We also have to consider legalization's impact on the prison industry.
A hefty proportion of prisoners are there for nonviolent, drug-related charges. The War on Drugs is the primary reason why the US has the biggest prison population in world history, both in absolute numbers and in rates. (It also goes further than anything else in explaining the extreme racial imbalance in our prison population, though that's another issue.)
Absolute numbers: There are well over 2 million people behind bars right now. Back in the early 1970s, there were only 200,000 prisoners. Trust me, the US population didn't increase 10X in that period.
Rates: We lock up about 750/100,000 people who live in this country. The next closest is Russia, at about 500/100,000. (And not to get into the racial issues again, but the rate at which white men are imprisoned today is higher than the rate of black male imprisonment back in 1980.)
And let's not forget that more and more prisons are owned by private corporations (approximately 15% of US prisons are privately owned.) Stakeholders in such companies have something to lose were we to change policies that would likely reduce the prison population, for prisoners=money for them. Prisoners are the raw material that keeps their businesses afloat. They're going to make sure our laws are designed to keep a constant flow of prisoners going through their penal corporations. In this regard, it's similar to what Dragon of Grief said about bars going out of business earlier in this thread.
These issues must weigh into any discussion about legalization of drugs, in addition to the other very good points made above.