A year into the experiments with legal, taxed marijuana sales, Washington and Colorado find themselves wrestling not with the federal interference many feared, but with competition from medical marijuana or even outright black market sales.
The black market for marijuana in Colorado isn't what it used to be. Nine or 10 years ago, the narrative of illicit cannabis in the state focused on illegally grown product filtering in from Mexico, California and elsewhere. Now it seems officials and experts are more concerned about Colorado-grown marijuana infiltrating other states, a trend that is seeing a significant upward trajectory. "In a lot of ways, our legal industry has become the black market for other states," said Tom Gorman, director of the Rocky Mountain High Intensity Drug Trafficking Area. (See also: A Year of Legal Pot)
Nebraska and Oklahoma filed the first major court challenge to marijuana legalization, saying that Colorado’s growing array of state-regulated recreational marijuana shops was piping marijuana into neighboring states and should be shut down. The lawsuit asks the United States Supreme Court to strike down key parts of a 2012 voter-approved measure that legalized marijuana in Colorado for adult use and created a new system of stores, taxes and regulations surrounding retail marijuana. (See also: Colorado vows to defend pot law against states' challenge)
That the black market in Colorado bustles in the emerging days of legalisation is not unexpected. By some reckonings, it will continue as long as residents of other states look to Colorado as the nation’s cannabis cookie jar. And as long as its legal retail competition keeps prices high and is taxed at rates surpassing 30%. “I don’t know who is buying for recreational use at dispensaries unless it’s white, middle-class people and out-of-towners,” said a longtime community activist. “Everyone I know still has the guy on the street that they hook up with.”
When recreational marijuana stores first opened their doors in the US state of Colorado on January 1, opponents predicted dire consequences: an influx of drug traffickers, a spike in fatal car accidents, and more crime. For their part, supporters claimed that legal weed could raise millions of dollars in tax revenue. Six months later, what have the results been? (See also: Six months after legalizing marijuana, two big things have happened in Colorado)
Only six months old, Colorado's recreational marijuana industry starts a transformation that could add hundreds of new pot businesses to the state and reconfigure the market's architecture. Previously, only owners of existing medical marijuana shops could apply to open recreational stores, and all businesses had to be generalists, growing the pot that they sold. Now, newcomers to the industry can apply for recreational marijuana business licenses. When these new businesses begin opening in October, all recreational marijuana companies will be allowed to specialize — for instance as stand-alone stores that don't grow their supply.
Cannabis is the world’s most widely used illicit drug. But for how much longer? In a short space of time we have moved from absolute global prohibition of the drug, with the emergence of legalised and regulated production and retail not in just one nation (Uruguay) but also, surprisingly, in two US states (Colorado and Washington). Do these and other new permissive models in Spain and Belgium, for example, point to a tipping point in the debate? Could cannabis step out of the shadows and join the ranks of alcohol and tobacco, the world’s most popular legal and regulated drugs?
Frustrated by the cash-heavy aspect of its new marijuana industry, Colorado is trying a long-shot bid to create the world's first financial system devoted to the pot business. But Colorado's plan to move the weed industry away from dank-smelling cash to easily auditable banking accounts is a Hail Mary pass that won't work, industry and regulatory officials agree.
Graham Boyd, Sarah Trumble, Lanae Erickson Hatalsky
11 April 2014
Despite a federal prohibition on marijuana possession, sale, and use, Colorado and Washington recently became the first states to enact laws legalizing the recreational use of this drug. Although the Obama Administration has taken steps to attempt to deal with this evolving situation, we believe the status quo is untenable and Congress must act to provide certainty and a framework for these states moving forward. This report explains the problem and offers a solution.
Far from being discouraged by shifts in public opinion, state laws and even within the Obama administration on the legalization of marijuana, federal drug agents are driven to "fight harder," said Drug Enforcement Administration chief Michele Leonhart. Leonhart, who criticized President Obama for comparing marijuana to alcohol during a closed-door meeting, suggested that voters in Washington state and Colorado were duped into legalizing marijuana. The Marijuana Policy Project is calling on the president through a Change.org petition to fire Leonhart.
Uruguay's drug czar says every legal marijuana plant in Uruguay will be registered and tracked using radio frequency tags, and that state-grown marijuana will be cloned to include genetic markers, making sure that what's grown here, stays here. That's a much tougher tracking system than those imposed in Colorado and Washington. Uruguay wants authorities to be able to test the pot in any drug user's possession to determine if it came from a registered, legal source.
Some 20 years ago, a Spanish official in favor of lifting the ban on drugs such as marijuana mentioned at a UN meeting that there "might be a more humane option" in the fight against trafficking. She was immediately taken aside by a senior diplomat, who told her in no uncertain terms: "Don't say things like that round here, not even in the washroom." Today, the same official says that internal documents are now circulating within the UN that openly admit to the failure of prohibition.
Federal marijuana prohibition in the United States started with a knock on a Denver man's apartment door. Seventy-six years ago, Samuel Caldwell became the first person arrested and prosecuted under a federal charge of selling marijuana, after drug enforcement agents busted him with 3 pounds of cannabis in his apartment. Three-quarters of a century and an estimated 26 million marijuana arrests after Caldwell's, legal marijuana sales were set to start at 8 a.m. in Colorado.
On January 1, 2014, Colorado becomes the first place anywhere in the world to allow legal marijuana sales to anybody over 21 for any purpose. You have questions about how it will work? Since the voter-approved Amendment 64 (ah, there it is) went into effect on Dec. 10, 2012, it has been legal for anyone 21 and over to use marijuana or possess up to an ounce of marijuana for any purpose. Here are 64 answers to commonly asked questions.
The first licences in the United States that permit retailers to sell marijuana for recreational use from 1 January were issued in Colorado. Owners of cannabis dispensaries lined up to collect the permits in Denver: an initial batch of 42 licences were issued, most to growers but around a dozen to shops. The state already licenses more than 500 medical marijuana dispensaries, and only those outlets may apply to sell it for recreational use. (See also: Colorado issues first licenses for recreational marijuana businesses)
Prohibitionists warn that it’s dangerous even to discuss legalizing marijuana because such talk sends “the wrong message” to the youth of America, encouraging them to smoke pot. If so, you might expect that the legalization of marijuana in Colorado and Washington, approved by voters more than a year ago, would have a noticeable impact on marijuana use by teenagers. Yet the latest data from the government-sponsored Monitoring the Future Study indicate that teenagers continued smoking pot at pretty much the same rates as before.