American underground.

Reefer Madness: Sex, Drugs, and Cheap Labor in the American Black Market by Eric Schlosser Houghton Mifflin. 310 pages. $23.00

Eric Schlosser made our stomachs churn with his behind-the-counter account of McDonald's and other chain restaurants in Fast Food Nation. In his new book, Reefer Madness, he examines the U.S. underground economy.

Schlosser, a correspondent for The Atlantic Monthly, is a talented and intrepid reporter, and one of his greatest strengths is his ability to tell the personal stories behind the faceless underground economy. But Reefer Madness raises more questions than it answers. Its title and packaging suggest in-depth analysis, but Reefer Madness is neither a close-up look at the political economy of marijuana nor a broad examination of the black market. Instead, it is a compilation of three discrete essays, all substantially based on previous research, loosely linked by a brief introduction and conclusion. His depictions of pot growers, migrant workers, and porn hustlers are vivid. But although drugs, sex, and cheap labor are all aspects of the underground economy, it's not clear whether the whole here adds up to more than the sum of the parts.

"At its simplest, the American underground is where economic activities remain off the books, where they are unrecorded, unreported, and in violation of the law," Schlosser writes. "These activities range from the commonplace (an electrician demanding payment in cash and failing to declare the payment as income) to the criminal (a gang member selling methamphetamine)." Schlosser admits that any estimate of illegal economic activity is imprecise. He uses the work of Austrian economist Friedrich Schneider to estimate the size of the underground economy. "According to Schneider, in 1970 the size of the underground was between 2.6 and 4.6 percent of America's gross domestic product (GDP). By 1994 it had reached 9.4 percent of the GDP--about $650 billion."

Other countries fare worse. Schneider estimates the underground economy is 27 percent of the GDP in Italy; Russia, 45 percent; Bolivia, 65 percent; and Nigeria, 76 percent. Thanks to the stability of the U.S. dollar, the $100 bill is the underground's current choice of currency. Poor Ben Franklin, the face of illegal activity.

In his first essay, Schlosser traces the evolution of marijuana use and cultivation along with the failure of the war on this drug in the twentieth century. He introduces us to Midwestern pot growers and the DEA agents who track them down. He explains that the current penalties for pot-related first offenses range from probation to a life sentence, depending upon which state you happen to get busted in. And every drug case can be charged under federal law, though there are "no established criteria for when a U.S. attorney will enter a marijuana case."

Schlosser points out the ironies of the U.S. government's attempts to criminalize drug use: Federal laws enacted to stop drug smuggling led to a huge increase in domestic cultivation; the toughest drug laws are enacted years after drug use is at its peak; and the Republicans say they support states' rights, except when it comes to drug laws. Ashcroft's raids on state-sanctioned marijuana distribution centers illustrate these legal incongruities. "Under California law, thousands of AIDS patients had been receiving marijuana through a handful of nonprofit cooperatives that worked closely with state law enforcement authorities," Schlosser notes. "One by one, Bush's Justice Department shut them down."

For people like me who enjoy reading about the hypocrisy of politicians, this chapter is a gold mine. Here's one nugget: "In 1981 Congressman Newt Gingrich introduced a bill to legalize the medicinal use of marijuana. Fifteen years later, as Speaker of the House, Gingrich sponsored legislation demanding a life sentence or the death penalty for anyone who brought more than two ounces of marijuana into the United States."

Schlosser names several fortunate sons who did not suffer the punishments their office-holding fathers advocated. "In 1990 Congressman Dan Burton introduced legislation requiring the death penalty for drug dealers.... Four years later his son was arrested while transporting nearly eight pounds of marijuana from Texas to Indiana. While awaiting trial in that case, Danny Burton II was arrested again, only five months later, for growing thirty marijuana plants in his Indianapolis apartment. Police also found a shotgun in the apartment. Under federal law Danny Burton faced a possible mandatory minimum sentence of five years in prison just for the gun, plus up to three years in prison under state law for the pot. Federal charges were never filed against Burton, who wound up receiving a milder sanction: a term of community service, probation, and house arrest."

The second essay, "In the Strawberry Fields," chronicles the role of cheap labor in agriculture. Undocumented workers are the backbone of the fastest growing and most profitable segment of California's farm economy--"specialty crops" like avocados, peaches, grapes, plums, and strawberries. Migrant labor has grown to be a crucial part of other industries, including construction, meatpacking, janitorial services, and the garment industry.

Schlosser states that because illegal immigrants work long hours for low wages, California has been able to sustain its agricultural production, despite the loss of more than nine million acres of farmland in the past forty years. "Illegal immigrants, widely reviled and often depicted as welfare cheats, are in effect subsidizing the most important sector of the California economy," he writes.

During harvest season, Schlosser traveled through three strawberry-producing regions in California. He gives us discomforting details of the day-to-day survival of a migrant worker, who, on average, is a "twenty-nine-year-old male, born in Mexico, who earns less than $7,500 a year for twenty-five weeks of farm work." Schlosser describes the horrific conditions in labor camps: "A typical room was roughly twelve feet by ten feet, unheated, and occupied by four men. Sheets of plywood separated the steel cots. I've seen better horse barns." And he gives us an overview of how growers easily get in over their heads by cultivating a crop so delicate that a rain shower can ruin an entire harvest.

While the Cuyahoga River burned and "Boy Mayor" Dennis Kucinich ran the city, one man was busy building a porn empire in late 1970s Cleveland. Schlosser's third essay, "An Empire of the Obscene," delineates the rise and fall of Reuben Sturman, a comic book salesman turned porn distributor. His story "spans the history of the modern American sex industry, from the distribution of 'girlie' magazines under the counter to the sale of adult videos at urban newsstands and suburban malls."

This essay is also an examination of fluctuating American attitudes regarding obscenity in the twentieth century. "Unlike murder, whose legal definition doesn't change significantly with each generation," Schlosser writes, "the crime of obscenity has always reflected the values of the government leveling the charge."

This last essay, the longest of the three, doesn't fit together well with the other two, but it could anchor a book on the modernization of porn. By focusing on Sturman, who is an interesting character, we get a very specific and extremely limited view of the porn industry.

Still, the chapter is provocative. Schlosser posits that the porn biz, like other underground industries, was responsible for innovations in everyday American life, including "the successful launch of the VCR." And the underground porn industry that Sturman dominated shared some of the same business practices we see today in the mainstream economy, including the use of off-shore accounts and foreign incorporation to evade federal taxes.

Porn is a place where the line between the legitimate and underground economies grows especially blurry. How can the Comstock Law--which makes it a crime to send "obscene, lewd, or lascivious" materials through the mail--still be on the books when people can order porn on pay-per-view TV? Schlosser notes that companies like DirecTV, AT&T Broadband, and AOL Time Warner make millions distributing porn. Americans spent over $200 million watching porn in their hotel rooms in 2001. "About half of all the films rented in hotel rooms are porn films," Schlosser writes. "The leading hotel chains--such as Hilton, Holiday Inn, Sheraton, and Marriott International--get a cut of up to 15 percent."

In his conclusion, Schlosser expresses "a suspicion of all absolute theories and a strong belief in thought that knows its limits." And he offers remedies to the problems he outlined: a regulatory system of "fewer laws, strictly enforced," the decriminalization of pot, an increase in the minimum wage, and a government that minds its own business when it comes to what consenting adults do behind closed doors.

However, Schlosser's book inspires unanswered questions like these: Is the black market distinct from the legitimate market? Can the legitimate market exist without the underground? And what does legitimate mean in a post-Enron economy? Although the three cases that make up Reefer Madness are filled with great anecdotes and statistics, they don't add up to a persuasive argument about the relationship between the underground and legitimate economies. Unlike Fast Food Nation, Reefer Madness is ultimately unsatisfying.

Elizabeth DiNovella is Culture Editor of The Progressive.