Jan 1, 2013

The Uruguay Model to Legalize Marijuana

In general, if any branch of trade, or any division of labour, be advantageous to the public, the freer and more general the competition, it will always be the more so.
Adam Smith 

The Times on India reported in November:

Uruguay is poised to become the first country in the world to legalize marijuana (cannabis). Last week, a bill was introduced in the General Assembly to legally permit marijuana cultivation and consumption within certain limits. The bill will be voted on in the lower house (Chamber of Deputies) in the coming weeks and if passed would then be voted on by the upper house (Chamber of Senators) early next year. 
The Uruguayan move comes close on the heels of marijuana legalization in two states of the US - Washington and Colorado on Nov. 6 this year. The use of cannabis and other drugs is already legal in Uruguay, one of Latin America's safest countries and a trailblazer on liberal lawmaking, but the sale and cultivation of drugs is not.
It is still unclear what will happen with this reform. The proposed model of legalization is interesting:
. . . the state to be the sole provider of marijuana. 
Even though I think legalizing marijuana is a good idea I wonder if State provision is the right approach. 
A book I am currently reading looks at the relationship between commerce and government. The book was written a long time ago, in 1776. It is available here in pdf. It says:
Its attention [of the State] is divided between too many objects, and it cannot be as active as merchant who are occupied with their trade alone.  
Its operation, nearly always precipitous, will conducted in a wasteful manner.  
The agents it employs, having no interest in economy, buy more dearly, transport at much greater expense, store the grain with less care; much grain is lost and goes mouldy. (P. 204) 
The author, Abbe de Candillac, refers to the production of grains in France, where a debate was taken place at the time. Some argued in favor of price controls and government production, and others in favor of private production. 

Candillac would say that private provision of marijuana is a better approach. 

The Uruguay model of provison sounds like taking one step forward and two steps backward (what do you think?). It might be possible that the government of Uruguay works better than others, but it should probably focus its energies on something else. 

Most of the harm that comes from drugs is because they are illegal.
Milton Friedman

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