Russell Hebets Feb. 20, 2014

The evolution of public opinion on marijuana has accelerated drastically over the last several years. Going back to the government’s “reefer madness” days, public support for legalized marijuana was almost non-existent. Contrast that with today, where a Gallup poll taken last fall found the 58% of Americans support legalization of pot. This support grew from 48% the year before, and as more states successfully implement medical marijuana programs, as well as outright legalization, the momentum of these numbers shows no signs of slowing. The reasons are varied and nuanced, but Colorado residents have realized that marijuana is not as dangerous as the drug war czars would have you believe, an incredible amount of resources were being poured into enforcement of drug laws without results, and there is a vast amount of potential tax revenue in legal marijuana sales.

Dating back to the 1930s, the US government released propaganda painted marijuana as a substance that induced criminality, violence, and even madness. The vast majority of legitimate scientists could not conduct research on the effects of marijuana because of its status as an illegal drug. Despite the fact that 20 states along with the District of Columbia have passed medicinal marijuana laws, the Federal government still categorizes marijuana as a Schedule I controlled substance. This classification means that according to the government, marijuana has no legitimate medical use. Meth, which is far more destructive to individuals and to communities, is still a lower Schedule II drug. Today it is very clear that pot does not incite violence, does not induce criminality, and is in fact not physically addictive (although make no mistake, just like alcohol it can be abused and can be addictive mentally).

If you’ve followed our blog, you know our thoughts on the War on Drugs. To date in 2014, Federal and state governments have already spent over $5.5 billion dollars on the war on drugs. Over 119,000 people have already been arrested on cannabis charges this year, at a clip of one arrest every 30 seconds. Whatever your pet government project, $5.5 billion would go a long ways towards accomplishing social goals. This doesn’t even consider the loss in productivity from those criminally charged, which cannot be measured but is undoubtedly a massive loss to the productivity of our nation.

Not only do Coloradans now get to spend less on enforcement and incarceration, but we get a huge windfall in the form of tax revenue. After voting to legalize pot, Colorado voted to tax marijuana, and tax it heavily. Marijuana buyers must pay the state tax rate of 2.9%, any local taxes, an additional 10% sales tax specifically for retail marijuana sales, and an additional 15% excise tax based on the average wholesale marijuana price. This gives marijuana an overall tax rate of approximately 29%. State officials estimate $65 million per year in tax revenue. With 100,000 medical marijuana patients driving a business exceeding $300 million a year, it is a safe bet that the market expansion legalizing marijuana to everyone over 21 will be exponential. In this atmosphere, $65 million is likely the tip of the iceburg.