California Rolls Out Legalized Recreational Marijuana in 2018

The start of 2018 brings with it the legalization of recreational marijuana in California. The state of California is one of only a handful of states that have outright legalized the use of recreational marijuana for adults, though dozens of other states have a patchwork of medical marijuana laws on the books.

The state of California has been a trailblazer in the past as it was the first state to allow the use of marijuana for medicinal reasons. California now joins states like Washington and Colorado who have used taxes from recreational marijuana to fund public programs like schools and lower their states' deficits.

Marijuana falls within something of a legal limbo since states have formed their own opinions on the drug's legality but the federal government's Drug Enforcement Agency still classifies marijuana alongside heroin as a schedule I substance. The continued classification of marijuana as a schedule I substance, according to the Controlled Substances Act ushered in to existence under President Nixon, has real implications for a marijuana dispensary's ability to use the inter-state banking system.

That said, legalized marijuana is on schedule to become a multi-billion-dollar industry in California in 2018. Dispensaries could garner as much as $3.7 billion in 2018 and expand to $5.1 billion in revenues in 2019. That's about the same in revenues as the beer industry in California, and it came as no surprise to marijuana enthusiasts in the Golden State that beer companies like Sierra Nevada campaigned heavily against Proposition 64 a few years ago.

Proposition 64 was the referendum in California that won a majority of voters in 2016. Prop 64 allows for adults in California over the age of 20 to grow as many as six marijuana plants and possess an ounce of pot at any point in time. The hope among marijuana enthusiasts is that a rethink of existing state law will coax Californians on the fence about the new policy to see some of the benefits that marijuana has to offer.

Police departments throughout California will be especially vigilant throughout the coming months for signs of people abusing their privileges. There's an increasing fear that Prop 64 could translate into more stoned Californians getting behind the wheel, a deleterious impact on the youth, and more black-market activity as entrepreneurial Californians seek a workaround to marijuana taxes.

Although this is a win for libertarians, the public-health toll is still unknown.



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