Using the Wednesday release of a study suggesting that replacing marijuana prohibition with a tax and regulate policy would save billions of dollars as a peg, more than 500 economists led by free market apostle Milton Friedman are calling for a national debate on moving toward regulated marijuana markets. The call comes in an open letter to President Bush, Congress, and state governors and legislators.
In his study, "The Budgetary Implications of Marijuana Prohibition," Dr. Jeffrey Miron, a Boston University economics professor and visiting professor at Harvard University, looked at the financial costs associated with marijuana prohibition as well as the revenue implications of a regulated marijuana market. Using state and federal sources, Miron concluded that legalizing marijuana would save approximately $7.7 billion a year in enforcement costs, with savings of $2.4 billion at the federal law and $5.3 billion among the states and localities.
But wait, there's more: According to Miron, whose research was largely underwritten by the Marijuana Policy Project, a tax and regulate system would not only save billions in policing costs, it would also generate as much as $6 billion annually in taxes. If marijuana were taxed like ordinary consumer goods, revenues would range around $2.4 billion a year, but if it were taxed like alcohol and tobacco, that number could rise to as much as $6.2 billion, Miron concluded. That is a net savings of almost $14 billion a year.
In their open letter, the economists called attention to Miron's work and conclusions and urged a national debate on legalization. "The fact that marijuana prohibition has these budgetary impacts does not by itself mean prohibition is bad policy," the economists wrote. "Existing evidence, however, suggests prohibition has minimal benefits and may itself cause substantial harm. We therefore urge the country to commence an open and honest debate about marijuana prohibition. We believe such a debate will favor a regime in which marijuana is legal but taxed and regulated like other goods. At a minimum, this debate will force advocates of current policy to show that prohibition has benefits sufficient to justify the cost to taxpayers, foregone tax revenues, and numerous ancillary consequences that result from marijuana prohibition."
Five hundred economists -- even including some of the well-known ones who signed the open letter -- are one thing; having Milton Friedman sign on is another. The Nobel Prize-winning economist is one of the intellectual heroes of the contemporary conservative movement, but his anti-prohibitionist views are less well known. But he spoke out Wednesday, and in an interview with Forbes magazine was on point. "There is no logical basis for the prohibition of marijuana," the economist said. "$7.7 billion is a lot of money, but that is one of the lesser evils. Our failure to successfully enforce [drug] laws is responsible for the deaths of thousands of people in Colombia. I haven't even included the harm to young people. It's absolutely disgraceful to think of picking up a 22-year-old for smoking pot. More disgraceful is the denial of marijuana for medical purposes."
Friedman was ready to go further than just marijuana legalization. "I've long been in favor of legalizing all drugs," he told Forbes, but not because of standard libertarian arguments. "Look at the factual consequences: The harm done and the corruption created by these laws... the costs are one of the lesser evils."
Forbes called getting Friedman to sign on and speak out "a coup" for the Marijuana Policy Project, and MPP executive director Rob Kampia was ready to make the most of it. "As Milton Friedman and over 500 economists have now said, it's time for a serious debate about whether marijuana prohibition makes any sense," he said in a press release trumpeting the study and the open letter. "We know that prohibition hasn't kept marijuana away from kids, since year after year 85% of high school seniors tell government survey-takers that marijuana is 'easy to get.' Conservatives, especially, are beginning to ask whether we're getting our money's worth or simply throwing away billions of tax dollars that might be used to protect America from real threats."