Marijuana Market: 5 Positives of Legalizing Pot in the U.S.

marijuana legalization in us

Legalizing Pot in the U.S.

It’s safe to say that we’ve never been as close to legalizing pot in the U.S. as we are now. Between the support given to the industry from all sorts of political figures, from high-ranking lawmakers to U.S. mayors to the president himself, the prospect of legalizing pot in the U.S. is growing.

Consider that 61% of Americans favor legalizing marijuana, according to a Pew Research survey. (Source: “About six-in-ten Americans support marijuana legalization,” Pew Research Center, January 5, 2018.)

Considering how polarized the U.S. political environment is, you can hardly get 61% of Americans to agree on the color of the sky let alone something as formerly divisive as drug policy.

But there’s a reason that the prospect of legalizing pot in the U.S. is gaining traction. Actually, there are many reasons, and in this piece, we’re going to list five major benefits of marijuana reform in the U.S.



If there’s one thing politicians love talking about, it’s jobs.

You rarely ever hear a stump speech or town hall meeting that doesn’t at least partially focus on the economy and job creation. The economy is the third-highest ranked public policy priority for U.S. citizens, behind terrorism by two percent and education by one percent, according to a poll by the Pew Research Center. (Source: “Public’s policy priorities for 2018,” Pew Research Center, January 25, 2018.)

After all, one of President Donald Trump’s biggest promises during his campaign for the White House was job creation.

As such, it only makes sense that Americans would see the value in the cannabis industry for achieving that lofty goal of job creation.

If federally legalized, cannabis would immediately add 782,000 jobs to the U.S. economy, according to a study conducted by New Frontier Data. That number would later jump to 1.1 million by 2025. (Source: “Marijuana legalization could inject over $130 billion into US tax coffers by 2025 — if the Trump administration stays hands-off,” Business Insider, January 13, 2018.)

By comparison, the Bureau of Labor Statistics is projecting that the total U.S. labor force would increase by only about 10.5 million in the next decade.

Creating an industry that would add hundreds of thousands of jobs overnight seems like a no-brainer to me, and I’m sure a lot of Americans agree.

Tax Revenue

Alongside jobs, another huge boon to the economy would be a massive injection of tax revenue.

The same study by New Frontier Data found that as much as $131.8 billion in federal tax revenue is just waiting to be claimed should U.S. pot legalization go through.

That’s how much money the country could make by 2025 if it pushed marijuana reform.

But you don’t even need to trust projections—Colorado is a perfect example of just how much money the U.S. is losing out on by not legalizing marijuana federally.

The state first began recording tax revenue from pot in 2014, when it raked in about $67.6 million.

Calendar Year
Total Revenue
2018 (Jan–May) $109,002,969

That number ballooned to $247.4 million in 2017 and has already surpassed $100.0 million by May 2018. (Source: “Marijuana Tax Data,” Colorado Department of Revenue, last accessed June 25, 2018.)

“If cannabis businesses were legalized tomorrow and taxed as normal businesses with a standard 35 percent tax rate, cannabis businesses would infuse the U.S. economy with an additional $12.6 billion this year,” New Frontier CEO Giadha Aguirre De Carcer said in a statement released with the company’s report. (Source: Business Insider, op cit.)

The Government Can Benefit

Another huge boon to the U.S. government would be that it would no longer have to dump resources into policing marijuana.

The country is already spending billions on incarcerating marijuana drug offenders.

While it’s not necessarily true that the U.S. would totally eradicate its issue with mass incarceration should it release all its non-violent marijuana users from prison (or non-violent drug offenders, in general) it would still make a substantial dent in an already swollen prison population. (Source: “Releasing Drug Offenders Won’t End Mass Incarceration,” FiveThirtyEight, July 17, 2018.)

Ending the prohibition of marijuana would save the country billions in policing and jailing, however, while hampering the ability of the black market to profit from an extremely lucrative cash crop: cannabis.

How Marijuana Stocks Can Benefit

As the hard data shows above, the marijuana industry is a powder keg ready to be set off, with billions in revenue and millions of jobs waiting to be created.

And—as you can expect from an industry of that size—a massive growth in stocks would follow.

I’m a marijuana bull and have been for some time, but I’m also realistic about the limits of the industry. Those limits being when the global market eventually opens up.

I say “eventually” and not “if” because it is going to happen. It’s an inevitability at this point. The question is one of time.

But should the U.S. market open up to marijuana, not only would stocks immediately shoot through the roof in value, but we’d also see a good many countries follow suit.

After all, they wouldn’t want the U.S. to be the only one able to benefit from this extremely exciting industry.

And that would be great news for us marijuana bulls.

Medical Benefits

A final “softer” benefit (it can’t always be about the numbers and money) is that cannabis is genuinely seen as a viable treatment to a good number of ailments.

Natural and generally safe for consumption, marijuana legalization would allow people to forgo much more dangerous drugs like opioids.

In fact, there’s good evidence to suggest that legalizing pot in the U.S. would actually do well to help curb some of the opioid epidemic.

Analyst Take

Create jobs, save money, boost revenue, boost stocks, and save lives—what’s not to like?

U.S. pot legalization may not happen in the next year—or two or five or even 10, maybe—but it is on the way.

And the longer the country forgoes it, the longer it is denying itself so many of the wonderful benefits that would help the government and its people.