LETTER OF THE WEEK

MARIJUANA'S POTENTIAL

By Gerald Clift

In Time magazine's March 13 issue, Alison Stateman notes "Pot is,
after all, California's biggest cash crop, responsible for $14
billion a year in sales, dwarfing the state's second largest
agricultural commodity -- milk and cream -- which brings in $7.3
billion a year, according to the most recent USDA statistics."

Economists Michael R. Caputo and Brian J. Ostrom explain in the
American Journal of Economics and Sociology that "the total retail
value of marijuana is virtually identical to potential tax revenue
due to the low cost of production."

Under our prohibition of marijuana, an ounce can cost as little as
$160 and as much as $800. However in Prague, where small amounts of
marijuana are legal to possess, it is sold for only 85 cents an ounce.

Tobacco merchants in California similarly make as little as $1 an
ounce and as much as $3 an ounce on legal tobacco, after sales tax. I
visited a local tobacco shop in Vacaville where the most expensive
tobacco was $4.76 per ounce. The clerk told me the store makes less
than 50 percent of that price after taxes.

If we taxed an ounce of marijuana at 15,000 percent, we could take in
tremendous revenue while consumers would still pay less than they're
paying now under prohibition. Further, the merchants distributing
marijuana would have a higher profit margin than merchants selling
tobacco. A $1 ounce taxed at 15,000 percent would bring in $150 in
tax revenue, and a $5 ounce at this tax would bring $750 in tax revenue.

The Associated Press reports that marijuana "is now the biggest
source of income for Mexico's drug cartels," so the ones who would
lose out are the drug cartels and dealers who sell to our kids.
Prohibition created these drug dealers and, under current law,
"teenagers say marijuana is easier to buy than cigarettes or beer,"
according to a study done by the National Center for Addiction and
Substance Abuse. This is because drug dealers have no incentive to
check identification, as respectable businesses would for legal
marijuana and now do for alcohol and tobacco.

Some may contend that once pot is legalized, people would just grow
it themselves and we would not increase revenue. Some people will
grow their own, but look what happened with medical marijuana. Though
patients can legally grow their own plants, they still go to co-ops
for the convenience, and where prices are comparable to street
prices. Just like tobacco and alcohol users, medical marijuana
patients choose these dispensaries ( marijuana co-ops ) for convenience.

We have two choices: Either continue letting the drug cartels get
rich off marijuana distribution to our neighbors and our kids while
our schools and social services suffer budget cuts, or let the state
get some much-needed revenue from people who are going to buy
marijuana regardless of its legality.

The people of California have spoken in a Field Poll, saying 56
percent of Californians support legalization of marijuana. Now it's
time for our legislators to do their job. Listen to the people and
balance this state budget.

I urge everyone to contact their state legislators in support of
taxation of marijuana. For complete citations, societal and health
implications of marijuana legalization, and further analysis, visit
www.GClift.com.

Gerald Clift

Vacaville

Pubdate: Sat, 06 Jun 2009

Source: Reporter, The (Vacaville, CA)