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March/ April/ May 2014 How Not to Make a Hash Out of Cannabis Legalization

Leaving it to the states is a recipe for disaster.

By Mark Kleiman

There’s plenty of precedent for this: states from Utah to Pennsylvania to Alabama restrict hard liquor sales to stateoperated or state-controlled outlets. Such “ABC” (“alcoholic beverage control”) stores date back to the end of Prohibition, and operationally they work fine. Similar “pot control” stores could work fine for marijuana, too. A “state store” system would also allow the states to control the pot supply chain. By contracting with many small growers, rather than a few giant ones, states could check the industry’s political power (concentrated industries are almost always more effective at lobbying than those comprised of many small companies) and maintain consumer choice by avoiding a beer-like oligopoly offering virtually interchangeable products.

States could also insist that the private growers sign contracts forbidding them from marketing to the public. Imposing that rule as part of a vendor agreement rather than as a regulation might avoid the “commercial free speech” issue, thus eliminating the specter of manipulative marijuana advertising filling the airwaves and covering highway billboards. To prevent interstate smuggling, the federal government should do what it has failed to do with cigarettes: mandate a minimum retail price.

Of course, there’s a danger that states themselves, hungry for tax dollars, could abuse their monopoly power over pot, just as they have with state lotteries. To avert that outcome, states should avoid the mistake they made with lotteries: housing them in state revenue departments, which focus on maximizing state income. Instead, the new marijuana control programs should reside in state health departments and be overseen by boards with a majority of health care and substance-abuse professionals. Politicians eager for revenue might still press for higher pot sales than would be good for public health, but they’d at least have to fight a resistant bureaucracy.

How could the federal government get the states to structure their pot markets in ways like these? By giving a new twist to a tried-and-true tool that the Obama administration has wielded particularly effectively: the policy waiver. The federal government would recognize the legal status of cannabis under a state system—making the activities permitted under that system actually legal, not merely tolerated, under federal law—only if the state system contained adequate controls to protect public health and safety, as determined by the attorney general and the secretary of the department of health and human services. That would change the politics of legalization at the state level, with legalization advocates and the cannabis industry supporting tight controls in order to get, and keep, the all-important waiver. Then we would see the laboratories of democracy doing some serious experimentation.

Could such a plan garner enough support in Washington to become law? Certainly not now, given a dysfunctional Congress, an administration with no taste for engaging one more culture war issue, and in the absence of a powerful national organization with a nuanced view of cannabis policy and the muscle to make that view politically salient. But there is a mutually beneficial deal waiting to be made. Though legalization has made headway in states with strong initiative provisions in their constitutions, it’s been slow going in other states in which legalization has to go through the legislature, where anti-pot law enforcement groups can easily block it. So it could be many years before legalization reaches the rest of the country or gets formal federal approval that removes the stigma of (even unpunished) lawbreaking from cannabis users. Rather than wait, legalization advocates might be willing to accept something short of full commercialization; some of them actually prefer a noncommercial system. Meanwhile, those who have been opponents of legalization heretofore might—with the writing now on the wall—decide that a tightly regulated and potentially reversible system of legal availability is the least-bad out-come available.

The current political situation seems anomalous. Public opinion continues to move against cannabis prohibition, but no national-level figure of any standing is willing to speak out for change. That’s unlikely to last. Soon enough, candidates for president are going to be asked their positions on marijuana legalization. They’re going to need a good answer. I suggest something like this: “I’m not against all legalization; I’m against dumb legalization.”

Return to “Saving Marijuana Legalization.”

Mark Kleiman is a professor of public policy at the University of California Los Angeles.

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