The uneasy dalliance between capitalism, government, and cannabis is most advanced in Colorado. There is real money to be made here, for bold entrepreneurs who are willing to trailblaze.
One of the odder experiments in the recent history of American capitalism is unfolding here in the Rockies: the country’s first attempt at fully regulating, licensing and taxing a for-profit marijuana trade. In California, medical marijuana dispensary owners work in nonprofit collectives, but the cannabis pioneers of Colorado are free to pocket as much as they can — as long as they stay within the rules.
The catch is that there are a ton of rules, and more are coming in the next few months. The authorities here were initially caught off guard when dispensary mania began last year, after President Obama announced that federal law enforcement officials wouldn’t trouble users and suppliers as long as they complied with state law. In Colorado, where a constitutional amendment legalizing medical marijuana was passed in 2000, hundreds of dispensaries popped up and a startling number of residents turned out to be in “severe pain,” the most popular of eight conditions that can be treated legally with the once-demonized weed.
More than 80,000 people here now have medical marijuana certificates, which are essentially prescriptions, and for months new enrollees have signed up at a rate of roughly 1,000 a day.
As supply met demand, politicians decided that a body of regulations was overdue. The state’s Department of Revenue has spent months conceiving rules for this new industry, ending the reefer-madness phase here in favor of buzz-killing specifics about cultivation, distribution, storage and every other part of the business.
Whether and how this works will be carefully watched far beyond Colorado. The rules here could be a blueprint for the 13 states, as well as the District of Columbia, that have medical marijuana laws. That is particularly the case in Rhode Island, New Jersey, the District of Columbia and Maine, which are poised to roll out programs of their own.
Americans spend roughly $25 billion a year on marijuana, according to the Harvard economist Jeffrey Miron, which gives some idea of the popularity of this drug. Eventually, we might be talking about a sizable sum of tax revenue from its sales as medicine, not to mention private investment and employment. A spokesman for the National Organization for the Reform of Marijuana Laws says hedge fund investors and an assortment of financial service firms are starting to call around to sniff out opportunities.
(click to continue reading In Colorado, Pot-Selling Pioneers Try to Turn a Profit – NYTimes.com.)
And this is a pretty good model to follow, methinks:
If there is a historical precedent for what’s now happening in Colorado, it could be the 1920s and the era of Prohibition. During America’s dry age, the federal alcohol ban carved out an exemption for medicinal use, and doctors nationwide suddenly discovered they could bolster their incomes by writing liquor prescriptions.
Pharmacies, which filled those prescriptions, and were one of the few places whiskey could be bought legally, raked it in. Through the 1920s, the number of Walgreens stores soared from 20 to nearly 400.
Prohibition also enriched adventurous sorts at every level of booze production and consumption, from grape farmers and distillers to the owners of speakeasies. Many of them went on to earn legitimate fortunes once Prohibition was repealed.
Fascinating to see how far along the reform of our out-dated marijuana laws has come in the last few years. Of course, federal law still classifies cannabis as a Schedule 1 Controlled Substance – i.e., with no accepted medical or societal usage. When is that going to change? How many states have to reform their laws before the reactionaries in Congress act?
From Wikipedia:
(1) Schedule I.—
(A) The drug or other substance has a high potential for abuse.
(B) The drug or other substance has no currently accepted medical use in treatment in the United States.
(C) There is a lack of accepted safety for use of the drug or other substance under medical supervision.”