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NEW YORK (Reuters) - A high-profile group of global leaders declared the "war on drugs" a failure on Thursday and urged governments to consider decriminalizing drugs in a bid to cut consumption and weaken the power of organized crime gangs.

The Global Commission on Drug Policy, which includes former presidents of Brazil, Colombia, Mexico and Switzerland, said a decades-long strategy of outlawing drugs and jailing drug users while battling cartels that control the trade had not worked.

"It's not peace instead of war, it's a more intelligent way to fight ... the use of drugs," former Brazilian President Fernando Henrique Cardoso, chair of the commission, told a news conference in New York. "Stop the war on drugs and let's be more constructive in trying to reduce consumption."

"We cannot have one recipe. It's not so easy to say stop the war on drugs and let's legalize, it's more complicated than that," he said. "Between prohibition and legalization there is an enormous variety of solutions in between."

The commission recommended that governments experiment with the legal regulation of drugs, especially cannabis, referring to the success in countries such as Portugal, Switzerland and the Netherlands where drug consumption had been reduced.

In 2001, Portugal decriminalized all drug consumption and users now face fines and treatment instead of jail time, while in Holland heroin can be medically prescribed and in Switzerland addicts get free methadone and clean needles.

But the White House Office of National Drug Control Policy said in a statement that making drugs more available would make it harder to keep communities healthy and safe. The United States is the biggest market for illegal drugs.

Ruth Dreifuss, former President of Switzerland, told reporters: "Drugs can be sexy when they are underground ... If you medicalize, it's no longer sexy."

Users "know now that they are ill persons and not rebels in society. It's no longer sexy and it's no longer attractive for future rebels," she said.

The commission, which also includes former U.N. Secretary-General Kofi Annan, former U.S. Federal Reserve Chairman Paul Volcker and British billionaire Richard Branson, said drug users should be offered health and treatment services instead of being treated like criminals.

There are 250 million users of illicit drugs worldwide, with less than a tenth classified as dependent, and millions are involved in cultivation, production and distribution, according to U.N. estimates quoted in the commission's report.

'UNWINNABLE BATTLE'

"The war on drugs has increased drug usage, it's filled our jails, it's cost millions of taxpayer dollars and it's fuelled organized crime," Branson said. "It's estimated that over $1 trillion (610 billion pounds) has been spent on fighting this unwinnable battle."

The commission -- which grew from the Latin American Commission on Drugs and Democracy convened by Cardoso, former Colombian President Cesar Gaviria and former Mexican President Ernesto Zedillo -- also hopes to spark a U.N. debate.

"What we are arguing (to the United Nations) is open up the debate, be more flexible and learn other lessons from other countries who have changed their drug policies," said former German government drug commissioner Marion Caspers-Merk, adding that the world body had criticized some of her drug policies.

Rafael Lemaitre, communications director of the White House Office of National Drug Control Policy, said in a statement: "The bottom line is that balanced drug control efforts are making a big difference."

"Drug use in America is half of what it was 30 years ago, cocaine production in Colombia has dropped by almost two-thirds, and we're successfully diverting thousands of nonviolent offenders into treatment instead of jail by supporting alternatives to incarceration," he said.

The commission recommended countries continuing to invest in a mostly law enforcement approach should focus on violent organized crime and drug traffickers and that reduced sentences should be promoted for people at the low-end of the trade, such as farmers, couriers and petty dealers.

"In Europe it's easy to treat the question as just a health problem," Cardoso said.

"In Latin America it's not just a health problem, it's also a problem of gangs and ... violence and the control of local power by drug lords, so it's more complicated and the government has to be much more active in fighting," he said.

The commission said that money spent by governments on futile drug war efforts could be better spent on different ways to reduce drug demand and the harm caused by drug abuse.