Ive seen dozens of economic development schemes over the years. Some were visionary, others simply delusional. Almost all involved tapping the taxpayers to benefit a handful of politically savvy lobbyists and their clients.
I can count the number of winners on one hand. New Mexico wine, which scarcely existed 30 years ago, is now a $60 million business expanding at 10 to 15 percent a year. Beer has grown from 25 craft breweries five years ago to 45 today with an estimated $340 million in economic impact.
Both succeeded without government subsidies and in the teeth of Prohibition-era laws and bureaucratic inertia. Real businesses flourish not by rent-seeking in Santa Fe or Washington to get the government to underwrite their costs and mandate customers to purchase their product, but by producing something consumers actually want to buy.
If the Drug War has taught us anything over the past 40 years, its that people want to buy marijuana.
Since Colorados first pot shop opened two years ago, that states legal recreational market has grown from zero to nearly $600 million last year and may top $1 billion this year. The state rakes in more than a quarter of that with a hefty 27.9 percent levy on sales.
Legalization has been equally lucrative in Washington, where the state has collected more than $250 million in taxes on marijuana sales.
Contrast that with poor New Mexico, which finished last fiscal year $150 million in the red and is looking at a hole twice that deep this year. Ironically, were raiding the Tobacco Settlement Permanent Fund to make ends meet, when we could be reaping a new windfall in marijuana taxes.
The economic effects extend far beyond the flow of new tax revenues. Warehouse space is at a premium in Denver, where growers are snapping up buildings suitable for large-scale cultivation, and struggling small towns are finding marijuana farming can create well-paying jobs, boost real estate values and revitalize the local economy.
Legal marijuana sales will total nearly $7 billion nationwide this year and triple that by 2020, according to one market analyst. Public opposition is declining rapidly 58 percent now favor legalization, according to Gallup and the question could be on the ballot in Arizona, California and Nevada this year, together with three other states back east.
The boom wont last. As more states legalize, well undoubtedly see prices and tax rates decline. But theres no reason New Mexico marijuana, like our wine and chile, cant be competitive over the long term. And in the short run theres considerable money lying on the table for those bold enough to seize the opportunity.
If the governor wants a one-day get er done, cowboy special session to deal with the states financial crisis, I suggest legislators lay a bill on her desk adopting Colorados marijuana law with its accompanying rules, regulations and tax structure, effective Jan. 1. If she rejects it, ask her why she prefers to break her no tax increases pledge or slash government services rather than accept a billion-dollar industry thats now legal in four other states.
Weve watched Colorado for two years and the dire unintended consequences predicted by legalization opponents have not materialized. Theres been no pot-fueled crime wave or epidemic of driving while stoned accidents. The black market is fading away as prices drop, and theres no increase in teen drug use.
Our alternative is painful budget cuts, higher taxes and a continuing dependence on the vagaries of the oil and gas markets. In these tough times we cant afford to reject a potential bonanza from the pot business.