Category Local Policy

Ignore Big Marijuana

Danny Vinik Leave a comment

Byron Tau penned a piece for Politico over the weekend about a new opponent of marijuana legalization: Big Marijuana. Yup, you read that correctly. Big Marijuana refers to the industry of medical marijuana growers that exist in states around the country. These growers partake in a risky business, since growing and selling weed is still federally illegal even if it’s legal in various states. That means that the Feds could raid a dispensary at any time. It’s a constant risk. So on a national scale, medical marijuana growers and supporters of full legalization are unified in their support for federal legalization. On a state level though, the two groups are starting to butt heads. Here’s Tau (emphasis mine):

Medical marijuana is a billion-dollar industry — legal in 18 states, including California, Nevada, Oregon and Maine — and like any entrenched business, it’s fighting to keep what it has and shut out competitors. Dispensary owners, trade associations and groups representing the industry are deeply concerned — and in some cases actively fighting — ballot initiatives and legislation that could wreck their business model.

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From the point of view of dispensary owners, legalization laws — depending on how they’re written — can have little immediate upside and offer plenty of reasons for concern. For one, their businesses — still illegal under federal law — benefit from exclusive monopolies on the right to sell legal pot, but state measures still don’t end the risks of an FBI raid or Internal Revenue Service audit. Meanwhile, those same federal laws that prohibit growing, selling and using keep pot prices high.

I’m in favor of marijuana legalization, but there are also some decent arguments against it. David Frum has written a lot in opposition to legalization and while I don’t find his arguments convincing enough to favor our current system, they also are not worth dismissing. What is worth dismissing is any argument from Big Marijuana against legalization.

This is rent-seeking in its purest form. Medical marijuana growers love their monopoly in the industry and don’t want to see competitors eat away at their profits. They also feel like they’ve taken on excessive risk over the past years in selling a federally illegal product and deserve for their industry to have stricter barriers to entry to compensate themselves for their risk-taking. This is entirely wrong. The compensation they received from their risk taking was the monopoly power they enjoyed and the profits that came with it.

So now they’re joining forces with the anti-pot crowd to oppose legislation that would make the drug legal in Maine and other states. In Colorado, the ballot measure that legalized weed this past November included a clause that gave medical marijuana dispensaries the right to receive a license to convert their shops into recreational stores before anyone else entered the market. This is also absurd. Medical marijuana dispensaries already have the supply lines and business experience that new entrants don’t have. They don’t need any extra protection from the state.

I hope people don’t take Big Marijuana’s arguments seriously. Like any other trade group, they are simply looking out for their bottom line and not for the interests of the general public. If you want to find reasons to oppose legalization, go read Frum and other writers on it. But please ignore Big Marijuana.

Question for Felix Salmon on Charitable Giving

Danny Vinik Leave a comment

Reuter‘s Felix Salmon wrote a blog post a few days ago on charitable giving and how the internet allows random acts of kindness. However, at one point Salmon asserts something and makes the rare error of not citing or linking to supporting evidence for his assertion:

The fact is that almost none of us have some kind of annual giving budget, from which we draw when we send money to someone like Karen Klein. Instead, we give as and when we’re moved to do so. Once you start giving money away, you’re more likely to give money away in the future; Stevenson’s implication, by contrast, is that giving money in one place makes you less likely to give money somewhere else. Which is completely wrong.

The first part of that paragraph I believe, but is it really true that once you start giving money, you’re more likely to give more in the future? When is “the future” exactly? For instance, if i give to a charity in April, am I then more likely to give in June? Or not until next year when I’ve earned more money (or in my case, hope to have earned more money)? I wish Salmon had linked to a study or any academic literature that shows this.

Also, at the extreme, giving money in one place DOES make you less likely to give to another. If you give your last $20 to one charity, there’s nothing left for you to give to another. Of course, that’s the extreme, but there has to be some point where an individual giving money to once charity makes them less likely to give elsewhere. That point may vary with each individual, but it does exist and Salmon seems to act here like it doesn’t.

Nevertheless, I agree with Salmon that the advent of the internet has changed how people give and charities must react to these changing times. Will this lead to a rise in charitable giving? I hesitantly say yes, but I’m not sure. Will it lead to less giving to charities and more to individual people? I’m very unsure about that, but it will be interesting to see how it plays out.

Do Fire Drills Work?

Danny Vinik Leave a comment

So, I was woken up this morning at 5:30 am in my GW dorm to the fire alarm going off. While I can’t say for sure it was a drill, no fire trucks arrived and security seemed well aware that there wasn’t a fire. Did I mention it was 5:30 in the morning?

Now I was certainly not happy to be awake, but what may have annoyed me most was the whole idea of a fire drill. Do these things really work at all? I’m very skeptical.

In some places, I see the value of fire drills. In schools or camps where teachers and counselors keep attendance and can make sure everyone is accounted for, they are very valuable, especially with younger kids who would panic and run around aimlessly.

But in a dorm of a few hundred college kids? There’s no way for anyone to do a headcount. At South Hall (the dorm I’m in), there are two staircases and everyone slowly filed through them and out the doors and moved away from the building. There wasn’t much to it. In fact, there was nothing to it.

If a real fire were to happen in the dorm, everyone would head right for those stairs, even if we hadn’t had a drill. They would probably move a lot quicker and there’d be a good bit more pushing, but a fire drill just isn’t going to reduce people’s panic if there was an actual fire. In fact, fire drills have begun desensitizing students to the alarm. Everyone now just assumes it’s a drill, slowly gets their things together and heads outside.

At Duke, many kids don’t even bother coming outside, assuming there isn’t an actual fire. If the school didn’t conduct fire drills, the opposite would be true. Students would assume it was a real fire and would head outside quickly. And since in that hypothetical world where there are no drills, it’d be a good thing the students assumed it was a real fire and moved quickly since it would be a real fire.

And this is without bringing up the fact that this was at 5:30 in the morning and everyone in their building had to get to work in just a few hours. Imagine doing this in an apartment building full of adults. People would be furious.

I tried to find a study on whether fire drills like this (not school fire drills) actually work. I came up empty though. If anyone can point me to a study or present me with a good reason that shows me the value of them, I’m all ears. But I just don’t see what this morning’s drill accomplished. In fact, I think it actually makes fires more dangerous because of the desensitization.

Oh, and the number of fires has been steadily decreasing for years so these drills are becoming even more pointless. (Image via)