California is killing the cannabis goose that might have laid many golden eggs. From Jonathan Turley at jonathanturley.org:
It appears that illegal pot growers are giving thanks this holiday for California lawmakers who legalized pot only to fuel demand for illegal cannabis due to massive taxes. It is the same problem that I wrote about in New York’s program in an earlier Wall Street Journal column. Politicians continue to pile on taxes as if they have no impact on pricing and demand. It just seems like free money if you ignore every economic metric and principle. Even with a recent recognition that they have killed their own market, California lawmakers are being criticized for offering too little too late in terms of tax relief.
Sgt. James Roy of the Riverside County Sheriff’s Department is quoted in Fox News as saying that “The illegal industry is competing with the legal industry and essentially putting them out of business.”
Why? As with bathtub gin after Prohibition, few people would prefer bootlegged products rather than the safer lawful alternatives. The only reason is economics — and the refusal of the California lawmakers to recognize basic rules of supply and demand. Not only is pot cheaper due to the massive taxes imposed on lawful businesses, but it is also being sent to the East Coast where similar price differentials are also fueling the illegal trade.