Markets in Everything: Crop Insurance

by on May 18, 2010 at 7:04 am in Economics, Medicine | Permalink

Crop insurance for marijuana.

Here is a related question.  How long do you predict it will be from legalization to government subsidization?

Hat tip: Ray Lehmann.

1 Andrew May 18, 2010 at 7:07 am

We’ll skip subsidies and go straight to

“Mandated as the only approved treatment for your cancer. Take care now, Your end-of-life committee.”

2 azmyth May 18, 2010 at 10:07 am

It depends on the pattern of which states grow it. I’d guess around 3 years.

3 mike@pvl May 18, 2010 at 10:28 am

Nate, take a look at what the discussion on taxing HFCS. A subsidy for producers and a sin tax on consumption are (somehow) not mutually exclusive.

4 Sam Lyon May 18, 2010 at 1:11 pm

Well, given that the US Government provided $18 million to tobacco farmers in 2004 (N.B. These figures are from Wikipedia, so take them with whatever volume of salt that requires), I’d say that we’d probably be looking at not long, but at the same time not to any particularly significant level.

5 mulp May 18, 2010 at 2:45 pm

Last Call argues prohibition was passed in part because of support for transferring Federal tax revenue from tariffs to income tax – tariffs on booze were a major share of Federal revenue, and always had been. By prohibiting booze, tariff revenue would fall drastically forcing a shift to income taxes. But as incomes fell, Federal income tax revenue fell in the Great Depression, so legalizing booze meant a big boost in tariff revenue.

Californians are seeking to legalize pot using the same tariff revenue argument.

Crop insurance becomes good policy in order to preserve the steady tariff revenue.

6 bbartlog May 18, 2010 at 4:05 pm

Making marijuana illegal is a form of subsidy, in the form of restricted competition. Since I expect legalization to take a limited, licensed form (you can only grow XXX plants for medical use, or only if you have a permit, etc…), there will be no unsubsidized period.
If you mean standard ‘we pay you cash not to grow this crop’ style subsidies, I have no idea. Possibly never.

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8 techreseller May 19, 2010 at 3:03 pm

Legalize it, tax the dickens out of it, watch the cross border violence go down, other taxes go down (just kidding) and redirect the policing resource to more pressing and dangerous problems. Wait, that is too simple a solution for our Federal and State governments. Never mind.

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13 GooGooDoll February 16, 2011 at 12:37 pm

I work in the car insurance quotes and let me tell you that legalizing marijuana would benefit the economy a lot and would also stimulate some new business fields… But for now this is just a dream… But marijuana crop insurance is surely something that insurance companies are waiting for…

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