There are a handful of big questions at the center of the weed legalization debate. Here’s one of them: Does legal weed eliminate the black market or not? Proponents of legalization say it will. But those opposed to the idea say black markets persist even after legalization. To address all this, economic experts have explained how to kill the weed black market.
Do Black Markets Survive After Legalization?
It is true that so far, attempts to make weed legal in the U.S. have not killed the black market. For example, Oregon continued to see a thriving black market for weed—even after the state made recreational cannabis legal.
On top of that, a review of recent drug busts shows that there is an influx of weed being smuggled out of weed-legal states into places where it remains illegal.
Given these realities, it’s understandable why many people would conclude that legalization does not eliminate the black market. But that conclusion may be a bit simplistic. Furthermore, it ignores some important facts.
For example, one of the main reasons that Oregon’s black market has lived on is because legalization in the state is uneven. In Oregon, cities and counties can opt out of letting cannabis businesses into their jurisdictions.
As a result, people living in those places are forced to turn to the black market. Sometimes it’s as simple as heading to the next county over, but often it’s simpler just to keep buying from a local dealer.
A similar thing happens when states see weed coming in from nearby weed-legal states. As economist Jeffrey Miron recently wrote, “black markets arise only when government policy forces markets underground by outlawing them or by imposing excessive regulation or taxation.”
Simply put, when weed is legal in one place but illegal in another, it will naturally start flowing into the black market in those places where it’s outlawed. But if it were legal across the board, that flow would start drying up.
On top of basic prohibition, Miron also pointed out that restrictive regulations, heavy taxes, and the inability of legal weed businesses to access banks all promote an ongoing black market.
How To Kill The Weed Black Market
Miron and other experts insist that the only way to eliminate the black market is to make weed fully legal. In fact, Miron goes even further. He recently argued that the legal weed market needs to be as unregulated as possible.
“The critics are therefore right that partial legalization will not eliminate the black market,” he wrote. “But the solution is trivial: full legalization. Most importantly, federal law must legalize marijuana so that marijuana businesses can access the legal banking sector and comply with federal tax codes without putting themselves at a competitive disadvantage.”
He added: “More broadly, the desire to control the marijuana market via regulation is misguided.”
Final Hit: How To Kill The Weed Black Market
Taking all this together, if anyone wants to know how to kill the weed black market, the answer is simple. Make it legal and remove any obstacles that make it inaccessible.
Understanding how to kill the weed black market could be especially important right now. The Trump Administration has raised all sorts of questions about how the federal government will approach weed.
Earlier this year, then-White House Press Secretary Sean Spicer warned that “greater enforcement” of cannabis prohibition could be coming.
Additionally, Attorney General Jeff Sessions has repeatedly spoken out against cannabis. He said that weed is “only slightly less awful” than heroin. He also said that medical cannabis “had been hyped, maybe too much.”
In June, he wrote a letter to congressional leaders. In it, he urged them to repeal the Rohrabacher-Farr Amendment. This amendment protects people from federal prosecution if they follow state laws that allow for weed.
But according to experts like Miron, any attempt to roll back legalization and increase prohibition will only backfire. If Sessions or anyone else wants to know how to kill the weed black market, the answer is simple. The most direct route to accomplish that goal is full-scale legalization.