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Thursday, April 14, 2016

Mexico Marijuana Debate: Proposing Government-Run Stores for Marijuana Sales

SinEmbargo: Jorge Javier Romero Vadillo
Translated by Leslie Castillo Navia

In these days during which the discussion on drug policy has acquired media relevance--as much as a result of the initiative for a General Law for Cannabis Control presented by Senator Roberto Gil Zuarth as by the conclusion of the [series of five] debates summoned by the Secretary of Government Relations and the proximity of the extraordinary period of UN General Assembly sessions on the world-wide drug problem (UNGASS 2016)**-- President Peña Nieto made a fool of himself with the announcement that he will not personally participate in next week's New York summit.

I am unable to understand the rationality behind the decision to cancel the president's attendance at the United Nations' session, which was promoted by Mexico, along with Guatemala and Colombia. Nobody expected Peña to go to the UNGASS and present himself as an anti-prohibitionist paladin, but the document that will be discussed and almost surely approved there brings together important points defended by the Mexican diplomatic corps, which in the elaboration process managed to substantially expand the group of countries inclined toward a reform that would end the war on drugs.

The final declaration of UNGASS will not be a document that reforms overnight the current international drug control system, but it represents relevant advances at the margins to temper the damages that prohibition has generated for psychoactive substance users, societies, and the States. It was hoped Peña Nieto would defend that next week in New York. And he decided not to go, which weakens the front that took so much effort from Mexican negotiators to build. An error in every aspect by a government which has shown a great weakness in foreign policy and chosen to promote public relations and tourism in the world instead of diplomacy. The President of the Republic owes an explanation to the nation, and the Senate should demand it in an appearance of the Chancellor [Secretary of Foreign Relations].

Meanwhile, the Government hides its head to pretend that the subject doesn't exist, after the anticlimactic end of their discussion forums. In the forums, it was not the Secretary of Government Relations who had the limelight--who after two good speeches ended by not taking a clear position. Rather, it was Senator Roberto Gil, with the presentation of a comprehensive initiative to regulate the medical, pharmaceutical and personal uses of marijuana. With this initiative, the State would take market control away from organized crime but would avoid the creation of market incentives that contribute to an increase in the consumption of a substance that is not innocuous and involves health risks that must be prevented and limited.

A central element of the initiative presented by Gil, the preparation of which I participated in, is the creation of a State government-run store, a monopsony [single buyer], responsible for buying all the cannabis production from farmers who are currently captives of organized crime, and channeling it both to points of sale for personal consumption as well as to pharmaceutical processing laboratories or clinics for therapeutic use. This has become a controversial point of the project.

Ever since the discussion of the model design, we anticipated that there would be no lack of criticism against the creation of a State company responsible for controlling the market. Once bitten, twice shy, says the proverb. And indeed, in this case the twice shy are those who do not understand that we propose a government-run store that prevents the emergence of competition precisely because we do not want an efficient market in terms of economic rationality. Marijuana is not an ordinary commodity because of the health risks involved.

In front of us, we have the case of tobacco, a dangerous substance that has been very difficult to control precisely because its trade is in the hands of large, vertically-integrated companies who have used their resources and power to hide information about health damages caused by smoking in order to avoid regulations that limit consumption and alert the population of the risks. Another example at hand is alcohol, the main substance of abuse in our country, which is also in the hands of large commercial companies who advertise it shamelessly and encourage its excessive consumption.

Since we do not want that to happen with marijuana, we propose a model of a non-competitive, stagnant market. ... In Sweden, as well as in eighteen states of the United States, alcohol is sold in government-run stores with a strong tax to discourage its consumption. No one in their right mind would suggest prohibiting alcohol again, but it has been considered necessary to remove this risky commodity from commercial competition. In Spain, for centuries, tobacco has also been controlled by a State government-run store. The Uruguayan regulation, pioneer in the subject, has also created a monopsony to control cannabis. What's more: the proposal for marijuana regulation by the Liberal-Democrats in the United Kingdom also advocates creation of a similar body.

The challenge of State control of the cannabis market is to establish competitive prices with respect to the black market in order to get rid of it, but high enough not to stimulate a growth in demand. That is why the creation not only of a controlling distribution company is suggested, but also of a separate regulatory body that would set limits of THC content of marijuana sold for personal use. This would limit the risks associated with the sale of excessively-potent varieties. The existence of the State-owned controlling company would prevent the capture of the regulating agency by business interests and vertical market integration, while the separate regulatory body would limit potential temptations of corruption in the public monopsony.

However, the initiative is not limited to putting all the provisioning possibility in the hands of the State. Defenders of personal liberty in consumption can rest assured because the project also takes into account the possibility of self-cultivation and the creation of licensed production cooperatives where any variety can be grown. Aside from self-cultivation and cooperatives, farmers who are currently selling to criminals would do the production, and the final points of sale would also be private. Not statist asphyxiation; just reasonable health control. Spanish original

*Jorge Javier Romero Vadillo is a political scientist, professor and researcher in the Department of Politics and Culture at the Autonomous Metropolitan University, Xochimilco Campus. He holds a masters in Political Science from the National Autonomous University of Mexico (UNAM) and a doctorate from the Faculty of Political Science and Sociology at the University Complutense of Madrid. He is a regular contributing columnist for Sinembargo.  

**MV Note: In November 2012, Mexican President Felipe Calderón, near the end of his term, and a group of Central American presidents, petitioned the Organization of American States to carry out an indepth analysis of the impact that legalizing marijuana in Central America would have. In June of 2013, the OAS issued a call to the UN to convene a special session of the UN General Assembly to reconsider its conventions against drugs. The last Special Session was in 1998 and a formal review was held in 2008. See MV's page on the history of UN Drug Conventions and the central role of the U.S. in formulating and enforcing them.

Read more on Mexico's Marijuana Debate