Thursday, September 17, 2009

Is Pot de facto legal?


How marijuana became legal - Medical marijuana is giving activists a chance to show how a legitimized pot business can work. Is the end of prohibition upon us?

10 comments:

Mr. Nice said...

I don't know about L.A.

The shops in Arcata are (pretty much) like so:

Nobody is allowed to purchase anything before being authenticated. Everyone is checked for ID every time they enter. The ID is not just glanced at, it is run against a computer in the same fashion that other membership-based stores do to authenticate identity. Nobody is allowed to redistribute. All members have to sign a document stating that they will not redistribute. In fact, if a person dares to say "I'm picking this up for another patient" and have not produced caretaker documents beforehand, they are kicked out.

All products are purchased above the going wholesale rate to attract vendors away from dumping their product on the black market. Any taxable acquisition requires the usual 1099 paperwork.

All products are sold slightly below the going retail rate for small amounts, but there is no quantity discount. Instead of a quantity discount, some have a "points" system for regular customers which offers periodic "rewards" in the form of twomp sacks. Taxes are paid to the BOE on every sale.

The percentage of old, grey haired, retired customers is much higher than it is for corner kids. Why? Well, obviously, it would look pretty funny for some retired professor to be hanging out with some dreadlocked street kid on 9th and H.

Dave said...

I find it interesting that you have this marijuana link (a good one by the way)on your blog Rose.

It was just a week ago you were complaining "Just another pot story" in reference to my article on Dennis Turner.

Or, could it be as I suggested in an earlier post regarding the use of Marijuana and a pot leaf on the front of the T-S - "It get's people attention when it's mentioned?"
You know. A readership thing.

Just curious

Rose said...

Eh, pot stories are a fixture here - just not "oh we're so in love with pot we have to print puff pieces and love stories about pot all the time." kind of thing.

I challenge you to THINK, Dave, not just about how lovely it will be when you can smoke all you want, but about the serious unintended and unimagined consequences of allowing that.

I voted for 215. It never occurred to me that you would see the proliferation of grow houses and the absolute flaunting of the law that goes on now.

It never occurred to me that it would mean someone would rent a house, cut holes in the walls and floors, and fill it up with dirt... did it occur to you?

I ask you whether you think it is FAIR that the growers - ILLEGAL growers, mind you, make all that money tax-free?

It is defacto legal, and Fortune magazine has just brought that into the mainstream consciousness - now what?

A push for government price supports? Like Tobacco subsidies? A push for brand protection like champagne?

That will be ironic - the lawbreakers asking for support from the law.

Dave said...

I agree that it's not fair that illegal growers don't pay taxes.

Those illegal growers who sell to "Medical Marijuana Clinics" are indirectly paying taxes because the clinics are.
What I mean by indirectly is the price they get from the clinics for a pound is below street value.
I know the illegal growers still sell to plenty of people who have nothing to do with these clinics.
And that sucks.

There's always a risk in legalizing something that alters our state-of-mind.

Alcohol is a good example. Look what's happened. Millions of Americans now have drinking problems that get them in trouble with the law, their friends and family.
The government took a risk legalizing it, but the majority of Americans wanted it, and freedom finally prevailed.

Will there be unexpected problems after legalizing pot? I'm positive there will be. Again, we're dealing with a mind altering substance.

I see taxing a legal pot industry bringing in a lot of tax money to the states and even the federal government. The saving alone from stopping the war against the herb will be staggering. THINK about the cost of federal programs right now (CAMP for example)that hook up with local governments to make a bust. There's been millions poured into the pursuit of pot.

I love your last comment, and agree it would be ironical.

Rose said...

INDIRECTLY PAYING TAXES???

Because they accept less illegal money. That's rich.

As is the Pot Clinics selling EXPENSIVE Pot (a weed) to sick people. Because to sell it at a more affordable price would undercut the street sales, and encourage more illegal activity as phony "sick" people would buy it cheap and then go out and sell it higher on the street.

Nothing like encouraging and being sympathetic for the best among us is there?

This is indeed a Bizarro world we live in today, when hard working law-abiding citizens are the ones who get none of the sympathy, respect or assistance, and the low-lifes and deadbeats get it all.

Dave said...

Rose,
You don't need sympathy, you have my respect, and if there's anything I can do for you just let me know.

There are others like me, who really do respect people like you, and acknowledge the fact that there's always two sides to a story.

Rose said...

Thanks, Dave. You have my respect, too, much as I might shake my head.

I am talking though, not about me, but about the hard-working people, Moms and Dads among them, who dedicate their lives to living law-abiding lives, raising their families, working in the schools, and other places, who don't break laws, who pay their mortgages, who scrimp and save in order to buy a house, a car, and put their kids through college.

Yeah, that's not as exciting as the rebel who flaunts the law, puts his family at risk and endangers your neighborhood, and essentially raises your costs in a myriad of ways, not the least of which is by not contributing as you do.

Lets stop glorifying criminals.

Mr. Nice said...

Dave, I don't know where you are getting this indirect taxes thing about clinics. Let me reiterate.

Clinics pay above wholesale price for product. The only problem with this is vendors are required to pay tax on these transactions. The whole reason the clinics pay above street wholesale is to attract people who would like to have the money now even if they have to pay tax on it later. If clinics paid below street value, why would anyone sell to them? Plus, taking the tax hit kicks is down to about equal with street price, so it is a win-win for everyone involved, including the government.

Similarly, clinics sell a little below street price (for small amounts, it is above street price for larger) even with tax. The reason they can continue to operate on buying high and selling low is that the whole idea is to be nonprofit. Any proceeds have to be reinvested into either expansion or as a break for members.

The only clinics I knew of in Arcata that tried to not follow this model went out of business. The one exception is HPRC who grow most of their own product. They more or less followed this model when Heimstat was pulling the strings.

This is a viable business model as it is. I think that the people who get up in arms about the way these places operate actually have no idea how things really are. The people who know generally don't say anything. I doubt newspaper reporters go to these places.

I do think that most people who grow indoors are just screwing us all. The one part of the Arcata regs that I agree with is people should be putting this stuff into a separate area from their house. You never hear of people burning their house down because they raised seedlings under an artificial lamp in their toolshed... mostly because they don't bite off more than they can chew. Ever heard of a house fire caused by a hobby grower of orchids? Of course not, because these are generally intelligent people to be able to grow finicky orchid specimen in the first place. On the other hand, the commercial growers do boneheaded things in order to stretch everything to the limit which is foolish and dangerous.

Rose said...

Legalize it.

End the sham that is 215. End the "medical marijuana" hypocrisy. And when it is legal, if it truly does help you if you are sick - it'll be wayyyy more affordable.

Mr. Nice said...

And as for selling too low so that people could theoretically buy it and go turn it around on the street: they do, for small amounts, but there is no discount like there is on streets for wholesale.

Specifically, patients can acquire cannabis for lower than street price for small amounts. They could theoretically buy $200 worth and go hustle it on the street and make $20. However, they would be getting paid... $3 an hour? This is not how hustlers operate.

In the black market, buying a full ounce at once time normally cost $100-$150 less than buying it $20 at a time. A street (or dorm room, apartment, etc) hustler who sells $20 bags from a full ounce will make that full $100-$150, sometimes more, but definitely not $20. Nobody would go break the law to make $20.

As I said before, the only way I've seen clubs lower the price is by giving regular small purchase buyers kickbacks in the form of freebie small amounts. The idea that someone is going to take this $20 bag and go hustle it on the street (and make $3/hr) instead of just taking it home is slim.

I feel that people have a lot of misconceptions about how this works. It is not like the black market. The black market is where the real money is at, this is why the reckless growers have elbows on the Cadillac, gold chains, fancy hats, etc. Nobody is making this kind of bread with clinics. Anybody who does ends up in the damned newspaper like that guy from modesto and the morro bay guy. While I agree that the Morro Bay guy shouldn't have been prosecuted for selling to that 17 year old cancer patient, he was still raking in the cash hand over fist... quite obviously at that. If he was more humble, he wouldn't be in prison.