Descheduling marijuana without conditions provides a handsome taxpayer-funded gift to the for-profit cannabis industry. Due to an obscure tax code provision known as 280E, a business selling a controlled substance scheduled at I or II cannot deduct ordinary expenses, including advertising and other product promotion. The Joint Congressional Committee on Taxation estimated conservatively that ending 280E via descheduling would grant the marijuana industry $5 billion in tax write-offs over 10 years.
An alternative that might appeal more to left-wing voters would be to allow cannabis businesses to deduct expenses only related to activities that help communities, for example creating jobs. As cannabis tax expert Pat Oglesby puts it: “For many of the folks who have battled to legalize cannabis, advertising and glitzy store fronts are distractions. Those folks just want the arrests to stop — they don’t care about subsidizing billboards and neon.”
The cannabis industry would no doubt point out that this is a double standard because the tobacco industry is allowed to deduct costs for promoting its addictive product. But a progressive candidate has a perfect rebuttal: “That’s a good point; I will take away the tobacco industry’s taxpayer subsidy, too.”
Moving further left, why trust for-profit cannabis corporations to not promote addiction when 80 percent of the revenue of almost all addictive products comes from those who have a substance use disorder? The RAND Corporation suggests alternatives to the profit-driven model such as restricting production and sale of cannabis to nonprofits or public benefit corporations overseen by boards of local parents, teachers, health professionals, child advocates and other individuals who value community well-being more than ever higher sales.
Taking a leaf from the book of the rising Democratic Socialist movement, presidential candidates might consider yet another alternative: promising to end federal involvement in policing marijuana only in states that operate a retail monopoly themselves. The “state store” approach has been used for alcohol and has a strong record of reducing alcohol-related harm compared to relying on for-profit retail outlets. The Democratic Party’s core voters might also appreciate a state monopoly model because government agencies have a much better record of employing and promoting women and people of color than does the for-profit cannabis industry, which is dominated by white men.
The above are only a subset of the many ways to legalize marijuana without creating a clone of the tobacco industry. In a crowded primary where candidates are struggling to differentiate themselves, one of the Democratic presidential candidates might very well embrace a nonprofit form of marijuana legalization that makes the rest of the field look like corporate Democrats.