The recent passage of state laws in both Washington and Colorado legalizing small amounts of cannabis sativa for personal use will have profound implications far beyond the borders of those states.
Legalization is perhaps an imprecise term in that despite the decriminalization within the borders of the pioneering states, marijuana remains a federal illegal controlled substance. The passage of laws decriminalizing pot for either medical or recreational use in any of the states is now a conflict about state’s rights over federal authority.
Thus far, the feds are yet silent on the goings on in America’s west, taking a cautious wait and see public stance. Yet there is surely a great deal of behind the scenes discussions about what are the implications for the nation as a result of the collective voice of voters demanding restrictions on marijuana use be loosened.
The emergence of a controlled, legitimized supplier industry and sales channels within all the states where cannabis is legal locally for either medical or recreational use means that sales can and will be taxed.
Excise taxes at both federal and local levels are imposed on all alcohol and tobacco products and it’s inevitable governments at all levels, local on up will adjust to capitalize on the green market cash flow. The taxing authorities are already scrambling to figure out the best ways to get their piece of the action and what happens in the various state legislators who will have to face the options of how to tax the product, sales, and businesses.
At the federal level it’s especially fraught with entanglements as taxing any part of it, is inherently a form of cognitive dissonance within the national mindset. How does one tax a product or the profits from the sale of it if it’s illegal to sell.
To tax its sale is to condone its sale, and acquiesce to it’s local legality. Which might even be illegal putting the government itself into the position of aiding and abetting a black market activity by profiting from it.
Whatever decisions are made one of the huge implications of the shift toward legalization and decriminalization is that what is now a economic expense on governments will flip sides and become a cash revenue generator. According to research by Taxpayers for Common Sense local and state governments are on the hook for between 6 and 7.7 billion dollars annually for enforcement, prosecution and internment of millions of marijuana users annually. Those figures don’t include the reported 4 billion spent at the Federal level.
Marijuana smokers are estimated to be at between 40 and 50 million persons in the US. Tobacco smokers have have been in steady decline for decades, now to about 74 million or about 24% of the population while cannabis smoking is increasing slighty (or at least it’s reporting of it).
One implication is that the arrest and incarceration rate and costs of prosecution and prison in states like Colorado should plummet. In the year prior to Colorado voter’s daring dismissal of the wisdom of keeping pot illegal, that state’s police forces busted more than 10 thousand of it’s citizens (even as one of the medical marijuana states). back links check . The savings to local taxpayers is far from chump change.
And the tax revenues once they figure out how to tax and fee the rapidly emerging industry, which by legalization will automatically be increasingly populated with straight laced, profit oriented business types as the small independent hippie types and black market suppliers are squeezed out of the picture with licensing, regulation, tax collections and official oversight. As Tony Dokoupil reported on PBS’s Fresh Air, legalization will not eliminate or wipe out the black market or cartels. Such entities adapt or diversify, and where the competition get’s too tough they move to something else. The Colorado police will still have plenty of illegal drug users and dealers to prosecute. They simply will be those who use and move more dangerous and harmful drugs than a natural weed, consumed or used in one form or another through five thousand years of human evolution.
Another implication is that Colorado and Washington may expect to see a further reduction in highway fatalities as they and the other states that have allowed medical marijuana use within their borders. Such states have seen an average of 9% fewer traffic fatalities since allowing it’s use, explained by the assumption that cannabis is replacing alcohol among many thus there are fewer dangerously drunk drivers on the road.
And if one reads and believes the medical psychology literature, the general ‘mood’ of the population in the aggregate in those states should shift many out of depression and toward a happier more contented emotional state. Really. Turns out that cannabis, among it’s other more well known medicinal functions, reduces the incidence of depression, reduces anxiety, and is being found to be among the most effective and safest treatments to reduce the extremes of bipolar disorder. That reported by both Lester Grinspoon of Harvard and researchers at the University of Oslo.
The implications will transform much in the states that have moved toward legalization even as they will have to adapt and struggle with creating systems and regulations to cope with the shifting attitude and the birthpangs of a baby guerilla industry. The implications are like the plant itself. It’s a weed. Its nature is to spread and take root in any suitable soil. It will grow beyond it’s state’s borders in the effects it has in the national psyche.
They eyes of a nation are upon both Washingtons and Colorado and what transpires there will impact and affect every other state whether it’s ready or not. Change is the most inevitable implication of what happened on November 6th. We’ll all see what those changes will be in good time.