Meth is dirt cheap, widely available in Los Angeles, and it induces psychosis. Isn't it obvious that's the issue?
As a long time volunteer and giver to drug rehab programs, I'm very sympathetic to this argument, but I still agree with OP.
People don't really like drugs. That kind of addiction is usually closely connected to something else in their life going wrong. If the only happiness you can find in your life is in a pill or a pipe, then that's where you will go until it destroys you.
This is where OP's "on the margins" argument comes back. If housing is more affordable, you'll have fewer miserable people and fewer people on drugs. If you transform public schools from prisons/daycares into institutions that actually feed and empower the curiosity of children, they'll have less a reason to buy drugs from each other. If you make it easier for people to start businesses and follow their dreams, they'll have a purpose that feeds them instead of a chemical.
You can't eliminate the drug problem this way, but it can be improved on the margins simply by giving more people an easier path to happiness.