In June 2011, the non-governmental organization Global Commission on Drug Policy published a report detailing the failure of global and national illicit-drugs policies and urging a fundamental change in approach to the global drugs trade.

The report coincided with the fortieth anniversary of President Richard Nixon's famous declaration of the "war on drugs." It offered a variety of policy measures for individual states to consider, ranging from targeted legalization to health services for those afflicted by addiction and prevention programs designed to limit the number of new users.

These sharp critiques and proposed policy initiatives come after the billions of dollars invested in the militarization of the drug war by the U.S. and its far-reaching consequences for societies in Latin America and elsewhere.

The violence associated with the trafficking of illicit narcotics and stimulants continues to stoke a macabre fascination among North American observers and politicians, who bandy about tired terms and phrases such as narco-terrorism, failed states, and security.

But it is the long history of drug production and distribution in Latin America—and the enduringly strong demand for narcotics in the United States—that best helps to explain why the "war on drugs" has resulted in so few battles won and has come at such a great cost both in money and human lives.

The trafficking of illicit drugs is a signature Latin American contribution to our globalized world, and today Colombia and Mexico play the paramount roles in terms of production and distribution. While cocaine, heroin, and marijuana have long figured as primary trafficked products, in the recent past drug trafficking organizations (DTOs) have increased shipments of methamphetamines. Yet, this contemporary arrangement was not always the case.

The production, trafficking, and distribution of drugs to consumers have moved geographically many times across Latin America. Like all successful businesses, organizations for narco-production and narco-distribution have responded rapidly and extensively to changing tastes and strong market demands in the consumer countries especially the United States.

At the same time, the often drastic shifts in the political fates of Latin American countries, geopolitics (most notably the Cold War), supra-state institutions (such as the United Nations with its anti-drug policies), and the increased militarization of efforts to eradicate drugs production (spearheaded by the United States) have also shaped the development of the narcotics trade.

In broad terms, the development of the Latin American drugs industry can be broken into four periods. From the late nineteenth century to 1945, Mexico controlled the illegal trade in opium and marijuana, and Peru dominated the mostly legal trade in cocaine products. A second period, from the end of World War II to the 1960s, saw the professionalization and greater organization of trafficking as networks of traffickers emerged.

The third era, from the 1960s to 1984, witnessed the rise of Colombia as the predominant producer and trafficker after Bolivia, Chile, and Cuba fell by the wayside and the Mexican government attempted to curb marijuana and opium production. This period also witnessed a sharp spike in the violence associated with the drug trade. Finally, Mexico has returned to a leading role since 1984 (as a result of connections made with Colombian traffickers in Panama), and drug-trade violence continues to escalate.

The history of Latin American narcotics production and distribution thus reveals the ways in which efforts to suppress the drug trade in one state have tended only to shift its location to another country in the region. Entrepreneurs throughout Latin America worked to take advantage of any opportunity to increase their share of this highly lucrative business and to take advantage of consistently strong demand.

Many drugs pose very real personal health or societal dangers. But, bluntly speaking, they are also commodities traded and consumed by societies for a variety of reasons, including casual and social uses, health purposes, and religious rites and rituals. It is the ways in which certain societies and polities view particular mind-altering substances that make one or many narcotics and stimulants acceptable or not.

These views of drugs have changed markedly over time and in different places. The designation of items such as cocaine, marijuana, and alcohol as illicit had far-reaching consequences in Latin America on the development of production zones, trafficking networks, destination markets, profitability, and violence.

From Opium to Cocaine: Creating the Latin American Narco-System (the late 19th century to 1945)

The beginnings of large-scale narco-trafficking in Latin America came with the production of coca and coca-based goods in Peru and the movement of opium and marijuana from Mexico into the United States.

As described by Paul Gootenberg, a legal cocaine industry emerged in Peru in the late nineteenth century and serviced pharmaceutical and commercial concerns in Europe and the United States. Cocaine is a derivative of the coca plant, a plant endemic to the Andean highlands and chewed by the indigenous populations residing in the present-day countries of Peru and Bolivia. During the colonial period (1532-1825), Spanish bureaucrats and elites largely viewed the consumption of coca as evidence of the local populations' inherent backwardness.

Beginning in the nineteenth century, however, scientific curiosity in coca emerged. These interests were largely based on the myths propagated by European travelers attesting to the coca leaf's power to allow indigenous peasants to work endlessly and commit great feats of strength as muleteers and porters.

Coca earned the interests of entrepreneurs who created tonics, such as Vin Mariani, that infused the plant into an energy drink to salve the vagaries of modern life. As a result, coca exports to German pharmaceuticals, such as Merck, increased in the second half of the nineteenth century.

In 1860, a graduate student in a German university gained the cocaine alkaloid from imported Peruvian leaf. Two decades later, the ophthalmologist Karl Koller proved cocaine to be an effective anesthetic for eye surgeries, and it was later utilized in dentistry and spinal surgeries.

In the years that followed, a booming international market emerged for coca and medicinal cocaine. The U.S. quickly became the largest and most enthusiastic market for coca products and rivaled German manufacturers in terms of cocaine production. Most famously, in 1886 John Pemberton produced Coca-Cola as a non-alcoholic herbal remedy to compete against the French Vin Mariani and as a response to the prohibition of alcoholic beverages in Atlanta.

In response to this new market, Peru promoted coca exports and a vibrant, legal cocaine manufacturing sector. In 1885, the Peruvian pharmacist Alfredo Bignon created a "crude cocaine," or cocaine sulfate, by using an efficient kerosene precipitation method. This innovation allowed for easier shipment in terms of size and, more importantly, the power of the cocaine alkaloid was not lost like in coca leaves that dried out during shipment abroad.

Because of the newfound medical use, and increasing European and American acceptance of cocaine, Peruvian liberal elites praised cocaine as a viable, national industry. Placing cocaine at the heart of Peruvian economic growth and trade led to a spurt in entrepreneurial activities throughout the Peruvian highlands. Nearly two dozen cocaine factories were in active operation by 1905.

Despite the early enthusiasm for cocaine by Peruvian elites and by North American and European physicians, surgeons, and commercial concerns, the first half of the twentieth century saw Peruvian coca and cocaine confront a series of challenges.

In the first decade of the 1900s, the reputation of cocaine plummeted. The U.S. government initiated a crusade to limit the production and export of coca and cocaine, as well as opium and marijuana, because government officials came to believe that cocaine was a threat to society.

This belief in the social threat of drugs, infused by the assumptions and beliefs of the Progressive Era, gave rise to the mythical cocaine "fiend" in American popular culture. A series of laws beginning in 1914 with the Harrison Act led to the prohibition of cocaine by 1920.

In the 1920s, during the period of America's alcohol Prohibition, the United States led an international drive to ban cocaine. However, the League of Nations and such producers as Peru, the Netherlands, and Japan resisted the effort.

Although allies against any ban on cocaine, Peruvian coca and cocaine competed on the market against Javan coca initiated and developed by Dutch colonialists, and later, from Imperial Japanese coca grown on Formosa (Taiwan).

As result, the legal cocaine industry limped along throughout the first half of the twentieth century. Peruvians were alternatively defensive of this crucial national industry and supported legal cocaine, at the same time that they were dismissive of what some elites saw as the "backward" native use of coca.

While Peru struggled to figure out what to do with its coca trade, an illicit production and trafficking network was also developing during the first half of the twentieth century in Mexico.

During the Mexican Revolution, which began in 1910, opium traveled up from Baja California and passed through the border towns of Mexicali and Tijuana, destined for the opium dens in San Francisco and Los Angeles.

As part of its long-standing opium trade in China and elsewhere in Asia, Europe initially produced much of the trafficked opium. Thanks to the Panama Canal, the product was more easily moved from Atlantic to Pacific, where it transited Nicaragua and entered Mexican ports.

Although the opium poppy had been grown in Mexico since the end of the nineteenth century, local production began to surge following the Mexican state's prohibition on the importation of opium in 1920. Despite a rapid production increase, Mexican poppy growers could not meet market demands. In the 1920s and 1930s, traffickers in Ciudad Juárez imported opium and morphine produced in India and Burma that transited Hong Kong, Los Angeles, California, and El Paso, Texas.

Marijuana was also produced in increasing quantities in Mexico over the course of the first half of the twentieth century, as fields blossomed in the central states of Puebla, Guerrero, and Tlaxcala. The target market was the growing demand in the United States. Marijuana consumption by residents of Utah was perceived so worrisome that the state banned its consumption in 1915. Even after the Mexican government prohibited marijuana in 1920, production could be measured in tons by the 1930s.

A loose network of traffickers evolved, which included Mexicans, Chinese, and U.S. citizens, in addition to immigrant Romanians, Spaniards, French, Greeks, and Japanese on both sides of the border.

These traffickers worked closely with local political elites and law enforcement officials. Beginning in the 1920s, the emergent Mexican political class viewed trafficking as just another profitable business opportunity. As such, the most important politicians of these northern states, including Governor Esteban Cantú Jiménez of Baja California, managed, allowed, and regulated the trade within local power arrangements. Scholars have asserted that the direct involvement of local political elites played an important role in reducing conflict and violence over the drug trade.

Peru and Mexico were not alone in their burgeoning drug production and distribution. Marijuana was introduced to Colombia before World War I from Panama. In 1925, the Colombian government noticed its extensive cultivation and consumption and by 1940 the Colombian state initiated an anti-drug campaign.

Cuba also emerged as a transit point and destination for illicit narcotics during the first half of the twentieth century, and organized crime groups from the United States established themselves there during Prohibition.

Taking Deep, Firm Root: 1946 to 1960s

The emergence of the United States as a global power and the growing importance of supra-state organizations like the United Nations characterized the second period of Latin America's evolving drug trade. In this new global context and in the highly unstable political environment of post-war Latin American politics, the production and distribution of drugs became both more organized and more regional in scope as it continued to shift across Latin America. Most tragically, this period witnessed the massive expansion of drug-trade connected violence.

In the wake of World War II, the United States and the United Nations emerged as the leaders of international anti-drug initiatives. The United Nations adopted the goal of eradication of the Andean coca bush in 1948. Peru, isolated politically and led by a pro-U.S. military junta, finally criminalized cocaine.

Yet, by 1948, an emerging network of traffickers connected Lima and Havana to New York City and other North American urban drug scenes, replacing irregular and opportunistic smuggling by individuals. Time Magazine reported in April 1949 that a Cuban diplomat stationed in Peru was arrested while carrying nearly one kilogram of cocaine in a diplomatic pouch.

Bolivia emerged as a key player in the development of the illegal cocaine complex following its 1952 revolution. The overthrow of the Bolivian government resulted in the dismantling of the national army and immediately created a vacuum of state power. The revolution also gave indigenous peasants access to large amounts of land, leading to a surge in coca production.

Coca consumption in Bolivia is an accepted social convention practiced by the indigenous majority and other segments of Bolivian society. With the criminalization of the cocaine industry in Peru, Bolivia stepped in after 1952 to nurture this illegal enterprise.

At the same time, Cuba became perhaps the most consequential location for the development of cocaine as a pleasure drug. Havana was one of the "first post-war global sin capitals"—a distinction that dated back to the Prohibition era in the United States—and a locus of conspicuous consumption. By 1954, Havana had the most Cadillacs per capita of any city in the world. Here, American mobsters mingled with their counterparts from Mexico and Central and South America.