The price of cannabis is falling, suggesting a supply glut

AFTER he was busted in 1974, Jeffrey Edmondson, a small-time dealer of marijuana, cocaine and amphetamines in Minneapolis, faced a daunting bill from the taxman for all his illicit income. He argued that he should be allowed to deduct $100,000 worth of business expenses, and a court agreed. Enraged, Congress revised the tax code in the early Reagan years, forbidding tax exemptions for drug traffickers. One unintended consequence of Mr Edmondson’s audacity persists four decades later: cannabis operations, now legitimate in many states, are forbidden from the usual business deductions and face crippling tax bills of as much as 70% of revenue.