Safer

Advocates of marijuana legalization say marijuana is safer than alcohol.  In that case, here’s an SAT-style analogy:  Marijuana: alcohol = monopoly: taxed commerce.   State monopoly would run afoul of federal law in the United States, but in other countries, it seems available.

Here are six reasons a monopoly is safer – more prudent – than taxed commerce:

The game-over first reason to pick marijuana monopoly over a private-enterprise model is that governments get only one chance to set up a monopoly. You can always switch from monopoly to a private model, but not the other way (private businesses would have a powerful and valid complaint).  Having a Plan B is safer than betting all on Plan A.

Second, a public seller can tweak prices more quickly than a Legislature can change tax rates, the better to battle bootleggers in the inevitable price war.

Third, a state monopoly limits the profit motive for distribution of marijuana. As John D. Rockefeller said about liquor, as U.S. Alcohol Prohibition ended: “”Only as the profit motive is eliminated is there any hope of controlling the liquor traffic in the interests of a decent society. To approach the problem from any other angle is only to tinker with it and to ensure failure.”[1]

Fourth, public monopoly offers more regulatory control. A mayor of Juarez, Mexico, expresses that view this way: “If you want to end the violence and the corruption it creates, . . . you only need to turn the business over to governments.”[2]

Fifth, monopoly offers more stable long-term control. As the marijuana industry matures, it can be expected to gain power and seek tax cuts – as the U.S. alcohol industry has done, if only by watching unindexed dollar-denominated taxes erode through inflation.

Sixth, the public may favor monopoly. At least it did in my state of North Carolina, in March 2013, by 58 percent to 19 percent (with 23 percent having no opinion).[3]

 

[1] “Toward Liquor Control,” cited in Harry G. Levine and Craig Reinarman,Lessons from Alcohol Policy for Drug Policy, http://www.cedro-uva.org/lib/levine.alcohol.html. See also http://www.robinroom.net/retail.htm.

[2] Mary Anastasia O’Grady, “Can Mexico Be Saved?” Wall St. J. A11 (Nov. 13-14, 2010).

[3]https://newtax.files.wordpress.com/2013/03/nc-marijuana-polling-march-2013.pdf.

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Author: patoglesby

From 1982 to 1990, I worked in tax policy for Committees of the United States Congress. In recent years, I was Adjunct Lecturer at UNC-Chapel Hill's Business School and then Adjunct Professor at its Law School.

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