Cannabis Capitalism

Mark Thornton blames the potency of pot on Prohibition:

I don’t see a problem with more potent pot. I don’t disagree that Prohibition is the main force behind it – but it means you can also inhale less for more effect. The double standards are again revealing. Who is complaining that we have bourbon in the alcohol market alongside beer? A couple of Jäger shots and I’m buzzed. Six beers and I’m bloated and useless. I’d rather do the shots. Vince Beiser examines the regulatory choices Washington state is facing as it sets up a legal marijuana industry:

One route Washington could take would be to issue lots of grower licenses and limit farm size to end up with a large number of small producers. Call it the mom-and-pop, artisanal-weed option. That would generate competition, which keeps prices low, encourages innovation, and makes it much more difficult for the industry to accumulate the kind of political power wielded by, say, Big Tobacco—the three companies that control 85 percent of the national cigarette market. On the other hand, it’s more difficult to monitor and regulate hundreds of small businesses than a few big ones. “And,” points out [Mark] Kleiman [who is advising Washington state on marijuana policy], “they’re not making as much, so each of them has a stronger incentive to push stuff out the back door”—into the black market.

If the state instead allowed only a few big growers to operate, they might get rich enough to become powerful players in state politics. But their centralized operations would be much easier to keep tabs on, and they would have a powerful incentive to abide by the law. “Otherwise they could lose their oligopoly position, which is basically a license to print money,” says Kleiman.