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Treat Pot Like Booze And Save $$$, Economists Say

GoldChico

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In a report released in June, Dr. Jeffrey Miron, visiting professor of economics at Harvard University, estimated that replacing marijuana prohibition with a system of taxation and regulation similar to that used for alcoholic beverages would produce combined savings and tax revenues of between $10 billion and $14 billion per year nationally and from $8.3 million to $9.4 million or more in Vermont.

Vermont Marijuana Policy Project State Organizer Nancy Lynch urged Vermonters to consider how these savings and revenues could be used locally. Nationally, a group of more than 500 distinguished economists - - led by Nobel Prize-winner Dr. Milton Friedman - released an open letter to President Bush and other public officials calling for "an open and honest debate about marijuana prohibition," adding, "We believe such a debate will favor a regime in which marijuana is legal but taxed and regulated like other goods."

"With Vermont's Medicaid program facing a 2006 shortfall of up to $70 million, we need to look closely at how we're spending our money and whether we're getting our money's worth," Lynch said. "A system of taxation and common-sense regulation will not only save money that Vermont desperately needs for health care and other programs, it will give our state better control over marijuana."

Legislation to regulate marijuana was introduced in the Vermont House by Rep. Winston Dowland ( P-Derby Line ). The bill, cosponsored by Rep. David Deen ( D-Westminster ), did not make it out of committee before the end of the first session of the legislative biennium.

Using data from a variety of federal and state government sources, Miron's paper, "The Budgetary Implications of Marijuana Prohibition," concludes that replacing marijuana prohibition with a system of legal regulation would save Vermont approximately $6.6 million annually in government expenditures on prohibition enforcement, while taxation of regulated marijuana sales would raise between $1.7 million and $2.8 million in new revenue if marijuana were taxed like ordinary consumer goods. Revenue would increase if marijuana were taxed at the higher rates that apply to tobacco and alcohol.

Lynch admitted in an interview that the savings figures do not reflect the costs of setting up regulatory agencies, hiring inspectors, establishing product standards, or promulgating rules for marijuana production and sale. Further, the costs for enforcement, perhaps along the model of alcohol enforcement, have not been taken into account, including testing of unauthorized users, their arrest, prosecution, and incarceration for those found guilty of violating regulations.

While Miron notes that many factors beyond costs and tax revenues would need to be considered in evaluating possible changes in marijuana laws, he said, "These budgetary impacts should be included in any rational debate about marijuana policy."

Miron's report is available at http://www.prohibitioncosts.org


Source: Out In The Mountains (VT)
Copyright: 2005 Out In The Mountains
Contact: Editor@Mountainpridemedia.Org
Website: http://www.mountainpridemedia.org/oitm_index.htm
 
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