WASHINGTON – Wars rarely end at the first hint of truce. But when the Obama administration quietly announced this week it will halt federal raids against dispensers of medical marijuana, advocates of drug policy reform found themselves in a tickertape mood.

Could this be Armistice Day for America's decades-long war on drugs? Not quite. Not yet, at least.

But the new government's reversal of the Bush-era's zero-tolerance on pot comes amid a confluence of signals that America may be nearing a turning point in its approach to prohibition. Exit "reefer madness" and enter a more reasoned debate on what works, with the goal of targeting deadly cartels who today place drugs in the hands of American children with greater ease than ever before.

With the U.S. economy in shambles and its banking systems on life support, people on all sides of the great drug debate agree on this much: the last thing America needs right now is to get stoned.

Yet stoned it is, in increasingly grim numbers, despite the world's most expensive sustained effort to use the full weight of law enforcement, prisons and foreign policy to staunch illegal drugs.

American demand today is estimated to be worth as much as $25 billion, a reality that has shredded Mexico's ability to impose sovereignty along its northern border, where rampant drug violence claims 100 lives a week.

"This awful reality is forcing us toward a debate that for the past couple of decades we just couldn't have because America's official drug policy was controlled by wild-eyed ideologues," said Dan Bernath, spokesperson for the Marijuana Policy Project, a Washington-based reform lobby group.

"But attitudes toward marijuana law reform have changed, even if policy hasn't. The opposition today is dwindling down to an ideological fringe rooted in a cultural war that doesn't really matter to people any more. And now, with a new administration, we find ourselves on the cusp of what we hope is going to be a reasoned, fact-based debate."

The best evidence of changing attitudes is the sheer fact of Barack Obama's ascendance. America now has a president who readily admits to having not only smoked marijuana but actually having inhaled it in a period of misspent youth before finding God and the woman of his dreams.

That places him in the company of an estimated 40 per cent of Americans, or 100 million people, who tell pollsters they have tried the drug at least once. Analysts say it never became an election issue simply because in today's America – where 13 states sanction medical marijuana – it was not going to move votes one way or another.

"Opinions have evolved. So many Americans have used marijuana that they are now kind of immune to the fear mongering intoning against its evils," said author Glenn Greenwald, prominent civil rights lawyer and frequent contributor to Salon.com.

Greenwald knows firsthand how the U.S. debate is opening up. In two weeks he will appear at the Washington-based Cato Institute to present a 50-page analysis on the effects of drug decriminalization in Portugal, which in 2001 became the first EU member state to halt criminal penalties for marijuana, cocaine and heroin.

"The biggest surprise for me about the investigation in Portugal is that eight years after the fact there now is a consensus that crosses ideological lines. It has worked so well that nobody is arguing for the policy to be reversed," Greenwald told the Toronto Star.

"It is a hot-button issue in every society and it was in Portugal in 2001, when they changed the laws. But the results are pretty clear: there has been no huge increase in usage. Money has been freed up for treatment, and at the same time lots of addicts have been able to get help because they are no longer terrified of being thrown into prison if they identified themselves as drug users with a problem."

Greenwald, however, is under no illusions the Portuguese approach could easily be adapted to America. Resistance to drug law reform in the U.S., he points out, has long been a bipartisan condition held dear by significant portions of Democrats and Republicans alike.

"The emotion surrounding America's drug war is very deeply entrenched, and the irrationality that has sustained it for so long is very difficult to uproot. I truly believe the unquestioned premise – that changing the laws will create a spike in usage – is a myth. But even as attitudes change, myths take time to break down," he said.

"Yet I do believe the space is opening up now to debate the issue based on empirical analysis, based on what works and what doesn't. We owe it to ourselves to consider the results in Portugal as part of a reasoned debate."

The Obama administration has yet to fully articulate its policies on illicit drugs, though the president has hinted he intends to tackle the problem from both a public health and law enforcement perspective.

But advocates of a more progressive approach take heart in the appointment of former Seattle police chief Gil Kerlikowske as Obama's nominee for drug czar. When Seattle citizens voted in 2003 to make marijuana prosecution the lowest law enforcement priority, Kerlikowske's police force acted accordingly, enabling the city to champion the use of the public health system rather than criminal justice to address problems caused by illegal drugs.

"So far the new drug czar is an unknown quantity, but his record in Seattle shows Kerlikowske does not approach marijuana from an ideological point of view. The city was able to take a new approach, respecting the wishes of the people it was serving, and that's all we've ever wanted at a federal level," said the MPP's Bernath.

Washington was conspicuously silent this week after Attorney General Eric Holder announced the feds will no longer raid medical marijuana dispensaries that comply with state law.

"It is a bit difficult for many conservatives to get worked up about it, since so many believe that states should be able to decide for themselves. And that is essentially what the Obama administration is saying – if the dispensary complies with state law, the state has spoken," said Bernath.

Peter Reuter, a professor of criminology at University of Maryland and a supporter of drug criminalization laws, noted: "We've had drug-using presidents before. But the great change now is that Obama is honest about it.

"Obama's response when he was asked whether he had inhaled was perfect: `I rather thought that was the point.' He is not apologizing. He doesn't have Bill Clinton's guilty conscience. This is a president who is not afraid to talk about it."

Reuter expects Obama's candour will help breathe new life into the stale drug war debate. But rather than a wholesale redrafting of legislation, he believes the new administration may have a better chance of success at the judicial level.

"One of the questions is: why do we have such long sentences for drug offences? It is very difficult these days to find law enforcement people who disagree. We have large numbers of people, particularly black males, in jail right now for long stretches, longer than is reasonable or efficient. It might make sense for Obama to begin there, at a federal level, to see what can be done."

Underpinning the entire debate, meanwhile, is money. With every dollar of federal spending now subject to a line-by-line review, advocates for drug law reform are renewing the argument for a rerouting of billions from drug war funding into addiction treatment.

Two recent studies by academics at Harvard and Virginia's George Mason University suggest the U.S. government could see a windfall of anywhere from $14 to $40 billion annually through decriminalization of marijuana. The figures combine law enforcement savings and potential marijuana tax revenues.

"The argument is a bit similar to the situation during prohibition of alcohol in the 1930s, when the Great Depression was forcing everyone to look at expenditures and the government accepted that the alcohol policies were no longer affordable," said Bernath.

"No matter what happens, the marijuana industry is never going to be as big as the alcohol industry. And it would be disingenuous to argue it could be some kind of silver bullet for today's economy. But every billion counts, does it not?"

Greenwald, however, observes that the money argument cuts both ways, pointing to the "range of vested interests" that are making money from the drug war.

"There may be few more grotesque wastes of money than the drug war. But the industries that have sprung up around it are enormous and lucrative and powerful," he said.

"Decriminalization would be a huge blow to the American prison industry, which is the largest in the world. Lots of defence companies and paramilitary firms would suffer greatly. They all have a strong interest in maintaining the drug war and they will not just go quietly."

However the debate evolves, the United States can proceed confident the rest of the world will be watching. Whatever lessons are to be drawn from beyond its borders, U.S. drug policy is ultimately expected to dominate policy beyond.

"The United States has a history of blocking reforms elsewhere. There are other countries, especially in Europe, that are ready to take more practical measures, especially when it comes to marijuana policy," said Bernath.

"There is no question America will continue to be the leader. What we're all looking for now is the most reasoned, highest quality debate to decide where we go from here."