Nip it in the bud: could Donald Trump be our best hope for sensible marijuana legalization?

• Author: Caulkins, Jon

With the approval of Proposition 64, which legalized the sale of marijuana for recreational use, California voters on November 8 created the world's largest market for legal pot. Massachusetts also voted to legalize, giving marijuana entrepreneurs the green light to open stores that could serve customers from up and down the I-95 corridor. So did Maine and Nevada. While Colorado, Washington, Oregon, and Alaska had already legalized large-scale commercial production, marketing, and distribution, these latest votes will accelerate the scramble among other states to follow suit.

Part of what's at stake is the tax revenues being generated by the burgeoning marijuana industry. In California, the state's Legislative Analyst's Office expects taxes on the drug to bring in on the order of $1 billion annually. But marijuana's extreme portability--a year's supply for a heavy user weighs less than a single bottle of beer--means that one state's prohibition can easily be undermined by legalization in neighboring states. Unless the federal government intervenes, it won't be long, perhaps less than a decade, before marijuana is legal in most states.

The problem with the state-by-state legislation process is that we are drifting into the worst possible form of legalization, one that imagines for-profit corporations to be effective guardians of public health. The danger in entrusting supply to for-profit businesses, as every state with legal marijuana (but not the District of Columbia) has done, is that most of their profits will come from exploiting a small number of problem users. Already, 80 percent of sales are to daily and near-daily users; half of all sales are to people with substance use disorder, or SUD, the clinical term for a range of problems arising from heavy drug and alcohol use. Occasional users, who make up a majority of pot customers, account for only a modest share of sales, but may provide political cover for an industry that gets rich supplying people who struggle with self-control. The damage to public health will be substantial.

The federal government can put a stop to this ill-advised trajectory. That's because all of the industry's activities, even if legal under state law, are prohibited by the federal Controlled Substances Act (CSA). Federal agents could arrest the owners of these businesses at will if President-elect Trump were to reverse President Obama's policy of not enforcing the CSA against state-legal marijuana enterprises.

A premise of that policy, which was announced in the Department of Justice's 2013 "Cole Memo," was that states should be "laboratories of democracy," free to innovate and experiment until the best policies emerge. But that theory is a poor fit for marijuana regulation, because America is one interconnected national market, not fifty islands with impermeable borders. (Alaska and Hawaii excepted.) And with their shared reliance on a for-profit model, the states don't appear interested in real innovation. As we'll see, there are other, superior approaches that states are not pursuing.

It's hard to know what position the new administration will take toward marijuana. Trump's nominee for attorney general, Alabama Senator Jeff Sessions, has called consistently for enforcing prohibition. But Trump himself said repeatedly during the campaign that legalization should be decided at the state level. The ideal solution may be somewhere in between.

It would be unfair to let investors pour billions of dollars into developing new products, securing celebrity endorsements, building internationally recognized brand names, and paying for product placement in movies and television shows--only to then say, "We changed our mind. We don't want for-profit businesses promoting consumption after all." That's why the Trump administration should act immediately to rein in the most pernicious consequences of for-profit legalization before the growing power of the for-profit industry takes other options off the table.

A commercially driven marijuana market would create public health challenges for the same reason that some users may welcome it: radically...