February 18, 2011 – An advertisement for Oaksterdam University reads “Cannabis Industry Now Hiring,” along with claims to a salary between $50,000 and $100,000 dollars. To the average American, such an ad would surely be deemed a joke — but in Oaksterdam, a district in downtown Oakland lined with medical marijuana dispensaries, training centers, head shops and the like, cannabis is serious business.

Marijuana has been used for thousands of years, and hemp itself was for centuries of great importance to the United States economy. But in the early to mid-20th century, many states began to ban the drug (the reasons for which are moot and worthy of their own article), and soon marijuana consumption became illegal under federal law.

The latter half of the 20th century saw a resurgence in cannabis usage and in 1996, California became the first of several states to allow the use of the drug for medicinal purposes. Since, “medical marijuana” has exploded with an estimated 2,100 cannabis dispensaries in California alone. Last year, California once again pioneered the push to legitimize marijuana with a proposition, Proposition 19, that would make it legal in a manner similar to alcohol; the act was ultimately defeated by a narrow margin.

Yet the question still stands — if countless studies (some more legitimate than others) claim the drug has a variety of medicinal benefits and is less harmful than tobacco, alcohol and other drugs, why is it still illegal under federal law?

One important facet of California’s proposition was an excise tax that proponents claimed would bring billions of tax dollars to a state in economic turmoil. From an economic perspective, it seems pretty rational — imposing a tax on a multi-billion dollar market and cuttting spending on law enforcement will yield more money.

Let’s think in terms of real dollars: a 2003 study by the Office of National Drug Control Policy estimated domestic spending on cannabis prosecution to be a whopping $29 billion each year. Furthermore, a study commissioned by the United Nations in 2006 estimated the North American cannabis market to be worth upwards of $60 billion per year, more than the combined value of corn and wheat. It seems obvious that the economic benefits would be outstanding, but there are other contributing factors.

Price points
First and foremost, it is a basic rule of economics that the easier it is to obtain a product, the less the product will cost. Taking marijuana off the black market and into a legitimate marketplace will make it easier to buy and consequently cause a considerable drop in price. In fact, a study by the international think tank Research and Development Corporation concluded that Proposition 19 could potentially lead to a decrease in the price of marijuana by as much as 80%.

If prices were to fall so drastically, it is unknown whether the economic tax benefits would outweigh the social costs.

Cannabis consumption
Secondly, the law of supply and demand tells us that as the price of a product decreases, consumption will increase. This is something that legalization opponents are quick to point out, and it is difficult to predict exactly how marijuana usage in the United States would change.

Enter the Netherlands, a country notorious for its lax (albeit somewhat complex) drug policies. Though marijuana isn’t exactly legal in the Netherlands, there exists a tolerance policy where possession of up to five grams is not prosecuted. The country distinguishes between “soft” and “hard” drugs — the idea being that tolerance of soft drugs will keep people away from the harder ones.

This legal distinction has faced much criticism, yet surprisingly young adults in the Netherlands have lower rates of “soft drug” use than those in most other Western European countries with less tolerant laws. Rates in Spain and Italy were twice as high as those in the Netherlands between 2002 and 2004, and cannabis use actually declined in the Netherlands in 2009 according to a study by the European Monitoring Centre for Drugs and Drug Addiction.

Weed prohibition
Many compare the illegality of marijuana to the Prohibition Era of the 1920s and 30s, and argue that legalization would have effects similar to those of the repeal of the Eighteenth Amendment. However, there are critical differences between the legality of alcohol and cannabis.

Socially, alcohol has widely been considered a part of American society, whereas marijuana carries a less acceptable reputation. Economically, the production of alcoholic spirits and beverages is difficult and costly on an individual level, and major alcohol companies have existed for centuries. Marijuana production is vastly different — there exist no major marijuana companies, and the thought of corporate cannabis sounds silly.

Nevertheless, the Prohibition Era was notorious for multi-million dollar crime rings involved in the underground trade of alcohol, and the same exists today for the marijuana industry.

The American marijuana trade is a large part of the ongoing drug war with and within Mexico, Canada and other countries. Pro-legalization activists argue that by legalizing marijuana, criminal activity would literally decrease and take the “shady” aspects out of the drug trade.

We may never know exactly what America would be like should marijuana be legalized, but the debate over doing so will surely never die until it happens. Source.

See Also:

How Big Is The Marijuana Market?

Legal Pot Means Big Savings on Law Enforcement

October 27, 2010 – By GEORGE SOROS – Our marijuana laws are clearly doing more harm than good. The criminalization of marijuana did not prevent marijuana from becoming the most widely used illegal substance in the United States and many other countries. But it did result in extensive costs and negative consequences.

Law enforcement agencies today spend many billions of taxpayer dollars annually trying to enforce this unenforceable prohibition. The roughly 750,000 arrests they make each year for possession of small amounts of marijuana represent more than 40% of all drug arrests.

Regulating and taxing marijuana would simultaneously save taxpayers billions of dollars in enforcement and incarceration costs, while providing many billions of dollars in revenue annually. It also would reduce the crime, violence and corruption associated with drug markets, and the violations of civil liberties and human rights that occur when large numbers of otherwise law-abiding citizens are subject to arrest. Police could focus on serious crime instead.

The racial inequities that are part and parcel of marijuana enforcement policies cannot be ignored. African-Americans are no more likely than other Americans to use marijuana but they are three, five or even 10 times more likely—depending on the city—to be arrested for possessing marijuana. I agree with Alice Huffman, president of the California NAACP, when she says that being caught up in the criminal justice system does more harm to young people than marijuana itself. Giving millions of young Americans a permanent drug arrest record that may follow them for life serves no one’s interests.

Racial prejudice also helps explain the origins of marijuana prohibition. When California and other U.S. states first decided (between 1915 and 1933) to criminalize marijuana, the principal motivations were not grounded in science or public health but rather in prejudice and discrimination against immigrants from Mexico who reputedly smoked the “killer weed.”

Who most benefits from keeping marijuana illegal? The greatest beneficiaries are the major criminal organizations in Mexico and elsewhere that earn billions of dollars annually from this illicit trade—and who would rapidly lose their competitive advantage if marijuana were a legal commodity. Some claim that they would only move into other illicit enterprises, but they are more likely to be weakened by being deprived of the easy profits they can earn with marijuana.

This was just one reason the Latin American Commission on Drugs and Democracy—chaired by three distinguished former presidents, Fernando Henrique Cardoso of Brazil, César Gaviria of Colombia and Ernesto Zedillo of Mexico—included marijuana decriminalization among their recommendations for reforming drug policies in the Americas.

Like many parents and grandparents, I am worried about young people getting into trouble with marijuana and other drugs. The best solution, however, is honest and effective drug education. One survey after another indicates that teenagers have better access than most adults to marijuana—and often other drugs as well—and find it easier to buy marijuana than alcohol. Legalizing marijuana may make it easier for adults to buy marijuana, but it can hardly make it any more accessible to young people. I’d much rather invest in effective education than ineffective arrest and incarceration.

California’s Proposition 19, which would legalize the recreational use and small-scale cultivation of marijuana, wouldn’t solve all the problems connected with the drug. But it would represent a major step forward, and its deficiencies can be corrected on the basis of experience. Just as the process of repealing national alcohol prohibition began with individual states repealing their own prohibition laws, so individual states must now take the initiative with respect to repealing marijuana prohibition laws. And just as California provided national leadership in 1996 by becoming the first state to legalize the medical use of marijuana, so it has an opportunity once again to lead the nation.

In many respects, of course, Proposition 19 already is a winner no matter what happens on Election Day. The mere fact of its being on the ballot has elevated and legitimized public discourse about marijuana and marijuana policy in ways I could not have imagined a year ago.

These are the reasons I have decided to support Proposition 19 and invite others to do so. By GEORGE SOROS. Source.

Mr. Soros is chairman of Soros Fund Management and founder of the Open Society Foundations.