Milton Friedman Urges Regulation

Jacob Sullum | June 2, 2005

Boston University economist Jeffrey Miron has a new report on "The Budgetary Implications of Marijuana Prohibition" in which he estimates that "regulating marijuana would save $7.7 billion per year in government expenditure on enforcement of prohibition" and that "regulating marijuana would yield tax revenue of $2.4 billion annually if marijuana were taxed like other goods--and $6.2 billion annually if marijuana were taxed like alcohol and tobacco." The Marijuana Policy Project has released Miron's report along with an open letter to President Bush signed (so far) by 500 economists, including Milton Friedman. They call for "an open and honest debate about marijuana prohibition," adding, "We believe such a debate will favor a regime in which marijuana is legal but taxed and regulated like other goods."

Comments

Thomas Paine's Goiter|6.2.05 @ 10:27AM|#

The math that Miron is using to come up with the $7.7 billion is bizarre.

The Wine Commonsewer|6.2.05 @ 10:35AM|#

Candy is dandy
Liquor is quicker
Pot is not

Thus sayeth Ogden Nash. That might change if pot was taxed.

The Owner's Manual|6.2.05 @ 10:35AM|#

"I see another thing in the news summary this morning about it. That's a funny thing, every one of the bastards that are out for legalizing marijuana is Jewish. What the Christ is the matter with the Jews, Bob, what is the matter with them? I suppose it's because most of them are psychiatrists . . ." -- Richard Nixon
Read more: http://gcruse.typepad.com/the_owners_manual/2004/11/socon_so_wrong.html

|6.2.05 @ 10:55AM|#

I have never been prouder of my faith heritage. (Currently an atheist, but it may be time to start practicing again!)

fyodor|6.2.05 @ 11:05AM|#

Jews for Jah!!!

|6.2.05 @ 11:05AM|#

Would creative copywriters be allowed to deduct their purchases as a business expense?

|6.2.05 @ 11:07AM|#

Jenn,

Now you're thinking! This is the kind of tax reform I can get behind.

|6.2.05 @ 11:18AM|#

Meanwhile, in NYC yesterday some guy shot a cop and later commited suicide over a dime bag.

http://www.nydailynews.com/front/story/315302p-269726c.html

They ain't never gonna legalize this stuff, what would be do with all the excess cops, lawyers, social workers, prison guards, etc.

Warren|6.2.05 @ 11:51AM|#

That prohibition is bat-shit stupid is abundantly clear. It's something that even gets mentioned aloud in public from time to time. What we have a shortage of, is elected officials willing to speak the truth about the emperor and his attire.

|6.2.05 @ 12:04PM|#

I just can't wait to see the Mara Salvatrucha, the Cali Cartel, etc, etc, dressed up in suits & ties, in a Vendor Cubicle in Bentonville, getting ground down to the last penny by a buyer over the price of Sam's Choice Wacky Tabacky.

Will Lou Dobbs, Pat Buchanan, etc demand high tariffs on Acapulco Gold to protect the growers of Maui Wowie?

|6.2.05 @ 12:11PM|#

Don't dare suggest that this isn't the greatest cause, worthy of martyrdom. And see, that's just the kind of nastiness that happens when you dabble in illegal drugs.

|6.2.05 @ 12:32PM|#

There are many good reasons for doing the pro-liberty thing by legalizing marijuana and ending the ongoing and costly tragedy of prohibition. But the prospect of tax revenue is not one of these good reasons. Marijuana transactions are currently not taxed so that taxing them will represent a new tax. This tax will harm individual prosperity relative to its absence.

Concerning regulation, we need to be careful that larger concerns with pull with the government aren't allowed to enact regulations which will limit competition from their smaller competitors in the marijuana business.

bob_misses_Suck|6.2.05 @ 12:48PM|#

Yes, yes, taxes suck. But the restriction on liberty they represent, and the problems they cause, would definitely be smaller than prohibition's.
However, pot is so easy to grow, I have to wonder how we ensure tax revenue will result in any case.

|6.2.05 @ 12:53PM|#

I agree with b_m_s. I support of consumption taxes in lieu income taxes, anyway. This way, the goverment gets to declare a moral victory; if you can't beat 'em, regulate the crap of 'em.

I would gladly pay a tax of marijuana if it meant I could acquire it legally.

|6.2.05 @ 12:54PM|#

Bob-
Even if every single pot smoker grew his own and not one dollar of marijuana tax was collected, it would still be worthwhile just to save all that money on enforcement, not to mention the number of people who COULD be working and paying taxes rather than sitting in jail costing taxes. However, I think most people would buy it, because it's easier. I could change my own car's oil more cheaply than going to Jiffy Lube, but it's just not worth the hassle.

Xmas|6.2.05 @ 12:59PM|#

What are you talking about? Pot is already taxed.

That's how it was originally made illegal.

http://www.druglibrary.org/schaffer/hemp/taxact/mjtaxact.htm

|6.2.05 @ 1:31PM|#

"Marijuana transactions are currently not taxed so that taxing them will represent a new tax. This tax will harm individual prosperity relative to its absence."

..as opposed to the overhanging threat of having one's life totally ruined?

Tax is legalized theft, etc, etc, I am on board. But sometimes a compromise is better then nothing. "Give Caesar what is Caesar" as JC said. If the govmint fucks want to tax weed, fine with me. I can't see it being nearly as high as the black market mark-up. Plus there isn't the threat of ass-pounder prison. That's just frosting on the cake.

|6.2.05 @ 1:31PM|#

I can't imagine most people growing marijuana even if it were legal. I think the only reason many grow it now is because it is illegal and rather than deal with criminals/black market and the high cost of purchasing it - they grow their own.

|6.2.05 @ 2:03PM|#

Rick Barton,
Everything said before about persons being productive members of society instead of costing money being in prison, and the cops and prison guards associated costing money.

But also, isn't a sales tax better than an income tax if we are to be taxed?

I say this because the income tax is a statement to the effect of you not being a free human being, that the government has the right to say how much money that you earned you have a right to keep. Whereas a sales tax is just saying that the government is taxing commerce, a lesser evil in my book.

|6.2.05 @ 2:24PM|#

kwais,

Amen, brother (or sister, sorry).

|6.2.05 @ 2:51PM|#

Uh oh. Now you did it, SPD.

|6.2.05 @ 3:06PM|#

Honestly, I can't tell from the name. I wasn't trying to insult anyone.

|6.2.05 @ 3:09PM|#

There should be a tax exemption, like the one on beer and wine, for folks who grow marijuana for personal consumption. And growing pot is a lot easier and cheaper than home-brewing. I think it'll be very popular.

|6.2.05 @ 3:16PM|#

Think of the boom in the hydroponics industry!

Excuse me... I, uh, just need to call my stockbroker... oh, wait, it hasn't been legalized yet. Damn it.

|6.2.05 @ 3:45PM|#

It might save the government money, but when has the government ever given a damn about saving money? The people it will hurt is the police/prison/military industries, which have big lobbying dollars. This argument, no matter how much I agree and want it to suceed, will not make any difference.

|6.2.05 @ 4:28PM|#

Marijuana transactions are currently not taxed so that taxing them will represent a new tax.

They are taxed in Tennessee. I don't have the source readily at hand, but it was on Hit and Run a few months back.

|6.2.05 @ 4:33PM|#

Marijuana reform is a joke, because middle class kids don't usually get arrested anyways. The people I know who have been caught get off with probation and community service. Reference jail stats all you won't, but its not like the majority of people know someone close to them affected by pot laws.

The people who would have to prod politicians to get it legal aren't being affected adversely enough by it to care enough about it. Their kids might be annoyed by high prices, but thats about it.

Marijuana legalization is about as much an issue as gay marriage is, except, at least that got some attention.

Each generation will more than likely have laxer attitudes about pot, meaning that the law will rot instead of being removed.

|6.2.05 @ 5:22PM|#

Whiner,
Unfortunately that is not the case. Arrests for marijuana keep increasing.

http://stopthedrugwar.org/chronicle/360/arrests.shtml

|6.2.05 @ 7:29PM|#

"They ain't never gonna legalize this stuff, what would be do with all the excess cops, lawyers, social workers, prison guards, etc."

They'll put them in schools and other places people under 21 frequent because nearly all "legalization" schemes introduced up to this point still call for harsh restrictions on possession/use by persons under 21.

Schools will complain that the newly legalized plant is showing/will show up more in schools, so more manpower for drug interdiction in schools will be called for.

People under 21 will find marijuana just as easy to obtain as beer, so it may show up more in schools and in the possession of people under 21, which will further justify the increased heat on people under 21. I don't agree with most pro-legalization folks that use by people under 21 is a bad thing. I don't think age has anything to do with it-moderate use by a 16 year old is no better or worse than moderate use by a 36 year old, same with extreme and non-use.

So, where will all the various drug war welfare queens go without the biggest warred against drug? They'll shift some their resources to the much more miniscule section of drug users who lean towards cocaine, heroin, etc. and most of their resources into "protecting" people under 21 from the evil, but newly legalized, green.

|6.2.05 @ 7:39PM|#

b_m_s., kwais, Mr. Nice Guy, et.al.,

I didn't say that marijuana shouldn't be legalized because of the reason that the government will tax it. No way!

I said: There are many good reasons for doing the pro-liberty thing by legalizing marijuana and ending the ongoing and costly tragedy of prohibition. But the prospect of tax revenue is not one of these good reasons.

Also, the consideration of consumption tax vs. income tax isn't really germane here because elimination of the income tax isn't on the table in connection with this issue. And this is a consumption that will be taxed that is not generally taxed now. So, this taxation just represents a downside of an otherwise wonderful proposal that is long overdue.

|6.2.05 @ 7:55PM|#

RE:People under 21 will find marijuana just as easy to obtain as beer, so it may show up more in schools and in the possession of people under 21, which will further justify the increased heat on people under 21.

Mr Perez:

I don't know where you went to high school or your first couple of years of college but it was always easier to get marijuana than beer when I was underage. Getting beer required a person over 21 to buy it or having fake identification. Marijuana on the other hand only required a phone call and then a delivery or a pick-up.

|6.2.05 @ 10:34PM|#

"...when has the government ever given a damn about saving money? The people it will hurt is the police/prison/military industries, which have big lobbying dollars."

I agree with you, lowdog. There are others that could potentially be hurt as well, such as the tobacco and alcohol makers, the paper and lumber industries, not to mention Big Oil. The last three, of course, have less to do with marijuana than hemp, but legalizing one could certainly lead to exploitation of the possibilities of the other.

I have written to all of my representatives on the federal level on this topic and only two have replied. Both have essentially said the same thing: 'I support the right of states to allow the tightly controlled use of it for medical purposes, but I am against outright legalization.' Oh well, at least they know where I stand.

|6.2.05 @ 11:18PM|#

What the Christ is the matter with the Jews, Bob, what is the matter with them?

JEWBOY!!!

|6.3.05 @ 3:58PM|#

Both have essentially said the same thing: 'I support the right of states to allow the tightly controlled use of it for medical purposes, but I am against outright legalization.' Oh well, at least they know where I stand.

At least he "support[s] the right of states to allow the tightly controlled use of it for medical purposes..."

My representative is John Mica (R). I have several letters from him telling me he "knows" MJ has no medicinal value and that growing industrial hemp would be harmful to the environment and the economy and so on. And besides he's agin it FOR THE CHILDREN. What a fucking tool.

Oh, yeah, that's right too Akira, just one more reason to hate the motherfucker Nixon. He suppressed the Schafer Report.