The way it was done is that crime was nationalized. For example in the USSR, the NKVD secret police nearly exterminated the criminal underworld completely, put the remaining in forced labor camps (Gulags) and used them to repress the political prisoners. Crime became a state monopoly. https://en.wikipedia.org/wiki/Thief_in_law

If the US decriminalised cocaine and other illegal drugs you would immediately put the cartels in a stranglehold financially. Upon this, you can start going after their "legitimate" interests in legal businesses like resorts and manufacturing.

Just like the US prohibition emboldened the Mob, drug prohibition emboldens the cartels.

The Mob used to literally have shootouts with police in the street.