Smoke dope and save the state of California, dude

It has been touted as a successful treatment for everything from insomnia and depression to Parkinson's disease and multiple sclerosis. Now supporters of legalised marijuana are making perhaps their most extravagant claim yet: that the drug can solve California's spiralling financial crisis.

A series of television ads was launched yesterday supporting a bill by Democratic assemblyman Tom Ammiano that would regulate and tax the sale of marijuana in the Golden State, where Arnold Schwarzenegger's administration is in a $26bn (£15.9bn) black hole.

The 30-second film features an "actual marijuana user". She is a retired, 58-year-old civil servant called Nadine Herndon, shown in front of her family portraits at home in Sacramento County, where she began using the drug after suffering a series of strokes three years ago.

"Huge cuts to police, schools and healthcare are inevitable, due to California's budget crisis. Even our state parks could be closed," she says. "But the Governor and legislature are ignoring millions of Californians who want to pay taxes. We're marijuana users. Instead of being treated like criminals for using a substance safer than alcohol, we want to pay our fair share."

The move could attract widespread support in a state where some regions never quite emerged from the Summer of Love. Medical marijuana use was introduced in California by a majority vote in a 1996 referendum, and Mr Ammiano's bill calling for legalisation was put before the legislature in February.

Highlighting the financial benefits of legalisation represents a canny tactic. California has for years been unable to raise as much tax as it spends, and its coffers finally ran dry last week, meaning the government is now paying bills with IOU notes. On Monday Mr Schwarzenegger's administration suffered the indignity of having its credit rating downgraded to BBB.

Tens of thousands of public servants have been sacked due to the crisis, and most others are being forced to take two unpaid days' leave each month. Ms Herndon's advert, which was launched by the Marijuana Policy Project (MPP), claims that taxing marijuana could pay the salaries of 20,000 teachers.

That figure is based on a calculation by Betty Yee, the head of the California tax collection board, who has said that $1bn per year would be raised via a $50-per-ounce fee charged to retailers, plus an additional $400m through sales tax. But marijuana advocates say actual income could be much higher.

"All these figures are approximations. We are dealing with a commodity that has been illegal for decades," said Bruce Mirken of the MPP. "It isn't traded on the commodities market, and we have no way of knowing how much is consumed. Everything is confused because at present we have this illusion of illegality."

Lawyers would also be likely to benefit from any attempt to legalise the drug. Though marijuana is supposedly available to any Californian who can find a doctor willing, for a small fee, to sign a piece of paper claiming they suffer from a condition such as insomnia or "anxiety", it remains verboten under federal law.

Many dispensaries were warily tolerated by federal authorities under the Bush regime, and Barack Obama's Attorney General Eric Holder has said the new administration will tolerate medical marijuana so long as it follows State law. But the White House has not outlined its position on full legalisation, raising the spectre of a test lawsuit.

Culturally, the drug can also be highly divisive: away from major cities such as Los Angeles and San Francisco, and some northern regions where hippy culture remains commonplace, local authorities in many small towns are less than tolerant towards users. A record 74,000 people were prosecuted for possession in 2007, the last year for which figures are available.

The reluctance of some conservative classes to embrace legalised marijuana prompted several television stations, including KTLA and KABC, to drop Ms Herndon's advertisement last night, apparently fearing it might offend viewers. The MPP accused them of "stifling open debate".