Ten Miles Square


July 26, 2011 8:03 AM Mis-Imagining Marijuana Inc.

By Keith Humphreys

I was on Nevada Public Radio a few weeks ago with Allen St. Pierre, who is a leading marijuana legalization activist. We had similar views on the likely shape of a legal marijuana industry, namely that it would be corporate dominated, employ armies of lobbyists and fight to keep taxes and health and safety regulations as minimal as possible. Mr. St. Pierre said that the food industry would be the best place to look for a parallel: About 90% of food is produced by mega-corporations and a few small players cut up the remaining scraps of business. I tend to think that a legalized marijuana industry would look like Big Tobacco — indeed marijuana production companies may simply be divisions of tobacco companies — but St. Pierre may have the better analogy.

Our predictions aren’t particularly insightful. Indeed, they don’t rise much above common sense: The shape of corporate America isn’t hard to discern. I was therefore intrigued to hear Mr. St. Pierre say that as he travels around the country, he spends a great deal of time disabusing legalization advocates of the idea that a legalized marijuana industry wouldn’t be, well, an industry. The likely form of a legalized marijuana industry isn’t appreciated by many people who oppose marijuana legalization either. Mis-imaginings of legalized cannabis in both camps are likely a consequence of the cultural meaning cannabis has for a significant portion of the U.S. population.

For millions of Americans, the word “marijuana” is hard-wired to the part of their brain that divides the human population into those who went to Woodstock and those who went to Viet Nam. The peculiar result is a largely left-wing movement fighting hard (alongside some corporate billionaires) to create a multinational corporation and a largely conservative movement fighting to stop the advance of capitalism and the private sector. Some people on both sides mis-imagine a legalized marijuana industry made up of bucolic co-op farms run by hippies in tie dye t-shirts, selling pot at the lowest possible profit to friendly independent business folk in the towns who set aside 10% of their profits to save the whales. This image is pleasant to some and revolting to others, but that’s as may be because it’s not what would happen under legalization.

This will be tough for baby boomers to hear, but the current generation of Americans doesn’t know Woodstock from chicken stock and understands the Viet Nam War about as much as they do military action in the Crimea. If the U.S. legalized marijuana today, those now fading cultural meanings would not rule the day, capitalism would. Cannabis would seen as a product to be marketed and sold just as is tobacco. People in the marijuana industry would wear suits, work in offices, donate to the Club for Growth and work with the tobacco industry to lobby against clean air restrictions. The plant would be grown on big corporate farms, perhaps supported with unneeded federal subsidies and occasionally marred by scandals regarding exploitation of undocumented immigrant farm workers. The liberal grandchildren of legalization advocates will grumble about the soulless marijuana corporations and the conservative grandchildren of anti-legalization activists will play golf at the country club with marijuana inc. executives, toast George Soros at the 19th hole afterwards and discuss how they can get the damn liberals in Congress to stop blocking capital gains tax cuts.

[Cross-posted at The Reality-Based Community]

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Keith Humphreys is a professor of psychiatry and behavioral medicine at the Stanford University School of Medicine.


  • Sapient on July 26, 2011 12:43 PM:

    Not to say that there wouldn't be an "industry" as is described, but anyone who wanted to opt out of supporting the industry could grow their own, and share with friends. It's a very easy plant to grow and to propagate, which is why it's called "weed."

  • Mitch on July 26, 2011 2:04 PM:

    Sapient is entirely correct. MJ does not need a corporate structure. It grows well in many climates and does not need any kind of treatment to prepare it for consumption.

    Now, it is entirely possible that marijuana may be legalized but regulated to the point where it is illegal for someone to grow it at home. That would be disgusting, and way too Big Brother-ish, but it wouldn't surprise me at all. Corporations have all of the Rights in this country, so I could totally see that.

  • Chesire11 on July 26, 2011 5:41 PM:

    Marijuana is easy to grow and does grow in a wide range of climates...so does tobacco. That's why corporate pot will be engineered for higher concentrations of THC and fortified with additives to make it more addictive - just like they did with tobacco.

    Then, they will advertise like beer companies to gin up business, but at least it will put the drug cartels out of business, right?

    Yeah, not so much.

    The drug cartels which control a vast, well organized, extremely profitable distribution network aren't likely to throw in the towel and start growing coffee. No, they will concentrate their resources on producing and distributing the things that are still illegal and they will be promoting them with the same ubiquity as the weed they are currently intoducing to 12 year olds.

    Pot is unquestionably a "gateway drug" - it is the gateway that created sophisticated distribution networks for illict products. If pot is as harmless as many people think, then we should take care before we take it out of the drug cartels' hands. They will fill the pipeline with something else and it is likely to be something much worse.

  • Orange Hair on July 26, 2011 6:18 PM:

    As a writer and activist in the California medical marijuana scene, I've been close to this issue for quite a while. There is a lot of fretting from small growers about the "corporatization" of cannabis, from takeovers by big agra/tobacco/evil corporation X, to enormous, market-distorting grow warehouses. As I've always argued, when cannabis is legalized in America, it will happen in America, i.e., it will fit into the overall economy as neatly as possible. This will include big corporations, mass production, and the other issues described above.

    The thing is, the market has changed since prohibition. It's no longer monolithic. There is a connoisseurship market now across a wide variety of goods and services that did not exist when prohibition ended, which values variety, unique flavors, rarity, organic growing methods, and other BoBo concerns. Most medical patients I know already think of cannabis this way, and the cannabis press pushes this model incessantly.

    Granted, there will always be a big market for a cheap, inferior product that "does the job" (Coors is doing great, despite the rise of micro-brews) so I expect "Wal-Mart Weed" to flourish in a post-prohibition market, but people will also be able to experience the wide variety of boutique cannabis the same way those of us with a recommendation and dispensaries can.

    As usual, it's not an "either/or" situation.

  • Benjamin on July 27, 2011 12:33 AM:

    Chesire11 are you implying that if cannabis is legalized that the cartels are just going to start pushing larger quantities of things like crystal meth and cocaine to make up for lost profits?

    I think this is a stretch. People do not want harder drugs in the same fashion that they want marijuana. People are fully aware that meth and cocaine and heroin can kill you. And how would the Cartels go about advertising anyway? They're certainly not going to have Hollywood and the pop music industry in sync with such a message like they currently do with marijuana. The only way they could even advertise such stuff is through word of mouth, and if people are able to purchase their cannabis legally and safely from a dispensary, then they get less of an opportunity.

  • Rich C on July 27, 2011 12:19 PM:

    It's worth pointing out that there are relatively few crops - examples including tobacco, cotton, sugar, and rubber - that can be grown most efficiently on large scale plantations. For most other crops, productivity (output per acre) is either constant with scale, or declines with scale. Mechanization and chemical fertilizers certainly provide some benefits with scale, especially as their use requires financing (and large scale organizations have much better access to credit). But its not clear to me anyway that the kinds of mechanization suitable to marijuana growing (indoor grow lights, hydroponics) are so expensive that economies of scale in financing would quickly lead to market domination by a few producers. I think the beer industry is a reasonable analogy: a few big producers who make both a rather dull mass market product, a large number of small producers making high quality specialized products (some of which would be subsidiaries of the big producer), and a significant culture of craft/hobby home production. Much, maybe most of the market would be in the first category, but you'd still have a substantial market share for the latter two categories, for whatever that's worth.

  • Just a guy on July 27, 2011 2:18 PM:

    For those who think grow your own is a solution:

    If marijuana is legalized -- especially if done so under the food model -- it will have to be regulated. This could easily mean that only government sanctioned "corporate" marijuana is legal. Growing your own could still be illegal.

  • jeffreydj on July 28, 2011 2:07 PM:

    "If marijuana is legalized -- especially if done so under the food model -- it will have to be regulated. This could easily mean that only government sanctioned "corporate" marijuana is legal. Growing your own could still be illegal"

    Marijuana legalized under the food model? OK, I'll bite. Quick, name me a foodstuff that is illegal for anyone but a corporation to produce. Nope, I can't think of one, either. Under the 21st Amendment, even bathtub gin is legal for me to make, if I just gotta do my own alcoholic intoxicant. Now admittedly, certain corporations are allowed to make and sell methamphetamines, and I am decidedly not, but they are allowed to market their dope only to physicians under the prescription regime.

    Me, I have no beef with my legal inability to produce my own meth. But if and when the strictures against hemp cultivation are lifted, I shall grow my own, and I see no extant body of law modeling how I legally may not while Phillip Morris may.

  • Orange Hair on July 28, 2011 2:09 PM:

    @Just a guy: regulations only apply to food grown for commercial use. There is no law preventing you from spraying your personal tomato plants with deadly chemicals, then eating them yourself. There is one preventing you from feeding those tomatoes to consumers.

    Having said that, drug policy hasn't historically been characterized by consistency, so who knows if legalization would include the right to grow your own. It's worth noting that every legalization measure yet written has included that provision specifically, and I've met more than a few lawmen in CA who say they like to see people growing a plant or two, rather than supporting the dispensaries and (insert slippery slope HERE) the cartels.

    I expect regulation of cannabis to include testing for fertilizers and insecticides (cannabis is an accumulator plant, so whatever you give it, it gives you) and for levels of different cannabinoids. I predict this because it is already happening in CA.

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  • Crissa on July 29, 2011 2:22 PM:

    What's illegal about making your own meth is, well, the methamphetamines. There are local laws about how much of various chemicals you're allowed to have or buy, but generally, everything there can be bought off the shelf or ordered from stores.

    I don't know of any actual laws that ban the tools for making harder drugs that don't also ban things like 'bottled water' - which is considered a paraphernalia for some drugs. Without the drugs, having those things is only an inconvenience to those with little enough money not to hire a lawyer. It's not outright illegal.

    But I can certainly see a law which made it illegal to grow the plant yourself. It would be stupid, but I could see it.

  • Garth Hagerman on August 04, 2011 5:14 PM:

    "we should take care before we take it [pot] out of the drug cartels' hands. They will fill the pipeline with something ... much worse."
    Chesire11 presents the lamest argument in the history of civilization, the old Zyklon C Argument. We are being kind and noble by gassing people with Zyklon B, because if we stop, they'll just move on to Zyklon C, which would be much worse.

  • Goldilocks on August 05, 2011 3:19 PM:

    Marijuana need not be legalized. It only needs to be de-criminalized. That way the corporatization is avoided.

    The analogy with the food industry is probably the most apt, since marijuana is non-addictive. Of course, people who try it tend to like it, and we do have a tendency to repeat what we like.

    To the extent that it has psychoactive properties it also has a correspondence with the alcohol industry, though the nature of the two drugs is very different.

    The only correspondence with tobacco is that both are usually smoked. Beyond that there is no similarity.