Why Canada Should Legalize Marijuana

By: Peter BeckI

I have many vices. Pot, however, is not one of them. I don’t smoke the stuff, and never have, but I don’t sit in judgment either. Recently, I started looking at what could happen to the Canadian economy if we didn’t just decriminalize marijuana, or condone medicinal uses for it, but actually allowed the free market to grow, package and sell it. What I’ve found out is pretty startling.

To begin with, most estimates say the cannabis business in British Columbia alone is worth US$24 Billion dollars a year, street value. How much is that? That’s more than the forestry exports to the US from BC in any given year, and is about two and a half times the agricultural exports for the entire country.

So, let’s start with that number: US$24 Billion a year in profits. That’s roughly CDN$34 Billion. I’m being conservative here, and forgetting the fact that if you were to legalize marijuana, Canadians would be growing it in every fallow field, window box, and basement in the country.

Now, factor in the tourist trade. Come to Toronto, or Vancouver, or Peggy’s Cove for that matter, and such back a Molson Canadian accompanied by a pre-packaged, filtered, high-quality spliff. I’ve seen estimates in the range of $90 Billion for the country if even 1% of the American population comes north to buy their stash.
$34 Billion plus $90 Billion equals $124 Billion.

Here’s another number. Canada has about 600,000 citizens who have been indicted for using marijuana for personal use, and around 30,000 arrests are made each year. According to the Auditor General’s report, this translates into $500 Million for annual enforcement of drug laws, and about $500 Million for legal fees. Tack on about $50,000 a year for each incarcerated offender, and you end up with about $1.5 Billion a year. Again, I’m guessing on the conservative side.

$124 Billion plus $1.5 Billion equals $125.5 Billion.

Here’s another one: one acre of hemp produces the same amount of cellulose fibre as 4.1 acres of trees. Trees grow back in about twenty-odd years. Hemp grows back every four months or so, and produces paper at one-quarter the cost of wood pulp (creating one-fifth of the pollution). You can also make four times more gasohol or methanol from help stalks than from corn. Hemp is actually the strongest natural fibre there is, and until the 20th century, it provided almost all the world’s paper, clothing, textiles and rope. Even if we ignore the moral, ethical, or ecological reasons for using hemp to replace pulp and paper, it just makes sense economically.
First, cut the capital expenditures in wood pulp production – about $8 Billion – by three-quarters. We just saved $6 Billion. Now, quadruple the potential volume of cellulose fibre. With about $15-20 Billion in annual exports of newsprint and wood pulp, that would be roughly (let’s be conservative and call it $15 Billion) $60 Billion. Obviously, there wouldn’t be that much demand, so let’s simply double the present number to $30 Billion, and keep in mind that our resource is now virtually unlimited. We don’t have to keep spending all that money in reforestation projects, so our parks and woodlands can be saved as an added bonus to the $90 Billion we’re making on tourism.

$125.5 Billion plus $6 Billion plus $30 Billion equals $161.5 Billion.

Is this starting to scare you? We haven’t even touched on the potential tax revenues from selling weed in nice, neat packages. The federal government gets about $5 Billion annually in revenues from tobacco. While the average Joe won’t be smoking a jack of J’s a day, a joint is probably going to cost more than a cigarette, and will certainly be taxed heavily. Let’s round it off to another $3 Billion – not including the increased sales of both tobacco and marijuana due to, again, the increased tourism. Textile export increases, new business development, job creation, medical research and exports – throw in another $4-5 Billion.

$161.5 Billion plus $5 Billion plus, let’s call it $3.5 Billion (to round things out), equals $170 Billion.

That’s $170 Billion: around 15% of the entire GDP for the country in 2001. We could give every man, woman and child in Canada five hundred dollars every year, and have about $20 Billion left for foreign aid.

And there’s more. Legalizing marijuana, growing hemp and producing its products, supporting research and development into its many uses, and cutting down pollution and deforestation to levels well below Kyoto’s meager demands would certainly reverse the brain drain to the US. It would also attract thousands of liberal-minded, well-educated professionals to Canada’s industry, education, and health care systems. This would increase production, demand, and profitability.

The US is, of course, concerned about Canada’s potential to become the Holland of North America. Their decades-old war on drugs has been too much of a backbone for popular support to let it slip away. The best threat they have come up with so far is to suggest that border crossings will be much tighter. This is not a serious economic threat, as we’ve already factored that in as of 9/11.

Over 70% of Canadians approve of the decriminalization of marijuana. That, in itself, should be motivational. Even the Canadian Medical Association has admitted that it’s ‘not addictive, occasional use not harmful, not causal with criminal behaviour, no evidence of mental damage.’

Take whatever stance you’re comfortable with on smoking the stuff yourself; I’m looking at this purely by the numbers.