Wednesday, April 23, 2014
I think I’ve figured it out. The sudden surge for legalization of marijuana has little to do with any argument about whether it is a dangerous drug. The real motivation for legalization is the switch from greedy illegal drug dealers to a greedy government.
Colorado already has legalized pot for recreational use, and the state of Washington will make it official in June. Maine is expected to join the early parade soon, along with California and Vermont. For those of us here at home, this should come as no surprise, since Maine is now rated one of the most liberal states in the nation.
Portland already has voted heavily in favor of legalization, but that may be of little significance when reminded that sale of the drug is still a state and federal offense. We watch in amazement as state governments throw aside any and all concern from science and medical sources that marijuana may be harmful.
Money — specifically tax revenue — is the new reason for drug legalization. Government wants a piece of the action. Why let the drug dealers get it all?
Colorado had $5 million worth of recreational marijuana sales in the first week, providing the government with $1.45 million. Colorado imposes a 25 percent excise tax on pot. That state hopes to collect up to $23 million a year.
The marijuana business also can create jobs; there are already several marijuana trade schools in Colorado. School reunions will really be fun.
Early developments in the first states to legalize pot include the fact that in Colorado recreational pot is sold at a price twice that of medical marijuana. Street drug dealers are happy because the more cost-prohibitive the drug is legally, the more incentive to do it illegally. The measurable result in the “Rocky Mountain high” state is that 136 of 517 medical-marijuana dispensaries applied for a recreational sales license.
In Washington state, street dealers are even happier. Taxes on marijuana there will be about 44 percent. That state thinks it will collect $2 billion in taxes from the sale of marijuana over a period of five years.
What if pot was legalized nationally? Estimates of tax money that could be raised fall in a range between $40 billion and $100 billion.
Opponents of the weed say that keeping it illegal holds down use a lot. They argue that if we make it legal, more people will use, and social costs will be high. Proponents claim that the number of people in jail for illegal marijuana sales or use is small, maybe only about 10 percent of those incarcerated for non-violent crimes.
Push comes to shove on this issue when the clash between federal and state law is tested. Growing, selling and processing marijuana remains illegal federally. Section 280E of the IRS code stipulates that anyone violating the Controlled Substances Act — street dealers or large, regulated marijuana businesses — must pay taxes on all sales. Further, marijuana growers and dealers are not allowed any normal business expense deductions. The end result is a big incentive to pour as much revenue as possible back into growing their business.
Leave it to Uncle Sam to reach the long arm of government into business, no matter what that business is.
An interesting aspect of the current legalization movement is that the president’s drug czar, Michael Botticelli, told a congressional committee last week that the administration will not move to legalize marijuana. He pointed out that “opposition is being driven by medical science and research.” The president’s position is being met with great dissatisfaction from his political base core, especially young voters.
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