Yeah, but that is with the "medical" farce, and the very real danger, until our new President was sworn in, that large scale growers would wind up in Federal prison.
What will it sell for when it has been legalized for years. When Monsanto (or some other big company) sells marijuana seeds in 50# sacks, and big corporations plant it not by the acre, but by the square mile. And when it is not smuggled to market, but loaded on railroad cars?
Sure, some folks will pay a premium for quality, just like you can pay $13 for 750ml of industrial grade vodka, or $350 for 750ml of 25 year old Scotch.
My point is that the price of marijuana is overwhelming attributable to the risk premium, and to the economic inefficiencies attributable to its illegality. Legalizing marijuana with a $1 an ounce tax would take most of the incetives for illegal production away. Legalizing marijuana with a $50 an ounce, $800 a pound, tax, just puts a cap on how much the illegal, non-taxed, retailer can charge, just as the $12.50 a gallon federal excise on spirits put a cap on how much the seller of moonshine could charge.
At $800 a pound, the tax on 500 pounds of marijuana would be $400,000. Plenty of incentive for smuggling.
It's hard to compare pot to beer, because that gram of pot might have seeds and stems in it no one smokes and it might have low THC levels, or it might be high grade stuff with no seeds and no stems that is two or three times or more stronger than the seedy stuff. And, some people only need a little to get a buzz or to get really stoned whereas it might take another person a lot more to get the same effect from the same product. It affects different people differently. But I think it is safe to say that a gram of pot will provide the average person with several smoking sessions. A couple of decades ago the government did studies and found that the average marijuana dose was around a third of a gram, and it is stronger on average today so the average is probably a good bit less than that now. It is not really all that uncommon for people to consume a six pack of beer or more in one session but it is rare that someone will consume an entire gram of marijuana all by himself in one session. A gram of even cheapo Mexican is generally enough for several highs, and the average person could get several more buzzes from a gram of the really expensive stuff. The average gram of pot I would think would have to be equivalent to at least two or three six packs of beer, if not more.
That $50 excise isn't the only tax people would pay in the unlikely event this law passes. They'd also pay regular sales taxes. Depending on the price of per gram those taxes would probably range from a few cent per gram on up to a couple of bucks a gram. So even if a gram of pot is only the equivalent of two six packs on average then the tax burden on pot would still be less than that for beer on average even if grams of pot end up costing from $5 to $20 each depending on quality.
You said in an earlier post that tobacco is around $1.75 a pound. I think that's the price for Burley, but there are others that are more expensive. Generally I believe it's going to be less than $3.00 a pound when the cigarette company buys it though. A pound of tobacco will make two cartons of cigarettes so you are paying about $50 a pound when you buy smokes at $5 a pack. If we were to legalize pot prices would drop way down. I doubt bulk wholesale costs would go as low as tobacco though because there is a lot more labor involved in clipping each bud off and trimming them up for sale. I don't know how much of the process they can mechanize. Still, it should be a whole lot cheaper right away in a completely legal environment and it's going to be dirt cheap after a few years of being legal when big corporate producers get their systems dialed in and slash production costs. The only way pot is going cost even half what it costs today is with really high taxes.
I don't think this California law will pass, but eventually I think we'll legalize pot in this country and regulate production and sales similar to the way we alcohol. People are going to want to buy their pot from the “pot store” where they will be able to select from a wide variety of quality product at reasonable prices. In a legal environment people won't want to buy black market pot from criminals that has who knows what on it. They'll want the stuff that has been produced in a regulated environment. For black market product to sell, it's going to have to be considerably cheaper than what they can get at the store. There shouldn't be much a black market because it's not going to be worth it for criminals to go to all the effort and risk involved. There won't be nearly the market for their product and they'd have to sell what little they'd be able to sell at a fraction of what they sell it for today. I bet we wouldn't see much more of a black market than we have with alcohol now.