Report: Marijuana legalization trades taxes for social problems

(The Center Square) — Recreational marijuana legalization in a number of states gives Pennsylvania some test cases for what to consider in its own debates.

A recent paper from the Federal Reserve Bank of Kansas City notes that the tradeoff of legalization might be more economic growth, but more social problems too.

“Overall, our results suggest that the distribution of economic benefits of recreational legalization are likely shared more widely compared to the costs. Widely distributed benefits versus more concentrated costs indicate that policymakers should be cautious in discounting the existence of potential costs of recreational legalization,” Jason Brown, Elior Cohen, and Alison Felix of the Federal Reserve Bank wrote.

READ MORE — Stephen F. Gambescia: FTC won’t be keen on oversight of Big Marijuana

Though the data were messy and much of what Brown, Cohen, and Felix found wasn’t statistically significant, their paper could serve as a note of caution to Pennsylvania policymakers.

New York, New Jersey, and Maryland have legalized recreational marijuana on the commonwealth’s borders, which could mean that tax revenue benefits (but also negative changes in crime and addiction) in Pennsylvania would be less dramatic.

States like Colorado that legalized early had more significant changes.

“One important finding is that the estimated economic benefits appear larger for states that legalized earlier,” Brown, Cohen, and Felix wrote. “States that legalized later had smaller estimated benefits in our analysis perhaps due to it being less novel or less of a perceived amenity or actual demand shock from ‘marijuana tourism’ compared to the first states that legalized recreational use.”

Even after accounting for substitution between alcohol and tobacco and cannabis, legalization generates a meaningful increase in tax revenues.

When legalization does boost the economy, individual returns tend to be small while costs fall harder on “heavy-user individuals,” Brown, Cohen, and Felix wrote.

Legalized marijuana might also be a substitute for tobacco and alcohol, driving down taxes from those sources but providing an overall increase.

“Even after accounting for substitution between alcohol and tobacco and cannabis, legalization generates a meaningful increase in tax revenues,” they wrote.

Much of the debate in the General Assembly has focused on potential tax revenue gains, though some legislators have concentrated on public safety concerns. Gov. Josh Shapiro’s budget proposal included a tax rate for recreational marijuana that legalization advocates called “prohibitively high” and akin to California, which has a risk of stifling a legal market. New Jersey had a similar problem in growing its legal sales due to the slow expansion of dispensaries.

Despite the problems and the hurdles that remain, however, bipartisan efforts in the General Assembly have pressed to make Pennsylvania the 24th state to legalize marijuana.

Anthony Hennen is a reporter for The Center Square. Previously, he worked for Philadelphia Weekly and the James G. Martin Center for Academic Renewal. He is the managing editor of Expatalachians, a journalism project focused on the Appalachian region.

This article was republished with permission from The Center Square.

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13 thoughts on “Report: Marijuana legalization trades taxes for social problems”

  1. Pretty sure Locking hundreds of thousands of people up and ruining their lives for a schedule one crime, for a substance test that does not qualify to be a Schedule one substance (meaning a substance with no accepted medical use) is the social problem already created.

    Enough with the excuses to try to continue filling prison beds with a false crime. Not being able to keep up with those arrest numbers with the actual leathal drugs All combined is not the peoples problem. That is not a social problem. That is a polical problem. And taking people to freedom over false crime for prison industry profit and to protect the profits of other industries is human trafficking.

  2. Manika Pat, I think this website may interest you: https://drugabusestatistics.org/drug-related-crime-statistics/

    The United States has made a practice of giving away billions of taxpayer money to oligarch donors via compromising politicians, often by waging wars with ever-shifting mission creep. And you can chalk up the “War” on Drugs as one of those campaigns. Incidentally did you see Rite Aid recently declared bankruptcy while dealing with Opioid-Related Lawsuits? Some researchers believe that heavy marijuana use may trigger psychosis or schizophrenia… kind of explains a lot of what is happening in our culture recently. Studies have shown that frequent cannabis use is associated with more than double the likelihood of developing schizophrenia. There have been reports that show brain waves are altered the same way as a person with psychosis during marijuana usage. Got to go now and smoke up before I get ready to attend a Drag Queen show in the children’s section of a public library.

    1. There is no objection schizophrenia anywhere where there’s been legalization. You’re seeing a study that was based on data that they did not collect. They cherry picked the data from other studies to reach the conclusion they wanted.

      Furthermore, do you are they that is also corrupted. Because they do not have a test that determines whether someone is impaired or not. So any data that you have with that is also cherry picked. It doesn’t include whether they were other substances in the systems of these people. Whether they were currently medicated, or these are test results from a previous years. For instance, a medical cannabis patient will still test positive for an active metabolize for up to five weeks after they stop.

      And there is the whole lie that it is stronger and dangerous. Based on what? We’ve already determined that the only weed that I’ve been able to test is half of was from the University of Mississippi, which new studies refuse to use because it is subpar dirt weed.

      And still, that doesn’t answer the whole issue that people are being charged with a schedule, one crime for a substance that doesn’t qualify to be a Schedule one substance. A false crime.

      Stop going through all the ancient BS that the governments been feeding us for nearly a century that has already been proven wrong. And not just buy a new research. It’s been used as a medicine throughout human history.

  3. Since the misinformation about schizophrenia and Cannabis has been put forward. As a member of the medical cannabis community, I feel the need to address my friends in the schizophrenic community.

    The study that has been pushed forward is based on DATA cherry picked from studies about people who already have schizophrenia who are self treating with cannabis.

    Unfortunately the misinformation that has been used to justify continuing criminalization of a medically beneficial plant it kind of abuses the schizophrenia community and uses them as a strawman.

    And since everybody who is in the know, knows it’s false and the only people who believe it other people who want it to be true, the real information will find it hard to get out there. As is true with anything that becomes politicized. They are politicizing they schizophrenia community for their own needs.

    What you need to know from these actual studies where the DATA comes from: if you have schizophrenia and you are reading this or you are a loved one of someone with schizophrenia. Treating with cannabis is not your best option. While I believe one day a more CBD based strain will be revealed to be a proper treatment. Currently under our current data cannabis should be avoided for a treatment for schizophrenia. There is too much risk of it dialing up your paranoia and causing an incident.

    That is just like cherry picked #DATA from DUI studies that get by on general knowledge that just detecting THC does not Indicate impairment. They also omit the data that would point other substances or issues being the cause of the incidents.

    Just like they constantly try to push that children are in danger. From edibles or whatever. Like we haven’t already had this conversation about pharmaceuticals. If you don’t want kids getting into it use childproof containers. Duh!

    Also, while a few kids a year may get into dad’s edibles. There has been countless children since the 1930s that have been denied life-saving medication. Don’t tell me about a few kids that got into edibles due to irresponsible parent and tell me that’s a reason why you Gotta keep locking people up. When countless children have died since the 1930s being denied this medication. Seizure diseases like drevit syndrome. Children dying by age 13 with their brains and organs mush from hundreds of seizures a day. They are now surviving and living healthy lifes.

    And no matter which example you put there is way more people benefiting from cannabis than any of the little incidents that again they cherry pick to try to say, is the rule, and not the exception.

    Medical cannabis is a great thing. It has improved my life tremendously since 2017. And the only real side effects I’ve had is from the prohibition and those in law-enforcement, that would try to get around my medical card to keep those bodies coming to the corrections industry. Either the prisons themselves or the contractors that profit from court appointed services. Turning the prison industry from a necessary evil to a giant profit, producing juggernaut. That doesn’t care how they fill their beds and programs. Just that the government does fill their meds and programs.

  4. Since the misinformation about schizophrenia and Cannabis has been put forward. As a member of the medical cannabis community, I feel the need to address my friends in the schizophrenic community.

    The study that has been pushed forward is based on DATA selectively picked from studies about people who already have schizophrenia who are self treating with cannabis.

    Unfortunately the misinformation that has been used to justify continuing criminalization of a medically beneficial plant kind of abuses the schizophrenia community and uses them as a strawman. In doing so it glosses over important information that the real studies concluded.
    As is true with anything that becomes politicized. They are politicizing the schizophrenia community for their own needs.

    What you need to know from these actual studies where the DATA comes from: if you have schizophrenia and you are reading this or you’re a loved one of someone with schizophrenia. Treating with cannabis is not your best option.

    While I believe one day a more CBD based strain will be revealed to be a proper treatment. Currently under our current data cannabis should be avoided for a treatment for schizophrenia. There is too much risk of it dialing up your paranoia and causing an incident. That is way more important to get out there.

    Furthermore,

    That is just like cherry picked DATA from DUI studies that get by on lack of general knowledge that just detecting THC does not conclusively Indicate impairment. They also omit the data that would point out other substances or issues being the cause of the incidents. And they are not even looking for the compound that actually causes you to get tired and that classic movie myth stoned look which is CBN.

    Just like they constantly try to push that children are in danger. From edibles or whatever. Like we haven’t already had this conversation about pharmaceuticals. If you don’t want kids getting into it use childproof containers. Duh! Comparatively It’s much less dangerous then if your kid gets into just about any pharmaceutical.

    Also, while a few kids a year may get into dad’s edibles. There has been countless children since the 1930s that have been denied life-saving medication. Don’t tell me about a few kids that got into edibles due to a irresponsible parent and tell me that’s a reason why you Gotta keep locking thousands of people up. When countless children have died since the 1930s being denied this medication. Seizure diseases like drevit syndrome. Children dying by age 13 with their brains and organs mush from hundreds of seizures a day. They are now surviving and living healthy lifes.

    And no matter which example you put there is way more people benefiting from cannabis than any of the little incidents that again they selectively picked to try to say, is the rule, and not the exception.

    Medical cannabis is a great thing. It has improved my life tremendously since 2017. And the only real side effects I’ve had is from the prohibition and those in law-enforcement, that would try to get around my medical card to keep those bodies coming to the corrections industry. Either the prisons themselves or the contractors that profit from court appointed services. Turning the prison industry from a necessary evil to a giant profit, producing juggernaut. That doesn’t care how they fill their beds and programs. Just that the government does fill their beds and programs. Most prison contracts come with minimum occupancy requirements. And states have been fined by the prison industries for not keeping up the numbers.

  5. The fact that marijuana is illegal is not keeping a single person who wants to use it from doing so. Making it legal won’t suddenly make those who don’t do it want to. The state might as well have the revenue.

  6. In 2018 Parents Opposed to Pot, a lobby group, tried to sound the alarm on the link between marijuana and mass shootings, compiling a list of mass killers it claims were heavy users of marijuana from a young age, from Aurora, Colo., shooter James Holmes and Tucson, Ariz., shooter Jared Loughner to Chattanooga, Tenn., shooter Mohammad Abdulazeez.
    “You can’t address the youth mental health crisis without considering the effect of rising teen marijuana use. Among American teenagers, the drug’s “daily use has become as, or more, popular than daily cigarette smoking” according to the National Institute of Health’s 2017 Monitoring the Future study. We’ve successfully demonized cigarettes while new laws send kids the message that marijuana is harmless. Yet we’ve known for more than a decade of the link between marijuana and psychosis, depression and schizophrenia. In 2007 the prestigious medical journal Lancet recanted its previous benign view of marijuana, citing studies showing “an increase in risk of psychosis of about 40 percent. A seminal long-term study of 50,465 Swedish army conscripts found those who had tried marijuana by age 18 had 2.4 times the risk of being diagnosed with schizophrenia in the following 15 years than those who had never used the drug. Heavy users were 6.7 times more likely to be admitted to a hospital for schizophrenia.
    Another study, of 1,037 people in New Zealand, found those who used cannabis at ages 15 and 18 had higher rates of psychotic symptoms at age 26 than non-users. A 2011 study in the British Medical Journal of 2,000 teenagers found those who smoked marijuana were twice as likely to develop psychosis as those who didn’t. Another BMJ study estimated that “13 percent of cases of schizophrenia could be averted if all cannabis use were prevented.” That’s more than 400,000 Americans… Young people and those with a genetic predisposition are most at risk, particularly during adolescence, when the brain is exquisitely vulnerable. The evidence of harm is overwhelming, and it defies logic to think that legalizing marijuana won’t increase the harm. And yet marijuana activists pretend there is no problem and baby-boomer lawmakers, perhaps recalling their own youthful toking, ­ignore the science. To make matters worse, the marijuana sold at legal dispensaries today is five times more potent than the pot of the 1970s and ’80s, according to a thoroughly researched new book by former New York Times reporter Alex Berenson: “Tell Your Children: The Truth About Marijuana, Violence and Mental Health.” Berenson reported that the first four states to legalize marijuana, Alaska, Colorado, Oregon and Washington, have seen “sharp increases” in violent crime since 2014.
    If we care about mental illness, which has been spiking up at an alarming rate in recent years among young people, especially teenage boys, we should care about the convincing evidence of marijuana-induced psychosis.” – Miranda Devine, 2019

    1. Even if all that’s true, kids are not deterred by the illegality of the substance. It’s peer pressure, it’s curiosity, it’s boredom – but the law does not scare them from smoking pot. So take the revenue and put it into youth mental health initiatives and other attempts to address root causes

  7. Jenn, this mountain of evidence is so easy to find and cross reference. It is a major reason US agencies are being sued in court for trying to censor facts and kill discussion. Ok, you want to discuss revenue?
    OpenTheBooks.com published an oversight report, U.S. Foreign Aid – How And Where The U.S. Spent $282.6 Billion, Plus Updated COVID-19 Aid & Payments To The UN And Other Agencies. Sinclair Broadcast launched the report on their National Desk and 190 local affiliates with ABC, NBC, CBS, and FOX. Auditors found that U.S. foreign aid dwarfs the federal funds spent by 48 out of 50 state governments annually. Only the state governments of California and New York spent more federal funds than what the U.S. sent abroad each year to foreign countries.
    The reason these oilgarch tyrants give money to our politicians’ campaigns, and tell them to legalize drugs, is because they want to drug as much of our youth in the US as possible. These video devices are also designed to be addictive. And these drugs are not the same drugs from the 1990’s and earlier. It is rather unpleasant when you wake up to the level of evil bull manure that is going on in the US. Revenue? The federal funds given to foreign countries could backfill drug tax revenue.

  8. An important signal to be aware of in any type of discussion, is when there is a shift to address the character, motive, or some other attribute of the person making an argument rather than attacking the substance of the argument itself. This is a signal (for either you or them – depending on who shifted) uncomfortable facts may have been presented.
    If you encounter an ad hominem argument like this, try to redirect the conversation back to the original topic and focus on the substance of the arguments – for example: Geez, I guess I misunderstood your earlier point. I thought you might be worried states needed the revenue and was pointing out the massive hundreds of billions of US dollars we give in foreign aid which could be redirected to US states and used on children in the US. Let me further understand, were your points that children are going to drugs anyway, and if we can make money off their misery and pain let’s do that? And who actually cares about their health, or society maintaining standards because it is too much hard work and requires rules?
    Attacking someone’s character does not address the issue at hand that drugs are significantly more potent these days, they are addictive and do massive damage to developing brains, and their widespread use is destroying our society. Have you noticed the crowds of teens getting high and tearing apart retail stores? In any discussion, it’s important to stay focused on the issues, evidence, and avoid personal attacks. By doing so, we can have a more productive conversation and reach a better understanding of other’s perspectives.

  9. From the Wall Street Journal, authors Andrea Petersen and Julie Wernau, on October 26, 2023 write: “The Cannabis That People Are Using for Anxiety Is Probably Making It Worse”
    Basically: People with anxiety are counting on cannabis’s ability to treat their symptoms. There’s a problem: The science shows that it probably doesn’t help, and it may make those symptoms worse.
    Children need protection so they can grow up to be healthy adults. Making potentially harmful drugs more accessible to children is evil.

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