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The U.S. National Drug Control Strategy developed by the Office of National Drug Control Policy has two components: supply reduction and demand reduction. As the term implies, supply reduction refers to efforts to decrease the availability of illegal drugs in the United States. According to the U.S. federal government, the strategy behind supply reduction is to disrupt the market for illegal drugs in order to reduce the profitability of the drug trade and increase the costs of drugs to consumers.

In other words, if there is a reduced quantity of illegal drugs available for purchase, the price will increase and the purity will decrease. This might discourage casual drug users from continuing to purchase illegal drugs and might encourage drug abusers to seek treatment. Over $117 billion has been spent on supply reduction efforts from 1996 to 2008, and 63.5% of the national drug control budget was allocated to supply reduction in 2008.

Supply reduction is generally divided among three different initiatives: domestic law enforcement, interdiction, and international efforts.

Domestic Law Enforcement

Domestic law enforcement comprises the largest expenditure of the three areas. As the name implies, these are all of the federal activities involved in the investigation, arrest, and prosecution of people and organizations that grow, manufacture, transport, and distribute illegal drugs in the United States. Domestic law enforcement also includes operations involving money laundering from the proceeds of selling illegal drugs. Nearly $3.5 billion, or 26.7% of the entire federal drug control budget, was devoted to this area in fiscal year (FY) 2006. That was increased to nearly $3.6 billion (27.4%) in FY 2007, and over $3.8 billion (27.8%) for FY 2008.

The federal agency with major responsibility in the domestic law enforcement area is the Department of Justice, specifically the Drug Enforcement Administration (DEA). The mission of the DEA is to enforce the controlled substances laws and regulations of the United States and apprehend individuals and organizations involved in the growing, manufacturing, or distribution of illicit drugs. Most people are familiar with DEA "drug busts" shown on TV or depicted in other media. The DEA's budget was nearly $2.1 billion in FY 2008.

The Department of Justice also includes the Interagency Crime and Drug Enforcement. The mission of this agency, according to the Department of Justice, is to identify, dismantle, and disrupt sophisticated national and international drug trafficking and money laundering organizations. As the mission implies, some of these activities go beyond domestic law enforcement and are included in other supply reduction initiatives. The Interagency Crime and Drug Enforcement is allocated almost $500 million a year.

The High Intensity Drug Trafficking Area Program (HIDTA) was established by the Anti-Drug Abuse Act of 1988 and is administered by the Office of National Drug Control Policy. With 32 locations throughout the country, HIDTA is designed to bring together representatives from law enforcement, criminal justice, and demand reduction disciplines to create partnerships for developing effective multiagency, multidisciplinary responses to regional drug problems. The program generally receives about $225 million per year.

There are other parts of domestic law enforcement in the budgets of other agencies. For example, the Customs and Border Protection agency in the Department of Homeland Security has some domestic law enforcement responsibility. However, the federal government does not make it clear as to the proportion of the budget devoted to domestic law enforcement as opposed to other initiatives in supply reduction.

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