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tv   Key Capitol Hill Hearings  CSPAN  March 29, 2014 6:00am-8:01am EDT

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did to? i am going to keep showing you other products coming of the medical marijuana states as we
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go through the rest of the slide. it is critical to understand the research, and there is huge scientific consensus on this showing of a the poverty drives used. as the availability increases aware leanness, addiction, school failure, auto crashes, mental illness and other public health and safety problems. this, by the way, is marijuana in fuse chocolate chip cookie used in some medical marijuana stores. we think there are three marijuana policy options, two products, charlie rangees and klondike ice cream bars. the first is to adjust our current marijuana laws to improve us by replacing incarceration of marijuana users with substance treatment and social services to help people to become non addictive.
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why is this important? first, it tries a middle road between incarceration and legalization but it also is the best we have for holding the number of kids who engage in marijuana use. medical marijuana issue is one of the enormous confusion that has taken this back in my view to the pre fda days when anybody could make a medicine man claims that it has curative -- that it can cure any kind of disease, even though there is no scientific evidence to show that. colorado will not begin testing marijuana for contaminants until later this year, and there is now on group at the university of newhaven trying to develop ways to detect contaminants in marijuana, finding such things as mold, mildew, pesticides, the coli and other contaminants.
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many of these kinds of products are being infused into food and there are no controls over whether this is good for you or not. at this point at least. so recreational marijuana, national families in action believes we should not do that because we cannot think of a single wave that will prevent use from increasing particularly among children. however if congress were to go there we would call for legalization model based on the model of the tobacco industry. after eight years as head of the fda fighting to gain control of regulating tobacco and losing that battle, he said my aunt is standing of the industry's power finally forced me to see the solution to the smoking problem rests with the bottom line. prohibiting the tobacco company from continuing to profit from the sale of the deadly addictive drug.
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these profits are inevitably used to promote the same addictive product and to generate more sales. he was trying to provide a powerful 150-year-old commercial addictive drug industry, trying to bring it to an end. if we apply his model to marijuana we could prevent another one from starting. what will the kessler mall look like? it would make public health the centerpiece of marijuana control. it would charter a tightly regulated non-profit corporation and by nonprofit, public health becomes key. my skating georgia, we have just passed the most extreme gun rights bill in the nation and it was lobbied for by the national rifle association, a nonprofit organization whose budget is $256 million and that buys a lot of votes in state legislators.
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this non-profit would have to be governed by a public health model and public health board and public health mission. use the money from sales to underwrite manufacturing and distribution costs. all other revenues would fund enforcement, medical research, treatment programs to prevent used use and evaluation to measure what is actually happening. marijuana would be tested for contaminants based on federal standards and would standardize ph.d. levels. we would ban all forms of marijuana edibles and other processed forms such as hand lotion, cream, soft-drink, which are now testing at 75% or higher and people of beginning to overdose on higher levels of thc. not died of overdoses, showing up in emergency rooms.
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all advertising and marketing, that would be sensible. package marijuana in childproof containers displaying only a brand name and health warning, control distribution to prevent sales to children and adolescents and finally and i think most importantly, include an exit strategy in the law to repeal legalization if problems become unsustainable. thank you. i am sorry. one more slide. allowing a corporate takeover of marijuana and a matter how it is done will result in an unnecessary increases in use, a necessary increases in addition, and necessary school failures among youth, unnecessary deaths from marijuana related driving, and necessary rises in mental illness and additional and unnecessary public health and safety problems. thank you. [applause]
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>> thank you, everybody. thank you, paul. great to be here. pmi em jonathan rauch of the brookings institution. i hate to disagree with my good friend paul glastris but i'm not a leading expert on marijuana policy which is one reason i'm here. i know of this debate having come at it from the gay marriage debate and years of study of public policy, although that brings disadvantages in terms of expertise it also brings some of vantage is in terms of seeing the debate with fresh eyes and i have to tell you among the public policy debate, i have explored, this is not one of the better models. there's a lot of hysteria, a lot of hype, lot of dogmatic certainty about what is going to happen, he thinks the best advice is from my niece who at the time was 3 years old this
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and everybody please calm down. action will lead the news is pretty good. appleby seated in the middle during the tunnel. ira militant moderate. moderate outcomes are a pretty reasonable thing to expect. let me just for a few minutes pull the camera back before i bear down specifically on the topic today, commercialization. there is actually a lot of good news in the marijuana debate right now. a lot of reasons not to think our hair should be on fire. one is that there's a growing consensus change after 40 years of failure and that is a very good thing. that gives us something to work with. another is it is extremely easy to improve on the present policy. almost anything you do is better than the present policy. eisenhower was on task what nixon had done to contribute to -- vice president nixon, the administration, the accomplishments of the past eight years, 1960 and eisenhower
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famously replied if you give me a week i might think about this. if you give me a week i might think of something good about what we have now said i might actually not. good news numbers, getting implementation right is difficult. it is just difficult but the good news, getting the process right is very, very easy in the public policy debate. what you need to do is try some different things in different places in different ways and experiment with them and try to learn from those things. that is your way to figure this out and that appears to be exactly what we're going to do under the national course of political events. that is not alarming. it is the only way forward in fact. finally something that makes it easier is there are only two credible tentative the we can do right now and they are both pretty well understood that this
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point. actually there are three. probably to most interesting model may be the best, the government monopoly and distribution of marijuana. mark kleiman proposed that, there's a lot to be said for that. unfortunately in the united states, federal law and treaty obligations, that is out of the question right now so that these two models and you heard about both of them. one is decriminalization, maryland is in the process of doing if i understand correctly and the second is regulated legalization like colorado and washington state are doing. these two things are not as different as you may have heard. they are not polar opposites. they are quite similar. those involved very large regulatory regimes, a lot of controls on this market with criminal sanctions for people who break the rules, criminal sanctions don't go away under
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either of these. in some respects they become more important. the main difference between decriminalization and regulated legalization is due does distribution of marijuana. is that done illegally in the black market by criminals or is that done legally by commercial enterprises? those are indeed two very different paths forward. that is not the world's easiest choice but i would argue i am less scared of commercialization, i am concerned about it, but i would like to point out let's not forget commercialization has been significant advantages. one of those is when big companies market stuff you know their address, you know who to write to and you know who to legislate if they start messing it up and that is very important to have a responsible entity and by and large big corporations
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are pretty responsible when it comes to following all long. that doesn't mean we like what they do or their lobbying operations and everything else but we know where to find the man that is certainly not true in the marijuana underground right now. also the illegal system is also pretty good at marketing, especially to children, children try this stuff all the time. we know that. not only does the illegal system market to children but uses children to market to children, something even anheuser-busch does not do. there is no shortage of marketing and illegal commercialization that goes on which decriminalization. finally, as would argue with commercialization you do have an alternative that you don't have with illegal marketing and that is regulation and here again there is some good news which is we have models for that.
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i would argue those models are relatively successful in the real world given the alternatives. there are two or three depending how you count, one is industry self regulation which is where the gambling industry does, one is a hybrid which goes on in the alcohol industry which is regulated in terms of marketing and the third is tobacco which is the most interesting and applicable to marijuana and were thinking hardest about. in the gambling market 1999, congress struck down the federal ban on gambling and since then the industry set up its self-regulatory guidelines, a voluntary code of conduct and touting personal success from gambling using symbols or celebrities and designed to appeal to minors, placing ads in
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media with audience primarily miners, featuring college athletes or anyone who appears too young to gamble. this stuff isn't perfect but it is true you don't turn on the tv or look at the newspaper and see tons of ads, go out and gamble, and less they are by the government. interesting about that, isn't it? that is not wholly unsuccessful. alcohol is 8 huge market. the idea that you can repress marketing of this to anybody, kids and anybody else, is just not going to happen. alcohol is regulated. labels are regulated by the alcohol and tobacco trade bureau. that is why these labels will co-stars. the industry otherwise itself regulated, the spirits careful, wine institute, they have guidelines and we can argue about health that works,
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guidelines restrict advertising to markets that i 70% of adults or more. in 2008 the ftc did a report and found more than 90% of ad impressions in the alcohol marketing were meeting 70% standard. there are flaws in this. that is perfectly not perfect, the clydesdale lad in the super bowl, this is not a perfect world. that is not a terrible model and remember alcohol is more than one industry. if marijuana comes out looking more like wine for example and less like beer then i think we would say that is actually a pretty good outcome. then you have tobacco. tobacco is directly applicable to marijuana. tobacco is a drug, cannabis obviously is a drug. in 2009 which is very recent history so we don't have to talk too much about gridlock in
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congress being a new phenomenon congress passed the tobacco control act and this is a very robust system of regulation and the commercialization and marketing. let me read you some of what this does. the fda says product standards and reviews, all new product. interesting products to children showed up, we're not mainstream products on fda controls so that is a loophole. that is not the main regulatory regime. there are nine specific warning messages that must be equally and randomly displayed on packages. they must cover a least half the package, no flavored cigarette, no claims of reduce harm without prior fda approval, only state to state sales are a lot with a few limited exemptions, limits on, rand design of packaging and advertisements. there's a lawsuit on an as applied basis to that but it is fairly narrow. the sponsorship of sporting
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events or entertainment events, free samples are banned, claims of reduced harm like light, low and mild band without fda order, colors are limited to black and white comic ingredients must be exposed, fda has the center for tobacco products, it is fully in charge of implementing this, i could go on and on. this is a regulatory system that has done most as what is humanly possible and why don't you legalize marijuana? there's no stopping the first amendment, now we can stop these guys from advertising. tobacco is here to prove otherwise. the other nice thing about the tobacco control act is the supreme court is up held with the exceptions as applied challenge going on right now. all of these models exist. one of them is clear the indisputably applicable. one of them is in place right now.
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we actually have some robust options for dealing with commercialization. that is not to say we will get it right but it is to say that it is not necessarily true we will get it wrong. [applause] >> thank you, a panel. i would like to invite you all to sit with us and we will have a little discussion, a moderated discussion about what we have heard and then we will open up to you. there are some faces years that i know and i want to make sure everybody can ask some questions of the staff of the panel. our microphones are on. are we good? move over. so let me first say i am just delighted at the level of detail
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and expertise in this discourse. i learned a ton and more confused now than i was when i started which is always a good sign that you have confronted some expertise and facts that you hadn't before. let me pose the first question which is i think we have among three if not four of the panelists, agreement that in theory if we are going to have legalization and all the best way forward would be a government monopoly of the product. and i sense that that is something those three of you would agree with. we live in an era when the public can't imagine the government doing anything right, yet if i go to buy liquor in maryland or pennsylvania or utah or any number of states i have
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to go to an abc store, alcohol beverages control, a government store. only in montgomery county. deegan montgomery county has loopholes. kids go there to get their alcohol. having kids in montgomery county -- this is something we had in america for 70, 80 years since the end of prohibition. what is wrong with and why can't we have marijuana sold through government stores, limited in the types of products that it sells, no fruit flavor in drinks, no waxes in hand lotions, with a price that is set as mark said at least at the current price, and a limit, basically no marketing. why wouldn't that solve the
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problem of making sure marijuana is available for adults who want it and would restrict -- why wouldn't that be the best way to restrict the inevitable increase in use. i will start with mark. >> we do have a treaty obligation in a way of that. it may exceed with reservation. i don't take that very seriously. other than that i don't see a downside of letting this be publicly operated. >> let me follow up and ask how do you make that happen? the federal government should somehow make that happen. mechanically how do you do that? >> i will disagree little bit with jonathan. a lot of the stuff we would like to do can't be done by the
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state's as long as the controlled substances act is in place because the state of maryland could not tell employees to commit at federal felony. so the state store option is not available under existing controlled substances act. once california legalizes in 2016 which it almost certainly will lead we have a multi-billion dollar commercial cannabis industry, the prospect of rolling over the industry to retrofit a public monopoly seems to me to be very slim. on the other hand, if there is a bill in congress next year any state it wants to legalize can legalize and is actually legal, not just trying to tolerate by the federal government but only as it was made first i can imagine them saying well, not what i really want but better than what we have got now.
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had thought i could imagine people on the anti-drug saying it is not what we really want but better than what we are going to get. at the moment there is no such movement. that is what i propose. i propose a bill that says you can legalize in any state that wants to legalize under the following conditions and make that the national framework palsy. not having congress dictate what every state should do. but the congress dictate what every state may do. the current system of having cannabis semi legal in some states is not a very good system. treasury department issued guidance, yes, actually, it is a felony to handle an account for marijuana business but we probably won't get you if you do that. this is not satisfactory. i think we need to if we are going to do it legally we have to do it legally.
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the system is issuing state licenses to commit federal felonies. it is not something we should be happy with. everybody in that business is completely at risk. president huckabee's attorney-general in 2017, what they're doing now, the current justice department guidance says that. is a crazy system. >> as the president questioner of this government's worse idea, i would like your thoughts back. >> overestimating the benefits of a government monopoly. if we're talking about a government monopoly are we talking about boris? state stores, washington state? we have state operated stores but we want a government monopoly for products in the stores. if you have private entities reducing products they will be
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marketing those products. >> said that is it. to get away from the commercial free-speech doctrine. every grower of cannabis has to be a vendor to the state you can write the marketing restriction in. >> we could have an argument about first amendment jurisprudence. let me set aside the legal technicalities. we all know there's no first amendment protection of marijuana right now because it is an illegal product under federal law. there is debate whether corollary states, free speech constitutional protections apply. there is no first amendment protection. this is not policy goal. if you are talking about having the government produce the marijuana that is going to be sold then you should be looking at where that is happening right now. like the united states which has
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a government monopoly on not medical marijuana but medical and scientific research. i don't think it would be difficult to find people who would say the quality is not going to have an impact on the black market. that is true with cannabis, with the government being involved in growing marijuana, you have to take into consideration whether or not consumers are going to be satisfied that the product -- if you are looking at just the stores being the government monopoly, you are talking about what impact? really, when the government monopoly is in place you have to decide whether the clerics are responsible for insuring they are not selling to underage people, where the stores are located, the hard alcoholic state player, and in a separate building you have to travel to so that you are taking away from the access ability. all of those policy choices are
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available on the private market and are exactly the policies with the initiative 506 which force these stores to give the regulatory agency a specific mandate to decide how many stores there should be, where they should be and we wrote into law that policy considerations that made their choices, had to be audits and availability to meet the market but not promote the market. when we imagine, and and control is going to achieve something we can't achieve by writing a better law we are not necessarily basing that on good data. >> let me pick up on that and go to something my friend jonathan talked about which is his sense that things are happening in a beneficial way as we do the state by state approach and most people would agree that the way
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washington has regulated its marijuana markets is as good as anyone has thought of right now, so very tight regulatory system. but what assurance do we have that every state will be as responsible as washington? let me give you an example. the state to the south of you, ore. there was a referendum on the ballot to legalize marijuana. it would be controlled by group that would be itself controlled by marijuana producers. it didn't pass, though it came relatively close and what you had was the voters of oregon almost did was build what they call regulatory captured directly into the regulatory process. they didn't but they came to colorado and washington, both fairly responsible. if you looking for assurances
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that state legislatures and the public will always do the right thing you are in the wrong city. that is not how they work. you try stuff and eventually you count on the good sense of the public to take a little time to make these choices. i don't think we actually know which is going to be better between regulated marketplace and the government monopoly. what i wish is congress would pass a bill allowing regulated monopolies to be tried and then we would find out. unfortunately congress is not about to do that. your organization has maintained a position of being against legalization as a matter of policy. is it your sense that the supporters of your position can -- you have also said if we are
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going to have legalization you would tightly regulate the system. is it your sense that is where the public is? to john's point that the public knows, once this freedom is carefully regulated and kept out of the hands of children is that read public is? you have some face going forward as jonathan does? >> that is a difficult question. i am not at all certain. there are number of people in this country to do not want to see legalization but what we are seeing is the excitement in the press that has picked up on legalization. we are seeing polls that say more than half want legalization but i am not sure those polls are asking all the right questions. i would like to ask some more like do you want a marijuana shop in your community where your kids can go? the inevitability of marijuana
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legalization is not as strong as we might suspect and i will give you three examples. two states that the maryland policy project concentrated on to legalize this session have rejected legalization. yesterday in new hampshire the new hampshire house voted down legalization after having earlier in the session. .. >> that the natural legal price of
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cannabis is close to zero, and even stiff taxes on a percentage basis as they have in washington, let alone the light taxes they have in colorado. but even a 40% tax, 40% of nothing is nothing. i don't see anything that's going to keep can us from getting to super cheap cannabis. and at -- >> two interjections. one on that, tobacco's also very cheap, but be new york's tax is $6 a pack. now, many states are much lower and much too low. but i don't understand why it's a given that we go to the alcohol model and not the tobacco model. polling on advertising, 8 to 0% do not want to see an open advertising market for marijuana, and that's true even among those who favor legalization. so there's a very strong consensus against marketing, and for both of those reasons, i just don't accept this notion once you legalize anywhere, your suddenly going to be in a world where it's like lego marketing.
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>> just point out in new york city, which has the highest taxes, somewhere between a third and a half of all the cigarettes sold are smuggled. >> uh-huh. >> not -- from virginia. so a state-by-state system with different levels of taxation is going to let the lowest tax state set the price for the well country because cannabis is much more smuggleable than tobacco. an ounceover cannabis is $300. a pack of cigarettes weighs about an ounce. and new york state has a hard time collecting $8 a pack. so the notion we can take a commodity's natural price of zero and with a patchwork of state regulations keep it near its current $10 a gram, i think that's farfetched. and i think it goes to $3 a gram, i think we're going to see a very substantial increase in consumption. and i don't see anything on the agenda that's going to stop
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that. and as enthusiastic as people are, even the folks who are now voting against cannabis be legalization, you know, when grover norquist tells them that higher taxes are bad, in colorado the republican legislature -- all of whom were against legalization -- all voted for the low arer tax because taxes are bad. which is the reason if i were running the state system, i would do it as quantity limitation and an auction on production rights. it's not a tax. gets you the same place. so this is my cannabis cap and trade. [laughter] but i just don't see any reason to think that we're not currently on a track to have very cheap cannabis. and if it's very cheap, it almost doesn't matter how heavily it's marketed. >> well, i want to open up to the folks in the audience. i'm sure you've got some questions. and we have a microphone, so
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please, this gentleman right here. we can start. state your that tame and your afill -- name and your affiliation if you've got one. >> this is david borden with stop the drug and the drug war chronicle newsletter. my question has to do with the idea that marijuana could be a substitute for use of alcohol. people like me have tended to assume that it is. people warn that we don't really know based on the evidence, babe it's a complement, maybe it's a substitute for some demographics and a complement in others. suppose that's with the better data we are going to have soon, it turns out that marijuana is more or less a substitute including in the groups that are people that are most vulnerable. in that case could a commercialized industry, even a robust one with lower prices be a good thing as an indirect
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means of abusing alcohol abuse with its greater public health consequences. >> anybody? enter absolutely. >> absolutely. it's a big wildcard in the cannabis legalization debate. and if it turns out to be a strong substitute, then more availability's a good thing. it's billion pointed out to me -- been pointed out to me, and i hadn't thought about this, that it's a pharmalogical and sociological fact partly malleable to policy. so, for example, on the impaired driving question, i would like to see a law that says if you test positive for cannabis, you have a bac of zero for driving. encourage people to think of cannabis and alcohol as things to do separately, not together. but look, you're completely correct. but let me flip it over. if it turns out they're, in
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fact, complements either simultaneously or other time, if getting habituated then leads you to be a heavy drink canner later in life, if that's true, are you prepared to reconsider your position that we should legalize cannabis? >> [inaudible] >> okay. the lady in the very back there. >> thank you. good morning. hi name is jasmine tyler, i'm from the open society foundation. i really have appreciated this panel this morning. but one thing that has been missing is the conversation around the cost, the human cost of marijuana prohibition and the, you know, folding in of african-american and that tee know entrepreneurs -- latino entrepreneurs into the corporatization of the new burr with johning marijuana industry. so i wonder if you could talk about that a little, any of the panelists. >> i could talk about the first
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half of that and say it's important. i think one of the places where i would differ with sue and with a lot of people in this debate is there's a lot of single-entry bookkeeping where you look at one half of the equation but not the other. marijuana consumption is bad for children, but it's also very bad to have your dad in jail when you're growing up and have an arrest record and not be able to get a job. so there are a lot of costs on both sides. >> i don't disagree with that at all. >> i can talk briefly about engaging communities of color that have been impacted so significantly by marijuana law enforcement in this opportunity to now build wealth in their communities, to actually be part of this new marketplace. and it was something that in washington state we worked very hard during the rulemaking process to engage communities so they could have an impact on what the market would look like and also to provide public education about how they could actually get involved in the market. and i will tell you that it was
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a challenge. my personal take on it is that we did a really good job during the 1980s of demonizing anybody that would think about going into this business. and i think especially with communities of color who wound up being the face of the war on drugs during the 1980s, there's even this level of shame and embarrassment to think that, oh, now i'm actually going to build the stereotype that was used during the '80s. so it's been difficult, but we have started to make some inroads and are engaging with communities to say don't let this opportunity go by, you who have sumped the most should have -- suffered the most should have the opportunity to participate. and i i guess from a sociological standpoint, that's a reason i'd be reluctant to turn this over to a government monopoly. let's let the people who have been impacted most have an opportunity to benefit from the new regulatory market. >> i think the best advice i could give to minority
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entrepreneurs about the marijuana business is stay the hell away from it. everybody thinks they're going to get rich in this business. i think the people who are running the venture funds are going to get rich leasing the investors. i think the investors are going to lose their shirt. everybody assumes that it's going to be a legal market with a big market, and you're going to sell it at $10 a frame. at $3 a gram, people are putting $2 million into setting up a store are going to go broke. i'd hate to see to minority business owners get trapped the way homeowners got trapped in 2006. >> i have the push back on that, because somebody is going to make money. somebody is going to make money. and right now, frankly, it's a lot of young white men. and, yes, a lot of them are going to lose their shirt, but some of them are going to make money. if we want to have a good impact on youth in communities of color, we should have their community members running the stores that are selling these products. we should not have the white kids from the privileged
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neighborhoods going into the communities and selling them the substance. we should have the neighbors running these businesses. i completely disagree that minority entrepreneurs should stay away from this his. they need to be shaping it. >> i think everybody should stay away from this business. >> it doesn't look like alcohol and tobacco where alcohol and tobacco have a history of targeting minority communities and selling their products to them. you can't shape the industry unless you are in it and at the table. be there. >> i have another view, and that is that if we are completely honest with ourselves, the drug problem is not why we have unequal enforcement of the laws. it's much broader than that. ask until we're willing to deal with that, recognize it and change it, i don't think that -- i think we're dissing the mark to say -- missing the mark to say it's only the drug problem. and shame on us. we need to change that. >> is it possible that the people who make money at this ultimately will be
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anheuser-busch inbev who buy with up all the broke hippies in mendocino county and roll them up into one giant marijuana company and they're the ones that start advertising on super bowls and so forth -- >> or maybe the tobacco industry. >> or the tobacco industry, that's right. >> there's already a venture fund working on rolling up the small operators, but the truth is, we don't know what kind of market this is going to shape up. again, if it's like the wine market, we're in a very different world than the beer market. >> right. and the question is what is going to be the market? >> it depends on the gallo part
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>> my question actually follows up on what dave asked earlier and for professor kleiman, you know marijuana's less harmful than alcohol. you suggest that substitution will be a good thing. you even challenged saying if it turns out the other way, would you change your mind about legalization. so the question is, why shouldn't the industry be able to advertise freely and market marijuana as a substitute for alcohol so that we can actually diminish alcohol use in the country, have people be encouraged to use marijuana instead and have a positive public health impact. >> if it were true that cannabis were a substitute for alcohol, there'd be an argument for having lower taxes and looser regulations on cannabis. at the moment, there is precisely zero evidence of that. and, you know, if ncia wants to
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start running anti-booze ads, i'm entirely on your side. my understanding is there have been discussions about us all being anti-prohibitionists together. and i expect the industry to be consistent with public interest. >> colorado is not a tightly regulated market. it's trying to be that, but the colorado legalized patient in 2000 and two state reports that came out the end of last year suggest that the regulatory system is awful. so i'm going to have to follow you around when you go to congress with those two reports. [laughter] >> we might want to remember the regulatory system right now in
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illegal statements is also extremely bad, as this much worse than colorado and washington. >> right. this gentleman right here. >> are yeah, good morning. i don't have any particular affiliation, i just would like to pose a question to the entire panel, maybe mr. kleiman in particular. i assume we're running on the assumption that what we'd want to do with a legal market is to diminish the size and the consequences of an illegal market. now, i'm wondering if the extent that some of you suggest the government would directly regulate even through monopoly the business, wouldn't that then create multiple incentives for there to be a black market running concurrently with the federal marketing for children, for people who might want to circumvent the registration and quota regime that you suggest, is i just put that question out there. >> so that, it's a good
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question. it requires a slightly extended answer, if i may. distinguished between the short run and the long run, right? in the short run, the regulatory system this washington has -- in washington has to compete with an illicit market and with the unregulated, untaxed medical market. and that puts an upper bound on how tight the regulations can be. also seems to me, it puts a premium on law enforcement, right? the day before you legalize cannabis if you arrest a marijuana dealer, all you're doing is creating a niche for a new marijuana dealer. not really reducing the supply of marijuana at all. the day after you legalize, you can arrest an illegal dealer, you can push his customers toward the legal market. so paradoxically, the benefits of cannabis law enforcement against illegal production and sale go up with legalization. they don't go up for very long because after a couple years, there won't be an illegal market any more than there's a
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substantial moonshine whiskey market. a lot of states people want the legal product. it's better, it's keeper, it's labeled, and you don't -- it's cheaper, it's labeled. and you don't have to sneak around to et -- to get it. it's going to require a little help from law enforcement to get there. once you've wiped out the illegal market, then you can be more adepress withive on both taxation and regulation. i think the idea that we should ban the concentrates in the legal market at the moment would simply set up an illegal concentrate market. the one thing we have to admit, and this really goes along with sue's point, there's not very much we can do to keep something that's available to adults away from kids. we can keep the state-licensed stores from selling to kids. we do a pretty good job of that with alcohol. that doesn't do very much to keep them from getting alcohol.
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and, in fact, if miles per hours are going to -- if minors are going to smoke cannabis, which they are, i'd rather have them get processed and tested and labeled cannabis diverted from the state system than strictly illegal cannabis. so i'd work hard to keep them from buying directly from the state stores and admit the fact that the shoulder-tapping market's going to a happen. steve daferren port at carnegie mellon's got a paper working on this that i think is going to be a very important document. >> the gentleman back here. >> thanks. i'm eric sterling. and i wear a lot of different marijuana-related hats. but my -- and i want to say what a terrific panel this has been, how much i've learned from everybody and and how excellent the discourse has been. my question is what are your suggestions about what kinds of conversations families should
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have about marijuana use to discourage young people from using marijuana in either the current, you know, national discourse in favoring it and then in a postlegallization environment. i'm on the montgomery county council, alcohol and drug abuse advisory council, and i think we're struggling to figure out, you know, what should we be saying in schools if the old bs is no longer valid? >> sue, do you want to -- >> sounds like a question coming to me. [laughter] >> sure does. >> i think that it's important to understand that as the country accepts marijuana first as a medicine and more recently as, for recreational use in two states, that that message that's coming to children is it's a safe drug. gee, mom, it's medicine. why can't i use it?
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i'm going to use it anyway. so the question about alcohol and tobacco is the same about the question about marijuana l it's legal or not to, and think other addictive drug. you have to be honest with your children, and you have to be certain. the research shows this. you have to be certain that you make a protective cocoon around your children and you set guidelines for which there are consequences if they're broken. that's the most effective way a family can protect his or her children. the second most effective way is to get together with the other families, the other parents of your child's closest friends and make a larger cocoon for those children. we don't tolerate alcohol use. we don't tolerate marijuana use whether it's legal or not. we don't tolerate tobacco use for kids who are underage pause it's not good for you -- because it's not good for you. it will hurt your brain, it will hurt your development. and as long as you can get a
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peer group to reinforce that message with children, you have your best chance of protecting them. but legal -- make no mistake, legalizing marijuana gives the wrong message to kids. and what we're seeing is increases in marijuana use since the constitution -- since the discussion about that began in the early 1990s. >> i saw that on your web site. i've got to call you on that. to say that the reason the drug war failed is because too many people criticized it doesn't make sense. that's the status quo. it's failing. i would love it if more folks would just recognize that. in terms of what to say about kids, i'm not a parent, so i don't really know. but i come from a different tradition in which the zero tolerance message is often counterproductive because it teaches kids this stuff must be magic. i come from a jewish tradition where we had alcohol. very, very bad-tasting alcohol.
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[laughter] every friday night as part of a family ritual. and one thing that that does is familiarize it with you, make this a routine part of your life so as where the other kids are thinking, gosh, i must be grown up, we're thinking this is boring. i think it's a failure. >> if i could, i'd like to add to that because i agree with sue about the aspect of building the cocoon around the children and expanding that, but the messages are so important. not only is zero tolerance perhaps creating this forbidden fruit dynamic, but it's not credible. and if we lose credibility with our children, we've lost it all. because parents, and i am a parent be, parents are the ones that children are looking up to as hong as they possibly can -- as long as they possibly can this they get to be teens, and then they proactively push back, i hear, so i'm really looking forward to that.
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but if you establish that relationship of trust and not bs-ing and also expectations, the expectations should be ones that respect the child's intelligence. the expectation should be i want you to wait, and here's why. i can give you the brain science. but the other piece i want to add to what both of you are saying is we ought to not kid yourselves that the truth will set us free. we ought to look at what's been effective with tobacco which is not necessarily focusing on the science of tobacco, but it's focusing on what teenagers care about. this makes you smelly, and people won't have sex with you. >> exactly. >> that woarlt to works. >> exactly. >> so let's spend some money on what actually works regardless of whether it's scientifically accurate. and, you know, have the science there, have the truth, but be facetious as well. >> well, let me just say that your bad-tasting wine on friday nights is really quite a different scenario from what kids face today with alcohol, for example, where they're
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exposed to it by their friends, by parents who allow it to happen and allow other people's children to come to their home and serve alcohol to them even though they're underage. that's really the pressure that you're fighting. and be it'llthe same, and it is the same with marijuana. and be it's the same with any addictive drug. you have to set standards, and you have to set guidelines. and it's a very good message, and and the science supports that. you're new, so i'll give you some science. >> but here's another science question. the american jewish population has an alcohol prevalence near one. everybody who's, you know, even ethnically jewish has used alcohol and used it very early. and the prevalence of alcohol abuse disorder is relatively small in the population. there are other subpopulations in the u.s. with much higher rates of abstinence from alcohol and much higher rates of alcohol
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abuse. so i think we should be focusing not on which substances kids use, but on whether they lose control of their behave. and i think modern prevention science is all around self-command, not around specific risk behaviors. finish so look, if a family wants to say no alcohol for you until you're 21, that's a reasonable guideline. i don't think it's the only guideline, and i'm not sure it's the best. >> with we've got about five more minutes, and i want to get some questions in. so let's do three questions, sort of a light none round. this gentleman here. keep your question real short. >> sure. there were two things that i didn't hear in this panel that could focus on the industry, the cannabis industry, home grow and market integration. obviously, colorado and washington have very different views on that and uruguay as well. >> okay. the young man on the far left
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there. here you go be. >> just a follow up to the gentleman's question over there and alison's comment earlier. price and availability are really only part of -- >> microphone. >> oh, it wasn't working earlier? price and availability are really only part of the equation. cigarettes, for example, are much cheaper and available to children than marijuana, and yet fewer kids use cigarettes than marijuana. and sort of related to that, a lot of of the sort of concern over the corporate takeover of marijuana seems to be just distape toward the idea of people getting rich selling marijuana. so rather than artificially inflating the price of marijuana and focusing on supply reduction, if the natural cost of marijuana is zero, then let it be zero and focus on demand reduction. there's every reason to believe based on our experience over the last 20 years with cigarettes that that's a much more effective approach. >> and this gentleman right here. >> a few weeks ago vincent --
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[inaudible] got into how banks could provide banking services to marijuana-related services. i was curious where you see that going and if you think that will have any material impact, moving away from the cash-only basis on legalization. >> okay. so we've got home grown, somebody -- we've got the possibility that lowering the price to zero won't be bad thing, and we've got the banking issue. you want to take those -- okay, please. >> the, you're quite wrong about tobacco. in fact, the singlemostfective prevention technique for kids is to raise the price so they can afford it. and all of the research shows us that. the more expensive it is, the fewer children start or use -- >> [inaudible] >> that's correct. but that has nothing to do with the price and taxes. >> home grown. why is that not the way to go?
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>> home grown is, home grown would have been an interesting alternative to commercial legalization altogether. you could have said nobody can produce it for sale, but anybody can grow it and give it away. tomatoes. i think we're past that. the problem with home grow in a world where it's legal only in some states is that home grow can be a cover for commercial production, and i think it's very hard to get that under control. we'll see what happens. i mean, so colorado and washington give us the contrast cases. washington does not allow home grow, colorado does. finish and we'll see if the home grow in colorado turns out to be a problem. if it doesn't, i certainly have no objection to it. >> laboratories of democracy, there we go. >> i'll piggyback on home grow. the only reason we didn't have it in the washington initiative was because it didn't poll well. we went with a hard alcohol model. i don't think it can have that much of an impact. we can home grow, we can home brew beer, wine, whatever, we
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prefer the convenience of a store. i also think that home grow has, the strategy for undermining the black market, and this is the point that the greatest concentration of demand is in urban environments where people live in apartments and they're not going to grow their open marijuana, so you have to have stores available. i just don't think home grow makes that much impact. >> andnd banking, ten seconds. >> i think it's a great idea that treasury's trying to get out of the way. i think most banks won't accept the bait, but most banks don't have to. all you need is some credit. somebody will play. this will not now be an all-cash business, and that's a good thing. >> we have that in washington, a credit union is going to go forward with the guidance, and i agree one or two credit unions, we take care of the problem. >> folks, thank you very, very much. what a great panel. show your appreciation. [applause] thank you all for coming. thank you, new america, for hosting this. thank you, the c-span audience, we really appreciate it.
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