Last night, Colorado and Washington (pending, but looks likely) legalized the recreational usage of marijuana for anyone over the age of 21. It will now be legal to have less than 1 oz of marijuana for people aged 21 and over, though the Federal laws regarding marijuana have not changed. Marijuana is the most popular illicit drug in the US, with an estimated market size of $10 – $120B annually(1). States have been eager to cash in on some of those sales through the legalization and regulation of marijuana.
Proponents for legalization argued:
- Data from states who have legalized medical marijuana actually causes a decline in teen consumption
- Treating marijuana like alcohol and tobacco allows state governments to save money on prohibition enforcement costs. Studies show 800,000+ arrested annually, and enforcement costs between $10-$40B per year(2).
- Legalizing marijuana provides an alternate source of tax revenue. Washington’s law provides for a 25% tax on marijuana sold, while Colorado requires a tax to be determined by the state’s general assembly.
- Making it legal forces sales out from underground markets and takes sales away from criminal elements
What actually changed?
- Removes criminal penalties for possession of less than 1 ounce of marijuana
- Authorizes marijuana dispensaries and producers registered with the state
- Imposes an age limit of 21 years of age for possession and purchase
- Taxes purchases at a rate of 25%, with proceeds going substance-abuse prevention and education
- Establishes strict punishments for driving under the influence of marijuana
- Makes the personal use, possession, and limited home-growing of marijuana legal for adults 21 years of age and older;
- Establishes a system in which marijuana is regulated and taxed similarly to alcohol; and
- Allows for the cultivation, processing, and sale of industrial hemp.
Amendment 64 director Mason Tvert: ”The current initiative proposes a fully regulated system of cultivation and sales, which will eliminate the underground marijuana market and generate tens of millions of dollars per year in new revenue and criminal justice savings. It also directs the legislature to regulate the cultivation of industrial hemp, a versatile, popular, and environmentally friendly agricultural crop.”
How will the Federal government respond?
Given that marijuana is still a Schedule 1 controlled substance, it is unclear how the Federal Government will respond. They have cracked down on medical dispensaries suspected of acting as fronts for trafficking in the 17 states that legalized medical marijuana. Mason Tvert suggests that since “The federal government has respected our current system of regulated medical marijuana production and sales, so we don’t really see why this would change anything. In fact, what we’re doing is controlling even more of the marijuana market that’s out there. “
Medical marijuana is now legal in 18 states, and given Washington and Colorado’s path from legalizing medical marijuana to full-blown legalization of recreational usage, it will be interesting to see if other states follow suit.
 http://www.prohibitioncosts.org/; http://www.drugscience.org/bcr/index.html