04 September 20XX
With regard to the question “should marijuana be legalized,” we conclude the answer is “yes.” This conclusion is made based on the economics of the issue. The existing system involves significant expense to local government with no appreciable result. Marijuana remains readily available virtually anywhere in the nation, decades of the war on drugs notwithstanding. That a demand for this product exists is undeniable. Continued criminalization will accomplish nothing beyond driving costs up marginally. The evidence is seen in the results. To continue to do the same thing and expect a different result is one classic definition of insanity. Prohibition failed to curb alcohol consumption in the 1920s. Prohibition is failing to curb marijuana consumption in the 20th and 21st Centuries. Continued criminalization is a classic case of throwing good money after bad.
The economics surrounding the concept of elasticity of demand are important in the discussion of marijuana legalization. This concept explains why the classic demand curve in any supply and demand analysis is not a straight line. Elasticity of demand increases at either end of the price scale. If, for example, the price is extremely low, approaching zero, then consumers will take some of the product or service whether they need it or not. At the other extreme, the Wall Street Journal points out parents with children suffering allergies to bee stings, for which an EpiPen can be a life saver, can be driven out of the market if the price is too high. If the “criminality premium” for suppliers drives the price too high demand will eventually fall off, the theory goes. The problem with marijuana criminalization is that this premium has been in place for decades now and is completely built into the market. Continued criminalization, then, serves no purpose from an economic point of view.
Another consideration is under the existing system the marijuana trade represents pure cost with no offsetting income to government. If marijuana was legalized it would be regulated with income from licensing fees offsetting those costs. It would be taxed, as well, just as other “sin taxes” are applied to products such as alcohol or tobacco.
In this conclusion we find ourselves in disagreement with the venerable Wall Street Journal. On November 2, 2016, in the runup to the election in which legalization of marijuana was on the ballots in several states, the Journal focused on social and economic costs. They noted that since legalization, marijuana use has increased by 9.5 percent in Colorado and 3.2 percent in Washington. The Journal’s position was that the costs associated with this outweighed benefits.
The Wall Street Journal notwithstanding, we stand by our recommendation. As an economic proposition legalization makes sense. It is a clear and straightforward tradeoff between a direct expense to control an illegal substance and an income stream from taxing a product that will, without any doubt whatsoever, continue to be sold. If the “social cost” argument wins out the income can be used for education programs, counseling or other ways to address this problem. What must be understood is prohibition is not working, either as an economic or as a sociological proposition.
Here you are. The opening paragraph establishes the thesis. The second and third paragraphs explain the economics. There’s even an extra Wall Street Journal reference. That was not the issue with the professor’s review. He was more concerned with the digressions into other matters as well as, it seems, length. The fourth paragraph brings in the Wall Street Journal as the “con” position. The final paragraph restates the conclusion as well as addressing the “con” position.
