Thursday, November 20, 2014
A helpful reader helpfully alerted me to this notable new Congressional Research Service report titled "Federal Proposals to Tax Marijuana: An Economic Analysis." Here is the detailed report's summary:
The combination of state policy and general public opinion favoring the legalizing of marijuana has led some in Congress to advocate for legalization and taxation of marijuana at the federal level. The Marijuana Tax Equity Act of 2013 (H.R. 501) would impose a federal excise tax of 50% on the producer and importer price of marijuana. The National Commission on Federal Marijuana Policy Act of 2013 (H.R. 1635) proposes establishing a National Commission on Federal Marijuana Policy that would review the potential revenue generated by taxing marijuana, among other things.
This report focuses solely on issues surrounding a potential federal marijuana tax. First, it provides a brief overview of marijuana production. Second, it presents possible justifications for taxes and, in some cases, estimates the level of tax suggested by that rationale. Third, it analyzes possible marijuana tax designs. The report also discusses various tax administration and enforcement issues, such as labeling and tracking.
Economic theory suggests the efficient level of taxation is equal to marijuana’s external cost to society. Studies conducted in the United Kingdom (UK) and Canada suggest that the costs of individual marijuana consumption to society are between 12% and 28% of the costs of an individual alcohol user, and total social costs are even lower after accounting for the smaller number of marijuana users in society. Based on an economic estimate of $30 billion of net external costs for alcohol, the result is an external cost of $0.5 billion to $1.6 billion annually for marijuana. These calculations imply that an upper limit to the economically efficient tax rate could be $0.30 per marijuana cigarette (containing an average of one half of a gram of marijuana) or $16.80 per ounce. An increased number of users in a legal market would raise total costs, but not necessarily costs per unit.
Some could also view excise taxes as a means to curtail demand, particularly as the price of marijuana can be expected to drop from current retail prices of up $200-$300 per ounce to prices closer to the cost of production at $5-$18 per ounce, if broadly legalized. The demand for marijuana is estimated to be relatively price inelastic, meaning that consumer demand is relatively insensitive to price changes. Although previous studies of marijuana demand largely examine consumers willing to engage in illegal activities, it appears that higher tax rates would have a minor effect on reducing demand. With this said, tax policy, coupled with adequate law enforcement, could be an effective tool to limit marijuana consumption among youth, as empirical studies indicate that their demand is more sensitive to price than non-youth.
Excise taxes on marijuana could also be levied primarily to raise revenue, as has been historically the case with tobacco and alcohol. As an illustration, assuming a total market size of $40 billion, a federal tax of $50 per ounce is estimated to raise about $6.8 billion annually, after accounting for behavioral effects associated with price decreases following legalization.
The choices in administrative design could affect consumer behavior, production methods, evasion rates, or the tax base of a federal marijuana excise tax. Some of the more significant choices include whether to exempt medicinal uses or homegrown marijuana from tax.
November 20, 2014 in Federal Marijuana Laws, Policies and Practices, Medical Marijuana Data and Research, Recreational Marijuana Data and Research, Taxation information and issues , Who decides | Permalink | Comments (0)
Monday, October 27, 2014
Dr. Jeffrey Miron, who is director of economic studies at the Cato Institute and director of undergraduate studies in the Department of Economics at Harvard University, has just produced this significant new Cato working paper titled "Marijuana Policy in Colorado." The paper is relatively short, though it includes lots of data, and here is its Executive Summary and its closing paragraphs:
In November 2012, voters in the states of Colorado and Washington approved ballot initiatives that legalized marijuana for recreational purposes. Alaska, Oregon, and the District of Columbia are scheduled to consider similar measures in the fall of 2014, and other states may follow suit in the fall of 2016.
Supporters and opponents of such initiatives make numerous claims about state-level marijuana legalization. Advocates believe legalization reduces crime, raises revenue, lowers criminal justice expenditure, improves public health, improves traffic safety, and stimulates the economy. Critics believe legalization spurs marijuana use, increases crime, diminishes traffic safety, harms public health, and lowers teen educational achievement. Systematic evaluation of these claims, however, has been absent.
This paper provides a preliminary assessment of marijuana legalization and related policies in Colorado. It is the first part of a longer-term project that will monitor state marijuana legalizations in Colorado, Washington, and other states.
The conclusion from this initial evaluation is that changes in Colorado’s marijuana policy have had minimal impact on marijuana use and the outcomes sometimes associated with use. Colorado has collected non-trivial tax revenue from legal marijuana, but so far less than anticipated by legalization advocates....
The evidence provided here suggests that marijuana policy changes in Colorado have had minimal impact on marijuana use and the outcomes sometimes associated with use. This does not prove that other legalizing states will experience similar results, nor that the absence of major effects will continue. Such conclusions must await additional evidence from Colorado, Washington, and future legalizing states, as well as more statistically robust analyses that use non-legalizing states as controls.
But the evidence here indicates that strong claims about Colorado’s legalization, whether by advocates or opponents, are so far devoid of empirical support.
Tuesday, October 21, 2014
This new Denver Post article, headlined "Proposed Colorado marijuana edibles ban shows lingering pot discord," documents the enduring challenges and debates over the best regulatory frameworks for states which have moved away from total marijuana prohibition. Here are excerpts:
Colorado's health department proposed an industry-spinning ban on the sales of nearly all forms of edible marijuana at recreational pot shops Monday but then quickly backed away from the plan amid an industry outcry and questions over legality.
After a heated, four-hour hearing, the public policy Tilt-A-Whirl ride ended where it began: with lawmakers, regulators and stakeholders still in disagreement — now more than 10 months after the start of recreational pot sales — on the best way to manage marijuana in Colorado. "This is by far the simplest recommendation," state Rep. Jonathan Singer, D-Longmont, said of the health department's proposal. "But I don't know if it gets us to where we want to be."
The aim of the state advisory group that met Monday to consider the health department's proposal and several others is to prevent people — mostly kids — from accidentally eating marijuana-infused products. Such accidental ingestions have sent children to the hospital, caused an increase in calls to poison-control hotlines and become one of the key measures lawmakers use in discussing whether legal marijuana sales can fit harmoniously in society.
Sales of infused edibles make up about 45 percent of the legal marijuana marketplace, said Dan Anglin, the chairman of the Colorado Cannabis Chamber of Commerce.
The health department's recommendation was one of 11 proposals the group considered Monday. Most suggested the state create clearer labels for marijuana-infused products or require producers to make edible marijuana items in a unique shape or dyed a unique color.
Many of those proposals, though, quickly met with a familiar back-and-forth. One side would offer the suggestion; the other side would bat it down. Stamp a symbol onto edibles denoting the products contain marijuana? Too easily rubbed off, edibles producers said. Improve labeling and require edibles to stay with their packages? Too easily ignored to spread unmarked edibles, groups concerned about marijuana said.
Require producers to dye their products a specific color or airbrush on a symbol? "You can't force a company to use an ingredient they don't want to," said advisory group member Julie Dooley, an owner of Julie & Kate Baked Goods, an edibles producer.
In the debate, there was talk of Sour Patch Kids and marijuana-infused sodas, discussion of the cost of chocolate molds, and these words: "I think soft candy is such a broad category."
Amid this atmosphere, Colorado health department official Jeff Lawrence presented the department's proposed ban on the sales of all edibles except hard candies and tinctures. Lawrence said the disagreement over more-nuanced regulations pushed the department to propose something more sweeping. "If it couldn't be achieved," he said, "we were looking at something that could be achieved."
But the proposal — word of which spread in an Associated Press report before the meeting — quickly met a buzz saw. Industry advocates questioned whether edibles could be banned under Amendment 64, Colorado's marijuana-legalization measure. Singer worried a ban would create a "marijuana Whac-A-Mole situation" where edibles production moved into the black market. Andrew Freedman, the state's marijuana policy coordinator, said the governor's office did not support a ban.
The health department later in the day put out a news release acknowledging that the department did not consider the proposal's constitutionality or ask the governor's office to review it. Instead, the proposal was put forward to generate discussion. "Considering only the public health perspective, however, edibles pose a definite risk to children, and that's why we recommended limiting marijuana-infused products to tinctures and lozenges," Larry Wolk, the executive director of the department, said in a statement.
The discussion seemed mostly over by the end of Monday's meeting, as talk returned to more incremental forms of edibles regulation. Any final proposals from the advisory group will be presented in a report to the legislature next year. The Department of Revenue, which regulates marijuana businesses, must adopt final rules on the topic by 2016.
Thursday, October 2, 2014
The Center on Juvenile and Criminal Justice has produced this interesting new research report titled "Reforming Marijuana Laws: Which Approach Best Reduces The Harms Of Criminalization? A Five-State Analysis." Here is what the report's Introduction:
The War on Marijuana is losing steam. Policymakers, researchers, and law enforcement are beginning to recognize that arresting and incarcerating people for marijuana possession wastes billions of dollars, does not reduce the abuse of marijuana or other drugs, and results in grossly disproportionate harms to communities of color. Marijuana reforms are now gaining traction across the nation, generating debates over which strategies best reduce the harms of prohibition.
Should marijuana be decriminalized or legalized? Should it be restricted to people 21 and older? Advocates of the latter strategy often argue their efforts are intended to protect youth. However, if the consequences of arrest for marijuana possession — including fines, jail time, community service, a criminal record, loss of student loans, and court costs — are more harmful than use of the drug (Marijuana Arrest Research Project, 2012), it is difficult to see how continued criminalization of marijuana use by persons under 21 protects the young. Currently, people under 21 make up less than one-third of marijuana users, yet half of all marijuana possession arrests (ACLU, 2013; Males, 2009).
This analysis compares five states that implemented major marijuana reforms over the last five years, evaluating their effectiveness in reducing marijuana arrests and their impact on various health and safety outcomes. Two types of reforms are evaluated: all-ages decriminalization (California, Connecticut, and Massachusetts), and 21-and-older legalization (Colorado and Washington). The chief conclusions are:
• All five states experienced substantial declines in marijuana possession arrests. The four states with available data also showed unexpected drops in marijuana felony arrests.
• All-ages decriminalization more effectively reduced marijuana arrests and associated harms for people of all ages, particularly for young people.
• Marijuana decriminalization in California has not resulted in harmful consequences for teenagers, such as increased crime, drug overdose, driving under the influence, or school dropout. In fact, California teenagers showed improvements in all risk areas after reform.
• Staggering racial disparities remain— and in some cases are exacerbated — following marijuana reforms. African Americans are still more likely to be arrested for marijuana offenses after reform than all other races and ethnicities were before reform.
• Further reforms are needed in all five states to move toward full legalization and to address racial disparities
Tuesday, September 23, 2014
The title of this post is the title of this new paper by Julie Andersen Hill now available via SSRN. Here is the abstract:
Although marijuana is illegal under federal law, twenty-three states have legalized some marijuana use. The state-legal marijuana industry is flourishing, but marijuana-related businesses report difficulty accessing banking services. Because financial institutions won’t allow marijuana-related businesses to open accounts, the marijuana industry largely operates on a cash only basis — a situation that attracts thieves and tax cheats.
This article explores the root of the marijuana banking problem as well as possible solutions. It explains that although the United States has a dual banking system comprised of both federal- and state-chartered institutions, when it comes to marijuana banking, federal regulation is pervasive and controlling. Marijuana banking access cannot be solved by the states acting alone for two reasons. First, marijuana is illegal under federal law. Second, federal law enforcement and federal financial regulators have significant power to punish institutions that do not comply with federal law. Unless Congress acts to remove one or both of these barriers, most financial institutions will not provide services to the marijuana industry. But marijuana banking requires more than just Congressional action. It requires that federal financial regulators set clear and achievable due diligence requirements for institutions with marijuana business customers. As long as financial institutions risk federal punishment for any marijuana business customer’s misstep, institutions will not provide marijuana banking.
Tuesday, August 26, 2014
The title of this post is the title of this terrific new Brookings research paper which takes a close look at Washington state’s early experience in legalization of recreational marijuana. Here is how the report is summarized on the Brookings website:
Voters in Washington state decided in November 2012 to legalize marijuana in their state, inspired by a campaign that emphasized minimizing the drug’s social costs and tightly controlling the legal recreational market. Joined to this drug policy experiment is a second innovative experiment that emphasizes knowledge: the state will fund and develop tools necessary to understand the impact of legalization on Washington’s law enforcement officials, communities, and public health.
This second reform, though less heralded than the attention-grabbing fact of legalization, is in many ways just as bold. Washington’s government is taking its role as a laboratory of democracy very seriously, tuning up its laboratory equipment and devoting resources to tracking its experiment in an unusually meticulous way, with lessons that extend well beyond drug policy.
Brookings’ Philip Wallach interviewed advocates, researchers, and government policymakers in Washington to learn about the state’s novel approach. In this report, he highlights several noteworthy features:
- Building a funding source for research directly into the law: a portion of the excise tax revenues from marijuana sales will fund research on the reform’s effects and on how its social costs can be effectively mitigated.
- Bringing to bear many perspectives on legalization by coordinating research efforts across multiple state agencies, including the Department of Social and Health Services, the Department of Health, and the Liquor Control Board.
- Mandating a cost-benefit analysis by the state’s in-house think tank, which will be nearly unprecedented in its scope and duration.
Wallach makes a number of suggestions to ensure that Washington’s knowledge experiment can be made to work, including:
- Ensure political independence for researchers, both by pressuring politicians to allow them to do their work and by encouraging the researchers themselves to refrain from making political recommendations
- Gather and translate research into forms usable by policymakers
- Counter misinformation with claims of confident uncertainty
- Have realistic expectations about the timeline for empirical learning, which means cultivating patience over the next few years
- Specify which reliable metrics would indicate success or failure of legalization
August 26, 2014 in History of Marijuana Laws in the United States, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms | Permalink | Comments (1)
Monday, August 11, 2014
The title of this post is the headline of this new commentary by Jacob Sullum at Forbes. Here are excerpts:
Two consequences that pot prohibitionists attribute to marijuana legalization—more underage consumption and more traffic fatalities—so far do not seem to be materializing in Colorado, which has allowed medical use since 2001 and recreational use since the end of 2012.
Survey data released last week by the Colorado Department of Public Health and Environment (CDPHE) indicate that marijuana use among high school students continues to decline, despite warnings that legalization would make pot more appealing to teenagers. In the 2013 Healthy Kids Colorado survey, 37 percent of high school students reported that they had ever tried marijuana, down from 39 percent in 2011. The percentage who reported using marijuana in the previous month (a.k.a. “current” use) also fell, from 22 percent in 2011 to 20 percent in 2013. The CDPHE says those drops are not statistically significant. But they are part of a general downward trend in Colorado that has persisted despite the legalization of medical marijuana in 2001, the commercialization of medical marijuana in 2009 (when the industry took off after its legal status became more secure), and the legalization of recreational use (along with home cultivation and sharing among adults) at the end of 2012.... Traffic fatalities also have generally declined since Colorado began loosening its marijuana laws. Fatalities rose in 2001, the year that Colorado’s medical marijuana law took effect, but by 2003 had fallen below the 2000 level. Since peaking in 2002, fatalities have fallen by more than a third. Legal sales of recreational marijuana began in January, and so far this year traffic fatalities are down. According to to the Colorado Department of Transportation, there were 258 fatalities from January through July, compared to 263 during the same period last year. In short, Colorado’s experience does not provide much evidence that less repressive marijuana laws make the roads more dangerous (and they might even make the roads safer by encouraging the substitution of cannabis for alcohol).
August 11, 2014 in Medical Marijuana Commentary and Debate, Medical Marijuana Data and Research, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research | Permalink | Comments (0)
As reported in this new AP article, "June was the best-selling month yet for recreational pot in Colorado, with $24.7 million in total sales, according to state tax collections reported Friday." Here is more:
Recreational pot sales were up more than 19 percent from June sales, an increase likely attributable to more stores opening. Since January, Colorado has reaped $29.8 million in taxes from marijuana, according to June collections reported by the state Department of Revenue. That figure includes taxes, licenses and fees from both medical and recreational pot.
Recreational pot is inching toward medical pot in total sales. In January, Colorado's statewide sales tax on medical pot produced nearly twice the taxes produced by recreational pot. By June, the statewide 2.9 percent sales tax from medical pot brought in less than 20 percent more than the same tax on recreational weed. Estimates for how much tax revenue legal weed would produce varied widely, with no preceding legal pot taxes on which to guess sales....
In Washington state, where recreational pot sales started last month, pot sales numbers were also released Friday. That state reported 18 stores selling about $3.8 million worth of marijuana in July — a higher number than Colorado's first month of recreational sales.
Sunday, August 3, 2014
In this recent post, I highlighted to potent work done by folks at the Washington Post concerning marijuana research and data in this detailed Wonkblog piece highlighting all the problems with all the science claims by the federal government to justify marijuana prohibition. I now just saw this notable follow-up piece by Christopher Ingraham at Wonkblog headlined "The federal government’s own statistics show that marijuana is safer than alcohol." Here are excerpts:
Opponents of marijuana legalization return to one particular number over and over in their arguments: the number of emergency room visits involving marijuana. [An] ONDCP fact sheet breathlessly reports that "mentions of marijuana use in emergency room visits have risen 176 percent since 1994, surpassing those of heroin." The Drug Enforcement Administration's "Dangers and Consequences of Marijuana Abuse," a 41-page tour-de-force of decontextualized factoids, reports that marijuana was involved in nearly half a million E.R. visits in 2011, second only to cocaine.
The problem, of course, is that these numbers are meaningless without knowing how many people are using those drugs to start with. When you consider that there are approximately 70 times more marijuana users than heroin users in the United States, it makes sense that more of the former are going to the hospital than the latter.
Since the government doesn't provide these comparisons in a meaningful way, I've done it myself....
For 2010, the latest year for which complete alcohol data are available, I grabbed the number of regular users from the National Survey on Drug Use and Health. "Regular," in this case, means people who report using a given substance in the past month. I then grabbed 2010 E.R. visits involving these substances from the Drug Abuse Warning Network. This is a hospital reporting system that collects detailed data on all E.R. admissions involving a given drug. These E.R. visits can involve the use of multiple substances, so the numbers for each drug involve all visits for which that drug was listed as a contributing factor....
The figures clearly show that on a per-user basis, marijuana is considerably less likely to send you to the E.R. than heroin, cocaine or meth. Marijuana users are also 75 percent less likely to face an E.R. visit than prescription drug abusers.
But most surprisingly, marijuana is significantly safer to use than alcohol. For every thousand regular alcohol drinkers there are eight more trips to the E.R. than for every thousand marijuana users. Or in other words, alcohol is about 30 percent more likely to send you to the E.R. than marijuana.
These are all the federal government's own numbers, and they show that marijuana is considerably less harmful to users than alcohol. At the risk of sounding like a broken record, this comports with just about every other credible study of the drug.
Friday, August 1, 2014
"Colorado’s Rollout of Legal Marijuana Is Succeeding: A Report on the State’s Implementation of Legalization"
I highlighted and celebrated in this post a few months ago that The Brookings Institution was committed to "researching the new marijuana industry, not as advocates, but as social scientists, interested in how our federal system comes to terms with statewide decisions to legalize a substance that is illegal in the rest of the country, and how states implement those policy changes." The first significant report resulting from that research carries the title that is the title of this post. And here are excerpts from the start of this notable 35-page Brookings report:
In November 2012, Colorado voters decided to experiment with marijuana. Formally, they approved Amendment 64, modifying the state constitution. This move was historic and did something which, to that point, no other state or modern foreign government had ever done: legalize retail (recreational) marijuana. As part of the amendment, the state was required to construct legal, regulatory, and tax frameworks that would allow businesses to cultivate, process, and sell marijuana not simply to medical patients — as had been happening in Colorado for over a decade—but to anyone 21 and older. This change came despite existing federal prohibition of marijuana and opposition from the governor, state attorney general, many mayors, and the law enforcement community.
At its heart, this report is about good government and takes no position on whether the legalization of retail marijuana was the correct decision. Instead, it takes for granted that Amendment 64 and its progeny are the law and should be implemented successfully, per voters’ wishes. The report examines what the state has done well and what it has not. It delves into why, and how, regulatory and administrative changes were made. Finally, it offers an evaluation of how effective the implementation has been.
Prior related post:
August 1, 2014 in Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms, Taxation information and issues | Permalink | Comments (0)
Thursday, July 31, 2014
The title of this post is drawn in part from the headline of this latest editorial in the New York Times series explaining its editorial judgment that marijuana prohibition should be ended (first noted here). Here is an excerpt from this editorial:
As with other recreational substances, marijuana’s health effects depend on the frequency of use, the potency and amount of marijuana consumed, and the age of the consumer. Casual use by adults poses little or no risk for healthy people. Its effects are mostly euphoric and mild, whereas alcohol turns some drinkers into barroom brawlers, domestic abusers or maniacs behind the wheel.
An independent scientific committee in Britain compared 20 drugs in 2010 for the harms they caused to individual users and to society as a whole through crime, family breakdown, absenteeism, and other social ills. Adding up all the damage, the panel estimated that alcohol was the most harmful drug, followed by heroin and crack cocaine. Marijuana ranked eighth, having slightly more than one-fourth the harm of alcohol.
Federal scientists say that the damage caused by alcohol and tobacco is higher because they are legally available; if marijuana were legally and easily obtainable, they say, the number of people suffering harm would rise. However, a 1995 study for the World Health Organization concluded that even if usage of marijuana increased to the levels of alcohol and tobacco, it would be unlikely to produce public health effects approaching those of alcohol and tobacco in Western societies.
Most of the risks of marijuana use are “small to moderate in size,” the study said. “In aggregate, they are unlikely to produce public health problems comparable in scale to those currently produced by alcohol and tobacco.”
While tobacco causes cancer, and alcohol abuse can lead to cirrhosis, no clear causal connection between marijuana and a deadly disease has been made. Experts at the National Institute on Drug Abuse, the scientific arm of the federal anti-drug campaign, published a review of the adverse health effects of marijuana in June that pointed to a few disease risks but was remarkably frank in acknowledging widespread uncertainties. Though the authors believed that legalization would expose more people to health hazards, they said the link to lung cancer is “unclear,” and that it is lower than the risk of smoking tobacco....
The American Society of Addiction Medicine, the largest association of physicians specializing in addiction, issued a white paper in 2012 opposing legalization because “marijuana is not a safe and harmless substance” and marijuana addiction “is a significant health problem.”
Nonetheless, that health problem is far less significant than for other substances, legal and illegal. The Institute of Medicine, the health arm of the National Academy of Sciences, said in a 1999 study that 32 percent of tobacco users become dependent, as do 23 percent of heroin users, 17 percent of cocaine users, and 15 percent of alcohol drinkers. But only 9 percent of marijuana users develop a dependence. “Although few marijuana users develop dependence, some do,” according to the study. “But they appear to be less likely to do so than users of other drugs (including alcohol and nicotine), and marijuana dependence appears to be less severe than dependence on other drugs.”
There’s no need to ban a substance that has less than a third of the addictive potential of cigarettes, but state governments can discourage heavy use through taxes and education campaigns and help provide treatment for those who wish to quit.
One of the favorite arguments of legalization opponents is that marijuana is the pathway to more dangerous drugs. But a wide variety of researchers have found no causal factor pushing users up the ladder of harm. While 111 million Americans have tried marijuana, only a third of that number have tried cocaine, and only 4 percent heroin. People who try marijuana are more likely than the general population to try other drugs, but that doesn’t mean marijuana prompted them to do so.
Marijuana “does not appear to be a gateway drug to the extent that it is the cause or even that it is the most significant predictor of serious drug abuse,” the Institute of Medicine study said. The real gateway drugs are tobacco and alcohol, which young people turn to first before trying marijuana.
This NY Times piece is a potent and effective review about what we really know about marijuana's health and societal impact. Even more powerful on the same front, though, is this remarkable new Wonkblog piece from the Washington Post that highlights all the problems with all the science claims by the federal government to justify marijuana prohibition. The title of this piece, with is a must-read for anyone who really care about both the science and advocacy realities surrounding marijuana reform, is "The federal government’s incredibly poor, misleading argument for marijuana prohibition." Here is how it gets started:
The New York Times editorial board is making news with a week-long series advocating for the full legalization of marijuana in the United States. In response, the White House's Office of National Drug Control Policy (ONDCP) published a blog post Monday purporting to lay out the federal government's case against marijuana reform.
That case, as it turns out, it surprisingly weak. It's built on half-truths and radically decontextualized facts, curated from social science research that is otherwise quite solid. I've gone through the ONDCP's arguments, and the research behind them, below.
The irony here is that with the coming wave of deregulation and legalization, we really do need a sane national discussion of the costs and benefits of widespread marijuana use. But the ONDCP's ideological insistence on prohibition prevents them from taking part in that conversation.
July 31, 2014 in Assembled readings on specific topics, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Data and Research, Recreational Marijuana Data and Research, Science | Permalink | Comments (0)
Monday, July 28, 2014
As detailed via this report from the folks at Quinnipiac University, the latest polling numbers suggest Florida voters are keenly in support of marijuana reform. Here are the basics concerning a state seemingly poised to bring marijuana reform movement into the south:
Florida voters support legalized marijuana for medical use 88 - 10 percent, with support ranging from 83 - 14 percent among voters over 65 years old to 95 - 5 percent among voters 18 to 29 years old, according to a Quinnipiac University poll released today. The lowest level of support is 80 - 19 percent among Republicans, the independent Quinnipiac University poll finds.
Sunshine State voters also support 55 - 41 percent "allowing adults in Florida to legally possess small amounts of marijuana for personal use," or so-called "recreational marijuana." There is a wide gender gap and an even wider age gap: Men back recreational marijuana 61 - 36 percent while women back it by a narrow 49 - 45 percent. Voters 18 to 29 years old are ready to roll 72 - 25, while voters over 65 years old are opposed 59 - 36 percent. Support is 64 - 32 percent among Democrats and 55 - 40 percent among independent voters, with Republicans opposed 56 - 41 percent.
"Forget the stereotypes of stodgy old folks living out their golden years playing canasta and golf," said Peter Brown, assistant director of the Quinnipiac University poll. "Almost nine- in-ten Floridians favor legalizing medical marijuana and a small majority says adults should be able to possess small amounts of the drug for recreational purposes.
"Even though a proposal to legalize medical marijuana, on the ballot this November, must meet a 60 percent threshold, these numbers make a strong bet the referendum is likely to pass," said Peter Brown, assistant director of the Quinnipiac University poll....
If medical marijuana is legalized in Florida, voters say 71 - 26 percent they would support having a marijuana dispensary in the town or city where they live. Support ranges from 57 - 37 percent among voters over 65 years old to 79 - 21 percent among voters 18 to 29 years old.
July 28, 2014 in Medical Marijuana Data and Research, Medical Marijuana State Laws and Reforms, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research | Permalink | Comments (0)
Thursday, July 24, 2014
Analysts predict Oregon would generate $38.5 million in tax revenue in first year of pot legalization
As detailed in this lengthy new report, titled simply "Oregon Cannabis Tax Revenue Estimate," a prediction of marijuana usage is at the heart of economists' prediction of significant tax revenues is the citizens of Oregon legalize recreational marijuana this fall. Here is the report's Executive summary:
Oregonians are slated to vote on the “Control, Regulation, and Taxation of Marijuana and Industrial Hemp Act” in November 2014. The measure would regulate, tax, and legalize marijuana for adults 21 and older with legal use beginning in July, 2015.
Economists at ECONorthwest conducted an independent study to estimate the amount of money that would be generated in the short term if the Act passes. The money generated in taxes would go to schools, state and local police, and programs for drug treatment, prevention, drug education, and mental health.
The key findings of this analysis are:
• $38.5 million in excise tax revenue would be generated during the first fiscal year of tax receipts;
• $78.7 million in excise tax revenue would be generated during the first full biennium of tax receipts.
The report does not look at the impact on courts, police, and jail operating costs due to legalization. The forecast is based on a comprehensive methodology that includes the following: the cost of production; price elasticity; the price of marijuana and its retail products; market demand; the short-term demand remaining in the gray market; accessibility of non-medical sales; new market entrants; home production; and non-resident demand.
The “Control, Regulation, and Taxation of Marijuana and Industrial Hemp Act” legalizes the growth, processing, wholesaling, and retailing of marijuana for adult purposes. If enacted, retail sales in Oregon could begin July 1, 2016.
Petitioners for this Act asked ECONorthwest to forecast state government tax revenues that would arise in the first fiscal year of its implementation, presumed to be July 1, 2016 through June 30, 2017 (FY 2017). Similarly, they asked ECONorthwest to estimate tax revenues in the first full biennium, July 1, 2017 to June 30, 2019 (2017-19 biennium). This report summarizes ECONorthwest’s research and forecast.
Tuesday, July 22, 2014
A study like this could provide political momentum and support for a planned 2015 legalization bill. Though, of course, its actual impact will depend in large part on what the study finds. At the very least, however, it indicates that a critical mass of elected officials in Vermont have more than just a passing interest in legalization.
Also of note, Vermont's Governor, Peter Shumlin has been praised by NORML in the past for his support of reforming marijuana laws. Shumlin is up for reelection this year. Assuming he retains office, his presence would go a long way toward making legalization via legislation a real possibility. (Some may recall that New Hampshire's legislative legalization efforts hit a road block earlier this year after opposition from their Governor.)
And, whatever the political outcome, I'm sure RAND's report will be interesting reading for all who follow this issue, especially since the news story indicates Beau Kilmer--whose work in this area is consistently must-read--will be meeting with Vermont officials next week to get the study going.
Here's some highlights from the story about the upcoming study:
Rand Corp. representatives will be in Vermont next week to begin work on a study of the effects that marijuana legalization might have on the state's economy, individual health and public safety.
The international, nonprofit research organization was chosen to conduct the study, which was mandated in a bill passed by the Legislature last session.
The state will pay $20,000 toward the study, which will be augmented by as much as $100,000 in private donations, officials said Friday.
Rand Corp. declined to comment on the research until the organization's senior policy analyst Beau Kilmer meets with Vermont officials next week. More details on the study would be released then, Rand spokesperson Warren Robak said.
"We were looking for someone who wasn't going to make a case that we legalize or not legalize," Spaulding said, adding that Rand is "very well-respected."
The report generated by Rand should give Vermont legislators the facts they need to have a well-informed debate next winter, one lawmaker says.
"I think the study will help with legislators and the public who inherently think it's a good idea but want evidence they can hold up to show people," said state Sen. David Zuckerman, P/D-Chittenden. Zuckerman said he will propose a marijuana regulation and legalization bill in the 2015 legislative session.
"It can work in other states," Zuckerman said. "We just have to make some changes."
Saturday, July 19, 2014
The question in the title of this post was my first reaction to this notable new article, headlined "Next Gold Rush: Legal Marijuana Feeds Entrepreneurs’ Dreams, which appears on the front page of today's New York Times. Here are excerpts from the article:
Like the glint of gold or rumors of oil in ages past, the advent of legal, recreational marijuana is beginning to reshape economies in Colorado and Washington State.
Marijuana is beckoning thousands of entrepreneurs and workers, investors and hucksters from across the country, each looking to cash in on a rapidly changing industry that offers hefty portions of both promise and peril.
At convention centers and in hotel meeting rooms, start-up companies are floating sales pitches for marijuana delivery services or apps to name-tagged investors who sip red wine and munch on hempseed snacks. This year, hundreds of people seeking jobs lined up for blocks in downtown Denver, résumés in hand, for an industry-sponsored marijuana job fair....
Tourists have flocked to those stores, making up 44 percent of the customers at one Denver shop during a sample week this spring, according to the state’s first study of demand for marijuana. Tour companies and marijuana-friendly bed-and-breakfasts have sprung up to serve tourists, too.
In Washington State, where recreational sales kicked off last week, the retail industry is much smaller, with as few as eight stores open so far. But the ambitions are boundless, with more than 300 licenses under state review and an outdoor growing season — perfect for apples, wheat and grapes — that could make Washington a national powerhouse of production if legalization spreads.
Hundreds of other people have found work on the edges of the industry. They sell water systems, soil nutrients, lighting and accounting services, like the 19th-century merchants who profited by selling picks and shovels to gold miners. There are now dozens of marijuana-related mobile apps, marijuana-centric law firms and real estate agents, cannabis security experts (it is a risky, virtually all-cash trade) and marijuana-themed event promoters offering everything from luxury getaways to bus tours. Washington has a rule requiring bar-code tracking of every marijuana plant to ensure that only licensed, Washington-grown marijuana is sold in its stores. It has also created a niche for tech start-ups like Viridian Sciences, a software company aiming to help retailers prove the provenance of their product should a state inspector or customer ask....
[M]any are ready to gamble on marijuana’s success. After a decade in the military and a career working in security, Sy Alli, 53, moved to Colorado to become the director of corporate security for Dixie Brands, a company that makes marijuana-infused drinks and snacks. Zach Marburger, 28, visited in January to ski and check out the early days of legal use of recreational marijuana, and decided to relocate to Denver to develop software to connect customers and retailers.
And a few months ago, a 22-year-old mobile app developer named Isaac Dietrich and a friend were smoking marijuana in a Norfolk, Va., apartment when they realized: There could be money in this. They moved to Colorado, where they are working on an app called MassRoots, which lets marijuana enthusiasts privately post photos on an online platform out of sight of their parents or co-workers. They want it to be the Instagram for marijuana users. “We thought about relocating to Silicon Valley, but they haven’t backed a single marijuana company,” Mr. Dietrich said. “This is where everything’s happening. We didn’t want to be left out.”
Friday, July 11, 2014
As everyone might have expected, proponents and opponents of marijuana reform have quite diverse perspectives on the success or failure of the legalization experiment in Colorado over the first six months of regular recreation pot sales. Examples of the divergent views are well demonstrated by these two recent commentaries:
From Jacob Sullum, reform proponent, here in Forbes, "How Is Marijuana Legalization Going? The Price of Pot Peace Looks Like a Bargain."
From Kevin Sabet, reform opponent, here at CNN, "Colorado's troubles with pot."
The enduring problem posed by these divergent perspectives is that it become so much very harder for marijuana reform "agnostics" to know whether the sky is really falling or if in fact all is swell in the wake of recent reforms. Perhaps usefully, though, the divergent views may help ensure that we go a number of years with the on-going experiment before anyone should feel extra confident asserting great success or great failure in recent reforms.
Tuesday, June 24, 2014
Article examines the impact of marijuana legalization on whether high school seniors plan to use marijuana
From the International Journal of Drug Policy comes this article with the catchy title "Correlates of intentions to use cannabis among US high school seniors in the case of cannabis legalization." The article is behind a paywall and I haven't yet attempted to track it down through the library but the abstract indicates that high school seniors self-report that they would be slightly more likely to want to use marijuana if it were legal.
Here are the basics from the abstract:
This study examined intentions to use among US high school seniors if cannabis were to become legally available.
Ten percent of non-cannabis-using students reported intent to initiate use if legal and this would be consistent with a 5.6% absolute increase in lifetime prevalence of cannabis use in this age group from 45.6% (95% CI=44.6, 46.6) to 51.2% (95% CI=50.2, 52.2). Eighteen percent of lifetime users reported intent to use cannabis more often if it was legal. Odds for intention to use outcomes increased among groups already at high risk for use (e.g., males, whites, cigarette smokers) and odds were reduced when friends disapproved of use. However, large proportions of subgroups of students normally at low risk for use (e.g., non-cigarette-smokers, religious students, those with friends who disapprove of use) reported intention to use if legal. Recent use was also a risk factor for reporting intention to use as often or more often.
Monday, June 2, 2014
The title of this post is the headline of this lengthy recent article appearing in the New York Times. As the headline suggests, the article documents glass-half-empty data and perspectives on Colorado's on-going experiment with marijuana legalization. Here are excerpts:
Five months after Colorado became the first state to allow recreational marijuana sales, the battle over legalization is still raging. Law enforcement officers in Colorado and neighboring states, emergency room doctors and legalization opponents increasingly are highlighting a series of recent problems as cautionary lessons for other states flirting with loosening marijuana laws.
There is the Denver man who, hours after buying a package of marijuana-infused Karma Kandy from one of Colorado’s new recreational marijuana shops, began raving about the end of the world and then pulled a handgun from the family safe and killed his wife, the authorities say. Some hospital officials say they are treating growing numbers of children and adults sickened by potent doses of edible marijuana. Sheriffs in neighboring states complain about stoned drivers streaming out of Colorado and through their towns.
“I think, by any measure, the experience of Colorado has not been a good one unless you’re in the marijuana business,” said Kevin A. Sabet, executive director of Smart Approaches to Marijuana, which opposes legalization. “We’ve seen lives damaged. We’ve seen deaths directly attributed to marijuana legalization. We’ve seen marijuana slipping through Colorado’s borders. We’ve seen marijuana getting into the hands of kids.”
Despite such anecdotes, there is scant hard data. Because of the lag in reporting many health statistics, it may take years to know legal marijuana’s effect — if any — on teenage drug use, school expulsions or the number of fatal car crashes. It was only in January, for example, that the Colorado State Patrol began tracking the number of people pulled over for driving while stoned. Since then, marijuana-impaired drivers have made up about 1.5 percent of all citations for driving under the influence of drugs or alcohol.
Proponents of legalization argue that the critics s are cherry-picking anecdotes to tarnish a young industry that has been flourishing under intense scrutiny. The vast majority of the state’s medical and recreational marijuana stores are living up to stringent state rules, they say. The stores have sold marijuana to hundreds of thousands of customers without incident. The industry has generated $12.6 million in taxes and fees so far, though the revenues have not matched some early projections.
Marijuana supporters note that violent crimes in Denver — where the bulk of Colorado’s pot retailers are — are down so far this year. The number of robberies from January through April fell by 4.8 percent from the same time in 2013, and assaults were down by 3.7 percent. Over all, crime in Denver is down by about 10 percent, though it is impossible to say whether changes to marijuana laws played any role in that decline....
The argument is being waged with fervor because both sides say Colorado’s successes and failures with regulating marijuana will shape perceptions of legalization for voters considering similar measures in other states and for leery federal law enforcement officials. After the 2012 legalization votes in Colorado and Washington State — where recreational sales are expected to begin this summer — Justice Department officials gave the states a cautious green light. But they warned that they might intervene if marijuana ended up fueling violence or drug trafficking, or flowing across state lines or into the hands of children.
Marijuana opponents like Thomas J. Gorman of the Rocky Mountain High Intensity Drug Trafficking Area program, which helps law enforcement, say Colorado is already falling short of those standards. “In any other state if they were making as much money and growing as much dope, they’d be taken out by the feds,” Mr. Gorman said.
Few agree on how much legally purchased marijuana is being secreted out of Colorado. Michele Leonhart, the head of the Drug Enforcement Administration, told a Senate panel in April that officials in Kansas had tallied a 61 percent increase in Michele Leonhart, the head of the Drug Enforcement Administration, told a Senate panel in April that officials in Kansas had tallied a 61 percent increase inseizures of marijuana that could be traced to Colorado. But according to the Kansas Highway Patrol, total marijuana seizures fell to 1,090 pounds from 2,790 pounds during the first four months of the year, a 61 percent decline.
Some sheriffs and police chiefs along Colorado’s borders say they have noticed little change. But in Colby, Kan., which sits along an interstate highway running west to Colorado, Police Chief Ron Alexander said charges for sale, distribution or possession related to marijuana were rising fast. This year, he tallied 20 such cases through May 23. Two years ago, there were six during that same time period. Sheriff Adam Hayward of Deuel County, Neb., said he was locking up more people for marijuana-related offenses. “It’s kind of a free-for-all,” he said. “The state or the federal government needs to step up and do something.”...
Police and fire officials across the state have been contending with a sharp rise in home explosions, as people use flammable butane to make hashish oil.. And despite a galaxy of legal, regulated marijuana stores across the state, prosecutors say a dangerous illicit market persists....
Many of Colorado’s starkest problems with legal marijuana stem from pot-infused cookies, chocolates and other surprisingly potent edible treats that are especially popular with tourists and casual marijuana users. On Colorado’s northern plains, for example, a fourth grader showed up on the playground one day in April and sold some of his grandmother’s marijuana to three classmates. The next day, one of those students returned the favor by bringing in a marijuana edible he had swiped from his own grandmother. “This was kind of an unintended consequence of Colorado’s new law,” said John Gates, the district’s director of school safety and security. “For crying out loud, secure your weed. If you can legally possess it, that’s fine. But it has no place in an elementary school.”
So far this year, nine children have ended up at Children’s Hospital Colorado in Aurora after consuming marijuana, six of whom got critically sick. In all of 2013, the hospital treated only eight such cases.
June 2, 2014 in Criminal justice developments and reforms, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms | Permalink | Comments (2)
Friday, May 23, 2014
I am pleased to learn from this new post on the Brookings Institution's blog that folks at this prestigious think tank "will be researching the new marijuana industry, not as advocates, but as social scientists, interested in how our federal system comes to terms with statewide decisions to legalize a substance that is illegal in the rest of the country, and how states implement those policy changes." And this new post authored by John Hudak, headlined "Dispatch from Colorado: The Interesting Case of Marijuana Entrepreneurs," already provides an interesting and exciting perspective on what the folks at Brookings are discovering as their research begins. Here are snippets:
I spent last week in the Greater Denver area researching implementation of legalized cannabis. In the process, I found a remarkable situation: a robust entrepreneurialism around an industry that elsewhere lives in the shadows of society....
Regardless of one’s personal feelings on the issue, Colorado has determined (and within bounds, the federal government has allowed) the construction of a legal, recreational, and highly regulated market by which consumers can purchase a vast array of cannabis products. And business is booming....
The legal market in Colorado, from professional grow operations to medical dispensaries to recreational dispensaries, looks nothing like street corner drug operation. These are professional businesses that are innovative and scientific. They bring black market lessons to the new, white market, while using tools of agriculture, engineering, science, manufacturing, and business to advance an industrial effort.
Businesses function in a market — though highly regulated — competing with each other to produce the best product in the highest demand. Surely there are members of the industry — like in any industry — who try to skirt the rules or operate outside of the regulatory structures. However, my interaction with businesses involved talking with executives, operators, and employees who embodied professionalism and care for their craft. They reminded me at every turn that they were quite aware that playing by the rules was a necessary condition to avoid the ever-possible federal intervention. At the same time, they showed pride in their efforts, just as a brewmaster would at a microbrewery or a vintner at a winery.
And the operations were just as scientific. For example, at the grow operation I toured, I was led through a series of rooms, engineered specifically for the growing of cannabis. The process involved water purification, testing pH levels, temperature, and conductivity. There was a genetics room where employees ensure a strain of marijuana is consistent in each subsequent plant of that strain. Lights (as it was an indoor grow) were metered, colored properly for the correct stages of growth, measured the proper distance from plants, and were shut off for the necessary periods of time each day. Feeding and watering were timed and measured, and every plant pinned with the state-required seed-to-sale tracking system identifier tags. While in some ways similar to a greenhouse where one would buy roses or petunias, this space looked nothing like the neighborhood florist’s supply space. It was a warehouse filled with advanced agro-science and manufacturing.
In addition, my visits to dispensaries and a grow operation offered a peek into the emerging labor market within the industry: it employs demographic groups hit hardest by the recent recession. Most employees were young (appearing 30 or under). There were numerous females and individuals of color. Though I lack systematic industry employment data and cannot make broad claims about employment trends, my conversations with those who know the industry best suggested that those observations were more than just anecdotes and reflect real trends among cannabis businesses.
Is the industry perfect? No. Does it need regulatory and legislative solutions to operate in a more effective, safe, and consistent way? Absolutely. I will address these topics in a paper to be released in the coming months.
However, a deep look into Colorado’s industry shows a professionalized marketplace that contrasts starkly with caricatures or stereotypes about marijuana growers and sellers. In Colorado, the marijuana seller may not look or dress the same as the woman selling pharmaceuticals or the man selling insurance, but they’re driven by similar entrepreneurial energy and a willingness to play by the rules in a regulated marketplace. The emergence of that marketplace, the ability of the state to respond to the unprecedented and unique challenges it will present, and its adaptation to the broader federal system will be the topics of more research.
I am especially eager to see this report focus on the "emerging labor market" within the marijuana industry. I have long suspected and have been hoping that the labor force dynamics that can surround a legalized marijuana industry, especially if it is regulated in a manner that encourages job creation, could be very beneficial for many under-employed populations. I hope the folks at Brookings give particular attention to this issue in its coming research, in part because I have not seen any significant coverage of labor issues in other work to date in this field.
May 23, 2014 in Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)
Friday, May 16, 2014
Following up on yesterday's post about driving and marijuana legalization, the Cannabist reports that a new study has been released showing an increase in the number of Coloradans in fatal car crashes that tested positive for marijuana. The study focused on the period from 2009-2011, when Colorado's commercial medical marijuana market came into being. It does not include post-legalization data.
Like other studies on marijuana and car fatalities, the study's tests cannot determine whether the drivers were actually impaired or whether they had smoked marijuana at some earlier date. As a result, we don't know whether the positive tests are simply the result of increased use or indicative or an increase in impaired driving.
Adding to the complexity, the story notes that traffic fatalities in Colorado decreased overall during the relevant time period. If there had been a significant rise in marijuana-impaired drivers on the road (as opposed to a rise in people testing positive because of a general increase in use), we might imagine that it would have resulted in an overall increase in traffic fatilities. Of course, it could be that marijuana impaired driving led to an increase in fatalities but that the increases were more than offset by other developments (e.g., innovations in car safety, effectiveness at deterring other forms of reckless driving, etc.).
In any event, it will be interesting to see if any future studies are able to tease out whether (and to what extent) legalization is resulting in more marijuana impaired driving. Here's the beginning of the Cannabist story:
One study shows that more drivers involved in fatal car accidents in Colorado are testing positive for marijuana — and that Colorado has a higher percentage of such drivers testing positive for marijuana than other states even when controlled for several variables. But the data the researchers use do not reveal whether those drivers were impaired at the time of the crash or whether they were at fault.
“[T]he primary result of this study may simply reflect a general increase in marijuana use during this … time period in Colorado,” the study’s authors write.