A marijuana dispensary in California

The passing of marijuana legalization ballots in Washington and Colorado raises the question of whether these measures will hit the profits of Mexican drug trafficking organizations.

The two states became the first to legalize the recreational use of the drug in the United States. In Colorado, the ballot passed with 53 percent of the vote, with 47 percent against. In Washington, with 60 percent of the vote counted, the measure was passing with 55 percent to 44.

The measures legalize personal possession of up to one ounce of marijuana, and allow the drug to be legally sold and taxed in licensed stores.

A similar initiative failed to pass in Oregon, gaining less than 45 percent of the vote.

InSight Crime Analysis

A recent study by Mexican free trade think tank the Mexican Institute of Competitiveness (IMCO), (co-authored by analyst Alejandro Hope, an InSight Crime contributor) found that if the marijuana legalization ballots passed in Oregon, Washington, and Colorado, it could reduce the revenue of Mexican drug trafficking organizations by as much as 30 percent.

But as Hope pointed out on Animal Politico, the impact of these measure will depend on the US federal government’s response. Drug legalization activists -- and critics -- have expressed surprise that US Attorney General Eric Holder did not issue any strong statements opposing the marijuana legalization initiatives as the election approached. This was in marked contrast to the strongly worded statement Holder issued before California residents voted on Proposition 19 in 2010. So far, the response from the federal government remains muted: according to Reuters, the US Justice Department reacted to the measures by stating that its drug enforcement policy had not changed.

As Hope argues, the consequences of these marijuana legalization measures depends on how quickly and vigorously federal authorities react. There are several things the federal government may now do, Hope states: try to overthrow the legalization measures in court, increase the number of federal anti-drug police in Washington and Colorado, or selectively persecute marijuana buyers, sellers, and distributors in these two states.

Mexico, one of the major suppliers of marijuana to the US, is unlikely to feel the impact of these measures for a while. Parts of the Colorado measure will come into effect after 30 days, but the Washington measure will not take effect for a year. As John Walsh noted in commentary for the Washington Office on Latin America (WOLA), the legalization may have more symbolic than practical impact. The outcome of the vote is indicative of shifting attitudes towards marijuana prohibition in the US, for elected officials and citizens alike. “Rather than considering marijuana policy reform as, at best, a topic to avoid, more politicians may see it in a new light -- as a potentially voter-friendly issue that spans the ideological spectrum,” Walsh states.

As Walsh sets out, the symbolic importance of this vote for drug legalization comes as other leaders across Latin America have called for alternative approaches to the current war on drugs. The presidents of Guatemala, Mexico, and Colombia emphasized the need for debate before the United Nations in October. Meanwhile, Uruguay and Chile have considered their own marijuana legalization bills.

However, as InSight Crime has argued, even with marijuana now legalized in two US states, Mexico's criminal organizations have proved to be very adaptable in finding new sources of revenue. Criminal groups have already expanded their criminal activities to include methamphetamine, migrant smuggling, and even illegal mining.  Even if the predictions of IMCO come to pass, and groups like the Sinaloa Cartel lose as much as half of their total income from drug trafficking, it will not be a fatal blow to Mexico's traffickers.

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