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BOSTON -- June 2 --In a report released today, Dr. Jeffrey
Miron, visiting professor of economics at Harvard University,
estimates 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. In response, 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."
Using data from a variety of federal and state government sources, Miron's paper, "The Budgetary Implications of Marijuana Prohibition,"
concludes:
**Replacing marijuana prohibition with a system of legal
regulation would save approximately $7.7 billion in government
expenditures on prohibition enforcement-$2.4 billion at the federal
level and $5.3 billion at the state and local levels.
**Revenue from taxation of marijuana sales would range from $2.4
billion per year if marijuana were taxed like ordinary consumer goods
to $6.2 billion if it were taxed like alcohol or tobacco.
These estimates may be conservative. Because available data is
incomplete, assumptions necessary to produce national estimates
inevitably allow for some variation up or down. For example, Miron's
report does not include estimates for certain potential savings -- such
as the likelihood of fewer criminal justice referrals of marijuana
offenders to drug treatment and reduced prison costs stemming from
persons on parole or probation being reincarcerated after positive
urine tests for marijuana. In addition, Miron based his figure for
corrections costs stemming from marijuana prohibition on an estimate
that one percent of state prisoners are imprisoned for marijuana- related offenses. A report released May 18 by the White House Office
of National Drug Control Policy put the figure at 1.6 percent,
acknowledging that tens of thousands of Americans are incarcerated
in state or federal prisons for marijuana offenses.
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."
Those impacts are considerable, according to officials of the
Marijuana Policy Project in Washington, D.C. For example, $14 billion
in annual combined annual savings and revenues would cover the
securing of all "loose nukes" in the former Soviet Union (estimated
by former Assistant Secretary of Defense Lawrence Korb at $30 billion)
in less than three years. Just one year's savings would cover the full
cost of anti-terrorism port security measures required by the Maritime
Transportation Security Act of 2002. The Coast Guard has estimated
these costs, covering 3,150 port facilities and 9,200 vessels, at
$7.3 billion total.
"As Milton Friedman and over 500 economists have now said, it's
time for a serious debate about whether marijuana prohibition makes
any sense," said Rob Kampia, executive director of the Marijuana
Policy Project in Washington, D.C. "We know that prohibition hasn't
kept marijuana away from kids, since year after year 85% of high
school seniors tell government survey-takers that marijuana is 'easy
to get.' Conservatives, especially, are beginning to ask whether we're
getting our money's worth or simply throwing away billions of tax
dollars that might be used to protect America from real threats like
those unsecured Soviet-era nukes."
Dr. Miron's full report, the open letter to public officials
signed by more than 500 economists, and the full list of endorsers
are available at http://www.prohibitioncosts.org.
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