Wednesday, January 20, 2010
Efficiency in the Marijuana Business
This article, although somewhat satirically, captures the second (efficiency) of the five performance criteria for economic evaluation. The focus is on the efficiency of Mexico's drug cartel primarily in the marijuana business. One of Mexico's lead officials even goes so far as to say that marijuana should be allowed to be legally grown in California in order to be grown more efficiently in a better climate as well as to be grown closer to the ultimate consumers.
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http://mises.org/journals/scholar/thornton3.pdf
Anyone who is interested in drug legalization ought to do some research: here is an article to get you started.
I think that this topic is very interesting because this issue has been going on for years and it seems as though nothing has happened to change it. Recently in California and Oregon, the possession of a small quantity of marijuana can result in a misdemeanor but it remains illegal to sell and distribute the drug, which is considered a felony. The article argues that the U.S. should legalize marijuana to weaken cartels in Mexico so that they gain less profit. I think this idea is possible because legalization in the U.S. will make the drug less appealing and it is somewhat hypocritical to allow the possession but not the selling of marijuana. The uses for it and reasoning for becoming legal is a completely different argument.
Instead of the U.S. government wasting the taxpayers dollars on the war on drugs, they should be making money on the war on drugs. They should legalize marijuana and put a tax on it which would make the U.S. millions of dollars. By the government growing and distributing marijuana, themselves they would control the whole industry. This would also solve the cartel problem in Mexico.
I don't think that legalizing marijuana would solve the problems with drug cartels in Mexico, but I do believe that it would lessen the amount of violence and deaths that have occurred as a result of illegal drug trafficking. The "war on drugs" will never be won, simply because there are a million different ways to traffic drugs into the US and there is an ongoing demand for marijuana, cocaine, etc. However, the article stated that 50-65% of cartel business in Mexico is from marijuana, a drug that has been pushed for legalization in the US for years. If the US were to legalize marijuana and tax it heavily it would mean less corruption and violence in Mexico as well as a more stable, legal income for thousands of people, both in the US and Mexico.
In the most recent Business Today they have entire article about legalizing marijuana. In that they say that "legalization would produce tax revenues of at least $2.4 billion annually," and thats not to account for the amount that would be saved on drug enforcement.
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