Note: This Factoid was written as part of the V.I.P. project for the Addictions channel. While the people who participate in these activities are not necessarily addicted to them, the activities themselves do have significantly addictive qualities.
If you’re easily offended or have very personal feelings about these topics, please don’t read on. This article is not about morality; it’s about reality.
Online gambling, marijuana, and prostitution all have limited (but rapidly growing) footholds in the United States currently. Their influence will continue to expand, to our nation’s net economic benefit. Even if you have personal reservations against any or all of these activities, it is imperative to realize that they may become important keystones of our slowly rebuilding economy, because all 3 activities have similar qualities that work towards the common good. Here are some of these qualities and their benefits:
1. These activities are significantly prevalent in our country. Online gamblers who regularly play make up an admitted 2% (actual numbers are likely higher) of our population and spend a staggering $10-$12 Billion. Estimates of marijuana users who regularly smoke vary between 2 and 4% (again only admitted numbers many will not admit but still smoke) and annual spending there is about $64 Billion. Numbers on prostitution are the most difficult to find (for obvious reasons), but an estimated 16% of men in the US use them. The point here is that these activities are well entrenched, even with ongoing and improved law enforcement to combat them. Which brings us to the next point:
2. These activities cost us a LOT of money in law enforcement. Harvard economist Jeffrey Miron calculated that we would save close to $8 Billion alone by fully legalizing marijuana. Online gambling is allowed (with restrictions and poor regulation), so we’re not spending much there, but prostitution-related law enforcement costs are also estimated in the billions. The argument has been made that when these activities are fully legalized and better regulated they will be safer overall, but right now, safe or not, we’re paying through the nose to stop activities that tens of millions of Americans choose to participate in.
3. These activities can reap us tens of Billions of dollars a year in tax revenues. I’m tempted to belabor this point by listing all the things you could do with this amount of money; provide college education to all High School graduates free of charge, housing for all, food for all, start another war (a bad joke; but sadly that’s where a lot of Billions seem to go). Add to these tens of Billions the tens of Billions we’re saving in law enforcement costs, and suddenly our balance sheet starts moving out of the red and towards the black.
Everyone knows we are in a recession. We need industry…here are industries that will provide jobs, industries that will raise consumer spending, industries that already exist from market to distributor and simply require regulation rather than having to be built from the ground up. There are many moral reasons to go against these things…but there are no economic ones as I see it. And for those enterprising investors and business-people out there, there are and will continue to be many new opportunities in these industries…take advantage of them.
