How to reduce the deficit

[bascule]

In the book Reefer Madness: Sex, Drugs, and Cheap Labor in the American Black Market talks about the three underground economies in the United States: marijuana, foreign labor, and pornography.

 

Do you think that proper regulation and taxation of these markets could make a big impact in reducing our national deficit? I do...

[iNow]

Dude... Porn alone accounted for how Americans spent a huge percentage of the $600 rebate checks this summer. "Big" impact? Not sure, but it certainly would have "an" impact... as well as marijane, and would be much more appropriate than letting it continue as purely an underground/black market economy where we don't benefit from the transactions.

 

http://thinkprogress.org/2008/07/02/bush-porn/

[Sisyphus]

Is pornography really "underground?" I mean, stuff like child porn is, but is there seriously a lot of money in the illegal stuff? If so, that is really depressing.

[ecoli]

maybe... but I'd support decreasing spending over raising new taxes any day of the week.

[DJBruce]

I don't think that, the regulation of those markets would make that much of an impact. The average sales of marijuana in the United States in 2000 was 10.5 billion so even if you tax the product the revenue generated would not solve the problem.

 

35-http://www.whitehousedrugpolicy.gov/publications/pdf/american_users_spend_2002.pdf

[ecoli]

I don't think that, the regulation of those markets would make that much of an impact. The average sales of marijuana in the United States in 2000 was 10.5 billion so even if you tax the product the revenue generated would not solve the problem.

 

35-http://www.whitehousedrugpolicy.gov/publications/pdf/american_users_spend_2002.pdf

you're assuming that consumption would remain constant if it is legalized.

[Phi for All]

maybe... but I'd support decreasing spending over raising new taxes any day of the week.

You wouldn't be raising a new tax. You'd just be legitimizing new markets which will then fall under existing tax structures. And if we decreased some spending as well...

 

This would work with marijuana, which would also create other hemp related products subject to tax, but like Sisyphus, I'd need to know what the underground, previously tax-dodging side of pornography was like before I'd agree to give it any legitimacy. This would probably be a big NO the more I think about it (Save the Donkeys!). And I'm not sure how much taxation foreign labor could take before becoming too costly.

[Pangloss]

I think it's a dodge, and because it's a dodge it'd be ready fodder for a resurgence in right-wing politics. IMO the decision should be based on whether it's a good idea, not whether we need the money.

[Phi for All]

I think it's a dodge, and because it's a dodge it'd be ready fodder for a resurgence in right-wing politics.

Especially if you tried to do all three at once.

[CaptainPanic]

you're assuming that consumption would remain constant if it is legalized.

The only example of legalized (tolerated) sale of marijuana is the Netherlands. And luckily for this discussion yesterday's newspaper (Volkskrant) published some numbers on consumption of the groups 15-64 and 15-24. In both groups, the Netherlands is merely average.

 

Article (in Dutch): http://www.volkskrant.nl/binnenland/article1094054.ece/Nederlanders_blowen_niet_massaal

Picture:http://www.volkskrant.nl/template/ver2-0/components/thumbnail.jsp?id=132411

translation of country names in that link:

Nederland = Netherlands

Frankrijk = France

Belgie = Belgium

Verenigde Staten = United States

Duitsland = Germany

Italie = Italy

Groot Brittanie = Great Brittain

Spanje = Spain

Left leaf is the average street price (of an certain quantity, probably a gram)

Right leaf shows the most recent use of cannabis in the population, in %, for the mentioned age group.

 

Having said that...

On topic of reducing the deficit (of any government, not just the US):

 

Decriminalizing marijuana means: "decrease spending, increase income".

 

Decrease spending:

-You'd need a lot less police (and army?) - that will save money.

 

Increase income:

-(Several million) People would be released from jail, and their records should be deleted. So they're free to get a job. Of course some of the lazy bums won't... but some will. They'll pay the normal income tax.

-If people would buy marihuana, which is legalized, you can get healthy competition. Like with tobacco, you can grow it cheap, and you can tax it immensely, and nobody will really complain.

 

Sadly, there is no country in the world that does this. Not even my own... although we're pretty close.

[iNow]

In addition to CaptainPanics discussion about decreased spending on law enforcement, the consumer themselves would also be saving money, and hence have more money to spend on other things, consequently stimulating other parts of the economy.

 

Without a black market/low supply situation, the prices would not be as high. Higher (more available) supplies would drive up competition and drive down prices (who's gonna pay the dealer $25 for a bag when you can go to 7-11 and get the same thing for $3.99 already rolled into individual smokes... Call 'em "Marlboro Greens" or something)?

 

That means (in addition to tax revenues) more money gets put into other areas of the economy, money which would previously have gone to the MJ alone is now available to the user and spent elsewhere... like fast food, potato chips, Ben& Jerry's ice cream, and doritos.

Edited November 18, 2008 by iNow

[doG]

Eliminating the very expensive, unwinnable war on drugs would certainly affect the deficit.

[Pangloss]

We are talking about legalizing marijuana, not ending the war on drugs.

 

Even so this thread is pure liberal fantasy. I'll give you a bankable prediction right now: The idea of legalizing marijuana will not be proposed or supported by the Obama administration. He's in favor of expanding Drug Courts, eliminating sentencing disparities and so forth, but he's also tough on meth and opposed to lowering the legal drinking age. Nor can he politically afford to propose or support it.

 

There is no legalization scenario in the cards.

Edited November 18, 2008 by Pangloss

[bascule]

Even so this thread is pure liberal fantasy.

 

I believe the word you were looking for was "libertarian". Note that the Cato Institute is in support of all these measures, and they're anything but liberals.

[Pangloss]

No, the word I was looking for was liberal, but I'll be happy to add libertarians to the mix.

 

This is actually part of a larger thing that's happening right now that is somewhat interesting sociologically. Since Obama was elected many discussions boards are predicting and end to the war on drugs, and end to gun control, an end to opposition to abortion, and various other "big swing" predictions. The liberal boards are cheering these things, and the conservative boards are screaming in terror.

 

It just isn't going to be like that, folks. It's not that kind of opportunity. But hey, we all have our dreams -- more power to y'all.

[doG]

We are talking about legalizing marijuana, not ending the war on drugs.

 

You might advocate that but I advocate the total legalization of all drugs and the end of the DEA, an end to the war on drugs.....btw, I'm Libertarian!

[jackson33]

With all due respect, would some one please tell me what any increase in taxes on any product or from who paid, has done to DECREASE the deficit. Congress has any number of programs ready and waiting for new revenue. The only real decreases came in the late 90's, per budgeted expense, when Federal government was virtually shut down.

 

It's been said, if the Federal just held spending to to the previous year plus inflation, the deficit would not exist. I'll bet this won't hold true for 2009, but whats said...

 

The Federal or National Debt is the real problem and only has one solution, whether others would help or not to decrease this figure...Congress, just reduce, not maintain, spending. Efforts along this line have also failed, at least to the tax payer. When a new program is invented or money required to fund, Congress just mandates States to pay for something, an extra 26 weeks for unemployment benefits, adding eligibility to some welfare program, some school program, never increasing the funds to pay the actual cost.

 

On the 'War on Drugs', I agree but for practical reasons and no less than beer, liquor or any perceived (?) vice, people will be people and legislating morals will never work in a free society.

 

bascule; How can you tax foreign labor? You might mean in the US and assume then illegal immigrants, but wonder how much is lost to Federal Government in those pay scales. Then there would be a probability (under law) those workers and their employers pay most to near all...not always collecting the benefits.

[pioneer]

One way to lower the deficit is to bring a little free market into government. For example, if you allowed the heads of all the various programs to profit share say 1% of what they can save in program expense, without lowering the value given to the final intended of the program, the deficit would fall. That 1% is then shared downward as incentive for subordinates to find ways to cut costs and share some of the booty. The 99% saved goes directly to the deficit.

 

Currently in government, there is no money incentive. The incentive is power, which is directly related to how much money you control. To reduce costs, in the current system, means less money under your control, sort of a demotion in the power hierarchy. But if we had profit sharing, then the same people would find a balance between power (expensive way) and personal money (cheapest way), with the result power would be sacrificed somewhat, for money and the deficit would fall.

 

If you tried this in one program you would see the affect. Instead of $500 toilet seats, maybe they would decide $50 toilet seats means $450 savings and they get $4.50 per seat. That also means $496.50 per seat to the deficit. Under this system, those who make the highest profit and give the most to the deficit get a higher percent of the budget the following year, since they are the best in terms of efficiency. The inefficient spenders in the system would get less and less each year.

 

Along these lines, the government doesn't spend all their annual budget the first day of the year. Maybe each department can put their annual budget money in an interest bearing account, with the year's interest bonus going to the deficit. This puts savings account money into the private sector, at the same time the govenment uses it, multiplying the money to help grow the economy.

[bascule]

No, the word I was looking for was liberal, but I'll be happy to add libertarians to the mix.

 

Well, let me put it in perspective: the candidate advocating major reform of our current marijuana laws who received the most votes in the primaries was: Ron Paul! Hardly a liberal...

 

The idea of legalizing marijuana will not be proposed or supported by the Obama administration.

 

And there you go, this isn't a "liberal" issue at all. Many Democrats, even "far left" ones, still support the status quo for drug policy.

 

How many libertarians do you see advocating the status quo for America's drug policy? Can you find one Libertarian political party or think tank that doesn't have a major reform of drug laws as a plank in their platform?

 

Really Pangloss, stop being so partisan! This isn't a left/right issue, it's a libertarian/totalitarian issue

 

With all due respect, would some one please tell me what any increase in taxes on any product or from who paid, has done to DECREASE the deficit.

 

Well, bottom line, any taxes bring revenue which decreases the deficit. I'm not saying we shouldn't cut spending, and indeed these measures would cut spending as well. Imagine how much the burden on INS and the DEA would be lightened if we had a sane guest worker program for immigrants which was actually preferable to illegally crossing the border, and if there were little need for marijuana enforcement at the federal level. In addition, a guest worker program would collect some sort of tax (probably payroll tax) for immigrants, so there's additional revenue.

[Pangloss]

(shrug) I agree it's not a unilateral political cause. There are even conservatives who support legalization. This is not particularly relevant. The left-leaning boards (and libertarian-leaning boards like this one) are excited about a non-existent possibility of legalization. The right-leaning boards are dreading it.

 

All are wasting their time, IMO.

[imp]

Usual: Print more currency. Risk: Inflationary collapse;

 

Unusual: Use the "Monetary Reform Act", 1983 or thereabouts, signed into law by Reagan, to exchange the entire currency at "any rate deemed necessary and prudent".

 

In other words, steal enough out of everyone's pockets to pay down the debt.

 

In reality, just another form of taxation, or parasitism, your choice. imp

[Phi for All]

I agree that the war on drugs, abortion and gun control are issues Obama will never address. At least I hope not. Any of those would waste a lot of resources we can't afford. Wait 8-12 years for more boomers to die and then we'll talk.

[ParanoiA]

(shrug) I agree it's not a unilateral political cause. There are even conservatives who support legalization. This is not particularly relevant. The left-leaning boards (and libertarian-leaning boards like this one) are excited about a non-existent possibility of legalization. The right-leaning boards are dreading it.

 

All are wasting their time, IMO.

 

Well I hope you're wrong, man. It can take a lot of motivation to sit down and eat a whole bag of cookies; marijuana can save the day.

 

I'm surprised how many are so worried and dreading legalizing marijuana. They won't notice much difference other than their neighbor smokes it on the porch now instead of on their couch in the basement. Hopefully the youth will gravitate to that instead, and get alcohol off of their short list.

 

You might advocate that but I advocate the total legalization of all drugs and the end of the DEA, an end to the war on drugs.....btw, I'm Libertarian!

 

Personally, I'm wondering if I can raise my property value with a pot garden. Could make home buying a whole new experience.

[Phi for All]

Personally, I'm wondering if I can raise my property value with a pot garden. Could make home buying a whole new experience.

Realtor: And out back is the garden. As you can see, getting a healthy crop of weed is no problem in this climate.

 

Husband: What do you think, honey?

 

Wife: (shakes head) Is that the shed? We'll need to remodel most of this. I mean, who uses tiles on their potting tables anymore? Maybe granite, or Corian. If you want some decent bud, we need to put some effort into fixing this place up.

[Pangloss]

I agree that the war on drugs, abortion and gun control are issues Obama will never address. At least I hope not. Any of those would waste a lot of resources we can't afford. Wait 8-12 years for more boomers to die and then we'll talk.

 

Wups, I said earlier "an end to gun control" but I meant "new gun control" (in message #15).

 

He will go after the so-called "assault weapons", because of a campaign promise, but I don't think he'll seek increased gun control legislation on handguns or guns in general. He's already stated opposition to handgun bans, supporting the Supreme Court decision of last year.