but also treatment, rehabilitation, productivity loss resulting from unemployment or death, and the pain endured by those around the offenders. It represents a national loss caused by the collapse of the social safety net.

On May 20, The Asia Business Daily, with advice from Sungsoo Park, Professor of Police Science at Semyung University, updated the study “Analysis of the Social Costs of Narcotics and Other Harmful Substances.” It found that, as of last year, the social cost arising from drug-related crime was estimated at 9.7676 trillion won. In a previous 2016 study by Professor Park using a dark figure multiplier of 28.57, the cost was estimated at 4.873 trillion won. This latest figure reflects a 21.7% rise in prices and a 64.7% increase in crime rates over the past decade.

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The finding that annual social costs are nearing 10 trillion won means that resources which should have been invested in the nation’s future growth are instead being spent as the price of crime. The Korea Aerospace Administration is investing a total budget of 2.2921 trillion won in the development of next-generation launch vehicles. Due to drug-related crime, the nation is losing enough money to develop four next-generation space launch vehicles, with funds left over. The agency’s budget this year is 1.1131 trillion won—meaning the cost is equivalent to nearly nine years’ worth of funding.

Professor Park pointed out, “People often say there are no victims in drug crimes, but just because you can’t see them doesn’t mean they don’t exist. In the short term, the addict and everyone immediately around them can all become victims.”

The social cost estimate includes all expenses—from medical and welfare costs for crime or addicts, to loss costs stemming from drug addicts not being able to participate in productive activities, and criminal justice policy costs associated with enforcement measures. In addition to these tangible costs, Professor Park also considered intangible costs, such as those related to victims and the pain and suffering (PGS) experienced by their family and friends as a result of drug-related crime.

Specifically, “medical and welfare costs” comprise national health insurance, medical aid, indirect medical expenses, and medical support costs. “Productivity loss costs” include reductions and losses in productivity and the loss of workforce due to premature death. “Criminal justice costs” refer to the budgets for police, prosecutors, courts, and correctional facilities. PGS costs are calculated separately for death and addiction, based on the costs associated with traffic accident fatalities and serious injuries (reflecting the number of drug addicts).

As of 2016, social losses from drug-related crime were estimated at 1.02371 billion won per person, totaling 168.25333 billion won overall. The per-person cost reflects the expenses incurred throughout the addict’s life cycle. Professor Park estimated, “Considering the nature and patterns of crime, the social cost per person now likely approaches 6 billion won.”

Professor Sungsoo Park, Department of Police Science, Semyung University. Photo by Yonhap News

Professor Park diagnosed that this cost estimate should also factor in the increased accessibility of digital distribution networks such as the dark web and Telegram, as well as variables relating to illegal diversion of medical narcotics. In other words, the real cost may be much higher.

He explained, “It’s important to assign weightings based on the number of drug sales channels and active users detected on secure messengers, and reverse-calculate using the actual rates at which investigative agencies shut down and apprehend these channels. If you extract the anomaly rate between prescription data from the Ministry of Food and Drug Safety’s narcotics management system and the actual patient disease codes—for issues like overprescribing or doctor shopping—you can estimate the scale of hidden crimes disguised as legitimate activity, causing the costs to rise even further.”

He particularly criticized the fact that every past administration has defined narcotics as absolute evil and stuck to a strong punitive approach. He said, “A simple punitive judicial system has driven crime deeper underground, leading to drug prices soaring to 10–30 times those overseas and resulting in failure. While it is necessary to focus investigative capacity on disrupting supply chains, it is urgent to adopt a restorative approach to reduce demand, including expanding treatment and rehabilitation infrastructure.”

Special Reporting Team｜Jang Hee-joon, Oh Ji-eun, Park Ho-soo, Lee Ji-ye, Park Jae-hyun

This content was produced with the assistance of AI translation services.