Marijuana Could Be a Gusher of Cash If We Treated It Like a Crop, Not a Crime

[Trillo]

By Steven Wishnia, AlterNet. Posted September 11, 2008.

Economists estimate tens of billions for governments if we taxed pot like tobacco and stopped wasting money on the drug war.

If marijuana were legal but taxed like alcohol and tobacco, how much money could it bring in to cash-strapped state governments?

One 2006 study called cannabis the top cash crop in the nation, worth more than corn and wheat combined. It was the leading crop in 12 states, outstripping grapes in California and tobacco in North Carolina, and one of the top three in 18 others, coming in just behind apples in Washington and cotton in Georgia. So with states facing massive deficits, could reefer revenues help?

The answer is unclear, but it could be lucrative for governments, especially when combined with the savings from ending prohibition. As the U.S. marijuana market is illegal, there are no sales figures. Estimates of its size range from $10.5 billion a year to $113 billion. But three studies done by economists and policy analysts say ganja taxes could bring in anywhere from $2.4 billion to $31.1 billion in revenue, depending on how big the sales really are. About one-third of that would go to the states.

"There's not enough really good data on it, so it's probably best to look at it in ballpark figures," says Jon Gettman, a Virginia policy analyst who has worked with the National Organization for the Reform of Marijuana Laws and the Marijuana Policy Project. "But there's a consensus that there's an awful lot of marijuana out there and that it's very valuable."

"The Budgetary Implications of Marijuana Prohibition," a 2005 study by Harvard economics professor Jeffrey A. Miron, makes the most conservative projections of the three studies. It calculates possible pot tax revenues at $2.4 billion. That's assuming that prices would drop about 25 percent under legalization, that pot-related economic activities were taxed at the national average of 30 percent, and that the federal Office of National Drug Control Policy's estimate that the domestic cannabis market is worth $10.5 billion is accurate. If herb were taxed more heavily, as alcohol and cigarettes are, that could bring in as much as $9.5 billion -- although excessive "sin taxes" could cause pot smokers to cut down or grow their own, diminishing revenues.
...

However, others in the field believe that the government's $10.5 billion figure is absurdly low. Dan Hamburg, a former congressman from Northern California's sinsemilla belt, says the Mendocino County Board of Supervisors estimates bud production in that county alone at between $1 billion and $1.5 billion, worth far more than timber and grapes. California's medical marijuana dispensary owners claim they pay $100 million a year in state sales taxes.

read more...
http://www.alternet.org/drugreporter/98317/marijuana_could_be_a_gusher_of_cash_if_we_treated_it_like_a_crop%2C_not_a_crime/

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Thought this was a good time to post this given the deteriorating economy....

[knowbody0]

1. I would volunteer for that project

we could open happy little franchises all over the country..

sigh

[silverweb]

2. Yup.

And industrial hemp, too.

Current policy is inhumane and insane.

[GoesTo11]

3. More importantly, 1 million fewer Americans arrested per year

That wrecks a lot of people's lives for a victimless crime.

Although maybe the point is to have them arrested so they can be stripped off voting rolls.

[AAARRRGGGHHH]

5. And in pure dollars and cents terms

that would save a ton of money, too, to not have to prosecute those people. Not to mention the savings in the DEA, FBI and countless other agencies that would no longer have to waste their time on such nonsense.

[truedelphi]

10. Don't kid yourself - the money isn't wasted - it is used to corrupt the

Local politicians at all levels.

Basically what happens is this: someone gets busted for a small time marijuana operation. Maybe they were selling, maybe they were distributing to people who needed med marijuana. Whatever.

Now that person's house and the cars, the bank accounts, any jewelry or big screen TV's -- all of that will be seized by the State. And sold at auctions.

Then that money is putt into a state fund, along with the monies from every other miserable beggar who has gotten arrested, and that is DOLED OUT to individuals who then dole it out to specially selected individuals, at the County level. Then they dole it out to he local City Council, or Board of Supervisors, and in some cases it is acknowledged under the heading "Discretionary Funding"

In Marin County CA I have heard that the person doing the doling out is A San Francisco Police Officer. He uses the money that comes his way to corrupt the Board of Supervisors. The politicians that they want to control the most get the most money under the table. The ones they don't care about controlling get some money through publicly acknowledged "discretionary funds" that can be used to fund projects that the Supervisor likes. But of course, it is most polite to use some of the money your agency or non-profit has received to help out monetarily at campaign time.

[truedelphi]

9. I just watched a tiny, sickening bit of one of those crimefighter

TV shows - ones that concentrates on what happens to you after you are arrested.

The police in charge of the newly detained was basically mocking this poor man. The policewoman kept saying to the guy, "You are here now and you are going to have to comply. your wife has been compliant -- why can't you be compliant? You need to start taking responsibility for everything that you have done that is wrong." (referring to his marijuana bust.)

He answered, "My conduct never scared my kids to death the way your SWAT team did when they broke down our door and pointed their guns at all of us, including my youngsters. And in the dead of night - waking all of us up! I have been a good daddy. All I did was grow some PLANTS! Why did your people ACT like that!"

The policewoman guarding him continued to give him a hard time and the whole thing made me so ill that I had to choose between throwing up or changing the channel.

[girl gone mad]

4. We can't afford our current drug policy.

We just don't have the money to be spending billions going after growers and jailing small time users.

[intheflow]

6. No time to do more than K&R this.

But it's what I've been saying since I started smoking week almost 30 years ago.

[NM Independent]

7. K&R

There would also be the benefit of our border being much, MUCH more secure. The flow over the border will end almost overnight (for pot anyway), and the Mexican Cartel Wars will likely cease as well. Well, maybe they'll just find something else to fight about.

[demigoddess]

8. I agree , read the other day that a marijuana chemical could be a cancer

fighting drug. In addition to all its other uses, it is also a crop that does not use as much fertilizer and water.

[IrateCitizen]

11. Eric Schlosser said this and more in _Reefer Madness_

It was his follow-up to Fast Food Nation, and it chronicled the underground economy. One full section of the book was dedicated to the marijuana trade. The cited estimates of its worth are in the billions -- figures that on the higher end place its worth at more than corn or wheat.

[ixion]

12. the answer is NOT unclear... in fact, it's crystal clear

end the drug war, stop putting non-violent offenders behind bars, and you'll see revenue increase and administration costs drop, guaranteed.