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Pot Revenue

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Proponents of marijuana legalization tout the big revenue gains that tax on legal weed will bring to strapped governments. Maybe not, says a new RAND Corporation study. See press release, full study by Beau Kilmer, Jonathan P. Caulkins, Rosalie Liccardo Pacula, Robert J. MacCoun, and Peter H. Reuter, LA Times story by John Hoeffel, and SF Chron story by Kevin Fagan.

Prices will likely drop, present enforcement costs are not as high as often claimed, and the brain-dead initiative version on the ballot this November actually leaves tax rates to local option, inevitably kicking off a price (tax) war among localities.

I was disappointed that the "alternatives" section of the report does not discuss legalization through a government-run monopoly, as "hard liquor" is presently sold in some states and as we presently have with the numbers racket state lottery in many states.

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Good to see an independent analysis of the issues. This study highlights a number of important facts that are germane to the debate:

1)The cost of enforcing current marijuana laws has been dramatically oversold;

2)Consumption increases of 50-100% are expected-not a big deal for adults but what if a similar increase occurs for our young adults;

3) a commensurate increase in driving under the influence should be expected; and

4)the sine qua non in this debate--flush government coffers from the local tax on marijuana--is also its achilles heal. The higher the tax rate the more robust the inevitable black market will be.

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