Political Risk Brief
Summer 2019

Unintended Consequences: Marijuana Legalization

“THE LAW OF UNINTENDED CONSEQUENCES
IS THE ONLY REAL LAW OF HISTORY.”1
– NIALL FERGUSON

Introduction

The normalization of marijuana consumption in the United States promises to have considerable consequences that the policy debate largely has ignored.  The role of government – both in responding to and shaping appetites through legalization – will produce far-reaching effects that require careful consideration during this early stage of the regulatory cycle.  Major corporations rushing to profit from exploding consumer demand for marijuana should factor the potential liabilities, especially in a political environment deeply suspicious of the “addiction economy.”2 

Background

With Americans increasingly detached from traditional sources of fulfillment – community, religion, and family – the population seeks new forms of consolation.3  Speaking at a pro-legalization event, cannabidiol (CBD) startup CEO Benjamin Witte described his and similar products as “an antidote” to the “anxiety economy,” and 2020 presidential hopeful Senator Kamala Harris (D-CA) praised cannabis for “giv[ing] a lot of people joy.”4  Recent studies find that the number of persons using marijuana daily has increased 50 percent and the number of cannabis addicts has doubled since the early 2000s.5 

The popular portrayal of marijuana as a harmless indulgence, and even a wonder drug for treating pain, commonly fails to acknowledge the well-documented medical repercussions and other effects.  For example, Rolling Stone commented at the beginning of 2019, “After five years of extensive reporting on the cannabis industry, it seems pretty clear that weed itself isn’t that dangerous – sure, it can be abused like any drug, but it’s weed’s illegality that poses a far greater public safety threat.”6  Whatever the moral dimensions of recreational drug use, significantly increased marijuana consumption appears to carry serious tradeoffs. Marijuana use has been shown to have lasting effects on heavy users, with the most severe consequences including: increased risk of psychosis, schizophrenia, depression, and suicide; interference with learning, memory, attention, and executive function; and an increased risk of developing opioid misuse disorder.7

Landscape

Policy makers have responded to the public demand for marijuana with increasing enthusiasm for legalization.  Democratic Party rising star Representative Alexandria Ocasio-Cortez (D-NY-14) expressed indifference to a President smoking cannabis while in office.8  Among Republicans, Representative Don Young (R-AK-At Large) co-sponsored bipartisan bills to lift the federal prohibition on marijuana, calling the current laws “harmful” and “outdated.”9  Even former Speaker of the House John Boehner (R), who in 2011 said he was “unalterably opposed” to marijuana legalization, has joined the board of a cannabis company and is advising a pro-marijuana lobbying group.10  This bipartisan consensus emanates from discrete intellectual movements: first, the progressive Left’s elevation of self-actualization as the most authentic expression of human identity; and second, the libertarian Right’s stringent individualism and associated absolute rejection of government restraint of even self-destructive personal choices, holding that “government’s only responsibility, if any, should be protecting people from force and fraud.”11

Potential Cascading Effects

INTENSIFIED SOCIAL STRATIFICATION AND CLASS CONFLICT

Cannabis has been shown to decrease individual initiative and economic prospects.12  According to a recent comprehensive study, “People who smoked cannabis four or more days of the week over many years ended up in a lower social class than their parents, with lower-paying, less skilled, and less prestigious jobs than those who were not regular cannabis smokers.”13   Cannabis use also has been linked to higher levels of unemployment and welfare dependency.14  At a moment of collapsing social capital – indicated by deeply troubling trends in suicides, addiction, and family formation – greater recreational drug consumption by vulnerable populations could prove devastating.15

EXPANDED GOVERNMENT

Significantly increased marijuana use likely will result in a larger population of citizens requiring health care and social services. For example, even a modest rise in the incidence of schizophrenia and similar conditions would disproportionately affect health care spending; according to the Treatment Advocacy Center, the average cost per individual per year with schizophrenia totals $46,873.16  Especially following the broad legalization that has occurred already at the state level, the moral arguments for government providing such care will be compelling, and the political pressure will be irresistible in the context of rising animosity for corporations that profit from products associated with addiction.

If the medical effects prove as severe as projected by research published in journals that include Oxford Clinical Psychology and The American Journal of Psychiatry, the phenomenon of marijuana-related disabilities will help fuel popular support for a government-provided universal basic income, single-payer health care, and similar solutions.  These options become increasingly plausible as the Right has abandoned Reagan-era free-market ideology, now derided by leading conservative influencers as “market fundamentalism.”17   The multi-billion-dollar opioid crisis bill that included funding for research and recovery centers passed the Senate 98-1, reflecting support for higher spending to address the consequences of marijuana as the new beer.18

REDUCED MILITARY COMMITMENTS

The U.S. political system already has entered an era of broad skepticism regarding the cost and value of national security spending. On the Right, President Donald J. Trump, when speaking of the “uncontrollable Arms Race,” exclaimed, “The U.S. spent 716 billion dollars this year.  Crazy!”19  On the Left, Chairman of the House Armed Services Committee Representative Adam Smith (D-WA-9) remarked, “The Pentagon is going to have less money in the future.”20  In the aftermath of the Iraq War and with a looming fiscal crisis, policy makers prefer to reduce the risks and financial burdens of military conflict.  In this atmosphere, significantly greater marijuana use among youth could accelerate and deepen America’s withdrawal from the commitments of the post-World War II era.  First, marijuana use reduces the available pool of warfighters.  Despite the willingness of the military to grant waivers for past cannabis use, the well-documented anti-motivational effects of marijuana present a serious recruitment challenge.21  Stanford University Professor of Psychiatry and Behavioral Sciences Keith Humphreys highlighted that users reported issues surrounding “concentration, short-term memory, and motivation.”22  Second, as fertility rates continue to decline overall and more young adults suffer from marijuana-related and other dysfunction, American society will be more reluctant to sacrifice the diminishing population of healthy offspring in combat.23  History offers several noteworthy precedents, for example, “Sparta’s mechanism for reproducing itself went haywire.  The eventual result was a demographic and military collapse.”24  Combined, these factors, if unaddressed, will constrain the ability of the nation to defend global interests, meet defense treaty obligations, and deter rising powers.

ACCELERATED DEVELOPMENT OF AUTOMATION, INCLUDING ARTIFICIAL INTELLIGENCE, QUANTUM COMPUTING, AND VIRTUAL REALITY

Employers consistently identify a tight labor market as a significant obstacle to growth, and recreational drug use has exacerbated the problem.25  In 2018, the percentage of job candidates who fail a drug test reached the highest level in 14 years.26  One study found that, in certain rural areas, half of all job applicants fail a drug test.27  Even if employers abandon such screening, multiple studies have shown that marijuana interferes with learning, memory, attention, and executive function even after the acute effects have ceased.28   For manufacturing and other sectors that prioritize safety, the challenge has become severe.  If marijuana use reaches pervasive levels, the incentives to displace low- and even middle-skill labor could expedite a dramatic wave of automation. This outcome only would intensify the harsh criticism corporations already receive for pursuing labor-displacing technologies.  For example, right-of-center publication American Greatness declared, “No job is safe.  Do we deserve to starve to death while men like Jeff Bezos (and his robot-owning pals) literally lock their ‘lucky’ few remaining workers in cages?”29  Other advanced forms of automation could emerge as responses to increased marijuana use, such as autonomous vehicles (AVs).  Driving deaths rose more than 30 percent in Colorado and Washington after the opening of dispensaries in 2014.30  As a consequence, development and deployment of AVs and other “post-human” solutions could reshape labor markets and the broader economy sooner than generally anticipated.

HEIGHTENED REPUTATIONAL RISKS TO THE CORPORATE COMMUNITY

Members of Congress spanning the ideological spectrum – from Senator Elizabeth Warren (D-MA) to Senator Josh Hawley (R-MO) – have been scrutinizing corporate behavior with ferocious intensity, and cannabis-related enterprises almost certainly will be a target.  Cannabis investment nearly quadrupled during 2018, with a significant portion of funds coming from major tobacco, alcohol, and pharmaceutical companies.31  As marijuana moves from a ritual associated with the counterculture to a profit center for publicly-traded multinationals, CEOs with eight-figure incomes will not benefit from “Cheech and Chong”-style tolerance. With the “Tobacco Wars” of the 1980s to 1990s and the current opioid crisis as important case studies, the enriching of the corporate class at the expense of vulnerable Americans creates an especially combustible risk to C-suites.32  Fox News host Tucker Carlson recently asserted that topline economic growth generated by the corporate sector does not inherently address the core concerns of a society: “The goal is demonstrably not a country where the suicide rate is going up. You can throw any number at me, I don’t care about your GDP … we are not getting where we need to be.”33 

Conclusion

Observers including Alexis de Tocqueville have attributed America’s success to the ambition and work ethic of its people. Continued state-level, and ultimately federal, legalization of marijuana would decrease the motivational drive, mental health, and cognitive function of millions of Americans.  Nonetheless, momentum in favor of normalization, whatever the path, appears irreversible in the short term.  Policy makers and the corporate community should consider the unintended consequences for individuals, communities, and the nation.  Marijuana legalization very well might prove as catastrophic to America as the one-child policy has been to China. 

1 Niall Ferguson, “Niall Ferguson on how Europe could cost Obama the election,” Newsweek, June 11, 2012, https://www.newsweek.com/niall-ferguson-how-europe-could-cost-obama-election-65153.

2 Twitter, Senator Josh Hawley, May 8, 2019, https://twitter.com/HawleyMO/status/1126191466819276801.

3 “What We Do Together: The State of Associational Life in America,” United States Congress Joint Economic Committee, May 15, 2017, https://www.jec.senate.gov/public/index.cfm/republicans/2017/5/what-we-do-together-the-state-of-associational-life-in-america; According to Senator Mike Lee’s (R-UT) Social Capital Project, between 1974 and 2016, the percent of adults who said they spend a social evening with a neighbor at least several times a week fell from 30 percent to 19 percent.  The same report found that just 55 percent of adults are members of a church or synagogue, compared to about 70 percent in the 1970s. Between 1970 and 2015, the number of marriages per 1,000 unmarried women aged 15 and older dropped from 76.5 to 32.

4 Event, “Shifting the Wellness Paradigm,” Axios, April 10, 2019; and Avery Anapol, “Kamala Harris acknowledges smoking weed in the past,” The Hill, February 11, 2019, https://thehill.com/homenews/campaign/429386-kamala-harris-acknowledges-smoking-weed-in-the-past.

5 Annie Lowrey, “America’s Invisible Pot Addicts,” The Atlantic, August 20, 2018, https://www.theatlantic.com/ideas/archive/2018/08/americas-invisible-pot-addicts/567886.

6 Amanda Chicago Lewis, “Is Alex Berenson Trolling us with his Anti-Weed Book?” Rolling Stone, January 12, 2019, https://www.rollingstone.com/culture/culture-features/alex-berenson-marijuana-tell-your-children-trolling-777741.

7 “Is marijuana addictive?” National Institute on Drug Abuse, June 2018, https://www.drugabuse.gov/publications/research-reports/marijuana/marijuana-addictive; Mark Olfson, Melanie M. Wall, Shang-Min Liu, and Carlos Blanco, “Cannabis Use and Risk of Prescription Opioid Use Disorder in the United States,” The American Journal of Psychiatry, Volume 175, Issue 1 (2018): 47-53, https://www.ncbi.nlm.nih.gov/pubmed/28946762; “High potency pot ‘strongly linked’ to psychosis: study,” Medical Express, March 20, 2019, https://medicalxpress.com/news/2019-03-high-potency-pot-strongly-linked.html; Christine L. Miller, “The Impact of Marijuana on Mental Health,” Oxford Clinical Psychology, June 2018, http://www.oxfordclinicalpsych.com/abstract/10.1093/med-psych/9780190263072.001.0001/med-9780190263072-chapter-6; Benedict Carey, “Does Marijuana Use Cause Schizophrenia?” The New York Times, January 17, 2019, https://www.nytimes.com/2019/01/17/health/cannabis-marijuana-schizophrenia.html; “The Health Effects of Cannabis and Cannabinoids: The Current State of Evidence and Recommendations for Research,” The National Academies of Sciences Engineering and Medicine, January 12, 2017, http://www.nationalacademies.org/hmd/Reports/2017/health-effects-of-cannabis-and-cannabinoids.aspx; and Samantha J. Broyd, Hendrika van Hell, Camilla Beale, Murat Yücel, and Nadia Solowij, “Acute and Chronic Effects of Cannabinoids on Human Cognition – A Systematic Review,” Biological Psychiatry, Volume 79, Issue 7 (2016): 557-567, https://www.sciencedirect.com/science/article/pii/S0006322315010379.

8 “Alexandria Ocasio-Cortez: no shame in President smoking weed,” TMZ, February 13, 2019, https://www.tmz.com/2019/02/13/alexandria-ocasio-cortez-president-weed-marijuana-legalize-kamala-harris.

9 Press release, “Representatives Don Young and Tulsi Gabbard Introduce Landmark Bipartisan Marijuana Reform,” Representative Don Young, March 8, 2019, https://donyoung.house.gov/news/documentsingle.aspx?DocumentID=399291.

10 Daniel Victor “John Boehner’s Marijuana Reversal: ‘My Thinking on Cannabis Has Evolved,’” The New York Times, April 11, 2018, https://www.nytimes.com/2018/04/11/us/politics/boehner-cannabis-marijuana.html; and “Former House Speaker Boehner gets behind marijuana lobbying group,” Marijuana Business Daily, February 8, 2019, https://mjbizdaily.com/former-house-speaker-boehner-throws-weight-behind-marijuana-lobbying-group.

11 “About the Libertarian Party,” Libertarian Party, https://www.lp.org/about.

12 Sam Wong, “Long-term cannabis use may blunt the brain’s motivation system,” Imperial College London, July 1, 2013, https://www.imperial.ac.uk/news/124806/long-term-cannabis-blunt-brains-motivation-system; and Andrew Lac and Jeremy Luk, “Testing the Amotivational Syndrome: Marijuana Use Longitudinally Predicts Lower Self-Efficacy Even After Controlling for Demographics, Personality, and Alcohol and Cigarette Use,” Prevention Science, Volume 9, Issue 2 (2018):117-126, https://www.ncbi.nlm.nih.gov/pubmed/28620722.

13 Magdalena Cerdá, et al., “Heavy, persistent pot use linked to economic and social problems at midlife,” University of California, Davis Health, March 23, 2016, https://health.ucdavis.edu/publish/news/newsroom/10874.

14 “How does marijuana use affect school, work, and social life?” National Institute on Drug Abuse, June 2018, https://www.drugabuse.gov/publications/research-reports/marijuana/how-does-marijuana-use-affect-school-work-social-life.

15 Anne Case and Angus Deaton, “Mortality and Morbidity in the 21st Century,” Brookings Institution, 2017, https://www.brookings.edu/wp-content/uploads/2017/08/casetextsp17bpea.pdf.

16 Doris A. Fuller, “Research Weekly: The High Cost of Schizophrenia,” Treatment Advocacy Center, August 9, 2016, https://www.treatmentadvocacycenter.org/key-issues/public-service-costs/3599-research-weekly-the-high-cost-of-schizophrenia; and Baron’s analysis of Treatment Advocacy Center data, “CPI Inflation Calculator,” Bureau of Labor Statistics, https://www.bls.gov/data/inflation_calculator.htm.

17 Henry Olsen, “Market Fundamentalism or Love of Country?” American Greatness, January 8, 2019, https://amgreatness.com/2019/01/08/market-fundamentalism-or-love-of-country.

18 Press release, “Sen. Lee Votes Against Unaccountable Opioid Spending,” Senator Mike Lee, September 18, 2018, https://www.lee.senate.gov/public/index.cfm/2018/9/sen-lee-votes-against-unaccountable-opioid-spending.

19 Nancy Youssef, “Trump, after boosting U.S. military budget, says it is too high,” The Wall Street Journal, December 3, 2018, https://www.wsj.com/articles/trump-after-boosting-u-s-military-budget-says-it-is-too-high-1543858578.

20 Kellen Browning, “Military panel likely to get Adam Smith – and his desire for budget cuts – as chairman,” McClatchy, November 11, 2018, https://www.mcclatchydc.com/news/politics-government/congress/article221286025.html.

21 Sam Wong, “Long-term cannabis use may blunt the brain’s motivation system,” ibid; and Meghann Myers, “As the Army modernizes its standards to join, legal marijuana use is still an open question,” Army Times, August 29, 2018, https://www.armytimes.com/news/your-army/2018/08/29/as-the-army-modernizes-its-standards-to-join-legal-marijuana-use-is-still-an-open-question.

22 German Lopez, “Why you shouldn’t dismiss the risk of marijuana addiction,” Vox, August 20, 2018, https://www.vox.com/science-and-health/2018/8/20/17759820/marijuana-addiction-cannabis-use-disorder-legalization.

23 Julia Belluz, “The historically low birthrate, explained in 3 charts,” Vox, May 15, 2019, https://www.vox.com/science-and-health/2018/5/22/17376536/fertility-rate-united-states-births-women.

24 Robert Beckhusen, “How Sparta Crushed its Enemies and Made some Serious History (but was Doomed),” The National Interest, April 26, 2019, https://nationalinterest.org/blog/buzz/how-sparta-crushed-its-enemies-and-made-some-serious-history-was-doomed-54292.

25 Rebecca Greenfield, “The decline of the pre-employment drug test,” The Seattle Times, March 9, 2018, https://www.seattletimes.com/explore/careers/the-decline-of-the-pre-employment-drug-test.

26 “Workforce Drug Testing Positivity Climbs to Highest Rate Since 2004, According to New Quest Diagnostics Analysis,” Quest Diagnostics, April 11, 2019, https://www.questdiagnostics.com/home/physicians/health-trends/drug-testing.

27 Nelson D. Schwartz, “Economy needs workers, but drug tests take a toll,” The New York Times, July 24, 2017, https://www.nytimes.com/2017/07/24/business/economy/drug-test-labor-hiring.html.

28 Samantha J. Broyd, Hendrika van Hell, Camilla Beale, Murat Yücel, and Nadia Solowij, “Acute and Chronic Effects of Cannabinoids on Human Cognition – A Systematic Review,” ibid; and Alecia D. Schweinsburg, Sandra A. Brown, and Susan F. Taper, “The influence of marijuana use on neurocognitive functioning in adolescents,” Curr Drug Abuse; Volume 1, Issue 1 (2008): 99-111, https://www.ncbi.nlm.nih.gov/pubmed/19630709.

29 Spencer P. Morrison, “The Siren of Universal Basic Income,” American Greatness, March 26, 2019, https://amgreatness.com/2019/03/26/the-siren-of-universal-basic-income.

30 “Crashes rise in first states to begin legalized retail sales of recreational marijuana,” Insurance Institute for Highway Safety, October 18, 2018, https://www.iihs.org/iihs/news/desktopnews/crashes-rise-in-first-states-to-begin-legalized-retail-sales-of-recreational-marijuana.

31 Grace Donnelly, “Cannabis Investments Nearly Quadrupled in 2018,” Fortune, December 20, 2018, http://fortune.com/2018/12/20/cannabis-investments-2018.

32 Danny Hakim, Roni Caryn Rabin, and William K. Rashbaum, “Lawsuits Lay Bare Sackler Family’s Role in Opioid Crisis,” The New York Times, April 1, 2019, https://www.nytimes.com/2019/04/01/health/sacklers-oxycontin-lawsuits.html.

33 Tucker Carlson, National Review Institute Ideas Summit, March 29, 2019, https://www.c-span.org/video/?459291-2/national-review-institute-ideas-summit-part-2.