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Could Ending the ‘War on Drugs’ Help Ease Urban Budget Crises?

3:21 PM EDT on August 17, 2009

Despite talk of a nascent economic recovery, the brutal toll exacted on state budgets by the recession continues -- with palpable consequences for transit riders and already lower-income urbanites. Could the cure for cities' fiscal woes be a dramatic shift in drug policy?

ba_oaksterdam_u_050.jpgA class on dispensary management in Oakland, where drug sales are taxed by the local government. (Photo: SF Chronicle)

Quite possibly, according to an op-ed in today's Washington Post written by two veteran Baltimore police officers, one of whom now teaches at New York's John Jay College of Criminal Justice.

Though the revenue-raising potential of decriminalized drug use is not their primary rationale for ending the nation's "war on drugs," the duo argues that legalizing -- and taxing -- drug sales would help fill strained local coffers.

We simply urge the federal government to retreat. Let cities and states(and, while we're at it, other countries) decide their own drugpolicies. Many would continue prohibition, but some would try somethingnew. California and its medical marijuana dispensaries provide a goodworking example, warts and all, that legalized drug distribution doesnot cause the sky to fall.

Having fought the war on drugs, we know that ending the drug war isthe right thing to do -- for all of us, especially taxpayers. While thefinancial benefits of drug legalization are not our main concern, theyare substantial. In a July referendum, Oakland, Calif., voted to taxdrug sales by a 4-to-1 margin. Harvard economist Jeffrey Mironestimates that ending the drug war would save $44 billion annually,with taxes bringing in an additional $33 billion.

The prospects for broad federal de-escalation of the "war on drugs" are slim, but a significant test of the idea's fiscal potential could come next year, when California voters may decide on a ballot initiative that would expand and tax drug dispensaries. That state's $26 billion budget gap forced a round of painful cuts that hit almost all sectors of city life.

On Capitol Hill, legislation by Sen. Jim Webb (D-VA) that would set up a commission to recommend drug policy and criminal justice reforms is slowly gaining momentum, though its potential impact on state budgets would take years to materialize.

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