We believe that legalizing marijuana in California would effectively eliminate Mexican DTOsâ€™ revenues from supplying Mexican-grown marijuana to the California market. As we elaborate in this chapter, even with taxes, legally produced marijuana would likely cost no more than would illegal marijuana from Mexico and would cost less than half as much per unit of THC (Kilmer, Caulkins, Pacula, et al., 2010). Thus, the needs of the California market would be supplied by the new legal industry. While, in theory, some DTO employees might choose to work in the legal marijuana industry, they would not be able to generate unusual profits, nor be able to draw on talents that are particular to a criminal organization.
Jon Walker has the true story of the newest Rand report, and how some of the intellectually dishonest “academics” at Rand are trying to spin it.
They use the worst argument fallacies imaginable. The government comes out and says that 60% of the cartels’ income is from marijuana. Legalizers say that legalizing will hurt the cartels (true) and mention the government’s numbers. Rand comes out and says that the government was lying through its teeth, but they don’t really know for sure what the real numbers are, but probably lower, and therefore the legalizers’ argument for legalization is supposedly weakened. And yet they admit that the legalizers’ core argument is true (that legalization will hurt the cartels – see above). Then they word their press release in such a way that they know the newspapers will report it as a blow to Prop 19.
The fact is that Prop 19 will be the first blow of many to the profits of the cartels, and it will be significant.