Is Keeping Marijuana Illegal the Best Way to Reduce Harm?

Is Keeping Marijuana Illegal the Best Way to Reduce Harm?

Geoff SimmonsEconomics37 Comments

Last week a poll revealed majority support for decriminalising marijuana, and legalising its use for medicinal purposes. Prime Minister John Key responded that the law is enforced on a discretionary basis and he is ‘not a fan’ of law reform:

It’s been my longstanding view really that one of the things that Parliament does is send a message to people about activity we want to see or not want to see’

In other words, by keeping marijuana illegal the Prime Minister wishes to send a message that people shouldn’t use marijuana. Does that ‘message’ have any impact? This is an empirical question, and according to a new report by NZIER the answer seems to be no; there is no evidence that keeping cannabis illegal is reducing the harm it causes. Instead, the report suggests that as a nation we are giving up significant benefits from not legalising.

The high cost of (not) stopping people getting high

Essentially the goals of the current drug policy are to reduce the demand for marijuana (especially amongst young people), the supply of marijuana, and the harm caused by marijuana. The NZEIR report judges that the current regime is failing on all these goals:

  • Marijuana use is widespread – around 42% of the country has tried it, 11% has used it in the last year. That figure is much higher for young people aged 15-24 at almost 25%. Use and prices have largely been stable over time despite varying levels of enforcement.
  • Most of the adverse consequences of marijuana occur because it is unregulated, illegal, and supplied by criminals. There are few health problems linked with overdoses or addiction.
  • NZ is losing out on at least $150m in tax revenue by not legalising marijuana. At the moment that money is going into the pockets of criminals instead.
  • NZ is spending around $180m on enforcing the existing laws. In total that is a cost of over $300m from criminalising cannabis.

Is the ‘message’ getting through?

The Prime Minister believes that Parliament has a role on signaling what activity we want to see from people. We’ll put to one side why Parliament chooses to send us a message on this issue but not on the problems caused by other issues like junk food. The question is this: is the message working? The NZIER report concludes that there is little evidence, either here or overseas, that keeping marijuana illegal has had an impact on the number of drug users. It appears the Prime Minister’s ‘message’ may not be getting through.

Of course it is difficult to be certain of this because we don’t know the counterfactual; what would happen if we legalised cannabis? Would consumption go up? NZIER argues that the best way to ensure this doesn’t happen would be to slap a tax on cannabis to ensure the price stayed higher than it currently is on the black market.

We can get some indication of what might happen by looking overseas. NZIER note that many countries around the world are legalising marijuana for medicinal use, and some are legalising all use. The US state of Colorado in particular has monitored the impacts of legalisation. Most notably, after legalisation the use by youth was unaffected, and may have even declined; remember that this is a major aim of the current drug policy in New Zealand. There has been an increase in use by adults (particularly tourists) with some increase in health impacts as a result. However, this increased consumption may be linked to a falling price; as noted above NZIER argue that the secret to avoiding this affect is by keeping the price high through taxation. Much like we see with tobacco, the downside of high taxation is that it may also keep a small black market alive; some people seek to avoid paying the tax.

The Prime Minister also pointed out that the law was enforced in a discretionary fashion. The report points out that enforcing marijuana laws still occupies $180m worth of criminal justice (police and court) time, which could be better spent in other ways. It also points out that applying laws in a discretionary fashion undermines the rule of law. Finally, the report notes that keeping marijuana illegal forces ordinary citizens to deal with criminals in order to access cannabis, boosting the coffers of dealers as a result.

What should we do instead?

NZIER have five recommendations on the best way to achieve the aims of our drug policy:

  1. Legalising marijuana
  2. Reducing demand using a tax to ensure the price stays the same or higher as it was in the black market;
  3. Regulation of the product to ensure safety, quality and consumer rights;
  4. Education of consumers; and
  5. Monitoring of use and effects.

The report is far from conclusive on the issue of cannabis law reform – more work needs to be done and it will be interesting to watch the experiments progress overseas. But it does call into question the sound bite response of politicians; that keeping marijuana illegal ‘sends a message’. It seems like the hundreds of thousands of cannabis users out there haven’t got the memo.


Is Keeping Marijuana Illegal the Best Way to Reduce Harm? was last modified: August 24th, 2016 by Geoff Simmons
About the Author

Geoff Simmons

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Geoff Simmons is an economist working for the Morgan Foundation. Geoff has an Honours degree from Auckland University and over ten years experience working for NZ Treasury and as a manager in the UK civil service. Geoff has co-authored three books alongside Gareth.

37 Comments on “Is Keeping Marijuana Illegal the Best Way to Reduce Harm?”

  1. Thanks for the excellent summary, Gareth.
    What we have published today is not the definitive work on this important issue. We hope, however, that it will prompt debate that looks at the evidence and the economics, rather than stop at bumper stickers.
    The position of the Colorado government in relation to marijuana is “legal does not mean safe”. It will be very interesting to see if this is more effective than prohibition in reducing use.
    Peter Wilson
    Principal Economist

    1. I agree Susanne, that is just silly and yes it would just be blackmarket prices again lol. And why would taxing it to such an extent be fair to medical users? Unless I can get it on prescription…then I could claim the prescription costs and Pharmac would pay the tax lol. However, if Legalised I would have no objection to paying a tax same as the “prohibitive” tobacco tax – around $30 an ounce.

  2. I welcome this discussion, it’s about time and I don’t understand why it is controversial. Not only is the status quo economically and harm-wise questionable, it is morally unsound too. In a society that places such high value on the freedom of individuals to choose how to live their lives, it is outrageous that one group of people are free to take their drug of choice, with very few restrictions, and others are not. Drug and alcohol laws need an overhaul.

  3. The following statement as quoted by you above is rather surprising: “Most of the adverse consequences of marijuana occur because it is unregulated, illegal, and supplied by criminals. There are few health problems linked with overdoses or addiction.” What about the health problems linked with ‘normal’ use? The statement implies that there are no adverse effects of the drug if taken legally. What about the evidence from the Dunedin longitudinal study of the damage to developing teenage brains? If the conclusion of NZIER is based on flawed logic it does not seem trustworthy.

    You aren’t even mentioning the harm done by inhaling smoke, a very common way for people to use marijuana. There are the health effects on the user and the effects of second hand smoke on those around them e.g. children. We have gone through years of arguing to reduce tobacco usage based on health effects and here we are ignoring similar effects in the marijuana debate. Do we learn nothing from experience?

    In regard to youth use, given that Colorado already reputedly had very high youth use, just keeping the status quo is hardly something to be very proud of. Not to mention that the effects that are seen now tell us nothing about the long term.

    1. With legalizing you can start educate. One of the first thinks smokers will learn is using a vaporizer to avoid burning the herbs
      Also cannabis oil with high CBD content to be used as a medicine has nothing to do with all the drama you try to describe. Only by legalizing we can teach and change our health system that is corrupt as hell and created more dead than any other illegal drug in the market.

      1. Putting together arguments for allowing medical cannabis together with decriminalising cannabis for general use makes as much sense as saying that smoking opium should be legal because morphine can be medically administered for pain relief. As far as I am concerned legalising medical cannabis on prescription is perfectly acceptable if the clinical evidence exists for its efficacy for particular conditions. Changing the legal status for general use of something known to be harmful to young people’s brains is a completely different issue.

    2. The longitudinal study pointed to one physical manifestation, dental hygiene….
      The socio economic impacts are still an issue of correlation vs causation. You dont blame CO2 emissions rising on falling levels of piracy do you?

        1. Schizophrenia rates are about the same the world over at about 1% of the population and if you think that the science on this subject confirms an up tick of Schizophrenia cases due to Cannabis use, this is not reflected in statisics.

          New Zealand has one of the highest rates of Cannabis use but only comes in at 162 of 192 countries, with number one being Indonesia.

          Alcohol kills hundreds of thousands every year and Tobacco kills 5 million per year world wide, it has been interesting that the fact Alcohol causes seven types of Cancer can be so easy to brush a side and yet you are convinced of the harm caused by Cannabis with a lack of science to back this up.

          You are a victim of the smoking gun approach, where science is replaced with might, maybe or could, but in light of no solid evidence to prove a harm greater than that of Alcohol, you seem content to see hundreds of thousands of Kiwi lives destroyed by the law.

          1. Who are the hundreds of thousands of people having their lives destroyed by the law in relation to cannabis. Hundreds of thousands implies 5-10% of the population. of 4.5 million. If that were true it would be very concerning so some evidence regarding it would be great.

          2. Fundamentally, for something to be illegal and at odds with the freedom of individuals, you need to justify it for the greater good. That greater good has always been protecting the health of users. Despite it being illegal, use remains high, so that law has clearly failed in its prime purpose. No-one is denying that there aren’t health consequences. But are those health consequences so significant that its worth spending diverting 150 million from Govt coffers that could go to educating around safe use, better treating youth mental health, treating other medical conditions etc, but instead funnels into financing the most antisocial groups in society (the Gangs). Furthermore, 180 million dollars of police and justice funds are used on dealing with this, when they could be much better used actually making out streets safer. I don’t see how locking up a whole lot of marijuana users keeps our streets safer. Meanwhile, the police are underresourced to deal with domestic violence, violent crime etc.
            Marijuana is not good for teens. But use is still high. Better off is regulation and education. And promoting the factors that drive educational success.
            It unmasks psychosis, but there is a lot of evidence that that is just due to the fact that those with developing schizoaffective disorders are more socially isolated, and therefore more likely to use it. The difference between causation and correlation.
            Furthermore, the law should be rational and fair. Alcohol has significant harm, yet we allow it. So does Tobacco, but is allowed. So is driving your car. Should the government make driving illegal as allowing it sends a message that speeding is ok, and might cause health problems.
            The disenfranchised group in this whole process are the younger generations, who unfortunately lack political voice, and it seems the major political parties are happy to keep ignoring them, as they have with housing, and climate change for which the younger generations are greatly more affected.

          3. Jane, it’s estimated about 14% of 4.5 million kiwi’s use Cannabis and this adds up to 630000 for a start that are criminals in the eye’s of the law. Take the convictions for Cannabis over the last forty plus years since the misuse of drugs act 1975 and you will see that Apprehensions of cannabis offenders for just the years 1994–2000 alone generated 152,841 convictions. This figure when you add the other 34 years of convictions clearly backs my claim.

          4. The 14% is not relevant because they are not all prosecuted. The law clearly isn’t interested in the majority of them. Do you know how many of the 152,841 convictions were ONLY for possession of an amount of cannabis that could be for nothing but personal use? And how many DIFFERENT PEOPLE were convicted?

          5. Yes and this is due to a very different way of thinking due to a change in public thinking on the subject. The law is still however in place and 20,000 lives now with convictions is still twenty thousand to many.

          6. There is no question that inhalation of smoke is carcinogenic, whatever the product. More smoking = more cancer. I don’t see hundreds of thousands of Kiwi lives destroyed as a result of them smoking cannabis. I know plenty of people who smoke it, none of whom have had any issues with the law.

          7. Jane there’s been many peer reviewed studies with the intent to prove a Cancer link to smoking Cannabis and all have failed to do so. In fact it was through one of these studies by Donald Tashkin of the University of California, that proved smoking Cannabis had an anti Cancer affect.

            I think you like many, who feel there’s no need to change from the prohibition model, really miss the point. If it came to light your teenager had used Cannabis, as a parent would you be serving in your child’s best interest to to inform the Police of his or her actions. Well the court system for one doesn’t think so and this is proven by the fact countless numbers of university students have been discharged without conviction. Judges balanced the lifetime effects a Cannabis conviction would’ve had on their future employment and travel prospects.

            By your own admission you say you know many Cannabis users, do you see these people as second class citizens due to their use and not worthy of the same protection we give the users of Alcohol. No one is trying to say the over use of any product is without risk Jane but when the risk of prosecution out weighs the possible health risks, questions need to be asked.

          8. As to the effects of smoke of all kinds, they are very well established and are not just related to any drug but to the effects of particulates on lungs. Particulates of whatever composition.

            I don’t support smoking of any kind, tobacco or cannabis. Why would I want to legalise smoking of a new drug when I would like to see smoking tobacco die out? And I intensely dislike a lot of the effects of alcohol on our society so why would I want more protection for other drug users on the basis of the protection afforded to alcohol?

            Your second paragraph proves that the legal system as it stands it working quite well. If I found my teenager was smoking cannabis I would do everything in my power to dissuade them on the basis that it would damage their brain which is a good deal more important than the criminality. NB A criminal conviction is not necessarily for life – you can get a clean slate after 7 years if you have no further convictions.

          9. The clean slate does not apply to travel to Canada, Japan or the united states, the convictions are for life.

            The question I asked you was, If it came to light your teenager had used Cannabis, as a parent would
            you be serving in your child’s best interest to to inform the Police of
            his or her actions.? Is your answer that criminality, is of no issue to a persons future?

            Jane we could arm wrestle every point till the cows come home, but as you seem more than content to fall into the minority that think the present system works and there’s no need for change, I don’t see what you want to achieve from our discussion. Do you still enjoy a wine to wind down even in the knowledge of its Cancer causing effects?

          10. Unfortunately for me, the negative impacts of alcohol on people close to me mean that I find alcohol very hard to like.

            And my answer to your question, I would do whatever I thought was best to deter them from using cannabis. That might be informing the police or it might not, depending on the situation. As stated already, my focus would be on preventing the cannabis harm. Which is why I don’t want to see the law change.

          11. I have no problem with you having your own views Jane, that’s what makes the world go round. I to have a dislike for Alcohol, but after seeing the negative impact prohibition had, I would never advocate for this approach.

            I have enjoyed our banter and I think we want the same things in the end, we just have a different view of how we are going get there. Kind regards.

          12. Agreed re prohibition. Yes, thanks for the discussion. It has made me think about my position on this which is all good.

  4. If you took an honest look at all the drugs out there, and checked out the benefits and drawbacks, then decided to make one legal, you wouldn’t choose alcohol. The vast majority of drawbacks associated with marina for example, are simply a result of its current legal status. Look at alcohol when it’s been prohibited vs permitted to see what making it illegal can do.
    Alcohol is permitted because it’s such a cash cow for governments. Once the powers that be, find how to tax marina, and make it possible for their cronies to produce, like booze, then marina will be legalized.
    Ever seen a doped up driver? Ever see a drunk behind the wheel? I don’t think booze wins there.

    1. Damned auto correct. Marina? Seriously, marijuana typed correctly comes out as marina? Big brother anyone? Phhhhttt

      1. Marcus, the word marijuana was a term used to demonize the Cannabis Hemp plant and brand it as a Mexican problem, not unlike what Trump been doing.

        1. Lotsa ties with blacks in the US also. Growing dope was easy to do and cheaper than buying booze. Blacks free and smoked dope while whites could afford booze.
          But why does marijuana autocorrect to marina? Lol

  5. I find the stats on numbers of people who have tried or use marijuana interesting. The fact that the use is illegal may inhibit people to admit they are users…If I could name 100 people I know, Im sure the percentage of smokers would be higher than 11%.
    Marijuana is not difficult to get hold of or even grow (a couple of plants for own use), the fact that it is illegal does not stop people using, simply penalises if caught. Legalising it will NOT result in an uptake of the use, but simply take away the penalty. Legalising will put “Dealers” out of business and guaratee quality ie you wont buy dope laced with Meth.
    The benefits of marijuana are becoming more evident (health wise) and therefore more acceptable in forward thinking countries.

    The bit that annoys me, is the fact that the Government does not want to see this type of activity regardless of what the people want. This is NOT democracy, nor are our politicians (ie our Representatives) listening to or acting for the people. It appears that legalising Marijuana is fiscally responsible, and the people want it so…so the big question is…who or what group of corporations are pulling the strings

    1. David seeing as we are talking about economics, the black market in Cannabis has it being sold at $25 a gram at a tinny house and thats top dollar. To believe that Meth valued at $1000 a gram is being used to blend with Cannabis is pure fantasy and shows what lengths the Government has gone to misinform the public.

  6. As I have zero respect for John Key and his corrupt regime & the same for his level of integrity so I won’t even dignify him with a plea to sanction my choices. Key is a cynical snakeoil salesman who will wait until he’s certain he can personally profit off cannabis before making any changes in favour of the NZ public’s wishes. While he claims he’s not a fan of law reform he has instituted law reforms on an almost Orwellian scale regards to the GCSB, has retroactively repealed laws that his government has been found guilty of breaking by the High Court of NZ & ridden roughshod over this country’s political process with the TPPA. Would I ask circus clowns for their permission to eat a pizza in public? No, so why would I dignify this cheap hustler with a plea to recognise my rights? Stuff John Key, like a lot of kiwis I’ll do what I think is right, not what his warped reality dictates.

  7. The Colorado experience is worth looking at,
    The evidence is that youth use went down
    And in adults marijuana use increased as it displaced a much more dangerous drug (alcohol)
    So the overall effect was strongly positive – BEFORE we get into the taxation and enforcement savings

  8. Yes to medical use and a resounding no to recreational use. The teenage brain does not mature until twenty one. Try doing a poll with parents who have watched their bright teenagers lose drive and purpose from this insidious drug. NZ has one of the highest rates of drug and alcohol abuse in the world….and suicide and road toll. Most of the proponents of legalisation are the privileged educated upper middle classes who are oblivious to the ruined lives around them. Kiwis are not sophisticated. Aside from that the chemicals can remain in the brain for up to six weeks so will we allow doctors nurses bus drivers dentists to freely partake?
    Marijuana has been proved to be a gateway drug. Lower the bar and……

  9. No law should exist if it’s enforcement is discretionary! Generally speaking laws should not restrict people from undertaking activities where any harm is to themselves. Our drug laws and the war on drugs are a complete failure. Legalisation and control will likely result in a better outcome as it could hardly be worse. Even ignoring the taxes that may come in imagine the gains to be made from pouring all that police and justice money into health instead. No problem with making ‘drugged’ driving illegal as with drunk driving. Not saying let 16 year olds get high either but if an adult wants a joint, a hash cookie or even to inject heroin it’s their body.

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