The Economics of Legalizing Pot

What’s the Latest Development?

Some new figures around marijuana use demonstrate the massive revenue the nation could gain by regulating its sales. First, there is money to be saved. Since 1969, we have spent $33 billion on public service announcements that discourage teens from smoking marijuana but the rate of 12th graders who have smoked pot is the same today as it was before all those billions. Prohibition alone costs the nation $7.7 billion each year. There is money to be made, as well. Already, marijuana is the top cash crop in twelve states and the 3rd cash crop is 30 states. 

What’s the Big Idea?

Regulating the world of marijuana, which exists now as a huge black market, would generate an estimated $6.2 billion in tax revenue annually and another $7 billion would be created through the establishment of legitimate businesses like cannabis coffee shops, medical marijuana dispensaries and industrial hemp. But what about the children, you ask? Of the ten states that have legalized medical marijuana, eight of them have experienced a decrease in teen marijuana use from 1999 to 2006. And, say teens, pot is already easier to get than cigarettes or beer. 

Photo credit: shutterstock.com