I always thought that this was some attempt to show at how messed up everyone had become by then--Alice wasn't even sure if she saw him with a guy or a girl, but maybe I'm giving them too much credit. When we had to watch this in school back in the early 90s, that was pretty much the number one thing everyone talked about (I pity our poor teacher who was probably forced to show it was misguided--by 1994 LSD was not really the threat other drugs are--never mind that as others have commented, while a drug that can cause serious troubles it's not a supremely addictive drug as Alice claims--and the heavy handed "poor innocent girl gets slipped a drug at a party and goes full on druggie/basically prostitute within a month or so, gets her life back in order it seems, but then we're told in voice over she died of an overdose a month later" caused more confusion and laughter than its scared straight message).
The author of the book, of course, Beatrice Spark was a well intentioned Mormon woman who used these books (which I'm sure did have elements of real life teenagers stories--one ofthe followups Jay's Diary got her ina lot of trouble from "Jay's" family who trusted her with the real diary and were nearly destroyed by all the satanic elements she added to it), and she used them to scare teens into morality lessons. SHe never did a book about homosexuality, but I always did wonder if she was trying, in Alice, to equate the fact that these loser dealers were really gay (or at least bisexual) as a further point about how evil they were. But that's probably reading too much into it, and she just wanted to show clearly that they had no real love for "Alice".
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