“How to Legalize Pot”

Bill Keller on mj legalization: Can we get to “orderly market” without passing through “way too stoned”?

Remind me to talk to Bill Keller more often. Not many reporters will expend the effort to understand the nuances of a complex issue and make them understandable to non-specialist readers. Key quote: “Can we get to ‘orderly market’ without passing through ‘way too stoned’?”

The Tobacco Industry’s Longstanding Desire to Sell Marijuana Cigarettes

In one of the last Newsweek magazine cover stories we will ever see, Tony Dukoupil offers a fascinating inside view of the business people who are making millions by selling quasi-legal marijuana. Exactly as predicted by yours truly, they are not long-haired hippies in tie-dye T-shirts but hard nosed, profit-focused, stylishly attired businessmen who make campaign contributions and try to squeeze out their smaller mom and pop business rivals.

Andrew Sullivan was one of many observers to pick up on the possibility that the tobacco industry will soon follow these early adopters into the pot business, bringing their ruthless, addiction-promoting tactics with them. Tony quotes my friend Dr. Peter Bourne as recalling tobacco industry executives discuss such things during the Carter Administration, but we needn’t rely on Peter’s memory when we have a smoking gun.

I dug through the internal documents that the government forced big tobacco to release and found evidence of the industry’s longstanding interest in selling pot. I gave one of the documents, a report commissioned in the 1970s by Brown and Williamson, to Mike Rosenwald of Washington Post, and here is how he wrote it up:

This is the dream tobacco companies have had since at least the 1970s, when consultants issued a secret report to Brown & Williamson touting a future product line in marijuana. “The use of marijuana today by 13 million Americans is socially the equivalent of the use of alcohol by some 100 million Americans,” said the report, found among millions of documents turned over to plaintiffs during the tobacco lawsuits of the 1990s. “It is the recreational drug; the choice of a significant minority of the population. The trend in liberalization of drug laws reflects the overall change in our value system. It also has important implications for the tobacco industry in terms of an alternative product line.”

The tobacco companies, the report concluded, “have the land to grow it, the machines to roll it and package it, the distribution to market it. In fact, some firms have registered trademarks, which are taken directly from marijuana street jargon. These trade names are used currently on little-known legal products, but could be switched if and when marijuana is legalized. Estimates indicate that the market in legalized marijuana might be as high as $10 billion annually.

The report was a long time ago, and no doubt the industry has more modern ideas for selling marijuana today. Maybe that’s why, during the run up to the 2010 election in which marijuana legalization was on the ballot in California, Altria took control of the web domain names AltriaMarijuana.com and AltriaCannabis.com. For those not in the know, Altria is the parent company of Phillip Morris, the manufacturer of Marlboro, Players, Benson & Hedges and many other popular brands of tobacco cigarettes.

Marijuana Legalization Would Add A New Player into Pot Policy

Mark Kleiman has offered some intriguing observations (here and here) regarding what may happen if a state legalizes marijuana this November. He forecasts the responses of state government, federal government and legalization activists, all of which is fine as far as it goes, but he leaves out an important detail: Legalization would create a new player in pot politics, namely whoever sells legal pot.

As we have seen with the drugs we have already legalized (e.g., alcohol) a legal industry in psychoactive substances will make a great deal of money and use it to keep regulatory structures weak. In Oregon, the legalization initiative gives the private pot production industry a baseline of control (self-regulation only) that the alcohol and tobacco companies could only dream of. In the other states, any new industry will immediately go to work eliminating the weak regulatory controls proposed in the initatives.

How successful these new corporate entities will be in their lobbying isn’t knowable, but it is clear that one cannot predict post-legalization scenarios without taking into account the actions of this new player in the game.

High-Potency Pot Would Dominate a Legal Marijuana Market

With marijuana, as with so many other things, where one sits influences where one stands. Relative to the U.S. population as a whole, people who write about public policy regarding marijuana (e.g., college professors, newspaper editors, drug policy analysts, Internet users and drug legalization activists) are disproportionately college educated and middle to upper-middle class. They therefore are prone to assume that the type of marijuana — specifically potent sinsemilla (THC content 10-18%) — that is popular with better-heeled users is more commonly consumed than it is.

As Caulkins, Hawken, Kilmer and Kleiman’s book Marijuana Legalization: What Everyone Needs to Know makes clear, sinsemilla is in fact a small part of the marijuana market. About eighty percent of the market is “commercial grade” cannabis, which has a THC content of about 5% and sells for $70 to $230 per ounce, depending on how far a buyer is from the producing farm and in what amount he or she buys. If that level of potency and price surprises you, you are probably an observer or participant in the small, nationally unrepresentative marijuana “upmarket“.

The reason for the current dominance of commercial grade pot is simple: It’s an inexpensive product for a price-sensitive population. In the late 1960s and 1970s, the marijuana market had an upmarket skew, but no longer. Today, Caulkins and colleagues estimate that college-educated people only account for about a 1/7 of all marijuana smoked in the U.S., and they overwhelming smoke sinsemilla. The vast bulk of marijuana consumption in the U.S. today is accounted for by working class and poor people who are heavy users. If you make $75,000 a year and smoke pot once a month, springing for high-potency sinsimilla is easy. But if you make $18,000 a year and smoke several joints every day, commercial grade pot is all you can afford.

However, as Caulkins et al. show, the only reason marijuana is expensive is because it is illegal: After all, it’s just a plant. Indeed they project that the post-legalization cost of sinsemella joints would be so low that businesses could give them away, much as bars now give away peanuts.

There may be a few consumers who are so price sensitive that they would still prefer commercial grade pot at say, 3 cents a joint versus 5 cents for sinsemilla. There may also be a few odd micromarkets in which people preferred the weaker stuff as “more authentic” (Those of us who grew up near Latrobe, Pennsylvania are agog when upscale hipsters who could afford something better drink Rolling Rock beer as a sign of their solidarity with us). But as a general proposition, it is safe to assume that the commercial grade market would shrink dramatically, making sinsemilla the dominant component of the marijuana market.

What difference would this make? For the heavy-using low income user, it would free up some disposable income which — presuming it were not spent on alcohol, tobacco or other drugs — could improve their economic situation and health. On the other hand, those of such users who are parents would be displeased that their children could now easily afford high-potency marijuana, which even in secondary black market sales would be extremely cheap.

Another important consequence: The cannabis-using population would experience a vast increase in average drug potency. Caulkins and colleagues estimate that in the past 15 years, average potency of marijuana in the U.S. has doubled. But after legalization, with the 80% commercial grade market share being almost completely supplanted by sinsemilla, average potency would roughly triple very rapidly.

This increase in exposure to highly potent cannabis is one of the mechanisms through which legalization would result in a higher prevalence of addiction (Some of the other mechanisms are discussed here). It at first seems reasonable to assume that experienced users would simply titrate their dose of higher-potency pot, making higher or lower doses equivalent from a biological viewpoint. But surprisingly, laboratory studies of experienced marijuana users show that they are in fact poor at judging the potency of cannabis.

Just as important, even if users could titrate their use (e.g., inhale for a shorter length of time) to achieve the same dose in the body, higher potency products would still be more addictive. With pharmacologic reinforcement processes, the speed of an attained effect is as important as the effect itself. Thus, two regular users who become comparably intoxicated at two different speeds have differing likelihoods of becoming addicted. The replacement of the commercial grade-dominated market with a sinsemilla-dominated market would result in more users speeding up the achievement of intoxication and thereby increasing their likelihood of becoming addicted to cannabis.

Would the dominance of sinsemilla be the end of a market-wide rise in potency? Maybe, maybe not. There are other ways to process cannabis that push THC content more than twice as high as that of sinsemilla. Currently these production processes are extremely costly, but they would become much cheaper under legalization, perhaps to the point that such products would be broadly affordable. Theoretically, this could be stopped by potency limits within the regulatory framework, but in reality, none of the three current state-level marijuana legalization initiatives include any controls on drug potency.

Does Hemp Matter?

In years of studying, designing and implementing drug policies, I have spent perhaps a total of one hour thinking about industrial hemp (i.e., non-intoxicating cannabis grown for its fiber to make paper, cordage, fabric etc.). That may have been too much, or so I have been persuaded by reading the invaluable discussion of hemp by Jon Caulkins, Christina Farber, Angela Hawken, Beau Kilmer and Mark Kleiman in Marijuana Legalization: What Everyone Needs to Know.

To the extent I have been able to stay awake during discussions of hemp policies, the con argument has been that if we let farmers grow industrial hemp, the so-called hemp fields will be used to hide high-potency sensimilla intended to be sold as a recreational drug. The pro argument has been that hemp is a potentially multi-billion dollar industry that has been suppressed by anti-marijuana crusaders.

As is so often the case in drug policy, both of the extremes are factually and analytically wrong.

Caulkins and colleagues dismantle the anti-hemp argument by noting that cannabis pollen can travel three to twelve miles. Therefore any green-thumbed criminal who planted a farm with industrial hemp all around the edges (to fool the police) and a batch of high-potency sensimilla in the middle would end up with a very expensive, very crappy harvest of low-grade pot. The other point the authors make is that there is no evidence of diversion of intoxicating cannabis from industrial hemp farms in Europe. It is therefore reasonable to assume that the U.S. could replicate the same hemp farming system without supporting illegal drug markets.

But why should the U.S. bother? Yes, hemp farming was once a mighty industry and during World War II, the federal government actively promoted it (as in the film “Hemp for Victory“). But it was already dying out not because of drug policy but because of the invisible hand: nylon, cotton and other substitutes became more functional and much less expensive. The result today is that industrial hemp farming is a boutique activity even where it is legal. To quote the authors “China is the world’s largest producer…yet plants 280 acres of cotton for every one acre of hemp”.

The hemp issue in drug policy is thus much ado about very little.

Marijuana policy and international law

Do the Single Convention and its successors make marijuana legalization a pipe dream? Kevin thinks so, but I doubt it.

Commenting on Matt Yglesias’s essay about how cheap pot would be post-legalization, my old friend Kevin Drum notes that marijuana prohibition is built into the Single Convention on Narcotic Drugs and its successor international drug control treaties. Within the constraints of those treaties, what Kevin calls “decriminalization and wink-wink nudge-nudge lack of enforcement” are indeed all we could have at a national level.

But that doesn’t mean taxation-and-regulation needs to be completely off the table.

First, the treaties don’t bind the fifty states. The treaties explicitly recognize that the obligations they impose on the signatories are limited by those signatories’ own domestic constitutional arrangements, and it’s settled constitutional law that the federal government may not require a state to criminalize something, or force a state to help carry out federal law.

For example, if the Michigan proposal to simply repeal the state’s marijuana laws – parallel to what New York did with respect to alcohol in 1923 – had passed, Michigan would have been entirely within its constitutional powers, and no international law would have been violated.

The constitutional situation would become murkier if a state did something more complex: if it created a tax-and-regulation system, or even a system of distribution through state stores. When state law directly conflicts with federal law, the Supremacy Clause means that federal law wins. I think that means the federal courts would shut down a state-store system. In addition, the federal government might be able to effectively disable a state’s tax-and-regulation system by using injunctions or arrests to make it impossible for marijuana growers and dealers to comply with state laws. (As Jon Caulkins points out, that would give the feds a hard set of choices: they could prevent controlled legalization, but the result might be uncontrolled legalization.)

If a state were to tax and regulate, and the feds were to mind their own business (i.e., prevent interstate commerce but not mess with strictly intra-state production, sale, and use) then we’d have something much more like real legalization than, for example, the Dutch system is.

In addition, while even five years ago the treaties looked immutable, that’s much less true now. The U.S. could withdraw from the Single Convention and re-acceed to it with a “reservation” about marijuana. That would leave the other parties to the treaty with the option of accepting the reservation or kicking the U.S. out of the treaty system entirely. Or the U.S. could propose amendments to the treaties; we’d have company, though whether enough company to actually secure the 2/3 required for an amendment is doubtful.

So the treaties do create barriers to true legalization, but those barriers aren’t impassable.

Note this is all said without prejudice to the question whether legalization in one form or another would be a good idea. My own view is that some sort of legal availability for adults would, on balance, out-perform the current system. I also think that we’re likely to see national legalization within a couple of decades.

But the post-prohibition policy is likely to look more or less like current alcohol policy – modest taxes and weak regulations, with massive marketing of cheap products leading to widespread drug abuse – rather than the tighter system of high taxes and strong marketing controls I’d prefer.

In any case, I doubt the treaties will play much of a role in shaping the results.

Footnote And yes, this is all in the book, Ch. 10, pp. 145-150, under the question headings “Would marijuana legalization violate international conventions?” “Does Dutch policy violate these international conventions?” “What are the consequences for violating international conventions?” and “Could these international treaties be changed?”

The Emerging and Badly Needed Science of Drug Policy

Drug policy research is at best a modestly sized field. Nonetheless, its findings have significant potential to help societies develop more effective public policies regarding marijuana, heroin, cocaine, nicotine and other psychoactive drugs. I am therefore very glad to announce that an extension of the international drug policy research integration conducted for the book Drug Policy and the Public Goodhttps://www.oxfordscholarship.com/view/10.1093/acprof:oso/9780199557127.001.0001/acprof-9780199557127 appears today in The Lancet. A generation ago, a reviewer of the world’s drug policy research findings would have been pressed to fill even one article in such a prestigious scientific outlet; the field has clearly matured since.

The three review papers have different foci:

*Louisa Degenhardt and Wayne Hall integrate the international evidence on the contribution of illicit drug use and addiction to the global burden of disease.

*Peter Reuter and Robin Room make their case that the international drug conventions succeed neither in providing medications (e.g., opiates) where they are needed nor in preventing the availability of widely abused drugs

*John Strang, Tom Babor, Benedikt Fischer, David Foxcroft, Jonathan Caulkins and I discuss “what works” in drug policy, reviewing the evidence on source country control, interdiction, policing, prevention and health and social services for drug addicted individuals.

Lancet has made the articles available with a free registration here.

A shorter take on some of the key conclusions in the third paper is also available for free in an op-ed by Jon Caulkins and me in The Guardian (UK) today.

I have spent too much time in public policy circles to be starry-eyed about the likelihood that scientific evidence will be always be heeded in a policy area that is often dominated by demagogues of various stripes. Yet I also see many positive signs in Europe and the U.S. of openness to information in quarters that had previously been a mix of loud voices and closed ears. Scientists cannot and should not control drug policy (that would be grossly undemocratic), but they certainly can contribute systematic and reliable findings to the policy debate and insist that serious research be given more weight than wishes, hunches and anecdotes. The reviews of the drug policy research knowledge base in The Lancet today are offered to policymakers and the public in that spirit.

Please consider this an open thread to debate and discuss anything in The Lancet papers if you are so led.

UPDATE: Here is a short interview with Dr. John Strang about the evidence for effective drug policy interventions

Caulkins on (quasi) medical marijuana

How come the number of “medical” marijuana users in some states is so large compared to the total number of self-reported marijuana users? Is there an epidemic of chronic pain among otherwise healthy thirty-year-old men who have been smoking pot for years?

Jon Caulkins of Carnegie Mellon is the lead author on a book on marijuana legalization scheduled for publication next spring. The rest of the team consists of Angela Hawken of Pepperdine and me (who worked with Jon on Drugs and Drug Policy, part of the same series from Oxford University Press) plus Beau Kilmer, who heads the RAND effort studying the possible effects of legalization.

Jon and I don’t come from the same place culturally or politically, and he’s extraordinarily smart (not to mention conscientious and kind), a combination that makes working with him – as I’ve been doing off and on for twenty years – both a challenge and a pleasure. Angela and Beau bring still different personalities, views, and skills to the enterprise – along with razor-sharp minds –  but so far it’s running very smoothly.  The concluding chapter of the new book will consist of a brief statement by each author laying out a preferred option; I can’t predict any of them in detail (even my own thinking keeps shifting) but I expect the four statements to embody lots of disagreement.

Jon and I agree more about facts than we do about values or policies. For example, he’s clearly right to say that the profile of “medical” marijuana users looks like a profile of recreational drug users, not a profile of patients, and that their sheer numbers in some states suggest that most of the recreational market is now accessing its supplies through quasi-medical channels. And that doesn’t even count the people whose recreational needs are supplied by friends with medical cards. Whether he’s also right to say that the Justice Department would do well to crack down on the scam is less obvious, at least to me.