Cannabis legalization in Oregon: Why Measure 91 is close enough for government work

Oregon’s proposed pot legalization is far from ideal.
But how else do you get the legislature off the dime?

Ballot initiatives are a terrible way to make policy changes when the technical details matter. Despite the simple-minded sloganeering on both sides, the question of creating a legal cannabis market is about as technical as they come, with equally valid public goals in sharp conflict, many unknowns, a variety of tricky design issues, and some big risks.

But sometimes initiatives are the only way to go, because legislators simply won’t do what a majority of voters want.

Cannabis legalization is that sort of issue, too: legislators are scared of cops and prosecutors, and most cops and prosecutors really hate legalization.

In Oregon, advocates went to the legislature and said, “We can and will put legalization on the ballot unless you handle the issue.” The legislature didn’t move. So the advocates acted on their threat, giving us Measure 91.

What they produced is noticeably less crazy than the measure that failed in 2012: for example, the quotation from the Book of Genesis about “herb bearing seed” is missing.  It seems to reflect a good-faith effort to craft a law that will allow adults to get cannabis, wipe out the illicit market, provide some revenue, and prevent a big increase in use by minors.

But Measure 91 does not reflect a sophisticated understanding of the problems of illicit markets or a nuanced view about substance use disorder. Focusing on the goal of eradicating the illicit cannabis market in Oregon, it doesn’t pay enough attention to the risk that Oregon might become a source of illicit supply to neighboring states. Focusing exclusively on preventing use by minors, it neglects the risk of increasing dependency among adults.

The basic fact about a legal cannabis market is that the product will be remarkably cheap to grow; once competition and industrial-style production have taken effect,  a legal joint would cost (before tax) about what a tea-bag costs, rather than the illegal or medical-dispensary price, which is 100 times as high. And the tax provided for in Measure 91 would add only about 50 cents to the price of a joint: not a high price to pay for two hours or more of being stoned.

Lower prices won’t much change the behavior of adult casual users; even at today’s illegal prices getting stoned is a bargain compared to getting drunk.  But lower prices would matter a lot to frequent users, and most of all to frequent underage users, simply because what they spend on pot represents significant element in their personal budgets: at current prices, the cost of a heavy cannabis habit can exceed $5000 per year.

Of course the claim that barring minors from buying in cannabis stores will keep them from having access to diverted supplies doesn’t pass the giggle test: just consider how easy it is for a minor to get alcohol from an older friend or relative or from the poor heavy drinker hanging around the liquor store, willing to buy a case for a teenager as long as he gets to keep a couple of bottles for himself. Cheap cannabis for grown-ups inevitably means cheap cannabis for kids.

Unless the legislature decided to raise it, the $35-per-ounce tax in Measure 91 would lead, within a couple of years, to prices way below current illicit prices and way below legal prices in Washington State. That in turn would mean big increases in use by minors and in the number of Oregonians with diagnosable cannabis problems. It would also mean substantial diversion of cannabis products legally sold under Oregon’s low taxes to Washington, where taxes are much higher. (Currently the flow goes the other way, with the two biggest-selling legal cannabis stores in Washington being the two closest to Portland.)

It wouldn’t be hard to draft a better-balanced measure than the one to be voted on in two weeks. For example, it might be wiser to limit legal production and sale to co-ops or non-profits, keeping the profit motive out of the business altogether.

But the choice Oregon voters face isn’t between what’s on the ballot and some perfectly designed cannabis policy; it’s between what’s on the ballot and continued prohibition at the state level, until and unless a better initiative can be crafted, put before the voters, and passed into law.

Measure 91 would enact an ordinary law, not a constitutional amendment. If it passes, the legislature will be free to amend it the next day by a simple majority vote; such moves are allowed not only by law but by the conventions of Oregon politics.

So the question facing Oregonians who want adults to be able to buy cannabis legally – without the nonsense of finding a “kush doctor” and faking an ailment – is whether to defeat the proposition and hope that the legislature will act on its own (or that a better-drafted bill will appear on the ballot in 2016) or whether instead to pass the current proposition and hope that the legislature will move to fix what’s wrong with it.

Given the balance of political forces, it seems more reasonable to trust the legislature to rein in a too-lax legalization scheme than to expect it to do what no legislature in the nation has been willing to do yet: pass a full cannabis-legalization law.

It’s not hard to identify the key points that need amendment, within the context set by the initiative: cannabis sold by a set of for-profit enterprises under state regulation. (That leaves aside such interesting ideas as just letting consumers grow their own, or requiring that growers and retailers be not-for-profit co-ops or public-benefit corporations, as well as the alternative of state-monopoly retailing, which has some attractive features but can’t be done while the federal Controlled Substances Act is in place, because the state can’t tell its officials to violate federal law.)

* Recognize preventing adult substance use disorder among the goals of the law.
* Assign some of the regulatory authority to the health department rather than giving it all to the revenue department.
* Give the regulators explicit authority to restrict the quantity of cannabis that can legally be grown. (Ideally, growing rights ought to be auctioned off rather than given away, giving the financial windfall to taxpayers instead of to the lucky few who end up with licenses.) * Increase the proposed taxes, and make them adjustable to keep legal prices at about the current illegal level as production costs fall. In the end, to prevent a big price decrease, the tax would have to be a very large fraction of the current illegal or quasi-medical price of about $10/gram.  Ideally, taxes would be based on the intoxicating power of the product – measured in milligrams of THC, the primary active chemical – rather than on the total weight of the plant material. (We tax whisky more heavily than beer or wine; why shouldn’t cannabis taxation work on the same principle?)
* Require that retail clerks have some serious training in pharmacology and substance use disorder, and make it part of their job to discourage excessive and dangerous consumption patterns, rather than letting their bosses just tell them to sell as much product as they can.
* Make sure there’s enough enforcement against illicit growing and dealing to make the legal market competitive.
* Rein in the medical-marijuana business. Once Oregonians with medical need can buy tested and labeled product at commercial outlets, there’s no need to have an entire parallel distribution system. It makes sense to offer tax exemptions for limited quantities to genuine patients, but the current practice of “patients” buying “medical” supplies for illicit resale has to stop.

There are lots of other good ideas around. (See the forthcoming RAND report on legalization options for Vermont.) But those will do for a start.

Would the legislature pass them all? Probably not. But Oregon’s chances of getting to a temperate cannabis policy will be better if the voters force the legislators to get off the dime.

It’s not an easy choice; as a Californian, I’m glad I don’t have to make one like it (yet). But if I had to vote in Oregon, I’d vote “Yes.”

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com

11 thoughts on “Cannabis legalization in Oregon: Why Measure 91 is close enough for government work”

  1. An op-ed I would read (and I think we have a partial draft here) "Former Washington State Pot Czar and America's Leading Expert Explains How Your State Should Legalize Pot — If It Is Going To." In 750 words, of course.

  2. It's funny but here in Oregon a majority of the pro-ads are by the police and prosecutors. Most of the resistance here and there are few anti-ads is from the prison industrial complex.

  3. Of course the claim that barring minors from buying in cannabis stores will keep them from having access to diverted supplies doesn’t pass the giggle test:

    Of course the assertion that anyone is claiming that "barring minors from buying in cannabis stores will keep them from having access to diverted supplies" doesn’t pass the giggle test either. I found no such thing by following the link you provided. The relevant passages from the first two hits on the google search link you posted:

    What's in between are all the Oregonians not particularly interested in their own personal access to marijuana who might be swayed that the state can better manage this market — and, say, a child's access to it — than drug dealers can.

    Marijuana prohibition makes it harder to protect children. Right now, it is easier for junior high and high school students to get marijuana than a six pack. There is no real regulation and effective prevention programs are chronically underfunded.

    Perhaps I missed something — do you have a more precise link to share?

    * Rein in the medical-marijuana business. Once Oregonians with medical need can buy tested and labeled product at commercial outlets, there’s no need to have an entire parallel distribution system.

    The needs of medical marijuana consumers are different from the desires of recreational consumers. Marijuana patients tend to benefit most from either very high-potency THC or high-CBD / low-THC strains. The market in Colorado is reportedly reacting to demand for "milder marijuana" for recreational consumers, while there is practically zero demand from recreational users for CBD-dominant strains like Charlotte's Web that help sick children avoid seizures without getting them high. I don't think a recreational market would serve medical customers well.

    So the question facing Oregonians who want adults to be able to buy cannabis legally – without the nonsense of finding a “kush doctor” and faking an ailment…

    I'm curious what you think of this peer-reviewed study:

    A new landmark study published last week by the peer-reviewed journal Drug and Alcohol Review refutes the long-held belief that abuse of California's medical marijuana law is ubiquitous. The study, "Prevalence of medical marijuana use in California, 2012," is the first time anyone has formally measured such data in the state according to its authors Suzanne Ryan-Ibarra, Marta Induni, and Danielle Ewing of the Survey Research Group at Public Health Institute in Sacramento.

    1. That's not a peer-reviewed study you're quoting. That's a press release by an industry lobbying group, about as reliable as an Exxon Mobil press release about a global-warming study.

      The actual study was a mere survey, providing no evidence whatever about how much the medical-marijuana law is being abused except that most of the respondents who said they'd used it said they'd found it medically useful. (Surprise!) Of course, the "patients" who make a living illegally reselling their "medicine" might have decided not to share that information with a surveyer.

      Here – as opposed to the spin – are the actual "results" and "conclusions" sections from the paper itself.

      >RESULTS:
      >Five percent of adults in California reported ever using medical marijuana, and most users believed that medical marijuana helped alleviate >symptoms or treat a serious medical condition. Prevalence was similar when compared by gender, education and region. Prevalence of ever >using medical marijuana was highest among white adults and younger adults ages 18-24 years, although use was reported by every >racial/ethnic and age group examined in our study and ranged from 2% to 9%.

      >CONCLUSIONS:
      >Our study's results lend support to the idea that medical marijuana is used equally by many groups of people and is not exclusively used by >any one specific group. As more states approve marijuana use for medical purposes, it is important to track medical marijuana use as a >health-related behaviour and risk factor. [Ryan-Ibarra S, Induni M, Ewing D. Prevalence of medical marijuana use in California, 2012. Drug >Alcohol Rev 2014].

      Not quite what the industry flacks said.

  4. 1) “risk that Oregon might become a source of illicit supply to neighboring states”

    Regulation in Oregon does not create demand elsewhere. Illicit out of state markets will be supplied with cannabis whether or not measure 91 passes

  5. You are right that voting yes makes sense. Prohibition has failed and is unjust. You are wrong that this initiative is too lax or the taxes too low. $560/pound is actually a very high tax already (20- 100 percent at current prices) and the tax rate will rise automatically if prices fall. The best way to reduce marijuana abuse is to fund proven education and treatment and a robust marijuana economy will provide the revenue. Excessive rules will usually miss the mark with unintended consequences exceeding those intended.

  6. It's too bad Oregon didn't put this initiative to their Citizens' Initiative Review. Every election since 2010, Oregon convenes panels of 20 randomly invited citizens from the voter rolls to get together and deliberate about initiatives on the ballot with expert and advocate input. Each panel gets a different initiative and generates a report with findings and recommendations which are then printed in the Voter Pamphlet.

    I assumed they did this for each initiative, but they don't have a report available for 91. It would have been interesting to compare the findings of such a panel with Mark's opinion.

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