In this 2009 piece from Time magazine, Joe Klein provides some legalize-pot numbers:
there is an enormous potential windfall in the taxation of marijuana. It is estimated that pot is the largest cash crop in California, with annual revenues approaching $14 billion. A 10% pot tax would yield $1.4 billion in California alone. And that's probably a fraction of the revenues that would be available — and of the economic impact, with thousands of new jobs in agriculture, packaging, marketing and advertising. A veritable marijuana economic-stimulus package!
That Joe Klein! He's hilarious when he's high! Actually, his $1.4 billion tally for Cali may substantially underestimate how much making the wacky tabacky legal could bring in. Here's why:
- The Patt Morrison Show recently did a very popular segment on a RAND study that says crime actually goes UP in neighborhoods where marijuana dispensaries are shut down. More crime means more prosecutions, which cost money.
- Back in 2003, a Boston University economist took a look at the legalization economics in Massachusetts and figured savings from not having to continue criminal enforement at $120 million per year. He's now at Harvard.
- Fewer prosecutions means fewer sentences, which mean less incarceration. Each prisoner in the system costs California an average of $47,000 per year, according to the Legislative Analyst's Office
- There are some concerns that legalization would cause the price of pot to collapse. But that could just be a brief downturn, as marijuana finds a larger audience and, like other agricultural products, moves away from small-scale to industrial production. How big could that get? Altria, the company that owns Philip Morris, has a market cap of $54 billion.
Earlier this week, the Wrap's Fred Schruers had a piece on the post-Carol Bartz Yahoo world and reported that Daniel Loeb, who runs the $8 billion hedge fund ThirdPoint LLC, was making a run at the beleaguered Internet giant. Here's what Schruers had to say, under the headline "Yahoo Under Siege: As Hedge-Fund Raider Closes In, Founders Hint at Sale":
No investor is more of a threat than hedge-fund powerhouse Daniel Loeb, who has recently acquired 5.2 percent of Yahoo's stock. Loeb has gone after companies he thinks are mis-managed before, but the level of vitriol -- and cash -- he’s throwing at the Yahoo board shows that he’s deadly earnest this time.
For a taste of the "vitriol," you can sample this letter that Loeb sent to the Yahoo board earlier this month:
it is evident that merely replacing the Company’s CEO – yet again – will not be enough to alter the direction of the Company. Instead, a reconstituted Board with new Directors who will bring fresh eyes, relevant industry expertise and increased investor alignment to the table is immediately necessary.
Holly Petraeus, wife of CIA Director and former U.S. Army Gen. David Petraeus, has intensified the debate about for-profit colleges, their astronomical student-load default rates, and accusations that they're looking to market hard to members of the military. NPR covered the issue this morning with her, and referenced an opinion piece she wrote on the subject for the New York Times.
I've been thinking a lot lately about for-profit educational models, given that the way forward for California's economy clearly lies with a better-educated workforce. But the state's public school system is under a lot of strain. Can private companies, operating charter schools, technical schools, and other types of institutions be a solution? If you look at the ability of many for-profit Southern California colleges to graduate people who can actually pay for their education, the answer is no.
I've been going big on Solyndragate here at DeBord Report. It's a good story. It has everything: ideas about the future, money, politics, success, failure, Silicon Valley, Washington — and it's sucked in the Obama administration. It's also generated a lot of discussion and debate in the blog-o-sphere about both the specifics of the solar startup's abrupt bankruptcy and the role of government in financing green energy projects. Here's a rundown of what I've written so far:
Think the Department of Energy is bunch of meek bureaucrats? Think again. It's a den of super-venture-capitalists who have been building up the thin-solar industry in America.
When you invest in new industries, you sometimes have to swing for the fences in order to capture major returns.
Meet the $199 Amazon Kindle Fire: “What we are doing is offering premium products at non-premium prices,” [Amazon CEO Jeff] Bezos says. Other tablet contenders “have not been competitive on price” and “have just sold a piece of hardware. We don’t think of the Kindle Fire as a tablet. We think of it as a service.” (Bloomberg)
Megan McArdle on the investment structure of Solyndra: "…I am distinctly prejudiced against plowing half a billion dollars worth of government funds into a company to see whether they can finally get their manufacturing process to work." (The Atlantic)
Fox goes to court to prevent the Dodgers from selling TV rights: "The suit asks that the court reject any such sale except in accordance with the current contract, under which Fox retains exclusive negotiating rights through November 2012 as well as the right to match any other offer." (LAT)