Quote:
Originally Posted by Schneed10
If you guys want to argue with me on economics, you're probably better off arguing with me on salary cap issues. Yes, weed can be grown in any moderate climate. Yes, it can be grown in a garage. But it can be grown much more cheaply in South America, where there is already infrastructure set up with vast fields used to grow the stuff. Here in the states we would require capital investment to clear fields, irrigate, plant, grow, and harvest. That requires money. We could use fields that we're already using for tobacco or any other crop, but the net effect on our GDP would be zero, as any revenues generated by the weed fields would be offset by the corresponding loss in revenues in tobacco.
The guy using hydrophonic lamps is using electricity to produce the pot, which isn't nearly as cost-effective as letting the sun shine on it. His cost per unit is much higher than South America's. But from an economic standpoint, I'm not interested in talking about the guys who would grow it in their garage, collectively they wouldn't produce enough weed to make a dent in the nation's demand. If weed became legalized, big business would take over and produce it in mass quantities. South America already has fields, equipment, irrigation, and the process set up to grow and produce the stuff at a marginal cost that is much lower than we could here in the US. One big reason: land in the US is much more expensive than in south America. We could generate pot here in the states for sure, but once Phillip Morris realizes that South America has them beat on labor costs (Columbians will work for 25 cents an hour), the cost of land, and the capital investments required, Phillip Morris will quickly decide not to push forward with a major pot-growing initiative. The nation will still end up importing most of it's pot, and as I said before, the trade deficit broadens, and the dollar weakens.
I don't care if you "buy it" or not, that's what would happen. Go find your friendly neighborhood economics professor and ask him. I know we have several guys around here with MBAs besides me, go ahead, do a SWOT analysis on the American pot industry assuming it were legal. There are too many barriers to entry to compete in a global market.
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You and your economics buddies are a little off. You're forgetting one of the most basic fundamentals of economics -- supply and demand. The cost of marijuana today is reflected in its illegal status. Remove the Black Market implications and the price goes down. I don't need econ professors for that; it's common sense.
And why do you assume people will go out and buy imported marijuana when they can easily grow it on their own? Is it your contention that the sun doesn't shine in the Northern Hemisphere enough to adequately address the demand for the marijuana?
If you're as versed in economics as you say, you of all people should realize that consumers will seek out the least expensive route for the products they want. That's where competition comes in. If Big Business decides to enter into this market, they're going to have to compete with the people who just as easily grow it in their living room. In fact, I would submit that not as many "Big Business" entities would even bother to compete when the cards are stacked against them like that.
Even in your scenario, clearing fields, putting up massive capital amounts to
devote to new products; any weakening of the dollar could be negated once all of the resources relegated to law enforcement, source interdiction operations, court costs, Coast Guard-border enforcement and customs enforcement are removed since it's no longer illegal to consume or possess.
Since you've already admitted to throwing logic and reason out the window with this issue, I suppose it's pointless to argue further. As long as the pharmecutical companies have a stranglehold on the politicians, the GDP and the strength of your dollar will be safe.