The green economy
Rock Band enthusiasts with bongs aren't the only ones taking note. More than 40 percent of Americans have tried marijuana, according to the National Institute on Drug Abuse. By NORML's tally, as many as 15 million people smoke at least once a month. That's a pretty substantial market, and one that could bring in a goodly amount of tax revenue — a fact that hasn't been lost on those seeking rational solutions to our nation's financial woes.
"When you're staring at the sort of budget deficits that governments at all levels are looking at right now, that clarifies the mind a great deal," says Mirken. "And it does, I think, begin to strike people as pretty absurd that we have this huge industry that is effectively tax exempt!"
California assemblyman Tom Ammiano made news in February when he introduced a bill that would essentially treat pot like alcohol: legalize it, tax it, and allow adults 21 and over to purchase and use it. Soon after, the state's Board of Equalization announced that the bill's proposed levy of $50 per ounce could put as much as $1.3 billion a year into government coffers.
"I think it's not time for that," Schwarzenegger said in response. "But I think it's time for a debate."
"He's far and away the highest-placed politician in recent memory who's dared to broach the subject at all," says Harvard economist Jeffrey Miron of Schwarzenegger. "He said, 'I'm not in favor of it, but let's discuss it.' Well, why are you gonna discuss it when you're so sure it's a bad idea? He clearly does think it might be a good idea."
Miron is the author of a 2005 study titled The Budgetary Implications of Marijuana Prohibition. In it, he looks at the money that could be saved by local, state, and federal governments by the cessation of prohibition, and that could be gained by taxing pot at rates comparable with those levied on other vices.
"Overall, my numbers are something like $12 billion would be saved from not enforcing marijuana laws," says Miron, "and $7 billion could be collected in revenue, assuming it's taxed at something like the rates on alcohol and tobacco."
The numbers are "not totally trivial," he concedes. "But when we're looking at a $1.84 trillion deficit, a net of $15 to $20 billion seems like a rounding error."
For that reason, he doesn't foresee legalization for tax revenue alone. "I think that would be a reinforcing effect, but I think there's got to be more of an attitude [shift] that, if people can do something without harming other people, it shouldn't matter what that thing is. I think if people don't feel comfortable with it for some broader perspective, $15 billion isn't going to change their minds."
If dollar signs don't convince the anti-pot lobby, then how about the fact that Mexican drug cartels are appropriating public land in Western states to grow bushels of marijuana? Or the fact that ever more US officials, from Homeland Security Secretary Janet Napolitano to Joint Chiefs of Staff Chairman Mike Mullen, are fearing spillover of the cartels' grisly violence — more than 6000 murders last year — into Tuscon and El Paso?