Study: Pot Prohibition Raises Cost Almost 1000%

Posted: 7 July 2010 by Little Alex in National News
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The RAND Corporation estimates the legalization of marijuana would lower the untaxed price to $38/oz.

The prohibition of marijuana raises the price per ounce almost ten-fold, a recent study by the RAND Drug Policy Research Center found [.pdf]. Prohibition in the state of California is costing the government an estimated $300m-per-year to enforce.

“The authors predict that retail marijuana prices could drop from $375 an ounce under the state’s current medical marijuana law to as low as $38-per-ounce,” Lisa Leff reported today at the Associated Press.

The study is in light of a state ballot initiative to legalize the possession of no more than an ounce of marijuana by adults, 21 and over, called the Regulate, Control, and Tax Cannabis Act of 2010 (RCTC Prop). For no special reason, the study suggests “a uniform $50-per-ounce excise tax throughout the state” that would raise the cost to around $91-per-ounce at point-of-sale after all taxes.

The study calculates a consumer of one gram-per-day would then lose an annual $644 to the State in taxes, compared to the $685 annual loss by pack-a-day cigarette smokers. Lifting prohibition would still lower the price on the gray market to $68-per-ounce, it added.

It also estimates that consumption would rise 3% per 10%-price-fall, but also that potency would rise by up to 77%.

RAND suggests granting the Department of Alcoholic Beverage Control to regulate marijuana. Add in that this is a government ploy to cash in on a low-maintenance crop that people enjoy and there you have the $50 excise tax.

The regime of drug prohibition has become “the new Jim Crow”, according to legal scholar Michelle Alexander, as it has set up a “racial caste system” in the U.S. She discussed the gruesome, racist elements of the so-called ‘War on Drugs’ that legitimize mass kidnapping and blacklisting for victimless crimes—crimes by assertion. Watch the interview with Democracy Now! here.

U.S. drug policy has escalated the brutal violence across the Mexican border and a March 2009 study by Human Rights Watch confirmed what anti-prohibition and rights activists have been screaming for years—that no matter what the rhetoric, the policy is a racist, society degenerator.

“There’s never been a medical reason to criminalize marijuana, only class,” Professor Noam Chomsky said years ago.

Drug arrests have “risen sharply in the past 20 years”, RAND found, adding that 80% of marijuana-related arrests “are now for simple possession”.

The rate of possession arrests per capita rose sharply in the United States in the 1990s, from about 89 per 100,000 population in 1991 to 223 in 1997. Since then, the number has risen more slowly, approaching 250 per 100,000 in 2008 (about 750,000 arrests in total). Sales arrests rose much more slowly from 1990 to 2008; instead of the nearly 200-percent increase for possession, sales arrests nationally rose only about 40 percent between 1990 and 2008.


There are approximately 1,500 marijuana prisoners in California, but most felony marijuana offenders in California state courts sentenced to incarceration go to jail, not prison. It is important to note, however, that these felony data do not give a precise picture of the flow of marijuana offenders to jail. They exclude those who are sentenced to jail after a misdemeanor conviction, which might be the result of a plea agreement. They also do not include those who spend time in jail before they are sentenced, which may be a more significant omission. There is much more that can be learned about the disposition of marijuana arrests in California.

There are thousands getting blacklisted and doing time because of these draconian laws and the price to them, the workforce and their communities are a large price we can never fully calculate.

  1. […] This post was mentioned on Twitter by LittleAlex. LittleAlex said: Study: #Pot Prohibition Raises Cost Almost 1000% #marijuana #tlot #p2 #libertarian […]

  2. […] looking at around £20 for an eighth on the street, and that’s under a prohibition framework. Bear in mind that’s an estimated 1000% price increase. Can you imagine just how cheap it would be to provide people like Ms Fifield, and countless others […]

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