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States' Pot Legalization Would Hurt Cartels

A new report calculates the losses Mexican drug traffickers could suffer if Washington, Oregon or Colorado vote to legalize marijuana next week.

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Marijuana makes money—but for whom?
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By Will Godfrey

11/01/12

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The staunchest opponents of three marijuana legalization bills being voted on in US states next week may be Mexico's drug cartels, a new study suggests. The Mexican Competitiveness Institute, a think tank, assumes that if pot were legalized in Colorado, Oregon or Washington—the three states where such measures have made the November 6 ballot—it would be produced relatively cheaply there and smuggled to other states. It calculates hypothetical prices and assumes that US consumers would choose home-grown marijuana over Mexican if it cost less. According to this model—and estimating that Mexican cartels currently make over $6 billion a year from smuggling into the US—legalization in Oregon would see a loss of $1.839 billion for Mexican cartels, while legalization in Colorado or Washington would cost the cartels $1.425 billion and $1.327 billion respectively. Such estimates should be taken with a pinch of salt, of course. One of the study's authors, former Mexican intelligence officer Alejandro Hope, admits that the figures rely on a series of uncertain assumptions; above all, aggressive intervention by the US federal government or neighboring state authorities could stop US-grown weed moving easily and cheaply around the country. And opponents of legalization argue that the cartels could respond by using legitimate US grow operations as fronts to continue their business. Still, the prospect of squeezing the profits of some of the world's most ruthless criminal organizations should give voters additional food for thought. 

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