>Premise 1: the US federal government spends half of a TRILLION dollars more than it has to spend
>
>Premise 2: the US federal government thinks stopping terrorists is important, and spends the appropriate resources to do so

Disagree. They may think this is important, but the choice of resources is, IMO, far from appropriate. And I'm not discussing the quantity, just the choice.

>Premise 3: the US federal government thinks stopping drug use is important, and spends a fraction of the appropriate resources to do so, which is still a incredible amount of money, but ultimately ineffective

And the British experiment with free heroin for registered addicts had to be dumped, just when it was shown to have reduced crime significantly, because of the pressure from Nixon govt and their "war on drugs".

Sometimes I think we're reading this completely wrong, and should ask ourselves on which drugs is this war. It does look quite like an addict :).

>Premise 4: terrorists are funded by drug trade, and thus benefit by the smuggling of illegal drugs into the US

Partially funded. Most of their funding usually comes from someone's agenda, secret service, secret funds... didn't CIA fund the Taliban once? And that's not the only example.

>The US would fight a more effective war on terror, spend nothing on an ineffective war on drugs, allow its adult citizens to make their own recreational choices, and after all of that, produce an incredible income that just might put our budget on a path toward a workable reality, if it were to grow, produce, and sell marijuana, cocaine, and herion.

Too late. There's no way that those who make money on this would let this money go back to the people.