Global Ganja Report

In another sign of turning tides, a prestigious British think-tank once beloved of Margaret Thatcher has called on the government to legalize cannabis. The breakthrough report finds that a legal cannabis industry could raise £1 billion per year in tax revenues for the United Kingdom, while undercutting the black market.

If we needed any further evidence that cannabis isn't just for hippies anymore, it is the report issued last week by Britain's Institute of Economic Affairs, a pillar of the UK's political establishment, calling for legalization—albeit under close government regulation.

The IEA describes itself as the UK’s "original free-market think-tank." It was founded in 1955, with an ideological Cold War mission—"to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems."

On June 30, it hosted a press conference and discussion at the Royal Geographical Society, wittily entitled "High Time to Legalise Cannabis." There, the proposal was unveiled.

The IEA finds that the UK's black market in cannabis is worth £2.6 billion annually ($3.4 billion), with 255 tonnes (metric tons) sold to more than 3 million people last year.

Chris Snowdon, the IEA's head of "lifestyle economics," was quoted by The Guardian: "It's high time for reform of cannabis policy in the UK. Canada and the USA are showing the way. Done properly, the legalization of cannabis is a win-win-win: criminals lose a lucrative industry, consumers get a better, safer and cheaper product, and the burden on the general taxpayer is reduced."

A legal cannabis market would generate sales of £2 billion, the IEA found—that's twice the size of Britain's cider industry. The think-tank stated that a value-added tax (VAT) and excise duty, together with new streams of business and income taxes, would lead to a £1 billion "windfall" for the Treasury. This, significantly, would be enough to close the budget gap at the financially troubled National Health Service. The IEA added that legalization would "virtually eradicate" the black market.

Irrational fear of 'skunk'
The report on one point unfortunately indulges reefer-madness type misconceptions. It states: "The dominance of hazardous, high-strength 'skunk' cannabis in the black market should be a key reason for legalisation. Licensed sales would allow safer, regulated cannabis to displace the more dangerous strains and generate tax revenue that could be spent on mental health services"

The proposal calls for regulators to establish maximum limits on tetrahydrocannabinol (THC), the psychoactive cannabinoid, and minimum limits on the non-psychoactive cannabidiol (CBD), which shows a growing array of medical benefits.

Of course, keeping "skunk" illegal would undermine the effort to "virtually eradicate" the black market. And there is a case to be made that high-potency strains are more beneficial, as they require users to smoke less to acheive the same effect—sparing the lungs exposure to tar and carcinogens.

The IEA proposes that sales be restricted to those over 18, and take place only at specially licensed outlets. A license would also be required for growing and importing.

Breakthroughs in the bureaucracy
The report comes on the heels of other signs that Britain's political establishment is starting to bend, at least. Last month, the Home Office announced that it will allow the use of medical cannabis products in one case—that of 12-year-old epilepsy sufferer Billy Caldwell. A general review of the policy that has heretofore barred such products even to the seriously ill is now underway.

In announcing the policy review, Home Secretary Sajid Javid was quick to emphasize that there are “absolutely no plans” for a general legalization. However, he did say:  "I have now come to the conclusion that it is time to review the scheduling of cannabis." And he acknowledged that the current policy “unsatisfactory” for everyone involved. 

Prime Minister Theresa May last year pledged to continue the "war on drugs," citing "the incredible damage [drugs] can do to families and the individuals concerned."

Opposition Labour Party leader Jeremy Corbyn has come around more forthrightly on the question. This week, he told a reporter: "I think criminalizing people for possession of small amounts of cannabis is not particularly a good idea, and does lead to great difficulties, particularly for younger people in communities like mine so I do think the debate is moving on."

The Daily Mail interpreted this to mean that Corbyn "hinted" that he would decriminalize cannabis if he became prime minister. Early elections, in which Corbyn might be well-positioned amid controversy over Theresa May's handling of the Brexit, are being considered.

Cross-post to Cannabis Now

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