Opportunity cost, opportunity lost

Last updated: 03/02/14 5:59pm


“Colorado Expects to Reap Tax Bonanza From Legal Marijuana Sales” was a headline which appeared in the New York Times over Winter break.

This year, Colorado has started to allow the cultivation and distribution of marijuana and is expected to reap $184 million in tax receipts from marijuana sales. The benefit to state coffers has always been a point raised by advocates in the overall debate about marijuana. Colorado will profit in another way as well. Law enforcement in the state won’t have to sniff out people who cultivate or use marijuana for medicine or recreation anymore.

Savings from ending marijuana prohibition accrue both explicitly and implicitly. Government spends $41.3 billion annually on drug prohibition estimated two economists, Jeffrey Miron and Katherine Waldock, in a study published in 2010. Like any policy, there is an opportunity cost in addition to the basic costs. Opportunity cost, an economic term, refers to the lost potential (or profit) from a choice compared to its alternative.

And politics is the way society allocates resources. This past recession has only reaffirmed, especially at the state and local level what we’ve always known, that those resources are finite. The opportunity cost is that for all the money put into the prevention of marijuana consumption, cultivation, and sale, is those resources are not available for other far more serious crimes.

Attorney General Kamala Harris of California, a Democrat, made a noteworthy point about how crime should be assessed in a presentation at Chicago Ideas Week in 2013. “I see crime as on a pyramid,” she said. “At the very top of the pyramid, the worst crime; there for an obvious reason. Homicide, child molestation, the worst cases you can imagine. They’re there at the top of the pyramid because they are the most outrageous of offense. The cost to the victim and the community is great and it needs to be a priority.”

“Thankfully at the top of the pyramid also the fewest number [sic]. What is occupying the bulk of what is in the criminal justice system is at the middle and the base of that pyramid. But we have had a one-size fits all approach to crime, even though crime is not monolithic.”

Drug offenders are the majority of criminals in our prison system show data from the U.S. Department of Justice. Partly this represents the intense focus on drug use started by the Reagan administration and carried on by his successors, and partly it represents the decrease in violent crime such as rape and murder. And while we should be pleased about the decrease in violent crimes, those crimes have not ceased to occur, and they are not as easily solved as television shows like Bones or Rizzoli & Isles would have you believe.

Wayne County Prosecutor Kym Worthy reported in 2013 that the county had an estimated 11,304 untested rape kits. A rape kit is a medical kit used to collect forensic evidence from sexual assaults victims. The cost to test a rape kit is around $1,500 – money that has instead been used to stop people from using marijuana. No politician made the conscious decision to redirect funds from solving rape cases to drug enforcement, but that is as I have said, the opportunity cost.

The opportunity cost to our prohibition of marijuana is that as we spend resources on people whose crime is harmless, and whose activities are not indicative of further criminality. Our opportunity cost is we do not have the funds to redirect toward more serious crimes, nor do we have the windfall from marijuana sales, which Colorado lawmakers have smartly allocated towards treatment of substance abuse and public safety.

Published Mar 2, 2014 in Opinions

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