I’ve been writing here for a while, so maybe it’s time to get a little bit edgier. Let’s talk about drugs. Not the Adderall shortage, not the amoxicillin shortage, not federally legalizing marijuana, but the hard stuff: cocaine.
Goran Gogic, a formerly world famous boxer out of Montenegro, was arrested right before fleeing the country after he was caught overseeing the logistics of a $1 billion dollar cocaine trafficking operation. That’s over 22 tons, which makes it one of the largest drug seizures in US history. Everybody is out here trying to set records nowadays.
Now Gogic faces anywhere from 10 years to life in prison.
Don’t worry, I did the Google search for you. Here he is:
Don’t recognize him? I didn’t either.
This made me think of three questions: (1) What leads a relatively successful person to do this? (2) Are there any other examples of people, specifically athletes, doing this? (3) Do the economics of illicit drugs make it appeal enough to join?
The first two were easy to answer, but the last one led me down an interesting rabbit hole. I’ll be sure to answer all three for ya.
From the Boxing Ring to the Trafficking Ring
Gogic was 21-4 in his professional career and racked up earnings between $1-1.5 million. Yes, $1.5 million is a lot, but it’s not going to last forever, and you can only box while in peak physical shape. So, I can see where Goran Gogic would need to find an income stream elsewhere, that’s not hard to imagine.
I can also see where a basic addiction and involvement in cocaine and its dealings snowball and balloon into ever increasing levels of involvement.
Bottom line is, it’s feasible to see how this came to be. Not necessarily this magnitude, but who knows maybe he was exceedingly good at supply chain and operations in college.
Other Athlete Examples
You may be surprised, but most athletes actually don’t retire into the billion-dollar illegal drug trafficking scene! Most famous athletes that have been busted in relation to drugs were only involved in consumption or your corner-of-the-block drug dealer scenarios (you would be surprised; however, at some of the names on that list). There were only three instances involving drug smuggling:
- Bob Probert, an NHL player, was caught smuggling cocaine across the US-Canadian border in 1989.
- George Morales, a super boat World Speed Champion, used his boats for more than racing. He was caught smuggling cocaine from South America to Miami.
- Joan Garriga, a motorcycle road racer, was charged with drug trafficking over half a kilo of cocaine as well as many guns.
These three athletes are all goldfish compared to the whale that is Goran Gogic, but all three dealt in the cocaine industry.
So, let’s talk about it.
Cocaine, from Crop to Key
Buckle up, we got some facts and figures coming in, and they’re all made by yours truly.
Cocaine makes up over a quarter (26.6%) of the total illicit drug market with a market of $85 billion.
Let’s go a layer deeper and just focus on cocaine.
Two pie-charts…. time to take a break and explain to make sure everyone is following me.
So, cocaine makes up a quarter of the total illicit drug market. Within that quarter the wholesalers and traffickers make a quarter of all the revenue, or $21.25 billion. The rest goes to the local dealers and distributors.
Ok, then why didn’t Gogic just follow the money and become a dealer? That’s a fair question, and the answer is because of competition. Think about it, I would assume there’s hundreds of dealers in any given major city, but how many wholesale drug traffickers do you know?
Using a pie analogy because of the pie charts and Thanksgiving coming up, Gogic was getting a bigger piece of a smaller pie (and $85 billion is no small pie). Compared to the dealers who are getting a small piece of a very large pie.
“Matt, don’t you have another cool chart that shows this?” Sure do!
You can see that the competition increases as the amount of money being shared increases. What’s also interesting is that you can see the margins being baked into these numbers, the value of the same amount of product is increasing as more people are getting involved. Everybody’s got to eat. In some regard I sympathize with the poor farmers who are growing and making this are only seeing 1.17% ($1 B) of the total value of their commodity. But at the same time, there is much less competition at that level, and they are getting a bigger piece of the pie.
I could honestly write 10 more pages on this talking about the pros and cons of each level, but to summarize, Goran Gogic was involved in a medium risk, high reward niche of the drug trades.
So, You Want to be A Drug Dealer
I wouldn’t recommend it, but if you are sold on my charts and think this is your calling, then here’s how I would classify each of the tiers in the hierarchy of the drug business.
- Farmer: Low Risk, Medium Reward. Often not criminally prosecuted but not super lucrative
- Trafficker: Medium Risk, High Reward. Often the puppeteer behind early-stage operations, which means they’re slightly removed. Harsh criminal consequences, but very lucrative.
- Traffickers Henchman: High Risk, Low Reward. High risk because they’re the ones moving the product and are most often caught. Low reward because they get a fraction of what the cut the puppeteer get.
- International Wholesaler: High Risk, High Reward. High risk because if one dealer gets caught and snitches, all roads lead back to you.
- Dealers/Retailers: Low/Medium Risk, Low Reward. Low reward because the money split among thousands so you won’t see much of it. Low risk because a lot of the drug dealing charges don’t lead to substantial prison time.
But by far the best position in the drug business is, drumroll please, a licensed and certified pharmacist. Yep, grad school for the win here.
A Few More Things, To Go
The more you look into it, the more you will realize that the illicit drug business is in many cases run like a Fortune 500 company. It just happens to be involving an illegal commodity. As weird and socially unacceptable as it may be to say, there are some brilliant minds involved in this business and it sucks to see them wasted on cocaine.
There’s actually an entire chapter (Chapter 3: Why Do Drug Dealers Still Live with Their Moms?) in Freakonomics that taught me a lot about the economics and facts of drug dealing that you might find interesting.
I’m not saying Gogic was a brilliant mind, who knows maybe he suffered from too much CTE as a result of boxing.
And maybe, if he’s not serving life in prison, he can go fight Jake Paul for some money if he needs it.
Let’s have ourselves a weekend.
executively from, matt