Why hasn’t legal weed ended the black market for marijuana?
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What’s going on
It’s been 10 years since the first states legalized recreational marijuana. Over the last decade, the legitimate marijuana trade has grown into a massive industry as the personal use of marijuana has rapidly spread to more parts of the country.
One of the central arguments used by legalization advocates, in addition to the impact on health, criminal justice, and personal liberty, is the belief that the legal marijuana market would put an end to the illicit marijuana trade and eliminate activity. crime that surrounds it.
But that has not happened. The black market for marijuana has to the point where legitimate growers and sellers are struggling to stay afloat in areas of the country awash in illegal weed. In For example, the illegal weed market is “indisputably many times larger than the licensed community,” according to an analysis by the . That same report found that unlicensed farms outnumbered legal operations by as much as 10 to 1 in the state’s largest growing areas.
Other states that have legalized the recreational use of marijuana, including Y They have faced similar challenges. has grappled with a booming “gray market” of unlicensed marijuana sellers that emerged as the state worked to establish its new system for legal retailers. Other nations that have legalized marijuana such as Y They have faced similar challenges.
The thriving black market for marijuana isn’t just hurting legitimate sellers trying to compete. The proliferation of illegal marijuana crops has also brought with it an increase in , human trafficking and severe environmental damage in the areas where cultivation without a license is concentrated. States are also losing hundreds of millions of dollars in tax revenue when marijuana sales occur outside of the legitimate market.
why is there debate
There is some logic to the idea that legal marijuana would eliminate, or at least drastically diminish, the black market for marijuana. But lawmakers, members of the cannabis industry and outside experts say there are a number of reasons why the illegal weed hasn’t been phased out.
The most common explanation is that the laws governing legal trade in most states provide enormous advantages to illicit traders and even push legitimate traders into the black market. In many cases, starting and maintaining a legitimate marijuana business, whether it’s a farm, dealer, or retail store, means dealing with fees, taxes, and red tape that can make it difficult for many businesses to stay afloat, let alone do business. a gain. Those extra expenses also drive up the price of legal marijuana products, giving consumers an incentive to buy cheaper weed from off-the-books sellers.
Legalization supporters often argue that the black market will continue to exist as long as marijuana remains illegal in large parts of the country. Not only do most states still ban the recreational use of marijuana, but states like California also allow individual cities to ban it. Marijuana advocates say this gives illegal sellers a large consumer base for their products that would disappear if marijuana were legal everywhere.
Many conservatives, however, say the legalization push is itself the problem. They argue that the growing acceptance of marijuana has dramatically increased the potential customer base, raising demand to a level that legal sellers cannot possibly meet. Some argue that the expansion of the legal market has made it impossible for authorities to distinguish between legitimate and illicit operators. Others say that tying legalization to criminal justice reform efforts, as many Democratic-led states have done, means criminals know they won’t face stiff penalties if caught.
Despite ongoing struggles to contain the black market, marijuana legalization is poised to expand to more states soon. it will begin allowing recreational use next year. voters in will decide if his state should do the same in March. Campaigns to get legalization measures on future ballots are .
Legitimate operators cannot compete due to over-regulation and excessive taxes
“The fact that unlicensed marijuana dealers continue to thrive in California is a testament to the ways in which the state has botched legalization. Most local governments do not allow recreational sales, and even those that do frequently impose caps that artificially limit supply. Bureaucratic barriers, costly regulations, and high taxes are daunting deterrents to marijuana dealers who might otherwise be inclined to go legitimate.” —Jacob Sullum
Heavy taxes drive up prices, driving users into the black market
“Too many taxes and regulatory baggage is a recipe for legal marijuana to stagnate and illegal marijuana to flourish. The more expensive legal weed is, the more people choose illegal weed, especially consumers who buy the most weed and therefore care more about the price difference.” —Robin Goldstein and Daniel Sumner,
Legalization has created millions of new customers for the black market
“If you make marijuana legal, you will encourage black dealers to get in the game or increase the amount of illegal marijuana they are already selling. … By legalizing, you are only increasing that demand, a demand that the cartels are clearly more than willing and able to meet.” —Tom Wrobleski
Small-time illegal traffickers could easily be absorbed into the legitimate market
“Yeah, the ‘black market’ guy down the road is still going strong and receiving visitors at all hours as usual. But, due to the collective power of the state-sanctioned dispensaries, the guy on the street remains a clandestine entity, as before. —Bob Flaherty
The legal marijuana business proposition has completely collapsed
“Boom and bust cycles are part of this county’s history, from gold mining in the 19th century to the collapse of the logging industry a century later. Legal cannabis was to be a lifeline for residents. But that promise has quickly collapsed.” — Adam Elmahrek, Robert J. Lopez, and Ruben Vives,
Misguided social justice motivations hamper law enforcement’s ability to crack down on criminal operators
“The unlicensed market operates with impunity because policing marijuana is thought to be racist and wrong. … The public rightly wants not just a marijuana market, but a regulated one. Yet leaders are too squeamish to prevent criminals from running businesses that routinely break the law to serve that market.” —Charles Fain Lehman,
It’s naive to think that illegal marijuana sales will really go away.
“For people who think this is a problem unique to cannabis, it’s important to remember that there are black markets for alcohol, cigarettes and many other products. Fighting the black market… is an almost impossible task. It’s a battle to diminish it.” — John Hudak, cannabis industry expert, for
The black market will persist as long as marijuana is illegal anywhere in the US.
“Federal decriminalization (removing cannabis from the list of controlled substances) is, by all accounts, the magic wand. I would remove the [tax penalties], allow normal access to banks and facilitate more interstate sales.” —Will Yakowicz,
Legal markets are driving illicit sales in states where marijuana is still prohibited
“Legalization has also benefited criminals in states where marijuana is still illegal. Gangs have seized the opportunity to smuggle goods across state lines, selling legal marijuana at a large profit. …Suddenly, dealers are stocked with a cornucopia of various varieties of cannabis, all grown under the sham of state marijuana laws, as well as vaporizers, edibles, and concentrates, all of which would never have traveled more than 1,000 miles across of the United States if legalization had not occurred. —Mike Adams
There are no practical or moral incentives for users to abandon their old buying habits.
“Most of the growers and sellers did not break any laws other than to produce and sell cannabis. Therefore, many cannabis users did not see a great moral, ethical or safety advantage in switching from their long-term benign providers to the new legal system.” — Mike DeVillaer, drug policy researcher, for
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Illustrative photo: Yahoo News; photos: Getty Images