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March 04, 2014 11:17 AM A Federal-State Bargain on Cannabis

By Ed Kilgore

Like a lot of people who aren’t pot smokers but don’t view it as The Devil’s Weed, either, I’ve watched the progress of the cannabis legalization cause with satisfaction, thinking it stupid to throw people into prison for growing, retailing or consuming a drug arguably less harmful than alcohol.

But that progress, and the growing realization that this time, the momentum towards legalization has already passed the point of no return, means it’s time to get very serious about how legalization occurs. And as UCLA’s Mark Kleiman (whose work I’ve been following for decades) notes in his important piece in the new issue of the Washington Monthly, we cannot forever continue the anomaly of selective state legalization against a backdrop of selectively enforced federal laws:

[T]he brand-new cannabis businesses in Colorado and Washington [are] in statutory limbo. They’re quasi-pseudo-hemi-demi-legal: permitted under state law, but forbidden under a federal law that might not be enforced—until, say, the inauguration of President Huckabee, at which point growers and vendors, as well as their lawyers, accountants, and bankers, could go to prison for the things they’re doing openly today.
But even if the federal-state legal issues get resolved, the state-level tax and regulation systems likely to emerge will be far from ideal. While they will probably do a good job of eliminating the illicit cannabis markets in those states, they’ll be mediocre to lousy at preventing an upsurge of drug abuse as cheap, quality-tested, easily available legal pot replaces the more expensive, unreliable, and harder-to-find material the black market offers.

The bulk of Kleiman’s article is about how federal legislation to create a uniform framework for state-regulated legal cannabis could prevent a crazy-quilt pattern of varying state systems that encourage smuggling, commercialization, abuse by heavy users and minors, and the growth of a very powerful industry likely to overwhelm its would-be regulators.

What’s needed is federal legislation requiring states that legalize cannabis to structure their pot markets such that they won’t get captured by commercial interests. There are any number of ways to do that, so the legislation wouldn’t have to be overly prescriptive. States could, for instance, allow marijuana to be sold only through nonprofit outlets, or distributed via small consumer-owned co-ops…. The most effective way, however, would be through a system of state-run retail stores.
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.

It may seem strange at this early juncture to worry about Big Pot, but there’s no reason we shouldn’t learn from the experience of public regulation of other drugs like alcohol, and from cannabis regimes in other countries. Kleiman also argues that a national discussion of a national framework for legalized pot could speed legalization (and probably preempt back-and-forth state policies based on changing political dynamics that could create enormous political and law enforcement chaos). Once in place, a national framework of conditional legalization could avoid a lot of state-level friction:

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.

It is time to get moving on a national framework for legalized cannabis, before the rules become as balkanized and irrational and those governing hootch.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

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