Ease the Debt Crisis: Legalize Marijuana and Internet Gambling

This idea comes from Rep. Jared Polis (D—CO) in a Wall Street Journal editorial. By legalizing and taxing marijuana, the federal government would take in an additional $2.4 billion a year. I would’ve guessed a lot more than that, but what do I know?

By legalizing and regulating Internet gambling, we’d take in an additional $42 billion.

According to the editorial, these ideas don’t violate the Pledge of Allegiance to Grover Norquist that’s put so many Republicans in a straitjacket. It wouldn’t be a “new tax,” since it’s a matter of legalizing something that’s presently illegal.

Also, Arthur Laffer — yes, he of Ronald Reagan’s infamous Laffer Curve — suggests a one-year tax amnesty. If tax evaders had a one-year period in which they could pay everything they owe without any penalties, the federal government would bring in between $800 billion and $1 trillion over the next ten years.

This last point is probably moot: a proposed immigration reform law was defeated in 2007. If this law had passed, we’d be bringing in an additional $12 billion annually by 2012, and $48 billion by 2017.