Recognizing and regulating cannabis as a temptation good

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Abstract

The U.S. appears to be on a path toward legalizing cannabis on the alcohol model, which is to say allowing for-profit corporations to produce, sell, and promote its use. Even after national legalization, it will take decades to observe the full effects on industry structure and behavior, or on use and misuse. However, we should not be surprised if after markets have matured and consumption patterns stabilized, legalization increases acute cannabis intoxication in the U.S. by 40 billion hours per year. This increase in use will be the most important cannabis-specific effect of legalization. The bulk of it will be consumption by daily and near-daily users, and it is possible that roughly half will be by people who meet the medical criteria for substance use disorder. Much resulting harms will be borne by the users, and their families, and the harms are not primarily “medical”, at least not in the narrow sense. Hence, legalization replaces the current problems of crime and black markets not so much with a medical or public health problem, but rather with a problem of potentially excessive consumption of a “temptation good” whose acute effects are performance degrading, not performance-enhancing. As legalization removes formal social controls, it might be prudent for society to develop stronger informal social norms – akin to “friends don’t let friends drive drunk” – to protect the public and more importantly the users themselves from the performance degradation of bouts of nearly perpetual intoxication.

Introduction

This paper presumes that most U.S. states and eventually the federal government will legalize cannabis production and will do so along the alcohol model; that is the approach taken by the first eight states to act. An equally valid and perhaps more informative description would be “legalizing large-scale production, distribution, and promotion by for-profit enterprise.” After all, essentially all market activity is regulated in a modern economy and much is licensed; the mere fact that “regulate like alcohol” would involve regulations and licensing would not distinguish the purveyors of cannabis from restaurants and barbershops, or from Walmart and Philip Morris.

This is the fourth in a line of papers that raise concerns about this corporate model for legalization. The first suggested it would be preferable to allow only nonprofit organizations to produce and distribute cannabis, and that they be chartered only to meet existing demand, and so to undercut the black market, but not to promote expansion of demand (Caulkins, 2014).

The second laid out a spectrum of options ranging from extreme prohibition at one end to laissez-faire libertarianism at the other (Caulkins et al., 2015). Legalizing home growing or cannabis clubs are only a few steps in from the prohibition end, but the alcohol model is near the far end. Jumping immediately to it flies by intermediate models that might protect against some of the downsides of the corporate approach.

The third conceded that commercial legalization was likely but argued that the corporate model’s excesses could be mitigated by choosing an aggressive regulatory agency (Caulkins, 2016a). I identified four main interest groups: (1) the industry itself, (2) the government’s interest in economic development and tax revenue, (3) the great majority of cannabis users who are happy with their use, and (4) the smaller number who have lost control of their use and are harmed by it. That last group is the primary wellspring of industry profits because they consume the bulk of the cannabis, so industry has a financial incentive to pump up the ranks of intemperate consumers who, incidentally, also tend to be less educated and less politically powerful.

The first three groups’ interests align in favoring lenient regulations, easy access, product variety, and promotion. The industry wants lower taxes and can rely on many casual users’ support in that regard. Only the fourth, smaller, and politically weaker group has contrary interests. They are the vulnerable that society needs to protect. Hence, at the moment of legalization, before the industry grows politically powerful, and in that brief moment when busy politicians are focused on the issue, it would be wise to stack the deck in favor of a regulatory agency that would defend this last group from exploitation.

This paper retreats one step farther. I am skeptical about depending on government regulatory agencies to protect the public welfare. They often appear more willing to cozy up to industry than to tame industry’s bad impulses. I grant that the FDA combats the tobacco industry aggressively, but even it has not restricted sweetened tobacco. And when I look across banking, alcohol, pharmaceuticals, and other regulated industries I do not see great evidence of highly competent government agencies actively defending the vulnerable against corporate interests (cf., Admati and Hellwig, 2014, Babor, 2010; Dukes, Braithwaite, & Moloney, 2014; Goldacre, 2014, Proctor, 2011). And however well or badly regulators in rich countries do at protecting their own citizens, the multinationals often have an even freer hand in the global South.

This paper suggests that an alternative or supplemental brake on corporate-driven promotion of problem use could be reframing how society understands marijuana. Marijuana has been viewed through many lenses, including demon drug, symbol of peace and progressive politics, embodiment of generational conflict, and more recently as miracle cure for everything from Alzheimer’s to Zika. Marijuana could equally be viewed as a “temptation good”, more akin to pornography, video games, or doughnuts than to cocaine or heroin. It may be useful to view cannabis as an indulgence that is not dangerous in moderation, but whose use both moralists and medicos are correct to caution can easily get out of control. As we remove the formal barriers that have historically shielded those who wish to avoid cannabis from its temptation, we may need to promote informal social norms that protect those who would be vulnerable to excess.

The remainder of this paper builds that case by imagining the consequences of alcohol-style legalization on cannabis use and misuse.

Section snippets

Legalization’s substantial – but delayed – effects on the industry and use

Legalization along the alcohol model does not mean policy has to be uniform everywhere. Some U.S. states restrict alcohol distribution to state stores, particularly for spirits; others do not. There is even outright prohibition in some towns and counties, and policies vary on matters such as whether one can buy spirits on Sundays and whether one can consume alcohol in public. Nevertheless, in every state any adult can buy beer—and many older teens report being able to obtain alcohol fairly

A further doubling in use would mean 40 billion more hours of intoxication

Kilmer et al. (2014) provide a detailed estimate of the size of the market today, but a simple derivation provides the same basic insight. Respondents to the 2014 U.S. NSDUH self-report 328 million past month days-of-use. Multiplying by 12 yields a shade under 4 billion days per year. Bumping up by 25% to account for underreporting as Kilmer et al. (2014) and multiplying by an average of 1.3 grams consumed per day of use suggests a market volume of about 6500 metric tons. If the average price

Change in intoxication is the most important outcome of legalization

The prospect of legalization creating 40 billion additional hours of intoxication should not be misconstrued as a precise estimate. It is just a translation into more meaningful terms of the guess that legalization might in the long-run double consumption. If legalization eventually led to a tripling in consumption, then it would create 80 billion additional hours of intoxication. If legalization only increased consumption by 50%, then that would be “only” 20 billion additional hours.

However, a

What is the character of cannabis use today, and what will it be like after legalization?

Sharply contrasting images of cannabis use abound. Some envision adults with no misuse or dependence problems having a little harmless fun on weekends. Others envision teens struggling with substance use disorder. Both occur, but neither is typical. Indeed, those two groups account for just 2% and 3% of consumption in the U.S., respectively.1

Daily intoxication often degrades performance

Among the eight million or so high-frequency users, there are hundreds of thousands who can hold their THC well. Yet there are also hundreds of thousands, perhaps millions, who are harmed by their use. So anecdotes are useless for sorting out which pattern is more common.

For example, if an employed college graduate thinks “I have lots of friends who use daily or near daily and are not in the least affected” that anecdote may not be conclusive. Friends tend to be drawn from similar

Conclusion

This paper does not focus on health outcomes such as cancer or schizophrenia or on harms to third parties, such as from impaired driving. The concern I have identified here – that alcohol-style legalization will lead to tens of billions of additional hours of intoxication among daily and near-daily users, whose performance is undermined by that use – is a non-medical internality. It is harm borne by the users themselves, and by their families, and it takes the form of reduced performance at

Acknowledgements

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors. Steven Davenport provided the data that were used to create Fig. 1. This paper is a condensed version of the plenary address given to the April 2016 Cannabis Policy and Research Summit and has benefitted from comments received on that talk. Many of its ideas emerged in the course of writing the Marijuana Legalization: What Everyone Needs to Know books, and I thank Angela

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