Make it legal to possess and sell. Any other situation leads to more government powers in the name of fighting crime. But, as always, the individual bears the responsiblity of their actions, not society.
In a healthier society, I would agree with you completely. However I do think there is at least a minimal discouragement value to be gained from making something technically illegal (i'd do it state by state, of course). It won't stop anywhere near all of it, but that's fine. It's just the way things stand culturally in America as of now, I believe that the legalization of, say, marijuana would do more to exacerbate drug use than it would if our culture were healthy. That is why I would not oppose it in other circumstances, possible future ones included, but oppose that final step now.
The issue of government power is definately there, but it too can be diminished by (1) dropping everything down from the federal level to lower levels and (2) lessening the sentences for minor drug offenses. I think on a practical level the police simply aren't going to stage a massive high tech undercover drug raid on an apartment to get a lower end misdemeanor for possessing a small ammount of marijuana.
I suppose a reasonable comparison could be to underage drinking as it stands right now. Underage drinking gets prosecuted right now, but almost exclusively when carried out in public or in automobiles. But how many times have you ever heard of an undercover FBI sting outside an apartment complex using special sensors to try and find a hidden stash of liquor under some underage college kid's bed? It simply isn't worth the effort, and I suspect neither would small ammounts of drug possession if they carried something less than multi-year jail sentences. Not that I condone any such drug use, I simply believe that there wouldn't be overzealous prosecution on minor drug charges if those charges were themselves actually minor.
Rather, I mean it in the sense that we live in a society that has in many respects disregarded its roots in liberty, its grounding in absolutes, its continuance in the truth, and its enrichment in a heritage of all three of these things.
The alternative that grows increasingly stronger is a society of relativist left wing garbage that recognizes no truth, no certitude, and no freedom beyond the license assumed by its propagaters as a tool to do whatever they want whenever they want to a degree that it violates the liberty of the rest of us around them.
Truth, liberty, heritage, certitude - none means anything to the political left beyond a select and ocassional tool with which one may temporarily advance leftism only to disregard once it has run out of use. When they do purport one of these things it's little more than a facade, because at the core of leftism is "I get to do whatever I want with whatever power I want to whoever I want and everybody else be damned." Sadly the left has discovered that government itself is a prominent and efficient tool with which they may achieve their tyrannical and deceptively promoted goals.