President Obama and US Attorney General Eric Holder blew up the internet today when they announced that the federal government will allow two states, Colorado and Washington, to enact voter-approved laws that regulate growing and selling marijuana. That was stunning news on its own. Starting next year, it's now official: Adults will be walking into stores and buying bags of marijuana, unmolested.

But this is about more than Washington and Colorado: The White House is formally deferring to the states on drug policy, much like the Feds now recognize marriage equality. In doing so, Obama is acknowledging that the US drug war is not mandatory, while he also sets a bold precedent of standing back when states present superior alternatives, such as more states legalizing pot, states decriminalizing hard drugs, cities opening safe-injection sites, and other countries breaking away from the formerly Drug Free America.

On the phone with governors from Colorado and Washington, AG Holder explained the US Justice Department would not sue Washington and Colorado for preempting the federal Controlled Substances Act, provided that the states do two things: (1) strictly enforce their own laws that regulate the pot market and (2) abide by eight federal conditions. The weightiest of those conditions are: preventing pot from leaking outside state borders, not allowing unregulated cannabis commerce, and banning access for minors. But what wasn't in those conditions stands out radically. Holder didn't tell states to prevent massive regulated pot farms, to ban wholesale marijuana distribution, or to prohibit storefronts selling marijuana just like bottles of wine. Those are also major violations of federal law—technically—but the Feds are, stunningly, groovy with them if the farms, distribution, and sales are done in compliance with state laws.

After the talk with Holder, Washington State Governor Jay inslee explained his understanding of the deal in a press conference: "If you are following Washington State law and following these eight rules, and our state follows them as well, we are going to have a successful program here—and successful business," he said.

This was a deliberate—and deeply radical—decision about who is in charge of most drug enforcement. "The thrust is that they will allow the state of Washington to be the principal law-enforcement agent in this regard," Inslee said. That is, for the first time, the president and head of the US Department of Justice have chosen to hand over the reins on major, controversial drug-control policy to the states. (The Feds have also stayed largely out of medical marijuana, but that is a much smaller market and a less controversial issue.)

Likewise, Deputy Attorney General James Cole also emphasized state control today in a memo to federal prosecutors about how to handle prosecutions in "jurisdictions that have legalized marijuana in some form." While the memo says prosecutors can bust offenders at their discretion (a boilerplate caveat), Cole essentially instructs prosecutors to butt out if states have their own "strong and effective regulatory and enforcement systems."

In other words, the Feds are surrendering power to states that come forward with a better idea—and show they can implement a tight regulatory framework—to experiment with a drug control strategy that will more effectively reduce violence and drug abuse. This decision is also an unprecedented admission that federal government is paralyzed in its drug war straitjacket, and they are ready to work in tandem with states that have more flexibility.

"If you step back, we're talking about ending the war on drugs, and the federal government has given a green light to the states to try different approaches," says Alison Holcomb, who drafted Initiative 502, which contained exactly that strict framework for marijuana that the Feds have tacitly endorsed. "That is much bigger than legalizing marijuana in Washington and Colorado." She says that courts, treatment centers, and communities can begin crafting new policy. "And we should not be shy about doing it."

For his part, Inslee acknowledged that drugs are "a vexing problem" and he praised the "courage" and "significant action from the attorney general and president to respect the wisdom of voters and recognize where we are in society today."

When Nevada and California tried to legalize marijuana several years ago, it was the White House drug czar braying as he led the charge to stop ballot measures. And internationally, the US has been breathing down the necks of other countries to stop them from legalizing marijuana. But Obama had no political or tactical benefit in challenging legalization this time around—if anything, he wants ineffective drug laws dismantled... but by someone else.

I wanted to get the perspective of Ethan Nadelmann, director of the Drug Policy Alliance, a preeminent authority on drug strategy in the US and abroad. I called his cell phone as he was in the passanger seat of a car driving down a narrow, winding road in Jamaica between Kingston and Negril. He'd spent yesterday in conference with members of the past and current cabinet, and members from dueling political parties to talk about legalizing marijuana. He said some were uneasy about legalizing ganja; a few years ago when the issue came up, the US ambassador made imposing phone calls.

"To the extent that they are no longer scared of the call from the ambassador or of losing trade preference, to the extent that other counties feel less intimidated, I think this announcement today is significant internationally," Nadelmann said. "State department officials have no credibility to criticize marijuana reform in other countries when the US is leading the way on marijuana law reform."