A Virgin Debate

This is shaping up to be a pretty historic week for drug law reformers in Washington state. On Wednesday, the State House will be holding a hearing on not just a marijuana decriminalization bill, but also a full legalization bill that uses the state liquor stores for regulated sales of marijuana to those over 21. To coincide with that bill, a group called Sensible Washington has filed a ballot initiative to remove all criminal penalties for adult marijuana possession, manufacturing, and sales. If that collects enough signatures, it will be on the ballot this November. If it passes, it would essentially put the onus on the legislature to come up with a system of regulating sales.

In a previous post, I laid out my arguments for why the legislature should be working to pass a bill that legalizes and regulates marijuana. A number of the reasons for doing so are economic ones. Arguing against that rationale – sort of – is Bill Virgin in the Tacoma News-Tribune:

Was there ever a miracle drug to match marijuana? A few puffs on a legalized, regulated and taxed joint, and you’ve not only closed the billion-dollar budget holes faced by government but you’ve eliminated the economic driver behind much of the criminal activity plaguing the globe.

That’s a bit of hyperbole, but there’s no question that there are economic benefits to having a legalized, regulated market, as well as taking a big chunk of income away from criminal gangs (largely based south of the border in Mexico). Throughout this editorial, though, Virgin seems eager to over-inflate the claims of drug law reformers as a way of discrediting them. I guess it’s easier to do that than to actually argue the points directly.

Decriminalization, legalization, whatever the term du jour, it’s all the fashion these days in political circles. The new mayor of Seattle is in favor of it. Legislators from the Puget Sound region have introduced a legalization bill (one of the sponsors was quoted in an Associated Press dispatch as saying she wants to start a “strong conversation” on the topic; in modern political parlance, “conversation” usually means hectoring monologue or lecture). In Oregon, several efforts are under way to get a measure on the ballot to legalize weed.

All of this isn’t happening in a vacuum though. The damage of marijuana prohibition has become far too massive to ignore. That’s why it’s become the “topic du jour”. Only about 10% of the American adult public uses marijuana, but over 40% want it legal. It’s not an argument about wanting to use marijuana. It’s an argument about economics, public safety, personal freedom, and protecting young people. Attempting to keep illegal a plant that 25 million people like to use for intoxication is harming this country in a number of ways. Having a “conversation” about it doesn’t become a “hectoring monologue” unless the other side has nothing to counter it with. And that’s exactly what’s happened with this debate, as is demonstrated by the rest of Virgin’s editorial.

We’ll set aside for another day discussion of the health and societal implications of legalizing marijuana, other than to note the contrasting trends of allowing, even encouraging, increased use of one combustible commodity while smoking another substance – tobacco – seems headed for its own Prohibition.

What’s amazing here is that Virgin completely misses a major point wrapped up in that contrast. Tobacco smoking, despite being legal, has seen significant drops over the past generation, despite being perfectly legal. The notion that the legality or illegality of a drug is a major determinant of how often it’s used is a complete fallacy, as one can easily see by comparing marijuana use rates in Holland (where it’s legal) and marijuana use rates in the United States (where it’s illegal but far more common). In fact, he makes that error right here in the next part, where he assumes that legalization equals increased drug use, even though tobacco has shown an opposite trend.

Also up for debate – sorry, “conversation” – is the notion that much of the real world is as sanguine about the impact of increased drug use as the chattering classes seem to be (try convincing your average parent, especially those with teenagers, that society’s collective shoulder-shrug toward drug use is a good idea).

Or maybe he could ask Rick Steves – who has several teenagers of his own – why he’s holding forums around the state in order to have this conversation about legalizing marijuana. Protecting children from marijuana might actually be the most compelling societal reason for establishing a regulated system of marijuana sales for adults. It takes the distribution out of schoolyards (where high schoolers repeatedly tell pollsters it’s easier to buy than alcohol) and puts it in regulated stores where people’s IDs are checked. If there are any parents out there who aren’t sure about the effect of “shoulder-shrugs” towards adult marijuana use should again look to Holland, where despite their famous tolerance of adult marijuana use, far fewer young people use it there than here in the United States.

But we can certainly have a “conversation” about the economic arguments made to justify legalization – and dispense with them.

No. 1: A little legalized vice is worth it if it pays the bills. Think of all the revenue to be had by taxing marijuana. If it seems as though there’s an echo in here, there is. You’ve heard this argument before – with state lotteries. It might be easier to list the states in which the lottery wasn’t sold as the permanent answer to the problem of how to fund public education.

It wasn’t. Marijuana sales-tax revenue won’t be either. Even if you believe the estimates of the marijuana trade currently, it’s a reach to believe all those sales will automatically transfer to legal channels.

Virgin is again attempting to overstate the case that the supporters of the bill are making. The regulation and legalization bill isn’t promising to save the state economy at all. In fact, it directs the vast majority of the tax revenue to be put towards drug treatment. So even if you’re inclined to believe that legalization would lead to increases in drug abuse for people of the state (I don’t believe that would happen, but it’s not something that can be absolutely proven at this point), the amount going towards treatment would also increase in parallel. This bill doesn’t aim to save school funding or transportation funding or any other specific shortfall – just drug treatment.

The bigger point that he misses, though, is that the vast majority of the economic benefit that comes from bringing marijuana prohibition to an end comes from savings within the criminal justice system. Decriminalization alone would save $16 million. And according to Harvard Economics Professor Jeffrey Miron, $12.9 billion in criminal justice costs would be saved nationwide by ending marijuana prohibition. Virgin only addresses this in passing later on in the editorial, even though it’s far more central to the cost saving argument than tax revenues. Also not mentioned is the potential for a regulated market in what’s already one of the state’s most lucrative cash crops to create many more jobs.

Furthermore, sales may not be nearly as large as hoped for. No matter how blissfully stoned happy faces proponents try to slap on packages of legal marijuana, and the use thereof, cannabis consumption will continue to carry some societal opprobrium.

I’m not even sure how to respond to something this silly. Is he suggesting that people will be afraid to show their face in the state liquor store to purchase some marijuana because they’ll be afraid that the people buying whiskey and vodka will sneer at them with an air of condescension? Seriously?

And those who continue to indulge may decide they’d rather smoke unregulated, untaxed, cheaper weed.

This is likely to be true for (my guess) about 5% of marijuana users. For starters, growing high quality marijuana is not as simple as most people imagine it to be. I expect that in a regulated environment, people will be able to get very good marijuana at very reasonable prices and not find the taxes to be an excessive burden (far less of a burden than tending to your plants all the time). People who’ve grown in the past – and medical users who consume a lot – will likely continue to keep their private grows going, but I have doubts that it will ever be any more popular than what home-brewing beer is to the overall alcohol market today.

No. 2: Like marijuana use, we can stop with marijuana legalization. Marijuana may not be the gateway to harder stuff for all users, but legalized vice rarely pauses in the doorway. To understand why this is so, let’s go back to the example of legalized gambling, where states are already engaged in an unending, unwinnable race to the bottom.

The next state over introduces a lottery? Fine, we’ll boost the stakes and promote ours more heavily. They match us? Fine, we’ll expand to more exotic forms of gambling. Them too? Fine, we’ll opt for casinos, slots at horse-race tracks, slots wherever there’s a sucker with money to drop. Which might provoke our neighbors to leapfrog us with ever more prevalent gambling. Which we’ll somehow have to meet or exceed.

Or we can make a comparison that makes sense – to hard liquor – where we don’t compete with other states in order to get our citizens to consume more of it. Demand for marijuana exists for the same reason that demand for hard liquor exists, and neither needs to be drummed up to generate excessive revenues. If we’ve been able to avoid this trap for alcohol for so long, why can’t we similarly avoid it for marijuana?

No. 3: Look at what drug-motivated crime is doing not just in the U.S. but around the world. If you legalize marijuana, you take away the profit motive behind drug-related crime. This is the big one, an argument compelling even to those uncomfortable with the “smoke ’em if you got ’em” attitude toward marijuana. Making the argument all the more attractive is the money spent on and supposed futility of the War on Drugs.

Virgin finally touches on the money-saved-in-law-enforcement-costs argument he seemed eager to avoid in the first two points. Although I’m not sure what’s “supposed” about the futility of the War on Drugs. We’ve spend trillions of dollars trying to eliminate drugs from our society, have more people (by far) locked away in jails for drug use than any other country on the planet, yet Americans do more drugs than any other country on the planet. What part of that causes one to doubt its futility? It’s the definition of futility.

Attractive, but not valid. Crime gangs may be happy to walk away from the marijuana trade, a bulky, low-value commodity, in favor of other higher-value, easier-to-make-and-move substances.

I have absolutely no idea what he’s basing this on. Marijuana constitutes about 60% of the revenues that Mexican organized crime groups rake in every year. This isn’t some “bulky, low-value commodity” to them, it’s their cash cow. If Mexican drug gangs would be “happy to walk away from the marijuana trade” for pricier drugs like meth and cocaine, then why are they trying so hard to set up grow operations throughout Washington state in parks and other forest lands?

They are not, however, likely to throw up their hands, say “You win, you’re too smart for us,” and walk away from a lucrative trade they’ve cultivated, unless you’re prepared to legalize the sale of everything that the populace might turn into a mind-altering material.

Sure, and that’s a conversation that may need to be made later. Few people are arguing that more addictive drugs like cocaine and meth should be treated like marijuana, but there are ways (through better treatment, which the legalization bill would provide) to reduce demand for those drugs right now. But even without that, removing 60% of their revenue by ending marijuana prohibition is a significant dent in their ability to operate.

And even then, that won’t chase crime away. Organized crime can make a healthy business out of illicit traffic in legal-and-regulated items – like cigarettes, in which there’s been a lively tax-dodging trade for decades.

I think it’s finally time to turn the tables and ask Virgin if he’s high. Does he really believe that Mexican drug gangs can replace the billions in lost revenue from the end of marijuana prohibition by selling cigarettes to people for less than what they cost with taxes? Wow. Whatever he’s smoking should sell real well if HB 2401 passes.

(Since the unhappy experience of alcohol’s Prohibition always gets tossed into the debate, we ought to consider why illicit traffic in alcohol didn’t persist after repeal. Here’s a theory: Alcohol is bulky, heavy and not easy to produce at a quality level in sufficient quantities to slake Americans’ thirst. The commercial ventures that legally produced beer, wine and spirits before Prohibition went back to doing so after repeal. Production of marijuana and similar items was never done on a legal, commercial scale.)

Um, no. The reason that illicit traffic in alcohol didn’t persist after the repeal of prohibition is because (drum roll, please!)…people prefer not to buy intoxicating substances from shady characters when they have a legal way to buy them. My lord, this guy has a regular column on business and economics in the News-Tribune?

The forces pushing for marijuana legalization will do so with arguments ranging from personal freedom to lack of harm to individuals or society at large. There are cases to be made on both sides of those debating points. But when it comes to the economic rationalization for legalizing and taxing the tokers, the proponents’ case is filled with bottles of another well-known American cure-all elixir – snake oil.

What’s arguably the saddest thing about Virgin’s editorial is that there likely won’t be a more coherent attempt to argue against the idea of ending marijuana prohibition all year. And in fact, this was only a half-assed attempt to do so. He essentially built up a strawman of a drug law reformer who was making over-inflated claims in order to have something – anything – to argue against. The regulation and legalization bill doesn’t promise to balance the budget, and it doesn’t promise to dismantle Mexico’s drug cartels with one swoop of the Governor’s pen. It only aims to get us closer to those goalposts, while expanding the rights and freedoms of Washington residents and better protecting the safety of our children.