Sam Clemmons
Banned
It's not impossible to be both hard on drug trafficking, yet take harm minimisation approaches to drug users themselves.
It is also possible that if Reagan were to take the approach of funding needle exchange programs, he could do so 'quietly'.
Here in Australia, that is what the Howard Liberal (right-wing) government did, during the time period 1996-2007. Howard and his government was known for trumpeting zero tolerances policies and lampooning the harm minimisation approach; yet they quietly continued funneling money into needle exchange programs. This allowed Howard to appear tough on law and order, yet also taking a sensible policy approach.
I would suspect that it is plausible that Reagan does similar; especially given that the programs will themselves likely be delivered at the state and local government levels (yet he would fund them federally).
Stop me if I'm wrong, but isn't the PM of Australia also the head of parliament and therefore has control over the government's pursestrings?
American Presidents don't control the federal pursestrings. That's done by Congress, the legislative branch. As a result, Reagan can't exactly fund such programs quietly, particularly not when Congress is controlled by the Democrats.