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Changing my mind on cannabis legalization in Arizona

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Since I don’t vote in Arizona (though, as it happens, I was born there) I hadn’t studied the details of the cannabis-legalization proposition which will appear on the ballot there this fall. So when the Sandra Day O’Connor Institute invited me to join a panel discussion, I came in thinking only what I generally think about such measures:

  1. Cannabis ought to be legal. Prohibition has broken down to the point where the harms associated with trying to control an illegal market generating $40 billion a year in criminal revenues greatly exceed the benefits, and there’s no plausible route back to effective prohibition.
  2. We ought to legalize in a way that makes moderate use by adults easy, while discouraging the formation of bad cannabis habits (an increasingly common problem) and use by minors.
  3. Alcohol-style legalization, which is what the ballot propositions generally offer, is a bad way to do that, because a for-profit industry (like the existing illicit industry) will make most of its money selling to heavy daily users rather than casual users, and about half the daily users – by their own self-report – have lost control of their cannabis habits.
  4. There are lots of other, better options.
  5. Even within a for-profit model, there are plenty of ways to encourage temperance, starting with keeping prices high, restricting persuasive marketing, and requiring that sales clerks have training in pharmacology and the prevention of substance use disorders and a professional responsibility to give advice in the interest of their customers, not their employers.
  6. It would therefore be better to handle this through the usual legislative process rather than by initiative.
  7. To make that workable, Congress should act to allow states to legalize (waiving the federal criminal laws that would otherwise apply) if their plans to do so meet rather strict criteria, as determined by the Secretary of HHS and the Attorney General. Those waivers should have to be renewed periodically, in order to hold the states and the industry to the promises made in order to get them.
  8. But since the state and federal legislative processes clearly won’t do what a majority of the voters clearly want them to do, I’d vote for any halfway-reasonable legalization initiative, both to end the arrests sooner rather than later and to nudge the legislators along.

So, going in to the discussion, I was prepared to advise Arizona voters to hold their noses and vote “yes.”  That’s the same advice I’d give voters in California.

But clearly there are some propositions that are so bad, and so hard to fix, that the voters ought to reason the other way: vote “no” to encourage the advocates to come up with something less awful. My conclusion, after participating in the discussion, is that Measure 205 is bad enough to warrant that treatment.

What changed my mind?

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Promoting cannabis use disorder in California

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The Sean Parker/Gavin Newsom Adult Use of Marijuana Act has now qualified for the California Ballot this November. The measure – 62 pages of legal prose – has many provisions, but only a few of them are directly relevant to what seems to me ought to be the central goal here: making cannabis available for moderate use by adults while minimizing the growth of cannabis use disorder and preventing an increase in the number of adolescent users or a fall in the median age at first use (now 15-16).

The proposition provides for:

  • Full commercial legalization, plus home-grow of up to six plants per household;
  • Licensed production and sale, but no provision allowing the state to manage the quantity produced;
  • A tax of $9.75 per ounce (33 cents per gram) of flowers, plus a 15% sales tax on the retail price (in addition to ordinary sales tax);
  • Bans on direct sales to minors and possession by minors
  • A nominal ban on marketing to minors (except through channels mostly consumed by adults);
  • A ban on false advertising, but no requirement that advertising contain warnings;
  • No required vendor training or prevention activity by sellers;
  • No option for users to limit the amount of cannabis they can be sold in the course of a month;
  • Required quantitative labeling for chemical content;
  • Anodyne warning labels, not mentioning the risk of cannabis use disorder;
  • Money for prevention and treatment;
  • Money to run the regulatory system;
  • No money for enforcement against the legacy illicit market;
  • A three-tier license system (i.e., a system that requires a distributor between the grower and the retailer, as in the beer industry);
  • Permission for home delivery.

There are also a number of provisions – including one that restricts licenses to those who have been California residents since the beginning of 2015 – designed to protect or enrich various incumbent players in the cannabis industry.

The key provisions in terms of preventing substance use disorder are the ones dealing with production, taxation, and marketing. All of those provisions favor the expansion of the market at the expense of public health. Unlimited production guarantees that farmgate prices will settle down at something below $1 per gram; add to that 33 cents in excise and a 15% sales tax, and the result will be prices  substantially lower than those in Washington State, where some stores now offer highly potent cannabis (claimed to be 18% THC by weight) for $95/ounce. That’s less, in inflation-adjusted terms, than my college classmates were paying around 1970. And today’s material is about 4-6 times as strong as what they were buying then.

To put it differently: A typical joint contains about 0.4 gram of cannabis. $95/oz. is $3.50/gm. So a joint of “Uncle Ike’s Budget Bud” in Seattle has about $1.40 worth of cannabis in it. At 18% THC – aka “one-hit weed” – that should get three naïve users wrecked out of their gourds (if you’ll allow me the use of technical terminology) for about three hours each. That comes to about 15 cents per stoned hour, making cannabis far more cost-effective than even very cheap beer on a per-hour basis.

Under the proposed law, expect to see California weed even cheaper than that within three years. (That would probably displace illicitly-grown California product in the still-illicit interstate trade; why should a dealer in St. Louis bother with buying bulk weed when he can get packed, tested, labeled product for $1600/lb. just by sending out some smurfs?)

At current national average pricing – about three times the “Budget Bud” level – the rate of cannabis use disorder has already soared. In 1992, about 10% of people who reported using cannabis the past month reported having used it on 25 or more days that month. That number is up to 40%. Of those daily/near-daily users, about half – by their own self-report – meet diagnostic criteria for cannabis use disorder: they’re using more frequently and in greater quantity than they intend to, they’ve tried and failed to cut back, and they find that cannabis use is interfering with other things they care about and causing conflict with significant others in their lives. Just over 4 million residents of the U.S. currently report meeting those criteria. (Aren’t you glad you know that cannabis is natural and non-habit-forming? Because if you didn’t know that, you might not be able to guess it from the actual data.)

If someone wanted to write a law to increase the prevalence of that problem, it would look a lot like the Adult Use of Marijuana Act. In other words, this is horrible, awful, very bad, no-good drug policy.

But it’s obviously going to pass. A solid majority of Californians wants legal cannabis; this is a much better written piece of legislation than Proposition 19, which almost passed in 2010; it will have more-than-adequate funding; it’s supported by respectable people, including the Lieutenant Governor; and it’s on the ballot in November of a Presidential year, which will maximize turnout, especially among younger voters who are most enthusiastic about cannabis legalization.

The only thing that could have stopped this law, or one like it, from being written into the statute books by the voters would have been for the Governor and the Legislature to pre-empt it by legalizing in some more public-health-friendly way. But the Governor has his political head stuck in 1980, and legislators don’t want to fall foul of police and prosecutors. So they chose – as a majority in Congress is now choosing at the national level – to let the political process walk us step by step toward truly lousy policy, rather than standing up, taking some heat, and doing their jobs.

That leaves the voters with a choice between the existing unworkable quasi-legalization in the form of a corrupt “medical marijuana” system and a formal legalization designed to make the drug problem worse.

I’m glad I left.

 

 

Cannabis policy: Walmart phenomenon, Whole Foods debate

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Jonathan Caulkins once described the debate over cannabis policy as “a Whole Foods discussion of a Walmart situation.” The graphic below illustrates his point: most of the days of use involve people with a high-school education (the purple band), high-school dropouts (the green band) or people under high-school graduation age (the red band); the people in the discussion mostly have college degrees (the orange band) if not more.

Keith Humpheys reflects on the implications of that situation.

Although education is not a perfect proxy for income, the fact that 85% of pot is consumed by people who didn’t graduate college makes clear that marijuana is mainly consumed by people in working-class and poor neighborhoods, not in the kinds of places that economists, attorneys, policy analysts, journalists, physicians and politicians tend to live. A major challenge therefore for the legitimacy of marijuana policy is to ensure that people outside the college educated bubble gain more voice in the ongoing political debate.

Continue Reading…

Smart legalization in Mexico?

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The Mexican Secretario de Gobernación (roughly, interior minister), Miguel Ángel Osorio Chong, gave a fascinating talk as part of the formal national debate over cannabis policy that followed the Supreme Court decision affirming a personal right to consume the drug.

The striking  thing about the speech was its recognition that both prohibition and commercialization have unwanted consequences, and its hint that Mexico might be alert to the possibility of finding an approach to avoid both sets of dangers.

Of course no one who has been doing drug policy for more than about twenty minutes is ever truly optimistic that a government will find something intelligent to do when there are so many unintelligent alternatives, but watch that space.

The official Spanish text of the speech is below; unofficial English translation here.

 

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The marijuana movement and the marijuana lobby

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Reactions to the “Responsible Ohio” cannabis-legalization initiative have a lot to tell us about the changing politics of the marijuana question. No much of what they have to tell us is encouraging.

Cannabis policy change in the United States has been driven, until now, by people whose interest in the matter was primarily non-commercial: pot smokers yearning to toke free, culture warriors of the (cultural) left, libertarians, criminal justice reformers concerned about arrest and incarceration, and people who think that it’s bad policy to criminalize the behavior of tens of millions of people unless there’s a stronger reason to do so than the risks of cannabis create.

Not that economic interests have been entirely absent; Dennis Peron was in the business of selling “medical marijuana” when he spearheaded Proposition 215. But Peron was also a righteous stoner; there’s no reason to doubt the sincerity of his expressed opinion that “all marijuana use is medical.” But the main funders of the recent initiatives, and of the big marijuana-legalization groups, have been ideologically-driven billionaires such as George Soros and the late Peter Lewis.  (How old am I? Why, I’m s-o-o-o-o-o-o old that I remember when billionaires weren’t a branch of government.) And the people doing the work have been, for the most part, true believers rather than hired hacks.

That has begun to change. Americans for Safe Access has morphed from an advocacy group for medical-marijuana patients to, in effect, a trade association of medical-marijuana growers and sellers. The National Cannabis Industries Association has taken things even further, hiring a Washington lobbyist who might have been provided by Central Casting: about as far, culturally, from a typical NORML or MPP activist as it’s possible to imagine.

Inevitably, then, the marijuana movement has begun to give way to the marijuana lobby. To be sure, I’ve had my share of clashes with movement folks, and I haven’t always been impressed with their policy acumen or their standards of argument, but I’ve never seen any reason to doubt that they’re advocating the public interest as they perceive it. The people now being hired by the guys in suits doing cannabis-business stock promotions play by different rules. I expect them to have about the same ethical standards as lobbyists for the alcohol, tobacco, pharmaceutical, food, and fossil-fuels industries: that is, I expect them to be utterly willing to sacrifice human health and welfare on the altar of the operating statement, just like those folks at VW who decided it would be a cute idea to poison the air just a little bit to goose the performance of their diesel-driven cars. Continue Reading…

Pot prices plunge in Washington State

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The harvest is in, and ounces of 10%-THC cannabis are selling for $200 at commercial retail outlets in Washington. (Figure roughly 70 joints to the ounce, and at least 3 stoned hours per joint, so the cost of intoxication is roughly $1 per hour.) That price is fully competitive  with both the illicit market and the medical market.

This was utterly predictable, as I know because my RAND colleagues predicted it. So much for the argument that Washington’s taxes were too high.

What is also predictable is that prices will continue to drop, both in Washington State and in Colorado, unless the authorities start to limit production volume. $200/oz. would be a fairly reasonable price target; anything much lower than that risks a big increase in heavy use and underage use. (Of course there’s no way to keep the stuff from leaking from adults, who are allowed to purchase, to minors, who aren’t.)

Falling prices are also bad news for all the folks who thought they were going to get rich selling a newly legal product at the old, illegal prices. No such luck.

 

 

 

Congress meddles in DC cannabis policy. Bad move. Good results?

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No, Congress shouldn’t have meddled in DC home rule by blocking the city from legalizing cannabis on the alcohol model. But the result is to leave in place the “Grow and Give” system the Washington voters approved. On its merits, that system deserves a trial, and we should watch the results closely

Jamaican government proposes non-commercial legalization of ganja

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Mark Golding is the Jamaican Minister of Justice. Below the fold is the text of a press release from his office about legislation that would decriminalize of cannabis possession and legalize its production and sale for medical use and for use in Rastafarian religious observance.

In addition, the fine print:

Permits the cultivation of five or less ganja plants on any premises, which will be regarded as being for medical or therapeutic use of the leaves or for horticultural purposes

In other words, the proposal is for complete but noncommercial legalization.

Key sentence:

The system of complete legal prohibition of ganja in Jamaica has been in place since 1948, has not worked and is no longer considered fit for purpose.

Note the cross-national difference in terminology: to “table” a bill means to offer it, not to defer its consideration. Also note that under a parliamentary system, a Cabinet bill is likely to become law without much modification.
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Legal cannabis in Vermont? RAND lays out the options

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Last year, the Vermont legislature asked the Vermont governor for a report on the options for legalizing cannabis. The governor’s office hired RAND to do the research. That report is now public. (I’m listed as the third author for alphabetical reasons, though I doubt I did as much as 2% of the enormous amount of work that went into it.)

The Vermont process holds out great promise, because the normal legislative process – ugly as it can be – has the possibility of producing a result much more nuanced and more carefully considered from multiple viewpoints than the initiative process, under which propositions are drawn up by advocates with the advice of pollsters, no one ever holds a hearing, and any idea that can’t be explained in a 30-second TV spot has to be dropped. The key point of the RAND report is that there are legalization options other than full commercialization.  Niraj Chokshi of the Washington Post “GovBeat” blog provides an excellent summary. 

The key design question – this is my view rather than the one expressed in the report, which is scrupulously neutral – is how to make cannabis legally available for use by adults and wipe out the illicit market while at the same time minimizing the growth in use by minors and in the number of people with diagnosable cannabis use disorders (currently about 4 million people nationwide, about 10% of past-year users, 20% of past-month users). There are many ways to skin that cat, but I doubt that commercialization is the best approach.

But however you come out in the end, the major contribution of the report is to break through the simple prohibit/legalize dichotomy and display the wide range of options we have to choose from.