When A Bad Idea Proves It

Thursday, October 23, 2025

The legalization of marijuana was/is (depending on your location) a bad idea.  Intoxication, in any form, is not a good idea – even if we tolerate it to some limited extent.  Given that we do try to limit and control intoxication, the last thing we need/needed, is to increase its possibility.  Most argument for the legalization of weed could just as easily have been turned around and used to argue for further controls on alcohol – they are not convincing arguments.  There was; however, one good one, but it is falling apart.

But before we get there, weed is becoming a public nuisance.  Players at the U.S. Open (tennis) in New York complained about the pervasive weed smell while playing.  While in D.C. a woman has sued her neighbor, and won, for the nuisance he created in her home with his weed odors.  Back in my California days I once saw a woman jaywalk her child across a very busy street to avoid the odor of tobacco from an approaching walker.  Tobacco is less than ideal, but is downright pleasant in comparison to weed smoke.  It stuns me that people just expected the rest of the world to put up with that stank.

But back to the one good argument for the legalization of weed – taxation.  Sin taxes are, to my mind, a brilliant idea.  The generate government revenue without being a general burden on the public.  They are a chosen tax, not a mandatory one.  When it came to legalizing marijuana, always cash starved California saw a potential gold mine.  Or so they thought.

In L.A.:

The legal cannabis market in Los Angeles is hitting a breaking point. At least two-thirds of LA weed businesses have failed to pay their local taxes, and the city is currently out hundreds of millions of dollars in lost revenue.

The dire financial status of the city’s cannabis stores — with more than 500 out of LA’s 738 pot companies owing outstanding taxes — has forced the city to take the extreme step of proposing an amnesty program to bail out the industry, according to a city letter obtained by SFGATE….

The hundreds of millions of dollars in missing tax revenue are sorely needed. LA has been navigating a $1 billion budget shortfall for this fiscal year, although Mayor Karen Bass worked out a deal this summer that her office said closed that budget gap.

In California widely:

Statewide, total cannabis sales are falling, as operators owe $1.3 billion in back taxes to the state, according to a 2024 state report.

Then, the kicker:

At the outset of cannabis legalization, LA prioritized giving licenses to people harmed by the war on drugs, including low-income residents and people of color — meaning that a large portion of tax-owing businesses come from these same marginalized groups. Today, many of these “social equity” license holders are now holding millions of dollars in debt and may not even have a functioning business to show for it.

Oops.

The article does not examine enforcement efforts against the burgeoning black market in weed, other than, “The LA cannabis market, which is the largest in the state, has been struggling for years. The city has failed to shut down a thriving illicit market, which has attracted customers to tax-free products….”  My guess is they did the math and figured the cost of shutting down the black market would exceed the revenues generated by their exorbitant taxes, so they punted.

So, I guess the one good reason for legalizing weed, wasn’t.

Now the issue is how to fix this mess.  Knowing California and especially government in California, they’ll only make it worse.