Overview of Current States re: Medical Marijuana

Detroit News

In some states, medical marijuana has become a sizable part of the economy -- even when the industry's expansion has largely fallen in the gray area of the law. In California, marijuana is considered among the state's leading cash crops. In Colorado, medical marijuana dispensaries outnumber Starbucks locations 3 to 1.

In other states, such as New Mexico and Oregon, heavier regulations have limited growth.

"It hasn't become a Wal-Mart type of business," said Jeffrey Miron, a Harvard University economist who studies the marijuana trade. "But it's gone beyond a mom-and-pop sort of activity."

California was the first state to legalize pot for medicinal use in 1996, spawning an industry that grew rapidly and remains among the nation's most loosely regulated.

The article goes on to note that states that have medical marijuana laws are recognizing that they have to regulate the industry because it's no longer in the realm of "mom and pop" stores.

It's interesting to watch this legislative process in action.


the link above via Cannabis News

Oakland's Post Drug War Marshall Plan

L.A. Times

This article is a profile of Jeff Wilcox, the person who has promised a a $20 million dollar investment in Oakland to create a large-scale growing operation.

Wilcox quote: In essence, you could say big business is here.

Comparing the economic potential of tetrahydrocannabinol to silicon chips may seem far-fetched. Some observers dismiss the notion as the fever dream of budget-traumatized politicians. But others think Oakland could be uniquely positioned to capitalize on the business opportunities created by the growing tolerance toward marijuana.

[City Council Member Rebecca] Kaplan said she believed that Oakland has two essential ingredients other California cities do not: political will and industrial space. "Oakland has been a major hub of the medical cannabis movement, so that's part of what I mean when I say political will," she said.

No other city has provided such red-carpet treatment. Oakland is essentially trying to set up legal sanctuaries for pot businesses, although the move may prove too brazen for federal narcotics agents who recently called city officials to request a copy of the [legal, large-scale cannabis growers] ordinance.

Oakland, like Silicon Valley, has been fertile ground for entrepreneurs and innovative thinkers, luring them from all over. Jones is from South Dakota. Richard Lee, who started the first trade school to train marijuana businessmen, moved from Texas. Steve DeAngelo, who came from Washington, D.C., runs Harborside Health Center, a $20-million-a-year dispensary that has become the largest and arguably the most professionally run marijuana retailer in the world.

Just as the repeal of prohibition became unavoidably attractive during the great depression, the approval and regulation of cannabis growing offers a way to create jobs within a legal framework (at the state and city level) for workers who have been decimated by two decades of the globalization of capitalism and its attendant frenzy for shareholder profits at the expense of America's working middle class.

DEA Targets Colorado Cannabis Center Owners

Denver Post

The DEA says 18 percent of medical-marijuana-center owners have been convicted of felonies.

"This business seems to have an inappropriate number of people with criminal backgrounds involved as business owners," said Kevin Merrill, assistant special agent in charge for the Denver field division of the DEA. "I would be hard-pressed to find any other business group where their members have so many criminal violations, arrests and convictions."

I would imagine that most business owners are not trying to move a substance from DEA-targeted zero tolerance to legalization, either. The DEA is shocked, yes, shocked to find that people running cannabis centers have had previous arrests for the same.

Many of those will be weeded out of the medical-marijuana business Sunday when new rules take effect prohibiting anyone with a drug felony conviction or anyone with a felony sentence within the past five years from obtaining a medical-marijuana-center license in Colorado.

If only those same business people had created worthless financial instruments and sold them to unsuspecting investors. Then they'd be dictating policy to the Treasury Dept.

Oakland Sets Tax Rates for Legal Cannabis

Reuters

Oakland's city council on Monday night approved the rates -- a 5 percent gross receipts tax on licensed marijuana growers and on businesses selling marijuana for medical purposes, and a 10 percent rate on sales of marijuana used for recreational purposes.

California voters in 1996 approved a measure allowing marijuana use for medical purposes and would legalize its recreational use if they approve Proposition 19 in November.

...While the vote by Oakland's city council marks another step in the city toward bringing marijuana into the mainstream, pot dispensaries that have proliferated in the city near San Francisco are worried a 5 percent levy is too high and that neighboring Berkeley will undercut it with a lower rate.

"Why go to Oakland when you can go to Berkeley and get the same thing cheaper?" Dale Sky Clare, a spokeswoman for Proposition 19 and executive chancellor for Oaksterdam University, a cannabis industry training school with campuses in Oakland, elsewhere in California and Flint, Michigan, said on Tuesday.

High Finance and Corporate Pot

ABC News

Wilcox's plan includes a 7-acre site with a 100,000-square-foot growing space, a bakery, a testing lab, job training and growing equipment production at the site -- which would need to win one of the four Oakland permits to go into business. If it did, it would produce 58 pounds of cannabis a day at wholesale prices of $2,500 to $3,000 per pound and send the city more than $2 million per year in taxes if a 3 percent growers' tax were initiated.

But Oakland could complicate his math. The city is considering an 8 percent tax on cannabis farms, more than double the top rate in Wilcox's economic analysis.

...One industry source, who is still involved in illicit drug circles and requested to remain anonymous, said he recalls prices falling in Los Angeles as medical marijuana dispensaries exploded there. Early on in his career, high quality marijuana went for $6,000 to $7,000 a pound. "Now you are getting $3,500. What's going to happen when you legalize? You are going to take it a couple of states (east)," he said. Growers and vendors with expensive taste would not be able to continue to lead the high life at legal prices, he said.

Also, not everyone buys the theory that California will become a rogue drug state that can undermine national efforts to put a lid on marijuana. The free market is pitting different cities eager for marijuana revenues against one another, and small growers at the Oakland council meeting threatened to leave the city if taxes were too high.

U.S. drug czar Gil Kerlikowske, director of the Office of National Drug Control Policy, in an interview cast cold water on California export potential. "I quite frankly don't see that," he said. "I just don't see it as being something that suddenly people in Kentucky say, 'Ah now marijuana can be shipped in from California.'"

I'm not an expert in this field. I'm not a part of pot culture. But I do know a few people who have inhaled in their lifetimes. Kerlikowske is, imo, somewhat naive if he thinks that those folks in KY are not already interested in the sativa x indica hybrids that are the direct result of the Reagan-inspired war on drugs.

The history of marijuana over the past three decades is all about the move from someone finding WWII-era ditchweed and being content to that same hypothetical someone seeking out hybrid strains that were cultivated in response to and because of the crack down on outdoor cannabis production. When these hybrids are regulated and labeled with percentages of indica or sativa, those folks in KY can make more informed decisions in their purchases - and I would assume they will.

Most people outside of cannabis culture don't even bother to find out about the differences in effects from various strains. But those folks in KY who do know the differences are not the rubes the uneducated might assume them to be. I would imagine there are folks in KY who also enjoy beer from microbreweries rather than PBR - just as there are folks from every other state in this nation who make the same distinctions.

With more information available for consumers, producers and/or suppliers of cannabis in other parts of the country would, I assume, be under greater pressure to provide more information to their customers - who would know they could travel to another state to obtain the product they desire if their local retailers do not meet this desire.

Those who view the production of cannabis as part of a drug war do not understand those who view the production and use of cannabis as the horticultural equivalent of "foodies."

I assume, based upon the history of wine and beer consumption in the U.S., that it is also the "gourmanibis" aspect of cannabis cultivation that will create profit for the industry. But what do I know? I predicted that Ikea would be a big hit in the U.S. back in 1985 after a trip to one of the stores while visiting relatives in Europe.

No Trademarks for Cannabis Entrepreneurs For Now

Wall Street Journal

On April 1, the U.S. Patent and Trademark Office created a new trademark category: "Processed plant matter for medicinal purposes, namely medical marijuana." The patent office, part of the Department of Commerce, posted the new category on its website.

The patent-office change set off a land rush by pot dealers in the 14 states where laws permit medical-marijuana sales. Some staked claims on rights to long-used names like Maui Wowie and Chronic. Others applied to trademark business names such as Budtrader and Pot-N. Two companies applied to trademark psychoactive sodas named Keef Cola and Canna Cola.

"It looked like a positive step to me. We don't have many steps by the federal government legitimizing medical cannabis," said Steve DeAngelo, executive director of the Harborside Health Center medical marijuana dispensary in Oakland, Calif., who hired an intellectual-property lawyer to trademark his company name before the patent office created the new trademark category.

But last week the patent office snuffed out the promise of federal recognition. On Tuesday, after questions about the new pot-trademark category from a Wall Street Journal reporter, a patent-office spokesman said the office planned to remove the new pot classification by week's end, and the category is now off the website.

The issue is trademark, not patent - attempts to lay claim to certain strains as a trademark of your business product versus someone else's. The business side of the legalization issue brings to the fore a little truth-in-advertising about American society. Laws exist not merely to protect, but also to exclude others when no protection is necessary. This is how prohibition laws work, as well.

The coming cannabis industry needs regulations to provide useful information to patients and connoisseurs. Trademarks don't provide information. They provide protection from competitors by perhaps, in this case, manipulating the use of well-known strains and terms. That's not what people need. We need information about the chemical composition of specific strains, with percentages of THC and other cannabinoids, with standards for how all strains are grown for legal sale and consumption so that people can make informed choices.

While I appreciate the value of legitimizing the legalization push if the Patent and Trademark office had chosen to acknowledge the existing industry, the cannabis industry needs to set terms, like wine growers, for the use of words like "kush," in the same way that a wine is a "pinot noir" because of the grape. Let the cannabis capitalists fight out the trade wars on those terms first, please.

Rand Corporation Predicts Plummet in Price of Cannabis

with the advent of legalization. Of course, if the state taxes cannabis, like alcohol, the money would go to the state, not just the supplier.

WLNS/AP

The researchers said legalization could bring substantially more revenue if California sees an influx of "marijuana tourism" similar to Amsterdam, where pot is legally sold at coffee shops, and if out-of-state dealers purchase California cannabis to sell back home.

"You would certainly guess that if it's cheaper to produce it in California legally than to import it from Mexico, it would reduce imports from Mexico," Jonathan Caulkins, a Carnegie Mellon University who also worked on the study, said. "Presumably, it would decrease them a lot."

Yet intervention from the federal government, which classifies marijuana as an illegal drug, or regulations limiting marijuana sales to California residents, as is the case now with medical marijuana, easily could defeat dreams of tourists flocking to the coast on pot vacations, Caulkins noted.

Consumer prices for pot would rise to about $91 an ounce if local governments adopt that same $50 an ounce tax scheme following passage of the ballot measure - still substantially lower than what Californians pay now but high enough to create incentives for growers to sell the drug under the table to avoid paying the government duty.

Michigan Returns to its Roots

WXYZ (ABC) News

Nick Tennant opened Med Grow Cannabis College in Southfield about a year ago. Since then he says he’s watched nearly one thousand students go through the program. It’s a diverse group, including people who really need an income.

Nick told us, “You have laid off autoworkers that have come in looking for a new means of viability for their career path. There are people from age 21 to 81 learning to grow medical marijuana.”

Nick himself used to work in the auto industry. But when opportunities started drying up he saw growth potential as a legalized marijuana supplier and educator. “It was a new industry, something Michigan had never seen.”

At Med Grow Cannabis College, potential suppliers attend six weeks of classes. For a fee of $475 they learn how to start a medical marijuana business.

Market Watch

Ghosts of Michigan Past This Halloween: Medical Marijuana meet up in the Pontiac Center

BBC: Requiem for Detroit

Fora TV: Marijuana Economics

For the Economy, Help is Not on the Way

Common Dreams

If there's some new technological innovation--like the Internet in the early 1990s--waiting in the wings, no one has heard or seen it.

Forget about Congress. The feds wasted hundreds of billions of dollars to bail out banks, insurance companies and big automakers who used our taxpayer money to give raises to their top executives and remodel their offices. Meanwhile, the stimulus that needed to happen--bailing out distressed homeowners, small businesses and individuals who lost their jobs--never happened. Now Congress is worried about the deficit. So read my lips: no new bailouts, not even one that might actually work.

Some think the U.S. could export its way out of the depression. But a radical restructuring of trade agreements and manufacturing infrastructure would have to come first, followed by years of expansion. U.S. policymakers haven't even begun to think about the first move. Moreover, the rest of the world isn't in a position to buy our stuff. The rate of expansion of the economies of China and Japan is slowing down. Germany and other EU nations are imposing austerity measures.

Globalization is key. Writing in The Wall Street Journal, John H. Makin argues that the actions of individual G20 nations threaten to bring the whole system crashing down in a Keynesian "paradox of thrift."

U.S. govt. demonstrates its lack of concern for American health

U.S. is, once again, last in healthcare among 6 western nations, via Reuters

Americans spend twice as much as residents of other developed countries on healthcare, but get lower quality, less efficiency and have the least equitable system, according to a report released on Wednesday.

The United States ranked last when compared to six other countries -- Britain, Canada, Germany, Netherlands, Australia and New Zealand, the Commonwealth Fund report found.

(from June 23rd)