Can Marijuana Help Rescue California’s Economy?

Could marijuana be the answer to the economic misery facing California? Democratic state assemblyman Tom Ammiano thinks so. Ammiano introduced legislation last month that would legalize pot and allow the state to regulate and tax its sale — a move that could mean billions of dollars for the cash-strapped state.

Pot is, after all, California’s biggest cash crop, responsible for $14 billion a year in sales, dwarfing the state’s second largest agricultural commodity — milk and cream — which brings in $7.3 billion a year, according to the most recent USDA statistics. The state’s tax collectors estimate the bill would bring in about $1.3 billion a year in much needed revenue, offsetting some of the billions of dollars in service cuts and spending reductions outlined in the recently approved state budget.

“The state of California is in a very, very precipitous economic plight. It’s in the toilet,” says Ammiano. “It looks very, very bleak, with layoffs and foreclosures, and schools closing or trying to operate four days a week. We have one of the highest rates of unemployment we’ve ever had. With any revenue ideas, people say you have to think outside the box, you have to be creative, and I feel that the issue of the decriminalization, regulation and taxation of marijuana fits that bill. It’s not new, the idea has been around, and the political will may in fact be there to make something happen.” (See pictures of stoner cinema.)

Ammiano may be right. A few days after he introduced the bill, U.S. Attorney General Eric Holder announced that states should be able to make their own rules for medical marijuana and that federal raids on pot dispensaries in California would cease. The move signaled a softening of the hard-line approach to medicinal pot use previous Administrations have taken. The nomination of Gil Kerlikowske as the head of the Office of National Drug Control Policy may also signal a softer federal line on marijuana. If he is confirmed as the so-called drug czar, Kerlikowske will take with him experience as police chief of Seattle, where he made it clear that going after people for possessing marijuana was not a priority for his force. (See a story about the grass-roots marijuana war in California.)

In 1996 California became one of the first states in the nation to legalize medical marijuana. Currently, $200 million in medical-marijuana sales are subject to sales tax. If passed, the Marijuana Control, Regulation and Education Act (AB 390) would give California control of pot in a manner similar to that of alcohol while prohibiting its purchase by citizens under age 21. (The bill has been referred to the California state assembly’s public-safety and health committees; Ammiano says it could take up to a year before it comes to a vote for passage.) State revenues would be derived from a $50-per-oz. levy on retail sales of marijuana and sales taxes. By adopting the law, California could become a model for other states. As Ammiano put it, “How California goes, the country goes.”

Despite the need for the projected revenue, opponents say legalizing pot would only add to social woes. “The last thing we need is yet another mind-altering substance to be legalized,” says John Lovell, lobbyist for the California Peace Officers’ Association. “We have enough problems with alcohol and abuse of pharmaceutical products. Do we really need to add yet another mind-altering substance to the array?” Lovell says the easy availability of the drug would lead to a surge in its use, much as happened when alcohol was allowed to be sold in venues other than liquor stores in some states. (Read why Dr. Sanjay Gupta is against decriminalizing pot.)

Joel W. Hay, professor of pharmaceutical economics at USC, also foresees harm if the bill passes. “Marijuana is a drug that clouds people’s judgment. It affects their ability to concentrate and react, and it certainly has impacts on third parties,” says Hay, who has written on the societal costs of drug abuse. “It’s one more drug that will add to the toll on society. All we have to do is look at the two legalized drugs, tobacco and alcohol, and look at the carnage that they’ve caused. [Marijuana] is a dangerous drug, and it causes bad outcomes for both the people who use it and for the people who are in their way at work or other activities.” He adds, “There are probably some responsible people who can handle marijuana, but there are lots of people who can’t, and it has an enormous negative impact on them, their family and loved ones.” (See pictures of Mexico’s drug wars.)

In response, retired Orange County Superior Court Judge James Gray, a longtime proponent of legalization, estimates that legalizing pot and thus ceasing to arrest, prosecute and imprison nonviolent offenders could save the state $1 billion a year. “We couldn’t make this drug any more available if we tried,” he says. “Not only do we have those problems, along with glamorizing it by making it illegal, but we also have the crime and corruption that go along with it.” He adds, “Unfortunately, every society in the history of mankind has had some form of mind-altering, sometimes addictive substances to use, to misuse, abuse or get addicted to. Get used to it. They’re here to stay. So let’s try to reduce those harms, and right now we couldn’t do it worse if we tried.”

Read “An American Pastime: Smoking Pot.”

– Article from TIME Magazine on March 13, 2009.

Comments

7 Comments

  1. Sir Les on

    It seems that the mindset is set to a one way mindset that Marijuana is only good as a drug…by some people now saying it will not help the economy?

    How so?
    Not only will it help the economy of the world, it helps the eco systems!

    Now you have to understand all the aspects and benefical products the plant offers the world!

    Now if it is illegal…it can be grown by all…and in that…they would have to pay the growers for the produce!

    If they empolyed say ethanol production…people could grow this plant and sell it to that industry for profits…

    Same with pulp and paper…cleaner rivers…better paper!

    And the list goes on….
    So we also have a problem with Global warming…growing large amounts of hemp and marijuana could curve the c02 build up in the atmosphere…thus climatizing the Earth to a more stainable state of harmonic natural process!

    People have to think outside the box they have put marijuana and hemp into!

    Sir Les

  2. Bluegrass on

    Forget about the tax revenue part of it. Their saying an oz. after tax will be 50 bucks? Thats a hole lot cheaper than it is now. But think about the tax revenue by means of, it’s legal. So a guy like myself can open up a Vapor lounge, where people can come in relax Vapor some buds play some pinball, read some books, or just hang out and vaporize with a friend over a cup of coffee. I will be proffiting from that business which will gain tax revenue for the state. Then there’s the people who make other products from the side of it being legal. Fuck bio-diesel theres no money in it for the manufacturer. The largest fuel supplier in 1900 was Hemp Seed oil. Another taxable income for the state. We need to ban together and have the same voice when it comes to legalisation. Until America see’s that it’s their stoner Uncle or pot head self employed Father, that is the working classs of this country, these people aren’t bad people and they have their shit together. Then we will legalize.

  3. jason on

    Marijuana has the same effect on me. It relaxes me so that I can get down to business.. Marijuana makes doing school work so much easier. I hate more than anything hearing the argument that marijuana makes you dumb…

    Alcohol makes you dumb. Marijuana does not. Atleast not me…

  4. Mary Jane and her 2 "Buds" on

    I dink all uh dis stupid nonsense about keepin’ marijuana illegal be a crock uh bull. Since when as any productive American citizen every messed down his life by smokin’ some joint and rappin’ some patriotic beat likes When Johnny Comes Marchin’ Crib? ah’ have been stoned on pot fo’ 45 years now, and it neva’ messed me down at all. I’m some self made millionaire, own real estate here and abroad. ah’ duzn’t gots much bre’d, but ah’ sho’ man gots enough left upside at da damn end uh de week t’purchase anoda’ bag uh baaaadies. Just mah’ opinion uh course.

  5. Mary Jane and her two best "buds" on

    I dink all uh dis stupid nonsense about keepin’ marijuana illegal be a crock uh bull. Since when as any productive American citizen every messed down his life by smokin’ some joint and rappin’ some patriotic beat likes When Johnny Comes Marchin’ Crib? ah’ have been stoned on pot fo’ 45 years now, and it neva’ messed me down at all. I’m some self made millionaire, own real estate here and abroad. ah’ duzn’t gots much bre’d, but ah’ sho’ man gots enough left upside at da damn end uh de week t’purchase anoda’ bag uh baaaadies. Just mah’ opinion uh course.

  6. joe and his six pack on

    Marijuana when smoke will cause me to day dream for the first hour so I can think out my problems cause by these stupid lying politicians who are corrupt. If I want to stop the day dreaming high that pot gives all I have to do is drink a strong cup of coffee and I become alert I can consantrate better on everything. It is funny these politicians are living on some other planet they talk like the pot is not here but we must wage a war on the people who hurt no one. It is funny that Bush and Chaney who are war criminals are free to continue on their marry way who hurt millions of people who killed thousands of people are free to roam around as though they did nothing wrong. Yet the people who suppose to live in the land of the free are force to pee in a cup and will be out cast from society if they ingest a protein plant which god gave to the human race as a medicine and relaxing herb to the human race but the government what to cage people who use it. I ask you who is more dangerous me with a joint or dick Chaney with a gun.