Can Taxing Pot Fix Our Broken Economic System?

Prohibition ended because the economy needed a boost. According to Harvard economist Jeff Miron, the country's revenue was bottoming out and a monetary infusion was needed to keep the economy afloat; alcohol to the rescue.

Could marijuana offer the same boost to America's flagging economy? According to an article written by John Dyer of MSN Money, Daniel Stein believes that it can. Stein, who actually sells medicinal marijuana through his own marijuana dispensary, believes that if Washington put aside it's bias and took a hard look at the revenues that taxing marijuana will bring in they could start to balance the books right now.

Daniel Stein owns two retail marijuana outlets. By his own claims he is making upwards of one million dollars in revenue and paying sales taxes of about $80,000 a year to the state of California. While California is happy to take Stein's $80,000, the federal government does not recognize his endeavors as a gainful enterprise. As such the federal government does not benefit from any monies taken in from Stein's medicinal marijuana sales.

According to Dyer, the government is losing money as they battle to shut down Stein's and other medical marijuana dispensaries. Stein says, "Imagine how much money the feds would save if they stopped cracking down on sellers."

"Cannabis is good for the economy. It's been here the whole time, but it's had a bad rap the entire time," adds Stein.

The Office of National Drug Control Policy admits that marijuana is the most popular of the illicit drugs in the United States.

According to the article "An American Pastime:Smoking Pot" published in Time magazine, a survey undertaken by the Public Library of Science showed that Americans are far more likely to have tried marijuana, at least once. The Netherlands which has far less stringent laws on marijuana usage has a lower percentage, 20%, of people who have actually tried pot as compared to America where the percentage stands at 42%.

Dyer's article also references a study overseen by Jon Gettman, a senior fellow at George Mason University's School of Public Policy. The study placed the value of the marijuana trade in the United States at $113 billion yearly. The study showed further that the federal government and states are losing around $42 billion annually because of their resistance to legalizing marijuana. Gettman, a former staffer for the National Organization of for the Reform of Marijuana Laws(NORML) says, "It's a very large, significant economic phenomenon, and it is diverting an incredible amount of money from the taxable economy". NORML lobbies before lawmakers for the legalization of marijuana.

Jeff Miron estimates the actual tax revenue at a far more conservative $6 billion. However, he feels that legalization would result in cost savings of $8 billion in legal fees.

The Obama administration and Attorney General Eric Holder seem to be taking a gentler stance on medicinal marijuana dispensaries like Stein's. Stein is relieved at this turn of events. In years past he indicated that he faced DEA raids and has had to move his business on at least one occasion because the DEA contacted his landlord and threatened them with the seizure of their building.

There are many vocal opponents to any move to legalize marijuana, who point to the health and abuse aspects. They feel that any slackening of the rules sends the wrong message to young people about the dangers of drug abuse. Calvina Fay, the executive director of a Drug Free America, feels that those who support legalization of marijuana fail to take into account the 'adverse effects' of the drug. Fay cites lowered productivity, impaired judgment and user's propensity to move on to heavier, more dangerous drugs as some of those effects.

Some states have come close to making marijuana as legal as their state's rights will allow. California has submitted a proposal to completely legalize marijuana. San Francisco Assemblyman Tom Ammiano estimates the proposal could result in $1.3 billion in sales tax revenue.

Medical marijuana has been utilized effectively for a number of health problems where traditional medicines have either been ineffective or contraindicated in users. Conditions such as Glaucoma, Multiple Sclerosis as well as Dystonia have been shown to benefit from the administration of medicinal marijuana. In countries where the laws against marijuana usage are less strict, drugs based on marijuana's chemical make-up are being formulated.

It remains to be seen if marijuana will be legalized but when one considers that in most countries where less repressive laws are in place, far fewer people actually abuse the drug it may be worth considering, especially in cases of medical need.

Sources:

http://articles.moneycentral.msn.com/Investing/StockInvestingTrading/a-budget-cure-marijuana-taxes.aspx#pageTopAnchor

http://www.drugpolicy.org/marijuana/factsmyths/

http://www.time.com/time/health/article/0,8599,1821697,00.html?

http://www.dfaf.org/?