California state Attorney General and Democratic candidate for governor Jerry Brown has recently displayed a dangerous lack of knowledge about basic economics and the likely effects of marijuana legalization. From KSBW:
Brown was in Monterey on Tuesday to speak at the California District Attorneys Association Conference, and said legalizing marijuana would open the flood gates for the ruthless and deadly Mexican drug cartels.
“Every year we get more and more marijuana and every year we find more guys with AK-47’s coming out of Mexico going into forests and growing more and more dangerous and losing control,” Brown said
It is time for Brown to take an economics 101 course. Brown is saying that legalizing, taxing, and regulated marijuana will increase the power and lawlessness of the Mexican cartels. This assertion, however, has little basis in fact.
The only reason that criminal organizations are the ones profiting off an illicit substance is that legal enterprises can’t be involved in the business. Do Mexican cartels run an orange juice syndicate? Do gangs run the wine trade? Do they control the bicycle business? Do you see illegal asparagus farms buried in state parks? Of course not, those concerns are controlled by law-abiding, tax-paying, regulated companies. And if marijuana were fully legal and regulated like other crops, it would also be controlled by law-abiding companies. Legalizing cannabis would kill the cartels profit stream by redirecting the money they get from cannabis to legal, tax-paying companies.
We know this, not only from basic economic theory, but from the perfect case study of our nation’s last attempt at alcohol prohibition.
Before alcohol prohibition, the vast majority of alcohol sales were controlled by legal concerns–breweries like Anheuser Busch, distillers and saloon owners. Once legal companies couldn’t sell alcohol anymore, the business was taken over by criminal enterprises. The massive growth in national organized crime in this country was chiefly the result of prohibition giving them a huge market that only criminals could control. During prohibition, the alcohol business was controlled by mobsters like Al Capone, bootleggers and speakeasy operators. Once alcohol was made legal again by the 21st amendment, the alcohol-making and -selling business was again controlled by legal, tax-paying companies like Anheuser-Busch, bar owners, and distillers like Jack Daniels.
Nobody profited more from alcohol prohibition or more wanted to see it stay illegal than the Mob and the bootleggers. Today, no one profits more from marijuana prohibition–and wants to see it stay illegal–than the drug cartels.
There are only two options here: One is that Jerry Brown is sincere in his belief, and therefore lacks even a basic understanding of economics and drug policy. (If so, this would seriously put his qualifications for governor in doubt). The other option is that candidate Brown has other reasons for wanting to keep marijuana illegal (political, moral, a weird, deep-seated hatred of libertarians?). If so it is time for Brown to come clean and stop polluting the public debate about cannabis legalization with this nonsense.
By either account, though, Brown’s excuses for opposing Proposition 19 are just wrong. Ironically, Brown is endorsing the policy position–keeping marijuana illegal–that has allowed the cartels to get wealthier and more dangerous every year. Ideally, the growing debate about California’s pot policy will teach to Brown that the only way to cripple the cartels is to take away the huge profits they earn from the sale of illegal marijuana–by giving the business to legal companies.