state level marijuana legalization reduces black market demand

A recent Drug Enforcement Agency (DEA) report to Congress acknowledges that state-legal marijuana industries led to a reduction in activity of illicit cannabis markets. The language of the DEA’s latest performance budget submission to congressional lawmakers also indicates that the agency views the end of federal marijuana prohibition as an inevitability.

The DEA report for fiscal year 2021 is concerned with providing an overview of its enforcement work and predicting its future activities. Within the document is a brief section noting that legal access to marijuana corresponds to lower demand in illicit markets.

The DEA report states that “after the 2017 legalization of medical marijuana in Florida resulted in retail distribution centers throughout the [area of responsibility], the legalization of low-Tetrahydrocannabinol (THC) (10%) smokeable medical marijuana in March 2019 is anticipated to lead to a growing market for Florida-sourced low-THC marijuana.”

“Yet, until high potency marijuana becomes legalized in Florida, we believe the impact will be minimal on the demand for high-THC marijuana from California and other states,” the report continues. “Until then, the potential for abusing current law remains a possibility due to the difficulty in detecting THC potency by law enforcement.”

So not only does the DEA recognize that consumers prefer to obtain marijuana from legal sources, a view backed up by scientific research, but through using the word “until” it appears to suggest that adult-use legalization in Florida is a question of when, not if. Indeed, support for ending federal cannabis prohibition according to several polls shows a comfortable two-thirds majority among Americans.

Justin Strekal, political director of NORML, said the report’s conclusions and language shows that marijuana legalization is viewed as an inevitability even within the Justice Department.

“Just as the practice of bootlegging moonshine declined after the legalization of alcohol, so too would the smuggling of illicit market marijuana in a legal, regulated state. Their framing clearly indicate that the days of prohibition are nearly over,” he said.

“We are living through the death rattles of prohibition.”

As far as Florida’s marijuana laws are concerned, the Sunshine State has a multitude of cannabis reform bills in the pipeline, though the COVID-19 pandemic has assured these are on hold for the moment.

The DEA’s admission corresponds with a significant decline in illicit cannabis seizures. While in 2016, cannabis seizures actually jumped by 21 percent from 2015 figures, in 2017 there was a 37 percent reduction. A 2019 report published by the Cato Institute based on US Border Patrol data found a reduction in cross-border smuggling of illicit cannabis owing to reduced demand in states which had passed some kind of marijuana reform.

Last year, a report by Supreme Court Justice John Roberts showed a sharp decline in federal marijuana convictions compared to the previous year. While Roberts did not offer possible reasons for this, it is intuitive that as more quality legal cannabis becomes available, the less demand there will be for illicit product.

While in isolation there can be all sorts of reasons for a decline in marijuana seizures, cross-border smuggling, and federal cannabis prosecutions, taken together it is hard to avoid the conclusion that state-level legalization has led to a profound reduction in illicit cannabis activity.

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