Forty years in, the War on Drugs has done almost nothing to prevent drugs from being sold or used, but it has nonetheless created a little-known surveillance state in America's most disadvantaged neighborhoods. Arrest quotas and high-tech surveillance techniques criminalize entire blocks, and transform the very associations that should stabilize young lives--family, relationships, jobs--into liabilities, as the police use such relationships to track down suspects, demand information, and threaten consequences.

Alice Goffman spent six years living in one such neighborhood in Philadelphia,...