The legal marijuana economy isn’t a pipe dream. It’s reality.
More than $1.43 billion worth of legal pot will be sold in 2013, and is estimated to increase by 64 percent next year to a mammoth $2.34 billion, according to new research looking at the ever-expanding legal U.S. cannabis market, including analysis of hundreds of medical marijuana dispensaries nationwide.
That gigantic estimated increase in 2014 is, of course, due in part to Colorado and Washington's legalization of marijuana sales for adult recreational use. Colorado has also developed packaged marijuana and marijuana products to sell in select stores this January, driving industrialization according to ArcView Market Research’s report “The State of Legal Marijuana Markets 2nd Edition.”
“The impact of this is huge,” the report’s editor, Steve Berg, tells TakePart. “Plus, the latest Gallup poll shows 58 percent of Americans as supportive of full legalization of marijuana, a 10 point increase from a year ago.”
Considering California Lt. Gov. Gavin Newsom and the American Civil Liberties Union announced last month that they are convening a panel of 16 experts, chaired by Newsom, focused on two years of research towards proposals to legalize adult recreational marijuana use in the state, the possibility of a 2016 California voter ballot initiative is high, and could likely pass.
The monetary sway of widespread legalization in California, especially, is enormous, given the state’s dominance when it comes to legal medical pot, enacted in 1996.
"The California market in 2013, even limited as it is to medical marijuana, is valued at $980 million, and is the largest medical marijuana state in the country,” says Berg. “When legal adult use is allowed, that number will grow. We do think it will be legalized in 2016.”
Berg says 14 states, including California, are forecast to adopt adult marijuana use legislation over the next five years, in addition to two additional states implementing medical marijuana.
“That grows the legal U.S. marijuana market to $10.2 billion in 2018,” he says.
Imagine $10.2 billion—$10.2 BILLION—coming in from legalized marijuana sales. The number is downright impressive.
“It’s an increasing market hard to ignore at the state level where they need and want this revenue,” says Allen St. Pierre, executive director of the nonprofit public advocacy group National Organization for the Reform of Marijuana Laws, founded in 1970.
Mason Tvert, communications director of the Washington, D.C.-based Marijuana Policy Project, which has a representative on Newsom’s California research panel, says the MPP plans to support a California 2016 measure by pushing financially and building support on the ground. MPP was one of the largest financial backers of Colorado’s regulatory adult recreational use initiative.
“It’s time to take marijuana sales out of the underground market and in the counters of legitimate businesses,” he says. “Rather than propping up the illegal drug cartel, we could make hundreds of millions of dollars for our communities. Taxing marijuana sales will not solve our budget problems entirely, but it will grow revenue for important services, such as education.”
St. Pierre, who says NORML plans to release its own hard data based on sales taxes in Colorado and Washington in the coming months, calls 2016 a “pot plebiscite year,” a time of major change.
“For reformers, California really should have been the first state to legalize marijuana, to move the country away from federal prohibition,” he says, noting 2016’s presidential election year status. “For the first time in most of our lifetimes, we’ll likely see a presidential candidate, regardless of political affiliation, advocating for substantive reform.”