Vicente Fox Says Drug Legalization Should Be Considered

Former Mexican President Vicente Fox, who proposed decriminalizing drug possession while in office, says it's time to consider legalizing the supply as well:

Fox said strict controls and high taxes would be necessary under legalization. He said levels of drug use might remain the same but violence would be significantly reduced because the cartels would no longer control the supply. Families and schools should bear much of the responsibility to educate against drug use, he said.

"I am not yet convinced that that's the solution," he said. But he added, "Why not discuss it?"

In February another former Mexican president, Ernesto Zedillo, declared the war on drugs a failure and, together with former Brazilian President Fernando Henrique Cardoso and former Colombian President César Gaviria, called for a new approach emphasizing "public health" that might include "decriminalizing the possession of cannabis for personal use." Unlike Fox, they did not suggest full legalization. Yet any reforms that maintain the black market will not address the violence plaguing Mexico and other Latin American countries. 

[Thanks to Tom Angell at LEAP for the tip.]

Comments

[Warty]

This stuff would be a lot more encouraging if current presidents said it.

And thanks for putting the narcocorrido song from Breaking Bad back in my head, you prick.

La fama de Heisenberg
Ya lleguanda a Michoacan...

[Isaac Bartram]

Fox said strict controls and high taxes would be necessary under legalization.

I'm reluctantly willing to accept this. It has to be an improvement over the current situation.

I'm just not sure I understand why he thinks "high taxes" are needed. I accept the fact that some commodoties may impose social costs (externalities?) but I'm not sure that of pot is that high.

After the abuse of the tobacco tax, I'm mostly not buying this. Even at traditional levels the taxes on tobacco, if dedicated that purpose, could have created a fund that could have paid for the treatment of every respiratory disease whether smoking related or not. Naturally the pols had plenty of other uses for the revenue and then had the gall to sue the industry to "recover' the cost of treating "smoking victims".

No, I'm not actually advocating that. I'm just trying to point out the mendacity of the political species.

But also that even accepting the existence of these externalities I can't imagine those deriving from pot use being anywhere near those from tobacco.

[guy in the back row]

I'm just not sure I understand why he thinks "high taxes" are needed. I accept the fact that some commodoties may impose social costs (externalities?) but I'm not sure that of pot is that high.

Just think how much lower taxes will become when all the narcotics cops are reassigned, retired, and just plain fired for nothing to do.

[R C Dean]

Just think how much lower taxes will become when all the narcotics cops are reassigned, retired, and just plain fired for nothing to do.

Nah. They'll just become soda cops.

[wayne]

I just want to point out that if taxes on legal drugs get high enough, they will completely negate the positive consequences of legalization.

The California bill that seeks to legalize Marijuana, for example, proposes a $50 per ounce tax levy. At that taxation level, there will be ample motive ($800 per pound) for criminals to stay in the drug trade.

I say legalize freedom completely! There is no good purpose served by letting the do-gooder, finger-waggers impose their moral perspectives on anybody but themselves.

[Paul]

Wayne, you've touched on something I've been concerned about. I always wince when a pro-legalization force or group says: "Regulate us! Tax us! Make us legitimate".

How about "legalize it" and just leave it at that.

[wayne]

Paul,

I agree. Some taxation is inevitable, but the government should not simply substitute itself for the cartels. That would be immoral, which politicians certainly are, but more importantly high taxes would maintain the monetary incentive that supports the current murderous drug runners.

[Elemenope]

The California bill that seeks to legalize Marijuana, for example, proposes a $50 per ounce tax levy. At that taxation level, there will be ample motive ($800 per pound) for criminals to stay in the drug trade.

We've talked about this before. 33 grams per oz, 0.8 grams per joint. That's ~41 joints per oz. So, we're talking just over $1.20 tax burden per joint.

I would be utterly shocked if the cost inflation of illegality were less than that.

[wayne]

lmnop,

When a tax of $800 per pound is levied on an ag product that probably costs about $3 per pound to grow, there will be criminals lining up to beat the tax man (and murder each other when profitable).

I think a tax of $5 per ounce is reasonable; $50, uhm, not so much.

[wayne]

Oh, one more point:

1 ounce = 28.3495231 grams

[J sub D]

wayne, what's the smuggler tax on reefer where you live? Absent legal prohibition, marijuana costs less than 5 bucks an ounce to grow, harvest and deliver to the consumer. What's an oz. of decent Columbian go for?

I'm betting far more than $55 an oz.

IOW a $50 per oz tax makes everybody a winner except the traffickers. Fuck them assholes.

[wayne]

JsD,

I don't know what weed sells for locally. I don't smoke pot.

My simple point is that people don't commit crimes all the way up to murder for drugs, they do it for money. If the tax rate on "legal weed" is high enough to incentivise crime then legalization won't achieve the main goal (at least my main goal), which is to root out the criminal underworld.

If I can grow pot for $3 per pound (not ounce... pound) and the tax man demands $800 as his take, then I (personally) will be tempted to sell on the black market.

[hmm]

When trying to support a point the last thing you want to start with is, "Vicente Fox Says..." Even if he is right, just not the best way to build support for your argument.

[David E. Gallaher]

Sadly, those of us hoping for an end to the insane war on drugs must also hope for a deeper recession. Prohibition was ended because of politicians' lust for new taxes, more revenue.

Social progress never happens for the "right" reason.

[Elemenope]

1 ounce = 28.3495231 grams

My bad, I was working of IIRC conversions (always a bad idea). That makes the tax closer to $1.40 a joint. Not a huge difference.

And it costs a helluva lot more than $3 to grow a pound of pot.

[wayne]

"And it costs a helluva lot more than $3 to grow a pound of pot."

I doubt that.

[wayne]

A bushel of corn weighs 56 pounds and SELLS for about $5... Corn ain't ganja, but that gives you some idea of production costs.

[Aresen]

R C Dean | May 12, 2009, 5:47pm | #

Just think how much lower taxes will become when all the narcotics cops are reassigned, retired, and just plain fired for nothing to do.

Nah. They'll just become soda cops.

Win.

[Episiarch]

And it costs a helluva lot more than $3 to grow a pound of pot.

Not really. You plant your seeds either in a pot on your veranda or in the back yard, and let nature do the rest. At most you have to water it occasionally. Those plants are weeds, dude. They're like mint.

Obviously if you are growing the best possible weed you will want to put some money into making conditions optimal, but if it's legal and you don't have to fear the plant being seen, you can do it for basically nothing.

[Bill C.]

They shouldn't start out with a $50 an ounce tax because the first thing we should do is kill the black market, but when the industry takes off and becomes efficient and competitive, $50 an ounce won't be that much.

A couple of people were talking about pot maybe costing about $3 a pound to grow in a legal environment. That's actually possible, or at least under $10 or $25 a pound. Look at tobacco. It costs Phillip Morris less than $3 a pound dried and cured, and the farmer is making a profit even with that low price.

From what I understand it costs about $2,500 an acre on average to produce tobacco. They average a couple of thousand pounds per acre. Pot yields wouldn't be that high. I know the government says that they get a little over 1000 pounds per acre in Mexico. I've seen an old USDA report on growing herbal medicines from back in 1912 or 1914 where they said the few American farmers growing marjuana back then were getting close to 500 pounds of dried seedless buds per acre, and that was back when they were getting something like 30 bushels of corn per acre compared to the 155+ farmers average today. Our farmers very efficient and capable of achieving incredible yields. They ought to be able to get a 1,000 pounds per acre like peasants in Mexico growing it out in the boonies without modern farm equiptment and modern farming methods.

In Canada hemp is legal. They grow it for seed up there. I checked into it and it looks like their costs are less than $1,000 an acre to grow the hemp and dry it and remove the seeds. It would probably cost more to separate the buds from the stalks and trim them up for sale, but not that much more. If it costs twice as much as tobacco to produce at a 1000 pounds per acre that would work out to about $5 a pound in production costs. If it costs ten times as much as tobacco to produce production costs would only be about $25 a pound.

Marijuana will be super cheap on a wholesale basis in a legal environment. There will be all sorts of room for taxes. That $50 an ounce may seem high, but there are a little over 28 grams in an ounce. The tax would be less than $1.80 a gram and in most cases a gram is enough for several smoking sessions for one person. The tax would be just a few cents per use. People might complain about it like they complain about all taxes but it wouldn't be so high that it's going to make them want to buy their pot in back alleys from criminals. They're going to want to go to the pot store where they can choose from a wide variety of quality product. And that product will probably be cheaper than what is out there today even with taxes and excises.

[Bill C.]

I doubt legalizing marijuana would help Mexico much. The vast majority of what they produce ends up here. The drug use statistics may be bogus, but according to Mexican and international drug use statistics for Mexico, only a small fraction of Mexicans even try marijuana and only a tiny fraction are current users. There is obviously some drug use down there, but they produce way more marijuana than they could ever consume. According to the 2009 Drug Threat Assessment put out by the USDOJ, Mexico produced 15,500 metric tons of marijuana in 2007 and most all of it came here. That's 15.5 billion grams and most of it came here. That's just a staggering amount.

Corruption is rampant in the Mexican government. If they legalized pot there the cartels would still probably control their domestic marijuana industry, and of course they'd still be producing thousands of tons of marijuana every year to sell to gringos. The violence wouldn't stop. Because so few use marijuana there now marijuana use would probably increase a fair amount and our government would point to this 200 or 300 percent increase in use, or whatever it would be, and the violence that would still occur, and say that not only does legalization increase use it does nothing to stop the violence. I kind of hope Mexico doesn't legalize before us.

I'd much rather see Canada do it. They already have high per capita marijuana use numbers. Like here, marijuana is everywhere and most everyone who wants to smoke it is already smoking it. They export a lot but also consume a lot domestically. Their government is nowhere near as corrupt as Mexico's. They probably could reduce their problems with organized crime if they legalized. They'd generate a lot of tax revenues. Use wouldn't go up much, and people down here would be much more likely to look at what is happening in Canada and demand the same thing here.

[Elemenope]

Not really. You plant your seeds either in a pot on your veranda or in the back yard, and let nature do the rest. At most you have to water it occasionally. Those plants are weeds, dude. They're like mint.

Obviously if you are growing the best possible weed you will want to put some money into making conditions optimal, but if it's legal and you don't have to fear the plant being seen, you can do it for basically nothing.

I'm more familiar with the economics of indoor growing. There, the two big expenses become energy for lighting and environmental heating, and fertilizer. The "industry-standard" tends to be a goal of one pound per 100OW light per grow cycle, which comes in most places to bills of about $200-250 per month in energy costs. There is also a very large start-up capital cost for buying the requisite equipment.

And then there is the labor cost, which includes preventing plant diseases, making sure they have properly balanced nutrients, and identifying and destroying the male plants before they pollinate (a pain in the ass), which I would imagine would be more difficult in an outdoor growing environment, particularly in areas where the wild, shitty stuff grows.

Sure, you can grow the stuff as a weed, but the "weed" that comes out the other end is by all accounts shitty. One of the thing that would come with legalization is a heavy demand for designer or quality strains, as well as some significant consistency in quality over time.

[wayne]

Indoor growing is a response to the illegality of pot. If pot is legalized, indoor growing will virtually disappear. Extremely high-quality pot can (and will) be produced outdoors where the input costs are low.

[John]

Nope, ain't going to happen. Mexico would be in violation of UN treaties, same reason we can't legalise it. We would go to war with Mexico over this.

[wayne]

John,

Treaties can be amended, or revoked.

[Bill C.]

Elemenope, do you think that in a legal environment commercial growers would be growing indoors under lights? I doubt we'd see much of that at all. Most would be grown outdoors. Companies like Monsanto would develop high quality strains that do well outside and have traits desirable to consumers. They'd make the crops as uniform as possible to make mechanical harvesting easier. We might even see multiple use plants, high THC hemp, grown for buds and also for fiber, biomass, and maybe even seed oil. We might even see hash becoming dominant in the market because they could even use seedy plants for that and could mechanically harvest and not even worry about trimming buds. They could then separate the resin from the plants mechanically and use the seeds and stems and stalks and leaves for other purposes. Then they'd blend the resin with resin from other strains, add in stabilizers and preservatives to make a uniform product with a ridiculously long shelf life, and then market this mass produced product like Bud Light.

The fancy connoisseur grade product could be grown in greenhouses with only a very small amount of supplemental lighting when necessary to make the plants "think" the days are longer than they really are so as to avoid premature flowering. Photoperiodic plants don't need light sufficient to promote growth to make them think the days are longer, so it could be done with only a few watts per greenhouse when the days are short and the plants aren't ready to flower. They'd have row after row of greenhouses on many acres like we might see with a large hothouse tomato growing or flower producing operation today. Costs would be higher than those for plants grown in open fields but they'd still be a small fraction of the costs incurred by someone using thousands of watts of high intensity discharge lamps in a home he's rigged up as a growhouse. Energy costs will be far lower and the economy of scale will drive costs down even further. It shouldn't cost hundreds of dollars a pound to produce even the finest quality marijuana.

[Bill C.]

"Nope, ain't going to happen. Mexico would be in violation of UN treaties, same reason we can't legalise it. We would go to war with Mexico over this."

The treaties are a minor hurdle, but do you really think we'd go to war with Mexico if they legalized marijuana? Looking at the polls it looks like it is getting to the point that close to a majority of the voting aged public in this country support legalizing marijuana here. Those for legalizing here aren't going to support a war in Mexico over them legalizing, and probably very few who are opposed to legalizing marijuana here would think Mexico legalizing would be something worth going to war over. Most people believe that sovereign nations have a right to make their own internal drug laws.

I bet that not only would we not go to war, any trade sanctions against Mexico or Canada if they legalized would be minimal. The majority of Canadians want to legalize it now. Their senate recommended legalizing back in 2003, and officials from our government promptly started threatening trade sanctions and other consequences if they did legalize. I doubted back then they'd we'd really follow through with much of that and with public attitudes on legalization now I doubt we'd do much of anything to either Canada or Mexico if they legalize. The American people would not be supportive of such measures, both because most of us think a country has the right to make their own decisions about their internal drug laws and because trade sanctions against our neighbors invariably end up costing us money. We'd probably hear some threats from some of our politicians if it looked like one of these countries was about to legalize, but if they legalized anyway we wouldn't do much of anything at all. We certainly wouldn't go to war over it.

[Nick]

I can't believe we haven't kicked The Netherlands out of NATO yet! Better yet, bomb the shit out of them. That'll show 'em.

[Paul]

We've talked about this before. 33 grams per oz, 0.8 grams per joint. That's ~41 joints per oz. So, we're talking just over $1.20 tax burden per joint.

Around $1.00 too high.

[Paul]

Shit, my bad. Around $1.18 too high.

[Jason]

American ounces must be 5 grams heavier than those in the rest of the world. I make it 27.8 grammes per ounce.

Either that or you get cheated on a gram.

Nevertheless, I'm off to Mexico, the only rational thinking country.

Thanks for proliferating your arcane drugs laws across the world my friends across the pond.

20 years a user, not one problem for anyone else and nothing but success in my own life since I gave up the legal drug.

Drug and alcohol laws a US conspiracy to protect it wealth. Too many lies and misinformation I fear.

Yes I accept there are problems, but then they are financing based and exist with alcohol too.