4 Feb 2014

Eric Holder’s Pot Problem

posted in: Cannabis News | 0

Twenty states plus the District of Columbia now allow sales of medicinal marijuana, allowing pot prescriptions to treat pretty much any malady, from a headache to a hangnail. Colorado and Washington have legalized the drug for recreational use, too.

Yet federal law still prohibits the possession, use and sale of marijuana for any reason. This dichotomy explains why some banks are reluctant to accept the large amounts of cash that pot purveyors generate — even if the cash is legal under state law.

To redress this, U.S. Attorney General Eric Holder has promised to issue guidelines to make it easier for marijuana sellers who are operating in accordance with their state laws to use the banking system. Large amounts of cash “just kind of lying around with no place for it to be appropriately deposited,” Holder mused, “is something that would worry me, from a law enforcement perspective.”

The fact is, Holder encouraged those bundles of unbanked cash to be assembled in the first place. Last year, perhaps in a nod to opinion polls showing that a majority of Americans favor marijuana legalization, he said the Justice Department wouldn’t seek to overturn the Colorado and Washington measures. Nor, he said, would Washington interfere with the 20 states that allow medicinal marijuana. Instead, federal drug agencies and prosecutors would leave it to local authorities to enforce marijuana laws.

All of which raises the question: When did it become acceptable for the country’s top law-enforcement officer to decide which federal statutes to enforce and which to ignore? Even those who agree with the broader policy of marijuana legalization should be left uneasy by open defiance of the rule of law.

Under the 1970 Controlled Substances Act, marijuana is classified as a Schedule 1 drug, which means it has high potential for abuse, serves no medical purpose and isn’t safe even under a doctor’s supervision. As recently as 2005, the U.S. Supreme Court ruled that, even in states that allow medical marijuana sales, sellers and users can be prosecuted.

Whether or not a law is outmoded, unpopular or overtaken by cultural change, the attorney general doesn’t have the authority to ignore it altogether in half the country. To do so is wrong, and has practical consequences: Holder’s pronouncement caused a surge of cash to flow from the black-market weed business into the regular economy. His guidelines presumably will make it possible for buyers to use credit and debit cards now — and for banks to accept those transactions — without fear of reprisal. But some banks won’t go along.

Banks are subject to federal banking laws, including the anti-money-laundering statute, which discourages large deposits of cash by requiring reams of paperwork to document where it came from and where it went. When regulators don’t enforce the rules, lawmakers haul them in, Holder’s blind eye notwithstanding.

What’s more, in states that allow marijuana sales, a whole new pot economy has grown up, complete with cannapreneurs, growers, equipment makers, transporters and even private-equity financiers. The National Cannabis Industry Association estimates marijuana sales will exceed $2 billion in 2014 and $10 billion by 2019. Nevertheless, a future president could wipe the industry out by regarding the federal prohibition as wise and strictly enforcing the law.

If that happens, the marijuana industry and thousands of employees would be put out of work or forced back underground. Banks would again refuse to accept their cash, dispensaries would have to unplug their ATMs, and Visa and MasterCard would refuse to process marijuana transactions. Sales of the drug would continue, of course, but they would again go untaxed and unregulated.

At any rate, guidelines from Justice wouldn’t be enforceable in court, and therefore wouldn’t provide the legal defense bank lawyers must have before advising their clients there is a safe harbor against prosecution. 

It’s time Congress recognized reality. With 22 states openly in defiance of the federal statute, lawmakers should decide whether to keep the national ban or turn the question of marijuana decriminalization over to the states. Congress could, for example, withdraw marijuana from the Schedule 1 list, recognize that it has useful medical applications and let the states decide whether and where to allow its use.

What shouldn’t be an option is for the Justice Department to look the other way.

Source: Bloomberg.com (USA)
Published: February 2, 2014
Copyright: 2014 Bloomberg L.P.
Contact: [email protected]
Website: http://www.bloomberg.com/

30 Jan 2014

Eric Holder Says Kids Won’t Be Able To Toke Up

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General Eric Holder said Wednesday that just because states are legalizing marijuana for recreational purposes doesn’t mean minors will be able to roll up a joint.

“People cannot buy alcohol I guess now until you’re age… age 21, but young people find ways to get alcohol because adults can have access to it,” Holder said before the Senate Judiciary Committee. “I’m not sure that we will see the same thing here given what we have said with regard to our enforcement priorities.”

His comments came as Colorado and Washington state have been implementing new laws allowing recreational pot. Marijuana remains illegal under federal law, and under questioning, Holder defended the Obama administration’s stance in allowing the states to move forward with their laws while the feds work to make sure the drug doesn’t become available to minors or move across state lines.

“The distribution of marijuana to minors will… will entail a very vigorous federal response,” Holder said.

The Department of Justice is expected to unveil new guidelines that might help banks transact with legal marijuana companies, which are increasingly worried about the dangers of operating all-cash businesses.

Alabama Republican Sen. Jeff Sessions, a member of the committee, lamented President Barack Obama’s recent comments that marijuana isn’t more harmful than alcohol, saying he was “heartbroken” to hear Obama argue that states’ experiments in legalization should go forward. Sessions said the country had previously worked to“create a hostility to drug use” that shouldn’t recede.

“I think that the use of any drug is potentially harmful,” Holder said of Obama’s comments. “And included in that would be alcohol.”

Sessions was skeptical. “Well, Lady Gaga says she’s addicted to it and it’s not harmless,” he said.

Source: Time Magazine (US)
Author: Maya Rhodan
Published: January 29, 2014
Copyright: 2014 Time Inc.
Contact: [email protected]
Website: http://www.time.com/time/

25 Jan 2014

Holder Announced A Major Shift On U.S MJ Policy

posted in: Cannabis News | 0

U.S. treasury and law enforcement agencies will soon issue regulations opening banking services to state-sanctioned marijuana businesses even though cannabis remains classified an illegal narcotic under federal law, Attorney General Eric Holder said on Thursday.

Holder said the new rules would address problems faced by newly licensed recreational pot retailers in Colorado, and medical marijuana dispensaries in other states, in operating on a cash-only basis, without access to banking services or credit.

Proprietors of state-licensed marijuana distributors in Colorado and elsewhere have complained of having to purchase inventory, pay employees and conduct sales entirely in cash, requiring elaborate and expensive security measures and putting them at a high risk of robbery.

It also makes accounting for state sales tax-collection purposes difficult.

“You don’t want just huge amounts of cash in these places,” Holder told the audience at the University of Virginia. “They want to be able to use the banking system. And so we will be issuing some regulations I think very soon to deal with that issue.”

Holder’s comments echoed remarks by his deputy, James Cole, in September during a Senate Judiciary Committee hearing on Capitol Hill.

Colorado this month became the first state to open retail outlets legally permitted to sell marijuana to adults for recreational purposes, in a system similar to what many states have long had in place for alcohol sales.

Washington state is slated to launch its own marijuana retail network later this year, and several other states, including California, Oregon and Alaska, are expected to consider legalizing recreational weed in 2014.

The number of states approving marijuana for medical purposes has also been growing. California was the first in 1996, and has since been followed by about 20 other states and the District of Columbia.

But the fledgling recreational pot markets in Colorado and Washington state have sent a new wave of cannabis proprietors clamoring to obtain loans and make deposits in banks and credit unions.

The Justice Department announced in August that the administration would give new latitude to states experimenting with taxation and regulation of marijuana.

But with the drug still outlawed at the federal level, banks are barred under money-laundering rules from handling proceeds from marijuana sales even in states where pot sales have been made legal.

The lack of credit for marijuana businesses, however, poses its own criminal justice concerns, Holder said.

“There’s a public safety component to this,” he said. “Huge amounts of cash – substantial amounts of cash just kind of lying around with no place for it to be appropriately deposited – is something that would worry me just from a law enforcement perspective.”

Holder did not offer any specifics on a timeline for action on banking services for marijuana. Cole in September said the Justice Department was working on the issue with the Treasury Department’s financial crimes enforcement network.

Critics of liberalized marijuana laws have said the lack of credit faced by pot retailers was beside the point.

“We are in the midst of creating a corporate, for-profit marijuana industry that has to rely on addiction for profit, and that’s a much bigger issue than whether these stores take American Express,” said Kevin Sabet, co-founder of the anti-legalization group Smart Approaches to Marijuana.

Reporting by David Ingram in Charlottesville, Virginia; Writing by Alex Dobuzinskis; Editing by Steve Gorman and Lisa Shumaker

Source: Reuters (Wire)
Author: David Ingram, Reuters
Published: January 24, 2014
Copyright: 2014 Thomson Reuters

29 Oct 2013

Marijuana Likely To Be Decriminalized in D.C.

posted in: Cannabis News | 0

Before long, smoking a joint in the nation’s capital might get you in even less trouble than parking on the wrong side of the street on street-cleaning day.

Ten of 13 members of the D.C. Council and Mayor Vincent C. Gray (D) have endorsed a plan to make small-time marijuana possession a civil rather than a criminal offense. That means recreational cannabis users wouldn’t face arrest, charges or jail time — any of which can destroy their lives — as long as they aren’t caught with more than an ounce of the drug. Instead, they would have to pay a fine, perhaps as low as $25. (The mayor also wants criminal penalties to remain for anyone caught using it in public.)

Much of the debate over the idea has focused on an American Civil Liberties Union report that suggests that the District and many other jurisdictions enforce their anti-marijuana laws unfairly, disproportionately arresting African American suspects. On these pages, Police Chief Cathy L. Lanier pushed back, insisting that factors such as a geographic concentration of tips about marijuana users, not biased policing, are responsible for the city’s arrest figures.

That debate does not need to be resolved to conclude that maintaining criminal penalties for small-time users of any race doesn’t make sense.

Enforcing criminal penalties against those who aren’t involved in trafficking or selling the drug would be too harsh and a waste of government resources. As it stands, very few people in the District are prosecuted for possessing less than an ounce of marijuana, unless there are other charges to go along with it. But even an arrest can make it difficult to find a good job.

Refraining from enforcing criminal penalties, on the other hand, would promote disrespect for the law.

An all-around better policy, long championed by District lawyer Paul Zukerberg, would be to slap small-time users with a civil fine, which is a measured way to send a message that the government does not condone or tolerate marijuana use. No one’s life would be permanently marred by getting caught with a joint. But violators would still have to pay, literally. In that vein, we would suggest that $25 — a smaller fine than that attached to low-level parking violations — is too modest a penalty. Maryland lawmakers considered setting a $100 fine this year, the same level that New York state approved last year. That sounds like the right size.

Attitudes about marijuana are changing, and quickly. A recent Gallup poll found that an astonishing 58 percent of Americans now favor legalizing the drug. Colorado and Washington state have both tried to do just that by changing their drug laws. Federal law still treats marijuana as an illicit substance, but Attorney General Eric H. Holder Jr. announced a policy this year that aims federal resources at high-level offenders. And now the District government is poised to join the 15 states that have decriminalized small-time pot possession.

Of all the official reactions to changing mores on marijuana, decriminalization is the best.

Source: Washington Post (DC)
Published: October 27, 2013
Copyright: 2013 Washington Post Company
Contact: [email protected]
Website: http://www.washingtonpost.com/

26 Sep 2013

Can The United Nations Block US MJ Legalization?

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The United Nations International Narcotics Control Board’s latest annual report expressed dismay at the legalization of marijuana in Washington and Colorado and urged “the Government of the United States to take necessary measures to ensure full compliance with the international drug control treaties in its entire territory”. This led many media outlets to report that the U.S. had violated the UN drug control treaties to which it is a signatory. U.S. obligations under the treaties, and indeed the broader international future of marijuana legalization, are complex matters. But the essential points can be summarized in a 4-part Q&A.

1. Is the U.S. currently in violation of the UN treaties it signed agreeing to make marijuana illegal? No. The U.S. federal government is a signatory to the treaty, but the States of Washington and Colorado are not. Countries with federated systems of government like the U.S. and Germany can only make international commitments regarding their national-level policies. Constitutionally, U.S. states are simply not required to make marijuana illegal as it is in federal law. Hence, the U.S. made no such commitment on behalf of the 50 states in signing the UN drug control treaties.

Some UN officials believe that the spirit of the international treaties requires the U.S. federal government to attempt to override state-level marijuana legalization. But in terms of the letter of the treaties, Attorney General Holder’s refusal to challenge Washington and Colorado’s marijuana policies is within bounds.

2. Can the UN punish countries that legalize marijuana? Only to a small degree. The UN International Narcotics Control Board is the keeper of the drug treaties and regularly chastises governments that violate their commitments. This can be embarrassing in international diplomatic circles, but no nation has ever collapsed due to embarrassment.

Because the International Narcotics Control Board has power over the production and transport of the legal medical supply of drugs it could in theory punish a country that legalized marijuana by imposing punitive controls on pain medications. But the international humanitarian outcry over such an action would be enormous. Further, the countries that produce the most opiate painkillers are not easy to push around (e.g., Australia, India, The United States). It is thus safe to assume that crimping the medical supply of drugs is a trigger that the Narcotics Control Board is not going to pull.

3. Does the entire UN drug treaty system need to be undone in order for countries to legalize recreational marijuana? No. Marijuana is just one of many psychoactive substances made illegal by the UN drug control treaties. Some drug legalization activists hope that if support for marijuana legalization grows internationally, it will require all UN drug treaties to be revised, thereby granting an opportunity to legalize cocaine, heroin and every other drug at the same time. This is a misreading both of international political sentiment and UN protocol.

Even among nations with some sympathy towards marijuana legalization, there is minimal enthusiasm for allowing, say, the Phillip Morris corporation to sell cocaine legally throughout the world as it does cigarettes. If the price of changing UN treaties regarding marijuana is legalizing all drugs, many otherwise sympathetic nations will vigorously oppose the action.

But as it happens, it’s a moot point because under U.N. protocol, new treaties supersede old treaties. Thus, if the nations of the world ever agree that they want to legalize recreational marijuana, they can write a new treaty focused just on that drug. This would nullify only the marijuana-related provisions of the overall UN drug control framework, leaving the status of other currently illegal drugs unaffected.

4. Wouldn’t a new UN marijuana drug treaty just be a vehicle for the U.S. to push its tough marijuana policies worldwide? Get ready for a surprise. If all nations adopted current U.S. marijuana policy, the result would be significant relaxation of international control over marijuana. Prior to the Obama Administration, a Rand Corporation study found that the level of marijuana enforcement in the U.S. was similar to that of Western Europe. Since Obama was elected, marijuana enforcement intensity has plummeted and the federal government has dropped its longstanding opposition to state-level marijuana decriminalization and legalization efforts.

Last but not least, remember that the only legal recreational marijuana markets in the world are not in the Netherlands or in Portugal but right here in the United States. Transplanting current U.S. marijuana policy worldwide via a new UN treaty would mean somewhat more liberal marijuana control policy in Europe, and dramatically more relaxed policy in most of Africa, the Middle East and Asia.

In short, supporters of marijuana legalization don’t really need to worry about the UN drug control treaties. Whether marijuana legalization sweeps the world or not depends on something far more fundamental: What people around the world decide is the best approach to the drug.

Source: Huffington Post (NY)
Author: Keith Humphreys, Professor of Psychiatry, Stanford University
Published: September 25, 2013
Copyright: 2013 HuffingtonPost.com, LLC
Contact: [email protected]
Website: http://www.huffingtonpost.com/

23 Sep 2013

Holder Expands Changes in Drug-Case Policy

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The Justice Department is expanding a major change in federal drug sentencing policy to cover pending drug cases, Attorney General Eric Holder said Thursday.

Last month, Holder said certain low-level, nonviolent drug offenders — those without ties to large-scale organizations, gangs or cartels — no longer will be charged with offenses that impose severe mandatory minimum sentences.

Holder said he now has broadened the new policy to cover defendants who have not yet been convicted in drug cases that could involve lengthy mandatory prison sentences. The policy also may be applied, at the discretion of prosecutors, to a defendant who has entered a guilty plea, but has not yet been sentenced.

Mandatory minimum prison sentences, a legacy of the government’s war on drugs, limit the discretion of judges to impose shorter prison terms.

Holder says the government should reserve the most severe prison terms for serious, high-level or violent drug traffickers.

“Some federal drug statutes that mandate inflexible sentences — regardless of the individual conduct at issue in a particular case — do not serve public safety when they’re applied indiscriminately,” Holder told a criminal justice issues forum of the Congressional Black Caucus Foundation.

At a Senate Judiciary Committee hearing this week, Sen. Rand Paul, R-Ky., said that in one case, a first-time offender arrested with less than 2 ounces of cocaine was sentenced to 10 years in prison because of mandatory sentencing guidelines. Paul has drafted legislation along with committee chairman Sen. Patrick Leahy, D-Vt., that would give judges wider sentencing discretion as one way to relieve prison overcrowding and bring down the exploding costs of operating prisons.

Source: Associated Press (Wire)
Author: Pete Yost, The Associated Press
Published: September 19, 2013
Copyright: 2013 The Associated Press

2 Sep 2013

Feds Say They Will Go Easy on Banks

posted in: Cannabis News | 0

During the groundbreaking phone call on Thursday, August 29 in which U.S. Attorney General Eric Holder told the governors of Colorado and Washington the federal government would not attempt to intercept regulated legal marijuana in their states, he also said the Department of Justice (DOJ) is “actively considering” how to oversee the relationship between banks and marijuana shops.

According to the Huffington Post, Holder told the governors as long as marijuana shops “operate within state laws and don’t violate other federal law enforcement priorities” the DOJ is looking to regulate those interactions as legal.

Rep. Ed Perlmutter (D-Colo.), a senior member of the House Financial Services Committee, released a statement on Thursday calling for a hearing to discuss his proposed bill, Marijuana Businesses Access to Banking Act (HR 2652). In the statement, he raised concerns over “public safety, crime, and lost tax revenue associated when these legal and regulated businesses are operating in a cash-only system.”

He continued:

“We need to provide financial institutions certainty they can make their own business decisions related to legal, financial transactions without fear of regulatory penalties. Currently, under federal banking laws, many legal, regulated legitimate marijuana businesses operating legally according to state law are prevented from maintaining bank accounts and accessing financial products like any other business such as accepting credit cards, depositing revenues, or writing checks to meet payroll or pay taxes. They are forced to operate as cash-only enterprises, inviting crime such as robbery and tax evasion, only adding to the burden of setting up a legitimate small business.”

To that regard, a senior DOJ official speaking on a condition of anonymity told Huffington Post “the department recognized that forcing the establishments to operate on a cash basis put them at greater risk of robbery and violence.”

CNN warned in a report that since the new guidelines do not change federal money laundering laws, some large banks might “still be leery of doing business with marijuana producers and sellers.”

Along with Holder’s announcement on Thursday came a memo from Deputy Attorney General James Cole, addressed to U.S. attorneys nationwide. The memo outlines eight priorities intended to serve as strict guidelines the attorneys are required to follow as federal marijuana policy when prosecuting in the states where it is legal.

According to the Huffington Post , the anonymous DOJ official said, “For now, financial institutions and other enterprises that do business with marijuana shops that are in compliance with state laws are unlikely to be prosecuted for money laundering or other federal crimes that could be brought under existing federal drug laws, as long as those pot businesses don’t otherwise violate the priorities.”

In addition, the Huffington Post reported, the official said he “would not rule out prosecution in any case, but the new approach is a reversal of a DEA policy that had warned banks not to work with marijuana businesses.

Washington Governor Jay Inslee and the state’s attorney general, Bob Ferguson thanked Holder for his efforts to work with the states’ decision to legalize and regulate pot, and called Holder’s announcement “good news” in a statement on Thursday.

“Attorney General Holder also expressed a willingness to work with the states on a financial structure that would not run afoul of federal law,” they said, calling the news an “affirmation of good work” by the state Liquor Control Board, which the state put in charge of designing a system of regulation and implementation for the new marijuana laws.

They continued, “We can assure the Attorney General that Washington state will remain vigilant in enforcing laws against the illicit marijuana market.”

April M. Short is a Bay Area journalist focusing on social justice reporting.

Newshawk: The GCW
Source: AlterNet (US)
Author: April M. Short
Published: August 31, 2013
Copyright: 2013 Independent Media Institute
Contact: [email protected]
Website: http://www.alternet.org/

24 May 2013

The Cannabis Is Out Of The Bag

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This week, the Colorado General Assembly put the finishing touches on legislation aimed at taxing and regulating the commercial distribution of marijuana for recreational use.  The process has been haunted by the fear that the federal government will try to quash this momentous experiment in pharmacological tolerance — a fear magnified by the Obama administration’s continuing silence on the subject.

Six months after voters in Colorado and Washington made history by voting to legalize marijuana, Attorney General Eric Holder still has not said how the Justice Department plans to respond.  But if the feds are smart, they will not just refrain from interfering, they will work together with state officials to minimize smuggling of newly legal marijuana to jurisdictions that continue to treat it as contraband.  A federal crackdown can only make the situation worse — for prohibitionists as well as consumers.

Shutting down state-licensed pot stores probably would not be very hard.  A few well-placed letters threatening forfeiture and prosecution would do the trick for all but the bravest cannabis entrepreneurs.  But what then?

Under Amendment 64, the Colorado initiative, people 21 or older already are allowed to possess up to an ounce of marijuana, grow up to six plants for personal use and keep the produce of those plants ( potentially a lot more than an ounce ) on the premises where they are grown.  It is also legal to transfer up to an ounce “without remuneration” and to “assist” others in growing and consuming marijuana.

Put those provisions together, and you have permission for various cooperative arrangements that can serve as alternative sources of marijuana should the feds stop pot stores from operating.  The Denver Post reports that “an untold number” of cannabis collectives have formed in Colorado since Amendment 64 passed.

Washington’s initiative, I-502, does not allow home cultivation.  But UCLA drug policy expert Mark Kleiman, who is advising the Washington Liquor Control Board on how to regulate the cannabis industry, argues that collectives ostensibly organized to serve patients under that state’s medical marijuana law could fill the supply gap if pot stores never open.

It is also possible that Washington’s legislature would respond to federal meddling by letting people grow marijuana for personal use, because otherwise there would be no legal source.

With pot shops offering a decent selection at reasonable prices, these alternative suppliers will account for a tiny share of the marijuana market, just as home brewing accounts for a tiny share of the beer market.  But if federal drug warriors prevent those stores from operating, they will be confronted by myriad unregulated, small-scale growers, who will be a lot harder to identify, let alone control, than a few highly visible, state-licensed businesses.

The feds, who account for only 1 percent of marijuana arrests, simply do not have the manpower to go after all those growers.  Nor do they have the constitutional authority to demand assistance from state and local law enforcement agencies that no longer treat pot growing as a crime.

Given this reality, legal analyst Stuart Taylor argues in a recent Brookings Institution paper, the Obama administration and officials in Colorado and Washington should “hammer out clear, contractual cooperation agreements so that state-regulated marijuana businesses will know what they can and cannot safely do.” Such enforcement agreements, which are authorized by the Controlled Substances Act, would provide more security than a mere policy statement, although less than congressional legislation.

Taylor, who says he has no firm views on the merits of legalization, warns that “a federal crackdown would backfire by producing an atomized, anarchic, state-legalized but unregulated marijuana market that federal drug enforcers could neither contain nor force the states to contain.” Noting recent polls finding that 50 percent or more of Americans favor legalizing marijuana, he says the public debate over that issue would benefit from evidence generated by the experiments in Colorado and Washington.  That’s assuming the feds do not go on a senseless rampage through these laboratories of democracy.

Source: Odessa American (TX)
Copyright: 2013 Odessa American
Contact: [email protected]
Website: http://www.oaoa.com/
Author: Jacob Sullum

26 Apr 2013

Legalizing Marijuana For Profit Is A Bad Idea

posted in: Cannabis News | 0

The push to legalize Marijuana is going Gangham style. In the past several months, 55 percent of voters in Colorado and Washington approved a ballot measure making it legal for medical and nonmedical uses, and a slew of polls indicate that a majority of Americans now support making Marijuana as legal as cigarettes and alcohol.

Changing public attitudes is a big reason why the drive to let people legally “toke” up is gaining traction. But the question on the minds of politicians and business leaders is how much money can be made from this new industry?

Earlier this month Fortune magazine ran an unusual cover story attempting to answer this question. The article featured a group of West Coast Cannabis entrepreneurs who are seeking investments from prominent venture capital firms. These entrepreneurs want to produce and market products that will make smoking pot easy, sexy, and appealing. What’s their selling point? Cannabis could represent a $47 billion industry opportunity.

A broader selling point is that legalizing marijuana could help state governments cut their enforcement budgets and generate tax revenue. Since 1970, state and federal authorities have spent billions enforcing marijuana laws, but pot continues to be ubiquitous. Police have not reduced production, and laws are applied inconsistently across the spectrum of socioeconomic and minority populations.

The economic argument carries great weight for proponents. As revelers lit up last weekend to mark 4-20, the annual celebration of all-things weed, it’s tough to argue that consumer demand isn’t there. Legalizing an already booming black-market industry means the potential for job creation and a fresh source of income for state treasuries scrambling in the age of the sequesters.

However, once you clean the bong, this line of thinking goes up in smoke.

First, just because public opinion and economic arguments indicate otherwise, Congress must ask some hard questions before it changes 50-years of national drug policy. Questions like: why has marijuana enforcement failed? Is the Controlled Substances Act of 1970 fundamentally flawed? And if so, what can be done to reform it?

Finding the answers to these questions is not at the top of the political agenda. Attorney General Eric Holder testified recently about federal policies in relation to the newly passed Colorado and Washington initiatives, and Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.) promised that the panel would discuss federal policies in light of the country’s patchwork of state marijuana laws. But there has been no concerted push for broad scale reform similar to the activities associated with the Affordable Care and Patient Protection Act of 2009 or the Tax Reform Act of 1986.

Second, legalizing cannabis for profit is simply a bad idea. It flies in the face of social responsibility. The acquisition of profit is driven by self-interest, not the common good. Business decisions are made based on how the outcome will improve the bottom line.

It wouldn’t be long before marijuana companies – likely backed by big tobacco, with its in-place marketing and distribution teams – started aggressive efforts to win consumers. They’ll develop attractive packaging, new and interesting flavors and strains, optimal paper to enhance the smoking effect, and compelling advertising campaigns all designed to get consumers hooked.

There will be messages appealing to long-time pot smokers and new pot smokers. There will be brands for youths, college kids, minorities, the poor, women, and urbanites. Smokers will come to believe they can’t live without their daily “wake & bake” just as they believe they can’t live without their smartphones or iPads. The mass-market consumption of marijuana will bring with it the same negative and ubiquitous effects we’ve seen with alcohol and cigarettes: health problems, driving under the influence, and addiction.

Once the industry gets rolling, those celebrated tax revenues will probably evaporate. Just in the last few days, Colorado State University released a study indicating that the tax revenues expected from the Centennial State’s newly legal industry will not pay for its regulation. Nor will it bring in a windfall of money proponents promised would pay for new school construction and other social benefits.

Even if the tax projections do pan out, as the industry grows in size and influence, lobbyists will exert pressure on politicians to lower taxes and loosen regulations, just as the tobacco industry has done in the past, to maximize profitability. This is the nature of the interplay of business and politics; for the most part, business has the upper hand.

Other advocates point to the potential of a diminished drug trade – growers, particularly Mexican drug gangs, will no longer have as lucrative a demand for their wares, and dealers won’t be engaging in criminal activity because their sales have dried up. But this too doesn’t factor in the flip side of business: where one market opportunity ends, another one begins. Drug lords may see a short-term curtailment of their revenue upon legalization, but they’ll branch out to sell other illegal substances, like some new designer drug or some drug that has been out of vogue.

Legalizing marijuana isn’t a simple, creative way to fill up the government’s depleted bank account or strike it rich in a new industry. It will only add to the cacophony of big businesses jockeying for your dollar and competing for politicians’ favor. The public needs to take a long-pause before it starts clamoring for the legal right to buy marijuana at the local 7-Eleven. Social responsibility dictates caution.

Source: Topix LLC
Link: http://politix.topix.com/homepage/5760-legalizing-marijuana-for-profit-is-a-bad-idea
Author: Jamie P. Chandler and Palmer Gibbs
Date: April 23, 2013

30 Mar 2013

Wash. Touts Credentials of Pot Consultant

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Green thumb? Check. Extensive knowledge of the black market? Check. Throw in impeccable academic credentials and decades of experience with government agencies, and you have Washington’s marijuana consultant — a team advising officials on all things pot as they develop rules for the state’s new industry in legal, heavily taxed marijuana.

The Washington Liquor Control Board introduced Massachusetts-based BOTEC Analysis Corp. as the presumptive winner of the consultant contract during a news conference Tuesday. The team is led by a University of California, Los Angeles, public policy professor and includes a former executive of the company that is the sole licensed supplier of medical marijuana in the Netherlands. It also includes researchers with the RAND Corp. who will help figure out how much marijuana state-licensed growers should produce.

“These are, by far, the top consultants available,” said Randy Simmons, who oversees the implementation of the legal weed law for the board. “We’re serious about doing this the right way.”

Washington and Colorado last year became the first states to pass laws legalizing the recreational use of marijuana and setting up systems of state-licensed growers, processors and retail stores where adults over 21 can walk in and buy up to an ounce of heavily taxed cannabis. Sales could begin at the end of the year.

The votes left state officials with a daunting task: figuring out how to build a huge pot industry from scratch. The state’s Liquor Control Board must determine how many growers and stores there should be, how much pot should be produced, how it should be packaged, and how it should be tested to ensure people don’t get sick.

The board is doing a lot of its own research, with buttoned-up bureaucrats traveling to grow operations in California and Colorado as well as within Washington state. But the consultant’s advice will also be important. The state is aiming to produce just enough marijuana to meet current demand: Producing too little would drive up prices and help the black market flourish, while producing too much could lead to excess pot being trafficked out of state.

BOTEC — it stands for “back of the envelope calculations” — is a 30-year-old think tank headed by Mark Kleiman, a UCLA public policy professor with a doctorate from Harvard University’s Kennedy School of Government. The firm has evaluated government programs and provided consulting relating to drug abuse, crime and public health. It studied the results of an effort to crack down on heroin dealers in Lynn, Mass., and in the early 1990s advised the Office of National Drug Control Policy on drug-demand reduction programs.

Kleiman has written several books on drug policy and crime, including “Marijuana Legalization: What Everyone Needs to Know,” and he has argued that states can’t legalize marijuana — federal officials would never stand for it.

“Pot dealers nationwide — and from Canada, for that matter — would flock to California to stock up,” he wrote in an opinion piece in the Los Angeles Times in 2010, when California was considering legalizing marijuana. “There’s no way on earth the federal government is going to tolerate that. Instead, we’d see massive federal busts of California growers and retail dealers, no matter how legal their activity was under state law.”

For that reason, some marijuana advocates questioned how committed his team would be to carrying out the will of the voters. But Alison Holcomb, the author of Washington’s new law, said the choice of a consultant who isn’t a pot cheerleader sent a message that the state is taking its responsibilities seriously.

That’s a crucial concern because state officials are trying to persuade the federal government not to sue to block the law from taking effect. Gov. Jay Inslee has said he stressed to U.S. Attorney General Eric Holder that Washington will have the best-regulated system possible, but the Justice Department still has not announced its intentions.

Steven Davenport, BOTEC’s managing director, said that with more than 30 people involved, the team comprises a wide range of opinions on marijuana legalization, but none is relevant to the task at hand: figuring out how it can best be accomplished, balancing the needs of a working marijuana distribution system with the interests of public health.

“We understand the significance and the size of the task in front of us,” Davenport said. “Our intent is to make sure the board does this correctly.”

Other team members include Michael Sautman, former CEO of Bedrocan International, the international affiliate of the only company licensed to produce medical marijuana for patients in the Netherlands; the company is overseen by the Dutch Ministry of Health, according to BOTEC’s bid for the contract.

Sautman “has consulted lawmakers and regulators in Canada, Israel and several U.S. states regarding how medical marijuana is produced and distributed in the Netherlands,” the bid reads.

Beau Kilmer, co-director of RAND’s Drug Policy Research Center, said RAND is already under contract with the White House’s Office of National Drug Control Policy to develop a new approach for estimating the number of marijuana users across the country and how much pot they consume. His group will build off that work to estimate use by county in Washington state, and that it could involve Internet-based surveys asking people to detail their cannabis use — to the extent of asking them to explain the size of their most recent joint, as compared with a photograph of a joint next to a credit card or ruler for scale.

“That’s going to be a challenge, but I’m excited to work on it,” Kilmer said.

The value of BOTEC’s contract has not been set, but it is expected to exceed $100,000. The losing bidders have 10 days to contest the award.

Source: Washington Post (DC)
Author: Gene Johnson, The Associated Press
Published: March 19, 2013
Copyright: 2013 Washington Post Company
Contact: [email protected]
Website: http://www.washingtonpost.com/

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