How Regulations Help Big Business: A Case Study in Pot

I recently commented how some corporate-sponsored libertarians focus on regulatory burdens on big business but never focus on the much more insidious phenomenon of regulatory barriers to entry which help big business keep competition at bay and were probably the true intent behind the regulatory era ushered in a century ago. The details around the legalization of pot are providing a great example of this in real time.

From the very beginning of the pot legalization movement, like the uber craze, I wondered why all of a sudden, government was getting out of the way of products and services that had long been in high demand but had been highly controlled. Pot legalization movements have been going on since pot was first criminalized decades ago, yet all of a sudden they started gaining traction. I am for ending the drug war, so I don’t object, but I did wonder why now–and why would George Soros be funding it?

I could think of several reasons:

• The NSA is replacing the CIA in black ops (the NSA gets a virtual blank check while the CIA notoriously uses drug money)
  • Given the diminishing need for black ops money, the profit and tax money of pot might on balance benefit the powers that be
• The thinkers behind social stability long ago recommended warehousing the “unemployable” and instituting a “euphemized form of slavery” – even more widespread pot use might fit the bill nicely
• Registering pot users might come in handy for the total surveillance state to use against some future activist
• Dumbing down the voting public is an essential element of tyranny-by-democracy

For all of these reasons, I try to make a few important points whenever the discussion of legalizing pot comes up, specifically:

• Don’t tax pot – drug use goes up when the government has a profit motive to promote its use
• The welfare state eliminates the natural feedback mechanism that gets drug users to stop getting high and start working once in awhile…it’s a “moral hazard“
• Beware settling for “medical marijuana” in your state no matter how easy they make it – it is simply a registration system for pot users (by all means, have pot for anyone who wants it, sick or well, just question the need to register for it)
• Most important: don’t regulate it or limit homegrown in any way…regulating it means that only big producers will be able to meet the requirements (these are called regulatory barriers to entry); homegrown will be the safest, healthiest stuff out there–pot is a weed, it grows easily & is practically free–there might not be any industry of corporate pushers at all if the production and exchange of homegrown are unrestricted

An article I read yesterday reminded me of how costly and counter-productive regulatory barriers to entry are going to shut out the little guy and create a massive industry for highly processed, high-priced pot instead of just allowing people to grow, share and sell this simple weed:

Colorado Pot Regulation Amendment Pulled By Its Own Supporters

Update (12/1/16): Different Sector, Same Principle…

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