Can marijuana help solve the economic crisis in Puerto Rico?

by Mar 16, 2016Economy, Headlines0 comments

Almost a year after outgoing Puerto Rico Governor Alejandro Garcia Padilla legalized medical marijuana through executive actions, he has again spoken out in favor of legalizing marijuana in Puerto Rico. Currently, Puerto Rico has strict drug laws where possession of marijuana is a felony punishable by 2-5 years in prison, and a $5,000 fine. While delivering his last public address as Puerto Rico’s leader, on February 29th Garcia said that legalizing marijuana would “lower crime and target hypocrisy,” as well as be useful as a tax revenue resource for paying back Puerto Rico’s $70 billion debt, helping the territory out of its long recession.

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Currently, 23 states have legalized marijuana in some form, and 4 states and the District of Columbia have legalized recreational use of the drug. Many of these states have already seen some benefits. Last year, Colorado collected $72 million in tax revenue from marijuana, almost double the revenue collected from alcohol that year. A large increase in tax revenue similar to Colorado would be a significant boost to the struggling Puerto Rican economy.  Based on the current level of marijuana use and sales in Puerto Rico, the potential tax dollars from this untapped taxation resource will be substantial, and that, in conjunction with the potential increase of tourism as a result of legalization, will result in significant benefits flowing to the economy from legalization. Although those against legalization may express concern that legalization contributes to increased drug use, a sizeable portion of the population already uses marijuana. Furthermore, many believe that criminalization of marijuana has clearly not been successful, and that drug policy may be more successful with an approach from a public health perspective.

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Puerto Rico’s harsh penal system and current laws, with a minimum of two years in jail for marijuana possession, has been extremely costly to the islands. By legalizing marijuana, in addition to the millions of dollars in tax revenue generated, Puerto Rico would save tens of millions of dollars from the significant decrease in arrests, administrative and judicial costs, and costs of incarceration for those possessing the drug.

Marijuana will not single handedly save the economy of Puerto Rico, but it can drastically help Puerto Rico reverse the economic course of the past decade. The tens of millions of tax dollars and money saved on the criminal system could make a lasting impact on the island’s economy that has seen severe unemployment rates and a major debt crisis. If the funds generated from legalization, or at the very least, decriminalization, are used to help create and fund job growth on the island, Puerto Rico’s economy may see the light at the end of a long dark tunnel.