May 12, 2005
Even a smart Supreme Court Justice can have trouble with supply and demand analysis

Some amusing moments from the transcript of the medical marijuana case that my friend Randy Barnett argued before the Supreme Court in March. (Barnett argued that Congress canít stop California from legalizing home-grown medical marijuana, because home-grown and home-consumed pot -- regulated by the State of California to prevent itís leaking into the national market -- doesnít fall under the Congressís power to regulate interstate commerce.)

JUSTICE STEVENS: Let me ask this question. What is your view with respect to the impact of the activities concerned in this case on the interstate market for marijuana? Is it your view that it will have no impact, that it will increase the interstate demand, or decrease the interstate demand? So there are three alternatives. Which is the one we should follow?

MR. BARNETT: Can I pick "trivial impact"?


JUSTICE STEVENS: No, but if it -- "trivial impact," is it a trivial impact that enhances the price of marijuana or decreases the price of marijuana, in your view?

MR. BARNETT: The only effect it could have on the price would be a slight trivial reduction, if it has any effect at all, because it's going to withdraw users from the illicit drug market. And to the extent that they are now in the illicit drug market -- and we don't know whether they are or not -≠

JUSTICE STEVENS: Well, that would reduce demand and increase price, it seems to me. It's the other way around.

MR. BARNETT: Well, it would reduce demand and reduce prices, I think. But -≠

JUSTICE STEVENS: If you reduce demand, you reduce prices? Are you sure?



JUSTICE STEVENS: Oh, you're right. You're right. Okay. Yeah. Yeah.

Hat tip: Jim Lindgren at The Volokh Conspiracy

Posted by Lawrence H. White at 05:28 PM in Economics  ·  TrackBack (41)

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