I Told You So

In October 2013, to be specific. That legalizing marijuana would be a total failure, to be more specific. That was 3 months BEFORE legal marijuana became law in Colorado, and 9 months before in Washington. And I based it strictly on market forces, just as Admin does for his many praiseworthy articles. As usual, I got hammered for my article. Here’s what I said.

Quote. “So let’s look at some market realities about the marijuana business in the U.S. And how these realities stack up against states who have legalized marijuana for personal and/or medical use to make a few bucks.

CULTIVATION. Cannabis cultivation and marijuana production operations are extensive throughout California, particularly in northern California. Outdoor cannabis cultivation is increasing dramatically in the northern region of the state, primarily because of expanded cultivation by Mexican DTOs (Drug Trafficking Organizations); as a result, the area is becoming one of the most significant outdoor cannabis grow areas in the state.

Oops. Not only is marijuana being grown extensively in Mexico, the cultivation here in the U.S. is largely under the control of the Mexican DTOs. I pointed that out two years ago when I cited an example of marijuana cultivation by Mexicans in a U.S. National Forest near Green Bay, Wisconsin (good grief, Green Bay?). And where was the labor coming from? Illegal Mexican aliens. And what do you think is happening in California’s forests, with the help from 2 1/2 million illegals, mostly Mexican, residing in that state?

LABOR COSTS. This one is a no-brainer. For cultivation, harvesting and processing, the marijuana cartels operate on third world labor, in which wages are one-half or less of anything a legal process can establish in the U.S. End of story. No further discussion needed.

MARKET RESTRICTIONS. The states that have legalized marijuana for either medical and/or personal use all prohibit the sale to persons under 21 years of age. That’s MILLIONS of lost customers. Gee, I wonder where the youngsters will get their blow? Same place they get it now.

OVERHEAD. Taxes on marijuana by the states are the biggest factor here, just as they are with alcohol and tobacco (which, unlike marijuana, also deal with federal taxes). And regardless of what type of market the states set up, whether it is largely private or government-controlled or something in between, there will be land purchases, leases, security, property taxes, building maintenance, and a whole host of other costs that are less or even absent for the marijuana networks. And all of these aforementioned advantages for the marijuana cartels leads to ………

PRICE. Here’s where the rubber meets the road. Right now, the average retail price of marijuana is $3,200-$4,800 per pound in the West, $4,800-$6,400 in the Midwest and East, and topped by North Dakota and Hawaii at over $6,500 per pound as the highest prices in the country. These figures come from thepriceofweed.com. Remember, these retail prices reflect what is being charged in the ILLEGAL MARKET, because that is what the market will bear. But those prices are extremely flexible. You can come to places in Arizona, Texas, New Mexico, and California and buy Mary Jane for $500 a pound. That’s retail!!!! Think Los Angeles, San Diego, Phoenix, Tucson, Las Cruces, and El Paso. That’s $31.25 per ounce, compared with the average LEGAL $200 per ounce price at your local state-approved medical marijuana “clinic” in California and Colorado. Those are real world MARKET FORCES that should tell any rational human being why legalization of marijuana will not work.

So what’s the solution to this conundrum over marijuana? In three words, decriminalization versus legalization. To put in it into three more words, fines versus felonies. This is done in several states, such as Ohio and New York. Get caught with an amount of pot that the state defines as personal use, here’s your speeding ticket, so to speak. Pay the fine and off you go. No jail time, no felony on your record, and the fine goes into the state treasury coffers without the ginormous amount of money the states would have spent on this folly of trying to make a few extra bucks, which won’t happen, on legalizing and taxing marijuana. Win, win.” Unquote.

Fast forward to this AP (a very liberal media organization) article, “States could share plenty about legal pot sales,” by Kristen Wyatt published January 3, 2015. From the article …….

“one of the biggest disappointments of the (legal) marijuana markets (is) lower than hoped for tax collections … the effective tax rates are about 44 percent in Washington and 29 percent in Colorado ….. the states assumed users would pay a steep premium to stop using drug dealers and have clean, safe stores in which to buy their weed. But the tax rates have led to a continuing black market, undercutting the TOP ARGUMENT for legalizing it in the first place.” Comment: Heh. I win. Let’s hear it from the simplistic “Legalize it and tax it” crowd now.

“School districts in Colorado and Washington have reported more kids showing up at school with weed. Also, there have been more kids treated at emergency rooms for marijuana ingestions.” Comment: See what I said under “Market Restrictions” above about kids. They’re now getting Mary Jane from both illegal and legal sources, where that shit is now sold in edible products. This doesn’t mean a hill of beans to the pro-pot crowd on this site. F*** the kids. Marijuana brownies now!!!! Marijuana brownies forever!!!! Right?

There are none so blind as those who will not see.

Disclosure: None.

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