Legalize it (sports betting edition)

As states and municipalities struggle mightily to close ever-growing fiscal gaps, the moral relativism that I first mentioned in this post and followed up on in this post is seemingly spreading like wildfire. It's clear that politicians are truly terrible at actually cutting spending (hello again, Super Committee), such that the only realistic solution is on the revenue side. Raising taxes is perhaps even more unpopular than cutting spending, so there's a tendency for politicians to get a bit... creative.

I long ago predicted that this "creativity" would take the form of legalization and/or liberalization of certain vices--alcohol, drugs, and gambling. Well, Virginia proposed privatization of liquor sales (a relaxation of its somewhat puritanical stance on alcohol), and California and the federal government both separately began to consider the issue of legalizing marijuana. And now, to finish off the triumvirate, here comes New Jersey (who else?) with a proposal to legalize sports betting.

This month, New Jersey voters passed a statewide referendum that allowed the state to legalize sports betting.

Over the next year, the state will continue its push for legalization by passing a bill into law and ultimately challenging the federal ban on betting in court.

New Jersey's reasons for legalizing betting are two-fold: they need any additional revenue they can get to close the state's budget gap, and they want to jumpstart the steadily declining Atlantic City tourism industry.

Yup... this was clearly inevitable. For what it's worth, I am personally excited about the prospects of a new Las Vegas on my coast. I've never been to Atlantic City (because I'm not 80 years old, and... I mean... New Jersey), but legalized sports betting might change that. But more so than that, I'm both amused and intrigued that politicians (and voters) would rather loosen the moral fiber of their community than loosen their pursestrings and pony up a few extra bucks of their own to close the fiscal gap.

People will seriously compromise all semblance of moral instinct when their financial self-interest is at stake. But then, Fox News already taught us that, didn't they?

[Business Insider]

Budget-initiated moral relativism

In case my jargon-y headline threw you off, this post is an update on an old theme, namely the one I first mentioned here, in "On budget woes and value systems".

It's been a little while since I wrote about the growing "trend" (for lack of a better word) toward the decriminalization of marijuana. It began in California with Prop 19 (which ultimately failed), gained traction with now ex-Governor Arnold Schwarzenegger's passage of Senate Bill 1449 (which, like a previous Massachusetts law, decriminalized possession of small amounts of the drug), then gained international attention this month when an interesting crew of individuals declared the War on Drugs a "failure".

Now, it seems that Congress has responded to the international criticism, with the unlikely duo of Ron Paul and Barney Frank (who have in fact teamed up on multiple occasions before) introducing legislation this week that would effectively decriminalize marijuana use at the federal level.

A group of US representatives plan to introduce legislation that will legalize marijuana and allow states to legislate its use, pro-marijuana groups said Wednesday.

The legislation would limit the federal government's role in marijuana enforcement to cross-border or inter-state smuggling, and allow people to legally grow, use or sell marijuana in states where it is legal.

The bill, which is expected to be introduced on Thursday by Republican Representative Ron Paul and Democratic Representative Barney Frank, would be the first ever legislation designed to end the federal ban on marijuana.

Sixteen of the 50 states as well as the District of Columbia have legalized the use of marijuana for medical purposes.

But planting, selling or commercially distributing marijuana remains illegal under federal law.

Regardless of your feelings on marijuana usage (Karl Denninger, who tipped me off to this article, has fairly strong opinions on the matter), this legislation is consistent with the traditional view of states' rights trumping federal control, a dynamic that has been steadily fading in recent decades.

But lest you think that this bill represents a shift away from Washington-based paternalism, rest assured that the timing of this bill's introduction means that budgetary concerns--and not political ideologies--are likely foremost in this discussion.

When financial times are tough, we are often forced to reconsider what we really want our federal government to be doing with our tax dollars. While we may not like the idea of a nation full of pot-smokers, we simply can't afford to continue legislating and fighting it the way we have--this, incidentally, is exactly what killed Prohibition back in the 1930s.

Recessions and budget crises have a way of revealing a society's true values in a way that is often impossible in boom times. It will be interesting to see how this bill is received in Congress, and I'll be sure to update you all if and when any news breaks. My guess is that we're not quite ready to pass this type of bill, but I've been surprised before.

[Yahoo!]  
(h/t Karl Denninger)

Hippie existential crisis

Uh oh...

The analysis performed in this study finds that indoor Cannabis production results in energy expenditures of $5 billion each year, with electricity use equivalent to that of 2 million average U.S. homes. This corresponds to 1% of national electricity consumption or 2% of that in households. The yearly greenhouse-gas pollution (carbon dioxide, CO2 ) from the electricity plus associated transportation fuels equals that of 3 million cars. Energy costs constitute a quarter of wholesale value.

In California, the top-producing state—and one of 17 states to allow cultivation for medical purposes—the practice is responsible for about 3% of all electricity use or 8% of household use.

I can just picture all of the stoners in California trying to figure out what matters more to them--saving the environment or getting high. Tough choices...

[Evan Mills]
(h/t Freakonomics)

R.I.P. Prop 19

Lost amid my Fed-induced ranting and anger, I forgot to post the news here that Proposition 19, California's marijuana-legalizing ballot initiative that I've written about here before, failed on Tuesday.

Those of us who want a bit of sanity in the worldwide drug law debate had a disappointing result yesterday.

Not the US midterms – I leave it to you to decide whether sanity was high on the agenda there – but Proposition 19 in California, which, if it had gone through, would have effectively legalised the growth and sale of marijuana in the state. Sadly, it has been defeated: exit polls suggest that the result was 57 percent no to 43 percent yes. It’s a surprisingly severe beating, given that opinion polls throughout the race had it largely neck-and-neck. The anticipated youth vote, it seems, failed to materialise on the day: but then stoned 22-year-olds probably aren’t the most reliable voters.

The consensus among media outlets seems to be that Proposition 19's failure does not strip it of its importance--it is rather a giant step forward on an inevitable march toward marijuana legalization in California, if not the entire nation.

I tend to share that opinion, if only for budgetary reasons. State and local governments--not to mention the federal government--are in dire straits. It is only a matter of time before we start taxing vices in order to balance our budgets. To be continued...


[Telegraph]

Quote of the Week

This piece yesterday on NPR (worth a listen if you can--reading the text doesn't really do justice to the people who are profiled) was a real gem. Essentially, it talks about the sometimes ironic supporters and detractors of California's Proposition 19, which could make California the first state to legalize and tax marijuana for recreational use (medicinal use is already legal in California).

Focusing on a self-described "marijuana connoisseur" named Dragonfly de la Luz, who gets high every day with a Hello Kitty pipe (seriously, I'm not making this stuff up, these people are like cartoon characters), the NPR story provides an absolutely amazing overview of the very strange world of pot smoking in California. So without further ado...

This week's QUOTE OF THE WEEK

Proposition 19 allows local governments to license commercial marijuana companies, which worries self-professed stoners like de la Luz. "We're kind of like anti-Wal-Mart and anti-McDonald's," she says. "So for them to try to sneak in and turn cannabis into a corporation, that's disgusting."
                                                                 -"Dragonfly" de la Luz, marijuana connoisseur

This is one of those truth-is-stranger-than-fiction moments. With Proposition 19, California stoners are facing an existential crisis. If their favorite hobby is legalized, then suddenly they will lose the anti-establishment edge that has been at the core of pot-smoking culture for generations. These people have built an identity--and a shady, gray-market economy--based entirely upon the government's strange stance on marijuana. In a sense, they operate in much the same world as Prohibition-era alcohol bootleggers, albeit with much less violence. They've begged the government to "legalize it" for generations, and now that it's become a real possibility, they don't know what to do.

So, Dragonfly, what's more important? Is it the high, or is it the weed-addled rambling anti-establishment nonsense that pervades the NPR piece? Either way, this is shaping up to be pretty amazing to watch. I can't wait to see how it all shakes out.


[NPR]

Interesting...

Well, I told you I'd be keeping my eye on California...

California Governor Arnold Schwarzenegger signed a bill Friday morning that decriminalizes possession of marijuana in the state.

Those caught with less than an ounce of marijuana will still receive a maximum penalty of $100. However, Senate Bill 1449 reduces the legal categorization of marijuana possession from a misdemeanor to a civil infraction. This means that those caught will not have to appear in court, pay court fees or receive a criminal record.

Basically, possession of a small amount of marijuana will now draw a penalty akin to a traffic ticket. Schwarzenegger opposes Proposition 19, a referendum that would essentially legalize marijuana production and garner taxes from its sale, but this bill is obviously a step in that direction. 

Independent of Prop 19, this bill will save California some money in court costs as it no longer arrests and arraigns people on marijuana possession (estimated around 60,000 people annually). At a time when California's budget can use the help, it's fairly clear to see why the decriminalization movement is gaining traction. Vermont, you're up next.

[Examiner.com]

No accepted medical use

Courtesy of Barry Ritholtz (again) comes this video on medical marijuana. If you have some time, it's worth a watch. As Barry writes,

The U.S. government classifies marijuana—along with heroin and LSD—as a Schedule I drug, the most tightly restricted category of drugs in the United States. According to the federal government, Schedule I drugs are unsafe and have “no currently accepted medical use in treatment in the United States.”

Really?

As medical marijuana proponents have pointed out since the Controlled Substances Act was passed by Congress in 1970, cannabis has been used medicinally for thousands of years, and there has never been a reported case of a marijuana overdose. Moreover, in recent years clinical researchers around the world have demonstrated the medicinal value of cannabis.

As pointed out in the video, most of the medical benefits of marijuana are what would be deemed "pain management" benefits. Marijuana doesn't cure or attempt to cure any ailments, but neither do many prescription drugs being peddled today. It would be hard to argue that marijuana has any less "medical use" than any legal opiate-based pain medication, such as codeine, morphine, or oxycodone. The pain-alleviating effects are extremely similar, without the dependency/withdrawal issues that are commonly associated with the opiate-based drugs.

The primary reasons behind marijuana's declaration as a Schedule I drug are unclear, though many claim that racist and cultural motivations were a significant factor. Either way, its continued treatment as a dangerous drug has cost federal and local governments untold millions in law enforcement and legal costs, with little effect on actual use.

At a time when balancing budgets is a primary concern, I would not be surprised to see marijuana legalization movements gain traction. By legalizing and taxing marijuana sales, we could actually turn a large government expenditure into a source of revenue. Ultimately, the need to balance government budgets may trump all other arguments in favor of criminalization, whatever they originally may have been. I'll certainly be keeping my eye on California.

[The Big Picture]