What on earth is wrong with regulation? It has to be regulated, just like alcohol. It is a simple fact that smoking harms a developing brain and therefore it is a communities responsibility to make sure it is not easily accessible for minors.
And for course it is going to be taxed, it is a high in demand consumer product, any high in demand consumer product will eventually get taxed one way or another.
I see two separate arguments. Your first argument seems to fall in on itself when you realize cannabis has been prohibited and therefore largely in the underground / unregulated economy If there really was a community responsibility to make sure cannabis is not easily accessible to minors, then almost every community in the USA is failing miserably because cannabis is more available to anyone who wishes to consume it then it has ever been. Because cannabis is everywhere and developing brains are battling the potential harm without the help of federal or local regulation; AND the population is not seeing ANY increase in cannabis related mental health issues, THEN regulation must NOT be NECESSARY for the health and welfare of the populace.
Your second statement about taxation rings true with mans nature. Perhaps you should drop the first part of your argument and state that cannabis will most likely end up regulated SO THAT the government can TAX (shake down producers and consumers) to the maximum revenue generation point.
So I'll half agree with you. Cannabis is always taxed one way or the other, the tax of prohibition is most likely higher than the tax born by producers and consumers under a regulated regime.
To answer your question: "What is wrong with regulation?"
ANSWER: The evils of regulation are normally waste (salaries to non producers), graft (bribes paid to non producers), and inefficiencies (individuals normally know best how to run their garden, not government prohibitionists now set to tax collection mode.)