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The Budgetary Implications of Marijuana Prohibition
Harvard University ^ | June 2005 | Jeffrey A. Miron

Posted on 04/24/2006 12:33:31 PM PDT by davesdude

Executive Summary

Government prohibition of marijuana is the subject of ongoing debate.

One issue in this debate is the effect of marijuana prohibition on government budgets. Prohibition entails direct enforcement costs and prevents taxation of marijuana production and sale.

This report examines the budgetary implications of legalizing marijuana – taxing and regulating it like other goods – in all fifty states and at the federal level.

The report estimates that legalizing marijuana would save $7.7 billion per year in government expenditure on enforcement of prohibition. $5.3 billion of this savings would accrue to state and local governments, while $2.4 billion would accrue to the federal government.

The report also estimates that marijuana legalization would yield tax revenue of $2.4 billion annually if marijuana were taxed like all other goods and $6.2 billion annually if marijuana were taxed at rates comparable to those on alcohol and tobacco.

Whether marijuana legalization is a desirable policy depends on many factors other than the budgetary impacts discussed here. But these impacts should be included in a rational debate about marijuana policy.

http://www.prohibitioncosts.org/mironreport.html


TOPICS:
KEYWORDS: bongwater; dazedandconfused; dopersrights; drankthebongwater; drugs; dudewheresmycar; hopheads; iseebutterflies; letssmokepot; liberdopertarian; marijuana; pot; potheads; prohibition; reefermadness; stoners; wod; wodlist
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To: SampleMan

In what is that 400 billion's a waste??


21 posted on 04/24/2006 12:56:28 PM PDT by davesdude (Don't criticize what you don't understand)
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To: davesdude
The authors of this report do not understand the economic issues involved in keeping marijuana illegal. Marijuana usage dwarfs the usage of every other controlled substance, and the civil seizure law's off-budget incomes for law enforcement agencies is off-budget revenue for those agencies that they don't have to go crawling hat-in-hand to the legislatures to get authorization to use. That is why the federal law enforcement authorities sponsor phony-balony science trying to make out as if marijuana usage has serious health effects. The blow to law enforcement income from marijuana legalization will never come close to matching the horn of plenty they have now.
22 posted on 04/24/2006 12:57:18 PM PDT by donh
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To: rhombus
yeah unfortunately the pro WOD warriors are being more childish than so called "hippies" in favor of more reasonable judgment!
23 posted on 04/24/2006 12:57:43 PM PDT by davesdude (Don't criticize what you don't understand)
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To: subterfuge

All "free clinics," all Medicare, Medicaid, any government-funded rehab programs, anything that could suck in more resources if drug use suddenly spikes. I want those gone first.


24 posted on 04/24/2006 12:58:51 PM PDT by Gordongekko909 (I know. Let's cut his WHOLE BODY off.)
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To: davesdude

Aside from the Kiwanis Club kidders (and aren't they so smart) I challenge anyone to show where Fed'l Govt ever had the right to prohibit MJ anymore than they did alcohol under the Volstead Act.

Now states can do what they want via the people's vote - but the Fed NEVER has had the constitutional right to do so as it was not an enumerated power.


25 posted on 04/24/2006 12:59:34 PM PDT by Marxbites (Freedom is the negation of Govt to the maximum extent possible. Today, Govt is the economy's virus.)
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To: davesdude
In what is that 400 billion's a waste??

That depends. If you start with the premise that there is nothing wrong with surrendering, and you can live with that, then the whole thing is a waste. This would be a satirical analogy to the economic argument for legalizing drugs.

26 posted on 04/24/2006 1:01:40 PM PDT by SampleMan
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To: Marxbites

Please, you are just asking for it now...

"States Rights" are only good for outlawing things like Sex Toys, but as for MJ, it's Nanny State, Fed Control all the way.

Wait for RP to show up about this one...


27 posted on 04/24/2006 1:04:47 PM PDT by Lord_Baltar
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To: donh
Interesting post, thanks! Your right that a lot more depends on the illegal status of marijuana... All the other industries would suffer from that, but i personally wouldn't mind...They are the industries (especially the black gold industry) making our world (planet) going wrong... Evil's winning...
28 posted on 04/24/2006 1:06:08 PM PDT by davesdude (Don't criticize what you don't understand)
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To: donh

About as constitutional as emminent domain has become.

The cheerleaders of the oppressive non-founding principles statists here makes one want to puke.

I don't want or need Govt, or anybody else, to presume to tell me what to do or not - and as long as one's actions do not interfere with another person's rights - it/they shouldn't.


29 posted on 04/24/2006 1:08:13 PM PDT by Marxbites (Freedom is the negation of Govt to the maximum extent possible. Today, Govt is the economy's virus.)
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To: davesdude

The only thing prohibition has ever done is to create black markets operated by criminals and encourage the corruption of public officials.

It has never, never prevented people from doing what they are going to do.


30 posted on 04/24/2006 1:09:27 PM PDT by Beckwith (The liberal media has picked sides and they've sided with the Jihadists.)
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To: weegee
If we would follow the example set by illegal immigration...do away with sales restrictions of alcohol and tobacco to minors

Two points, up until this weekend,immigration laws, haven't been enforced and this report isn't recommending removing age restrictions.
31 posted on 04/24/2006 1:09:50 PM PDT by jackieaxe (Democrats are mired in a culture of screwing English speaking, taxpaying, law abiding citizens!)
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To: Lord_Baltar

Bring em on!


32 posted on 04/24/2006 1:09:56 PM PDT by Marxbites (Freedom is the negation of Govt to the maximum extent possible. Today, Govt is the economy's virus.)
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To: SampleMan
So it doesn't apply... Comparing the war on terrorism has nothing to do with the war on drugs, as in the last case, you are prohibiting something that can't be prohibited...It's more of a war against nature that serves nothing...The war in irak, which i am not familiar with, sends a message to stay to f*ck off the USA, which for a lot of patriots is worth the 400 billion, and to some others, not... But again i am Canadian so i cannot comment to much on that war...

But the comparison between those 2 wars cannot be applied...
33 posted on 04/24/2006 1:10:05 PM PDT by davesdude (Don't criticize what you don't understand)
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To: Gordongekko909
All "free clinics," all Medicare, Medicaid, any government-funded rehab programs, anything that could suck in more resources if drug use suddenly spikes. I want those gone first.

Hmmm. Aren't some people actually entitled to make use of those programs, via payments they've made through social security or federal taxes? I don't know. I agree that every Tom, Dick and Heroin junkie shouldn't be given a free ride on my dime. Just wondering.

34 posted on 04/24/2006 1:11:01 PM PDT by subterfuge (Call me a Jingoist, I don't care...)
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To: ez

Yes open discussions of marijuana don't seem to have much of an honest chance on FR. Maybe we should pass a law making discussion of marijuana illegal. /sarc


35 posted on 04/24/2006 1:12:23 PM PDT by Sender (“The beginning of wisdom is to call things by their right names.” – Old Chinese proverb)
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To: Marxbites

:)

They'll be here, along with their same old hack kneed "WOD" talking points.

I've wasted my share of bandwidth with these pro-WOD types. It's funny, but whenever they get going, it's like they all cut and paste from the same sheet of pre-written arguments against MJ, and always defend Bigger Government approaches.


36 posted on 04/24/2006 1:13:05 PM PDT by Lord_Baltar
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To: weegee
Marijuana Prohibition Has Not Curtailed Marijuana Use by Adolescents

Introduction

Marijuana prohibition may be defined as the set of laws that establish criminal penalties for all marijuana offenses, including possession and cultivation for personal use. Efforts to change these laws -- even if only to remove the prohibition against medical use -- have invariably been met with the argument that the prohibition of marijuana is necessary to curtail adolescent drug abuse.

This report shows that the prohibition of marijuana in the United States has not curtailed adolescent marijuana use.

The Marijuana Policy Project Foundation was unable to find any scientific evidence demonstrating that marijuana prohibition results in decreased use or that removing criminal penalties would result in increased use of marijuana by adolescents.

I. Criminal Laws Have Not Curtailed Adolescent Marijuana Use A. Penalty Differences Between the States

By 1979, eleven states containing 32.6% of the U.S. population [1] had "decriminalized" marijuana, i.e., a jail sentence was no longer a penalty option for somebody apprehended with a small quantity of marijuana. [2] Offenders in these states typically are not arrested: They are given a written citation at the site of the offense, similar to a traffic ticket, and they are required to pay a small civil fine.

The federally funded researchers who have been studying high school students' drug use and attitudes since the mid-1970s examined the effects of criminal penalties on marijuana use and attitudes during the time period of 1975-1980. Reported usage rates (lifetime, annual, monthly, and daily) among high school seniors in the decriminalized states were compared to the rates in the rest of the states, where criminal penalties remained in effect. The researchers concluded that "decriminalization has had virtually no effect either on the marijuana use or on related attitudes and beliefs about marijuana use among American young people in this age group."[3]

The MPP Foundation is not aware of any other such studies.

B. Quasi-Legalization in Holland Compared to Marijuana Prohibition in the United States

Since 1976, the cultivation, sale, and possession of small amounts of marijuana has been officially tolerated by the government of The Netherlands. While technically illegal, a policy of prosecutorial discretion has permitted more than 1,000 retail marijuana businesses ("coffee shops") to operate with impunity. The anti-marijuana laws are only enforced against those creating a nuisance or flaunting the prosecutors' quantity limits.

City University of New York professors Lynn Zimmer, Ph.D., and John P. Morgan, M.D., have compared reported usage rates among young people in the United States to the usage rates in TheNetherlands, as summarized in the table below.[4]

The Percentage of People Who Have Ever Used Marijuana Is Lower in The Netherlands Than in the United States

United States The Netherlands

Total Population 31.1 [a] 28.5 [b]
Young Adults 47.3 [c] 45.5 [d]
Older Teens 38.2 [e] 29.5 [f]
Younger Teens 13.5 [g] 7.2 [h]

[a] U.S. population, age 12 and over (National Household Survey on Drug Abuse: Population Estimates 1994).

[b] Amsterdam residents, age 12 and over (Sandwijk, J.P. et al., Licit and Illicit Drug Use in Amsterdam II, 1994).

[c] Ages 18-34 (see note a above).

[d] Ages 20-34 (sees note b above).

[e] Twelfth graders, average of 1992, 1993, and 1994 data (The Monitoring the Future Study, 1975-1994).

[f] Ages 16-19, average of data from 1994 Amsterdam survey (see note b above) and 1992 national school-based survey (De Zwart, W.M. et al., Key Data: Smoking, Drinking, Drug Use and Gambling Among Pupils Aged 10 Years and Older, Netherlands Institute on Alcohol and Drugs).

[g] Eighth graders, average of 1992, 1993, and 1994 data (see note e above).

[h] Ages 12-15, average of 1994 Amsterdam data (see note b above) and 1992 national data (see note f above).

C. Decriminalization in Australian Territories Did Not Increase Use

Decriminalization Has Not Increased Marijuana Usage Rates in Australia Two of Australia's eight territories -- South Australia and Australian Capital Territory -- removed criminal penalties in 1987 and 1992, respectively, for possessing small amounts of marijuana for personal use. Offenders face only a small fine or a "caution." An Australian government-funded survey published in 1996 found no substantial difference in reported usage rates, as shown in the graph to the right.

The report did not include age breakdowns. However, because there was essentially no difference in consumption patterns in the population at large (which includes people age 14 and older), there was likely no substantial difference in adolescent usage rates either.[5]

D. No Evidence That Removing Criminal Penalties Would Increase Use

Supporters of prohibition often respond to all of the aforementioned evidence by arguing that there are studies indicating that the absence of criminal penalties does, in fact, promote adolescent marijuana use. The MPP Foundation is unaware of any such studies. In a public forum, the author of this report asked the primary researcher of the study cited in Section I.A -- Lloyd Johnston, Ph.D. -- if there had ever been another study that compared marijuana usage rates in the decriminalized states to rates in the other states in the U.S. This leading federally funded researcher said that there had not.[6]

Adolescent Marijuana Use Has Increased Since Marijuana Prohibition Was Enacted in the U.S. in 1937E. Neither Prohibition Nor Increased Penalties Have Decreased Marijuana Use Over Time

1. Adolescent Marijuana Use Has Skyrocketed Since Marijuana Prohibition -- One-third of those born between 1919 and 1929 turned 15 prior to the federal prohibition of marijuana, which was established by the Marijuana Tax Act in 1937. Because a statistically insignificant proportion of the people in this age group used marijuana by age 15 -- the federal government estimates "0.0%" -- it is safe to say that usage rates among 15-year-olds were nonexistent both immediately before and after prohibition.[7]

The percentage of those born between 1919 and 1929 who report having tried marijuana before age 21 was only 0.4%. This number has been increasing throughout the century: The rate for those born between 1966 and 1970 was 51.4%.

Usage rates for young people peaked in 1979 -- many decades after the passage of prohibition.

Although there are too many variables to permit the inference that prohibition actually caused this tremendous increase in usage rates, prohibition has unquestionably failed to prevent adolescent marijuana use.

http://www.mpp.org/adolescents.html

37 posted on 04/24/2006 1:13:13 PM PDT by highimpact
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To: davesdude
As a deputy prosecutor, I can vouch that we have an awful lot of marijuana charges. I can see the immediate benefit of decriminalization:

1) No more marijuana cases, therefore more of my time can be devoted to OWIs, batteries, etc.

2) No more probation officers having to spend time and energy on tokers.

3) No more court time spent on regular and probation-related marijuana cases.

These 3 benefits don't even include time savings for officers, since they won't have to go after tokers any more.
38 posted on 04/24/2006 1:13:33 PM PDT by hispanichoosier
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To: Gordongekko909

"so that I don't have to pay these druggies' rehab costs"

a lot of pot rehabs are forced into it, having to choose between jail or rehab...so make it legal and you'll see a drop in rehab, at least, for pot...


39 posted on 04/24/2006 1:15:46 PM PDT by davesdude (Don't criticize what you don't understand)
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To: davesdude
So as a Canadian, what is your concern with U.S. laws?

you are prohibiting something that can't be prohibited

Beyond the conflict of language here (like killing something that can't be killed), your thought is fascinating. We also prohibit pedophilia, yet it happens. Are you for dropping the prohibition on it, "as it can't be prohibited"?

40 posted on 04/24/2006 1:16:03 PM PDT by SampleMan
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