The Real Problem With Legal Weed

When New York legalized recreational marijuana in 2021, the future seemed bright. “It has been a long road to get here, but it will be worth the wait,” State Senator Liz Krueger, a sponsor of the legislation, told New Yorkers. Legalization, she and others said, meant a wave of new jobs and new tax revenue. It meant an end to racist policing of marijuana and the start of equity, with rules that put those harmed by prohibition at the front of the line for licenses. And it meant easy-to-buy weed for the 1.6 million adult New Yorkers who already partook.

Three years later, things are not going to plan. Gov. Kathy Hochul has called New York’s legalization rollout “a disaster.” Mayor Eric Adams has spent months demanding that Albany fix the current system. “What happened?” The New Yorker recently asked in a feature on the collapse of the state’s marijuana “revolution.” Many New Yorkers are asking the same thing.

There are around 140 recreational dispensaries operating statewide — about one for every 148,000 New Yorkers. Instead of shopping legally, New Yorkers tend to get their weed from the illegal shops that now blanket the state. Estimates suggest that there are anywhere from 2,000 to 8,000 in New York City alone, with uncounted more from Ithaca to Oneonta. Recent crackdowns have temporarily sealed more than 400 stores — only a small fraction of the total in the city.

These shops undercut the legal stores, offering the same high at a fraction of the price. And they attract crime: There were 736 robbery complaints at unlicensed shops last year, according to the New York Police Department. Shootings are not uncommon, including the killing of a 36-year-old man captured on video last April.

They also sell to teenagers, as The Times has reported. Teachers, prevention experts and pediatricians have raised the alarm about high schoolers smoking or vaping marijuana at school. “Kids will do it in the bathrooms,” one student in Westchester says, “and it’s become a pretty normal occurrence for you to walk into a bathroom and you can smell it.” Disciplinary incidents involving drugs and paraphernalia rose 17 percent in the 2022-23 school year, according to New York City officials.

Pressed on why things are going poorly, defenders of the law have pointed to a series of roadblocks. Ongoing litigation has ground licensing to a halt. The programs meant to give disadvantaged license holders a head start have struggled to secure funds and storefronts. The state’s main marijuana regulator, the Office of Cannabis Management, was given almost no enforcement power in the initial law, and its powers remain too weak, its executive director, Chris Alexander, told a State Senate subcommittee before resigning last month. These setbacks can’t be helping. But there are flaws in every policy rollout. So why does this one seem worse?

To millions of Americans, marijuana legalization seems not only good but obvious. The case against pot — made in retro public-service announcements and the DARE program — feels like laughable scaremongering, so ineffective that it can even increase marijuana use. Cautious moves toward legalization, like the Biden administration’s recent push to change the legal status of marijuana, seem like inexplicable half-measures. Fears about “reefer madness” are so unpersuasive today that even a majority of self-identified conservatives supports legalization.

I used to be one of those. I am a writer and researcher at a conservative think tank who has been on the right since high school, but I’m also a millennial, part of the age cohort most supportive of legalization. I’ve smoked pot; it was harmless fun. In college, I even participated in a (mostly tongue-in-cheek) protest of conservatives supporting legalization; we called it “Tweed for Weed.” And as someone committed to individual liberty, for a long time I thought we should let people do what they want and not judge them for what amounts to a personal choice.

I still believe much of that. But I’ve also come to think that debating whether individuals should use marijuana obscures the harms that come when we let businesses sell it. While marijuana may not be as bad as some critics claim, the medical evidence is clear that it can do substantial harm. Marijuana is addictive — around 30 percent of users use compulsively, even as their use harms themselves and the people around them. And while I, as a conservative, think that free markets do enormous good, I also think that combining addiction with the profit motive creates perverse incentives, letting corporations compete to help people ruin their lives.

Once you understand these dynamics, New York’s weed problems are no longer confusing — they’re obvious. They’re so obvious, in fact, that public-health researchers have been talking about them for decades. But nobody — not New York’s leaders, not the millions of Americans excited about legalization — wanted to listen. Blinded by excitement, they saw marijuana as a great opportunity with no downside. As they are slowly finding out, they were wrong.

It’s a little weird how marijuana-obsessed Americans are. In 2022, more than 60 million people reported using it. There’s a multibillion-dollar industry dedicated to it. Americans buy coffee-table books about it, attend festivals dedicated to it, take guided tours focused on it. If they want to watch people cook with weed, they can choose between Netflix’s “Cooked With Cannabis” or “Chopped 420” from the Food Network. Big stars talk about it: Seth Rogen says he smokes “all day, every single day,” and Bella Thorne has an entire area of her kitchen devoted to marijuana. In 1992, Bill Clinton had to claim he “didn’t inhale it.” In 2022, the Democratic Senate nominee in Louisiana released a pro-legalization ad featuring him smoking a blunt.

Much of this, of course, is a reaction to how we used to think about “the devil’s lettuce.” President Richard M. Nixon, and a great many of his voters, would have been shocked and dismayed to hear that one in five Americans smokes. In 1969, when Gallup first asked, just 12 percent of Americans favored legalization. Today, 70 percent do. But we seem to have gone beyond just rejecting Nixon-style prudery. We’ve gone from “Just Say No” to an enthusiastic yes.

Part of our excitement is a sense that, contra the DARE view, marijuana is pretty safe. Sure, people will mouth the words “consume in moderation.” But in 2023, high schoolers were less likely than at almost any point on record to say that regular marijuana use carried great risk. And how worried do they really need to be? Cannabis is a plant that humans have been consuming for thousands of years. Deaths from cannabis toxicity are extremely rare. Many people rely on it to treat chronic conditions.

Marijuana’s addictive potential, though, gives us at least one reason to worry. Modern psychiatry tends to characterize addiction — today usually called “substance-use disorder” — as continued use of a substance in spite of negative consequences. The Centers for Disease Control and Prevention notes that roughly three in 10 marijuana users qualify as having a “cannabis-use disorder,” known as CUD; the Diagnostic and Statistical Manual defines CUD in part as “an inability to stop using marijuana even though it’s causing health and social problems.” Federal survey data indicate that 19 million Americans suffered from cannabis-use disorder in 2023.

This may come as a surprise to readers who have heard that marijuana is not “physically addictive,” meaning that marijuana does not induce dangerous withdrawal the way alcohol does. But it is entirely possible for regular marijuana users to develop tolerance (needing more to generate the same effect) and dependence (experiencing unpleasant symptoms when they don’t use). Nearly half of regular cannabis users will experience “marijuana withdrawal,” characterized in the journal Addiction as involving anxiety, irritability, anger, depression and sometimes “chills, headaches, physical tension, sweating and stomach pain.”

Somewhat perversely, our culture regards such people with amusement. If someone says they need to start drinking the moment they wake up, we say they have a problem; if they “wake and bake,” we think that’s kind of funny. But in reality, cannabis-use disorder can be debilitating, causing problems with concentration, memory, focus and motivation, as well as mental-health issues. As with any addiction, marijuana can come to take priority over the rest of the user’s life, causing job loss, damage to personal relationships and profound distress. “Do people die from cannabis-use disorder? Almost never, unless they have an accident,” says Keith Humphreys, an addiction specialist at Stanford University. “But can their lives be severely damaged? Absolutely.”

Cannabis-use disorder is still less widely recognized than other addictions. Humphreys says that’s because it was less common when marijuana was less potent. According to the National Institute on Drug Abuse, average THC concentration has risen from around 4 percent in the mid-1990s to 15 percent in 2021. Legalization has also permitted the production and sale of high-potency concentrates, with THC levels as high as 80 percent. As a result, addiction has become more common, even as public perception has lagged.

Although more data are needed, the best evidence indicates that where legalization has taken place, addiction has surged. A 2023 review of the literature found that the research “generally support[s] an increase in CUD prevalence among adolescents and adults post-legalization.” This makes sense. Legalization has let companies create higher-potency products. It has also let them advertise to users, which can trigger cravings in much the same way that sports-gambling ads trigger people to place bets. And most of all, it has made pot more available, at lower prices than ever, making it easier for people on the margins of addiction to be pushed into overconsuming.

That marijuana is addictive does not necessarily mean it should be illegal. Nor is it an indictment of its users. People with a cannabis-use disorder have a health problem, not a moral problem. But by the same token, if marijuana creates a health issue for as many as 30 percent of its users, then maybe the government should be concerned with how it affects public health. Consumers of marijuana — like recipients of high-interest loans or purchasers of other legal drugs — might still need some form of consumer protection.

To understand why, it’s helpful to think about the economics, and to consider how markets for addictive products function differently from others. In most markets, what’s good for the seller is also good for the buyer. If a farmer sells me fresh vegetables, for example, we both profit — he gets money, and I get a healthy, delicious meal. But what’s good for the seller of an addictive good is often bad for the addicted buyer. Whether selling an ounce will hurt his customer might affect a retailer’s conscience, it’s still good for his bottom line. And if an ethical dispensary won’t sell the ounce, an unethical one will.

People who are addicted to a substance — like heroin or alcohol — tend to consume a lot more of that substance than those who are not. If one person has five drinks a day, he consumes more in a week than 17 twice-a-week drinkers. This is also true for marijuana: RAND Corporation and Carnegie Mellon researchers have estimated that daily or near-daily marijuana users account for 37 percent of the using population but 80 percent of marijuana used. As a result, most sales will come from people whose use is likely to be harmful, and the preferences of those people will end up shaping the market.

One preference in particular will matter a lot: price. Smoking a lot of marijuana can mean spending a lot of money. Addicted marijuana users, moreover, want to consume a certain amount, regardless of how much it costs to buy that amount. In economics terms, their demand is “inelastic”: In general, they don’t respond to higher prices by consuming proportionally less. Instead, they may try to cut back other costs — or look for cheaper product. That cheaper product often comes at the expense of other qualities, like safety or ethical sourcing. A RAND web survey in 2013 found that those who used daily would pay only about $2 more per gram for cannabis that was “legal, labeled and tested for pesticides and other contaminants.” More than a third of respondents would not pay any more at all.

The importance of price to markets in addictive substances explains why New York’s unlicensed market is so big: It’s cheaper. To understand, consider a retailer like Hell’s Kitchen Cannabis Collective, which sells legal marijuana in Midtown. The founders, Bijan Joobeen and Patrick Conlin, have backgrounds in hospitality and wine, and the store, with its mahogany wood and tasteful decorations, is reminiscent of a high-end bottle shop. Conlin described the product as “small-batch”; he couldn’t call it “craft,” he noted, until the state labeled it as such.

Not itself licensed to sell, H.K.C.C. functioned as a sort of marijuana farmers’ market that gave growers somewhere to take their product so it didn’t rot in their warehouses as they waited for legal storefronts to open. As of late last year, an eighth of an ounce at H.K.C.C. cost between $34 and $62. That is, Joobeen says, “more than you would pay at any of the illicit shops around the corner.” But H.K.C.C.’s bet is that the quality difference — and the legality — is worth the cost.

That may be true for casual customers. But it’s probably not true for someone like Joseph, a daily smoker who was window shopping at H.K.C.C. Joseph smokes about an ounce of marijuana a week, meaning that buying from H.K.C.C. could run him upward of $14,000 per year. Instead, Joseph buys at the bodega around the corner, where he can get an eighth for $12.50 to $15. Shopping illegally probably saves Joseph nearly $9,000 annually. But it also renders H.K.C.C.’s business model nonviable. “It’s extremely likely that we will be the first licensed retailer to fail in the state,” Joobeen says. “It’s impossible for us to compete with the 24 illegal dispensaries in a three-block radius that present themselves as legal shops.” (H.K.C.C.’s showcase license has lapsed, and the store remains closed as Joobeen and Conlin struggle to reopen under a full license.)

Why is legal weed more expensive? Because its sellers comply with the rules. Regulating a commodity imposes costs on producers, which are then passed on to consumers as higher prices. New York’s 9 percent tax on marijuana sales means that legal weed costs more. Requirements that marijuana be sourced in-state or restrictions on the number of licenses limit the number of competitors in the market, further raising prices.

New York has made certain choices that exacerbate this dynamic, like initially restricting its dispensary licenses to people who had been convicted of marijuana-related offenses (or their close relatives). But the problem is not unique to the state. In their book “Can Legal Weed Win?” the economists Robin Goldstein and Daniel Sumner argue that licensed and unlicensed marijuana are basically the same product — the same plant, with the same psychoactive effects. The difference is that licensed weed is heavily regulated, which results in higher prices. That’s true outside New York: In their 2019 study of the prices of over 200,000 marijuana products in California, Goldstein and Sumner and their colleague Raffaele Saposhnik estimated that licensed cannabis is 10 to 25 percent more expensive than unlicensed cannabis. The cheapest unlicensed product costs half as much as licensed ones. (California, like New York, has a huge unlicensed market.)

This dynamic isn’t caused by lawsuits or government incompetence. It’s fundamental to the way the markets work. “Everything involves a trade-off,” Goldstein says. Every time you add a costly regulation to legal weed, you “add that much more cost to legal product, which makes it that much more difficult for it to compete with the illegal seller down the street whose product doesn’t have to comply.”

What all this means is that the size and vibrancy of New York’s unlicensed market doesn’t stem from just a few missteps in implementation. It’s a necessary consequence of how the state designed its legal marijuana regime. A small number of legal licenses, issued to people without much business experience, with stringent regulation of the product, all adds up to an expensive legal market. Customers, especially addicted customers, instead go to the cheaper, illegal market. So long as the licensed market can’t compete with the unlicensed market, the unlicensed one is here to stay.

One solution would be to deregulate. Give out licenses to anyone who wants one, slash taxes to nominal levels and let business flourish. Goldstein says he would regulate marijuana “like kale”: test for contamination, but otherwise treat it like any old plant. “I think you would see the disappearance of the illegal competitors, because there’s almost no illegal kale on the market,” he says. Minimizing regulation would end the headache of the unlicensed market. Would a marijuana market free-for-all really be so bad?

Large firms would be much, much better at growing and selling marijuana at agribusiness scale, drastically reducing prices and driving the illegal shops out of business. Jonathan Caulkins, a drug-policy researcher at Carnegie Mellon University, has argued that industrial-scale growing and other efficiencies could drive prices down to pennies a joint, much as automated cigarette rollers instigated the transition from pipe smoking to pack-a-day cigarette consumption.

This all may sound fine if we think that marijuana is just a fun version of kale. But if marijuana is a harmful, addictive substance, then letting Amazon or Walmart sell joints by the pack might give us pause. Yes, deregulation would kill off the black market. But would it be better to have big businesses selling to addicted consumers?

We know, after all, what markets in addictive, harmful substances look like. “Big tobacco” continues to dominate an industry worth tens of billions of dollars in the United States alone. Alcohol retailers are abundant and much less regulated. And while many people enjoy a drink or a smoke safely, in the aggregate they do sweeping social damage. Research consistently finds that alcohol is a major driver of criminal offending. Smoking-related illnesses cause an estimated $300 billion in economic costs in this country each year. And both alcohol and cigarettes are involved in more deaths every year than all illegal drugs combined.

Marijuana, too, can be harmful. Some of the harms are acute: Ingesting too much can cause abnormal heart rate and central nervous system depression, particularly in children. Recreational legalization is consistently associated with an increase in cannabis-related hospitalizations, according to a review in the journal Public Health. Intoxication also impairs basic functioning, and legalization has caused up to an additional 1,400 road deaths a year, according to a recent study in The International Journal of Drug Policy. It’s probably not a coincidence that, according to Quest Diagnostics, the share of American workers testing positive for marijuana after an accident on the job is at a quarter-century high.

Risks can accumulate over time, too. Some are unsurprising: A growing body of evidence links cannabis smoking with a number of lung issues, including cancer. (The existence of edible products lessens this concern, though 78 percent of marijuana users still smoke it.) Recent research in The Journal of the American Heart Association also finds a connection — though not necessarily a causal one — between marijuana use and heart disease, myocardial infarction and stroke. There are also associations between marijuana use and mental illness, with the strongest evidence linking regular consumption in adolescence to psychosis and schizophrenia.

Perhaps marijuana is not as bad as alcohol or cigarettes. But saying it is not as bad misses the point: Marijuana does hurt a substantial portion of its consumers, often quite badly. And there is no reason to think that businesses won’t sell marijuana to those it hurts, if they’re allowed to. What the alcohol and tobacco markets show us, rather, is that addiction and profit don’t mix well.

Concerns about this dynamic have led some drug-policy scholars to look for alternative approaches. Beau Kilmer, a co-director of RAND’S Drug Policy Research Center, has with his colleagues tried to define a spectrum of options between prohibition (punishing people for selling or possessing a drug) and commercialization (letting businesses sell the drug at a profit). These include limiting sales to nonprofit operations, letting individuals grow their own plants and creating state-owned retailers. The goal is to find a balance between the harms of prohibition and those of commercialization.

These aren’t pie-in-the-sky ideas. “When you get outside of the United States,” Kilmer says, “there’s much more interest in some of these middle-ground options.” The Netherlands has long declined to prosecute the sale of small quantities of marijuana in its famous “coffee shops,” but it otherwise prohibits the trade. Germany is creating “cannabis social clubs,” small groups that grow cannabis for their own consumption. These models have their own challenges. But they are a far cry from the crass commercialism of the emerging U.S. approach.

New York had the chance to do things differently. Back in the 1970s, it was part of a wave of 11 states that decriminalized marijuana possession. Legislators replaced jail time with small fines in most cases, but kept sales and manufacturing illegal. As a result, arrests for marijuana possession were relatively rare. In 1987, at the peak of the “war on drugs,” there were only about 4,000 possession arrests in New York City; that figure fell below 1,000 by the early 1990s.

But while possession was decriminalized, smoking or possessing marijuana “open to public view” was still an arrestable offense. That prohibition became a key part of the Giuliani and Bloomberg “stop and frisk” strategy. N.Y.P.D. officers would ask young Black men to turn out their pockets, then arrest them for the now-visible marijuana. In 1992, there were just 722 marijuana possession arrests in all of New York City. By 2000, there were over 50,000.

The public’s support for legalization was motivated in large part by a backlash against this approach, and especially its impact on Black and brown New Yorkers. Across New York State, from 2002 to 2017, Black residents were roughly 12 times as likely as white ones to be arrested for marijuana possession. Voters saw this glaring discrepancy as evidence of a system in need of fundamental reform.

Succeeding Michael Bloomberg, Mayor Bill de Blasio championed such reform. N.Y.P.D. officers were advised to issue a citation, rather than make an arrest, for “public view” offenses. Over the next several years, arrests fell steadily. Then, in 2019, the state revisited its decriminalization statute, making “public view” no longer an arrestable offense. In 2020, the N.Y.P.D. reported just 437 marijuana-related arrests.

Elizabeth Glazer, who ran de Blasio’s Office of Criminal Justice, believed that changing the public-view rules made sense, but even then she thought “it was a terrible idea to have pot shops lining the streets available more or less for all who might want it.” Now she feels that she was right. Legalization “seems to have been disastrous,” Glazer says. “To me, it’s one more example of how crucially important governance and operations is in the execution of any policy at all. This seems like Exhibit A.”

What was obvious to Glazer then was also obvious to the researchers who have thought long and hard about the challenges of marijuana legalization. But New York’s leaders were apparently uninterested in the careful balancing that successful commercialization entails. After all, how bad can marijuana be, really? There is, one might speculate, a connection between how New Yorkers — how Americans — regarded marijuana and the disaster that followed. Our collective enthusiasm about it blinded us to the hard trade-offs involved in actually letting businesses sell it.

What to do now? It’s hard to take seriously the idea of New York undoing legalization — returning to decriminalized, but not commercialized, marijuana. Such an about-face is unlikely to get past the voters. But what might be possible is a change not in marijuana’s legal status but in its social status. Marijuana is still a cool drug, with few aware of its risks and harms. But if we start to understand that marijuana is not benign, that it can do real harm, then perhaps we can begin to address our pot problems.

What, for example, if we thought of marijuana more like cigarettes? Smoking, too, was once seen as harmless fun. Today, a vast majority of Americans recognize cigarettes as a noxious irritant peddled by an industry that preys on children and adults alike. The decline in smoking, particularly among teenagers, was accomplished without war-on-drugs-style enforcement. It is one of the great triumphs of public health.

Marijuana and cigarettes are in many regards quite similar. A puff of either is essentially harmless, and often pleasurable. Many people can use them recreationally — the weekend pot or cigarette smoker are established types. For some, they are addictive. And while the ultimate effects of that addiction are different, they have in common the perverse incentives that are created when someone is allowed to sell them for profit.

More to the point, our experience with cigarettes shows that just because a substance is technically legal does not mean that we, as a society, have to like it. Nor does it mean that the government cannot discourage its consumption without banning it. The recent crackdown on pot shops is a good start, though it is likely too small to have much effect. The pervasive smell of marijuana in New York City frequently violates the city’s smoke-free air laws; a little enforcement would go a long way toward making marijuana smoking less prevalent. Similarly, the state government could spend less money advertising for weed and more warning citizens about its risks.

Mark A.R. Kleiman, the eminent scholar of drug policy who died in 2019, often argued that vices like cigarettes, alcohol and marijuana needed what he called “grudging toleration”: legal permission combined with stiff restrictions designed to mitigate the social and individual harms of use. Such an approach also requires social intolerance — a collective sense that a behavior is permitted but just barely. Animated by a genuine desire to undo racial injustice, New Yorkers have shifted from intolerance of marijuana to enthusiastic embrace. Perhaps that swing was a little too hard. A little less tolerance, and a little more grudge, could do everyone a world of good.