Cannabis Legalization: A Jailed Generation and the Suits Making Millions

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The marijuana juggernaut is rolling at full steam. Legalization and decriminalization is creating a massive financial windfall for business. Global sales in the legal cannabis industry now top $21 billion. Capitalism has converted itself from prison guards and 25 million people locked up for marijuana possession during the 40-year War on Drugs, to cannabis salesmen in suits for a product that the ruling class increasingly agrees is a valuable profit opportunity.

Germany is joining Canada, Mexico, and Uruguay for full legalization of cannabis, with the U.S. Congress now beginning to discuss it. Uber has won the right to sell it in Ontario, Canada via Uber Eats. The sudden impulse to look to cannabis for taxable revenue and corporate profits is a watershed move for the establishment. Big Pharma, Big Tobacco and Big Beer are racing to invest in legal cannabis, which the Financial Times characterized as “a gold mine.” 

Legal cannabis in California accounts for $13 billion a year, five times the value of Napa Valley wine. The full force of the state has been used to dismantle all the obstacles to making cannabis profitable for corporate America. This contrasts with the previous 50 years of extreme state crackdowns. Every President from Nixon through Reagan, Clinton, and Bush used the ban on marijuana to fill America’s prisons to a bursting point. Now, while big business opens up shop in this billion-dollar business, those primarily black and brown individuals and families whose lives were shattered by America’s War on Drugs are being left behind. 

From Prohibition to Legalization

Cannabis was originally criminalized in the early twentieth century, with a series of acts and bills throughout the early 1910s as a part of the Prohibition movement. One of the first cannabis drug raids in the U.S. took place in Sonoratown, Los Angeles, in 1914 and targeted primarily Mexican immigrants. So began a long history of state laws that sought to outlaw cannabis. Alongside sale and possession, cultivation also became an offense in 1929. 

From the outset, the regulations and propaganda around cannabis were political and purposefully racist. The first wave of prohibitions targeted Mexican immigrants with the Federal Bureau of Narcotics deliberately adopting the Spanish word, marijuana, to make negative associations with Mexican workers. Black people were targeted from the outset, with conservatives linking jazz music with deviant behavior and cannabis use. Many of the early cannabis laws in the South were tied to Jim Crow. From the outset of criminalization, black people were three times more likely to be arrested for possession, and Mexicans nine times more likely to be arrested, than whites.

Minimum sentences rose to 10 years for possession and up to 15 years for selling cannabis by 1954. At the same time, carceral punishment became more drastic for repeat offenders, including life imprisonment.

Police repression has a long record of falling disproportionately on people of color, with higher arrest rates and harsher punitive measures. Drug possession was only the form and not the content. The goal was to maintain low wages and expectations for working people of color and to divide the working class. 

Starting in the mid-1950s, with rising disposable incomes and with the “Red Scare” era in decline, young people started experimenting with cannabis further, and its use later surged throughout the 1960s, and so arose the question of legalization. New cultivation techniques developed and spread to areas like Humboldt County, California. The U.S. government spraying cannabis crops in Mexico with herbicides drove people away from Mexican cannabis for fear of contamination and sharply increased demand for Californian-grown cannabis. The marijuana industry, still an entirely black market, was quickly becoming very established, especially in Northern California. The San Francisco Bay Area became a hotspot for legalization activism, with the first pro-legalization group LEMAR (LEgalize MARijuana) established in San Francisco in 1964. 

By 1979, 35% of cannabis consumed in California was grown in-state. And by this point, there was already some work being done on decriminalization (separate from legalization, in that use of cannabis is still prohibited but the state declines to prosecute possession below a certain amount) and, importantly, advances in production and development of the industry to maximize profit. In other words, even informally, cannabis capitalism was on the ascent.

A key turning point was California’s Compassionate Use Act of 1996, passed by 56% of voters under Proposition 215. This was the first instance of marijuana being legalized for medical use in the country, which followed resolutions at the city level endorsing the medical use of cannabis starting with Proposition P in San Francisco in 1991. These resolutions paved the way for dispensaries to start operating, first primarily for those suffering from HIV and AIDS – a rapidly rising epidemic with few options at the time for treatment of pain management without the side effects of nausea. The AIDS crisis, and AIDS activism, was a critical part of how marijuana came to be legalized medically. Prop 215 essentially allowed patients to use, possess, and cultivate small amounts of cannabis with a doctor’s recommendation, and this was expanded in 2003 with California Senate Bill 420, which established the medical cannabis ID card system. 

For 20 years, despite still being federally recognized as a Schedule 1 prohibited drug and thus subject to raids and prosecution by the DEA, dispensaries operated in California on an exclusively medical basis. The industry then went through a long period of legal battles, broken by the passage of Proposition 64 in 2016 – the Adult Use of Marijuana Act. This was part of a wave of laws across the country that legalized the use, cultivation, and sale of recreational cannabis for adults 21 and up. 

The California legal cannabis market is now the largest in the world. In 2021, California pulled in more revenue on cannabis sales than the two next highest-earning states combined. The state has a 20% market share in the United States, and that is not expected to drop through 2025. Business is booming, and the industry has immediately become fully entrenched in accumulating its wealth at the top as corporations swoop in one after the other to extract massive profits. The industry exemplifies the parasitic nature of capitalism: it descended on a framework of an industry and entirely oriented its full force towards profits, and profits only, ignoring the unlivable conditions of its own workers as well as those who have been incarcerated for use of the very thing they’re now making bank on. 

Cannabis and Mass Incarceration

During and after the Vietnam War, the Republican Party shifted their campaign politics towards the War on Drugs, arguing that the country’s multiple crises were caused or exacerbated by increased drug use, especially among young people. Young people were targeted as they had been increasingly drawn into leading the fight against the war, for civil rights, women’s rights and in the early fight for LGBTQ rights. As a part of Nixon’s battle to stay in power against an increasingly unpopular war and rising price inflation, he stepped up repression. 

Nixon’s domestic policy advisor, John Ehrlichman, openly admitted in an interview with Harper’s Magazine that the War on Drugs was concocted with the distinct purpose to break apart these communities, stating, “We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.” Cannabis was written into the 1970 Controlled Substance Act as a Schedule 1 drug equating its level of addiction and abuse with heroin. Reagan’s War on Drugs rebrand in the 1980s made crack cocaine the focus, yet marijuana arrests always outnumbered crack arrests by 5 to 1. 

By the 1990s the racist War on Drugs was taken to a new level with the Clinton-Biden Crime Bill that took millions of mainly men of color off the streets and into America’s prison system. The U.S. prison population grew by 700% from 1972 to 2009. While Fred Hampton said, ‘you can jail a revolutionary, but you can’t jail a revolution,” capitalism did its best to do just that. 

According to the ACLU, marijuana arrests accounted for about half of all arrests in recent decades and the vast majority of drug arrests. Arrests during the 40 years’ War Against Drugs overwhelmingly used marijuana as its battering ram: 80% of imprisonments were for cannabis. Almost nine out of ten marijuana arrests between 2001 and 2010 were simply for possession, with black people more than three times more likely to be arrested for marijuana offenses than white people. With the broad rise in racial justice consciousness driven in part by the BLM movement, awareness rose of mass incarceration and its racist agenda. It is in this context that capitalism has needed to step carefully in taking over the marijuana industry, both because it was the only source of income for many individuals trapped in racially segregated poverty, and because it had promoted the highly profitable prison industrial complex in the past. Navigating the hypocrisy stepping stones was going to be complicated for big business. 

One of the major components of California Prop 64 was its promise to give courts a way to partially or fully clear and seal the records of people that have been charged with marijuana-related offenses over past decades. There was even an additional bill passed in 2018, Assembly Bill 1793, that was designed to speed this process up, which took the onus off the individual and moved responsibility to the state to identify records with cannabis-related charges. There are still tens of thousands of Californians whose records have not been fully processed due to massive disorganization and inefficiency in the court system. 

The “Social Equity” Farce

This 2018 assembly bill established a process for the California Department of Justice identifying potentially eligible cannabis-related cases for review, and then sending all those cases to individual county courts to update the records and then send them back to the DOJ. This is an important step because the DOJ maintains the state’s criminal history database and answers background checks for housing, jobs, and loans – making this one of the critical pieces that directly impacts the lives of people who are still carrying criminal charges for marijuana-related crimes. One of the main problems with the bill was that it never gave counties deadlines for their superior courts to complete processing cases. 

There are some counties that have cleared records quickly, but there are others like San Bernardino and Riverside that, according to the Los Angeles Times in January 2022, had not fully processed a single case. Clearing your record depends entirely on where you live: Alameda County has processed 58% of its cases, Santa Cruz has processed 39%, while Santa Clara has cleared all its records. The state budget allocating almost $17 million to the courts for additional staffing and technology to clean these records once again came without any deadline or tracking of how the money is actually being spent. There are myriad reasons why this process has taken so long – some counties have had technical issues and software crashes, some have been short-staffed – others were just closed due to the pandemic. However, the defining reason for this protraction is the lack of will from the state’s political establishment to correct its injustices. The Democratic Party that runs California wants to be seen to be carrying out justice but, in their actions, resent doing anything for working people, especially people of color.

Other states are now looking to California when they write their own legislation, despite Prop 64 and AB 1793 not delivering on their promises. At least six other states looked directly at California’s Cannabis conviction sentencing bill and modeled their bills after it. Prohibition is ending rapidly around the country. New York, Virginia, New Mexico, and Connecticut all legalized recreational cannabis last year. Other states are legalizing medical use, with Mississippi being the most recent. The Democrats in the Senate are trying to get it legalized federally. It has not even been a decade since Washington and Colorado legalized recreational use. As this process plays out quickly, however, it is crucial that working people fight for the expunging and sealing of records as an essential part of this process. 

Even today, there are still tens of thousands of people incarcerated for cannabis-related crimes in the U.S. Hundreds of thousands of predominantly Black and Latino men carry felonies and misdemeanors on their records that directly impede their ability to get jobs, housing, and even their ability to vote. Meanwhile, the industry is ever-expanding and pulling in billions of dollars a year, using their armies of NGOs that the industry is propping up as a fig leaf of a solution. For a lot of companies, it’s enough to just make policies of hiring a token number of felons, but these gestures do not come close to undoing the damage that the War on Drugs has leveled on communities of color. 

Genuine social equity in the development of the current cannabis industry has been a planned failure. According to the LA Times, less than 8% of applicants for cannabis licenses are social equity applicants – those with a former cannabis conviction. There are no figures available for how many people successfully gain a license, but with the financial barriers confronting working class families, the odds of business success are stacked heavily against them. 

Landlords have made a killing on buildings that sit empty and unused as applicants wait for license approvals, since a physical location is required to obtain the license itself. Applicants may end up paying hundreds of thousands of dollars before their doors even open, especially since many landlords charge higher rent to cannabis businesses, claiming marijuana still being federally illegal makes them riskier to rent to. “Social equity” programs claim to be righting the racist wrongs of the past, but in reality they simply have presented new avenues to the ruling class to further exploit communities it has damaged in the name of profits for years.

The Segregation of Illegal and Legal Pot

The new cannabis establishment wants to appear ‘woke,’ but it will never correct the systemic inequality baked into the history of its industry and of capitalism. When alcohol prohibition ended in 1932, some of the bootleggers went into legal brewing while others remained in criminal activity. With marijuana sales and distribution, we have the added element of the extreme oppression of black people in America, especially in relation to jobs. Illegal marijuana sales and use continues to be huge, representing 75% of the market in California. 

Two marijuana worlds have now emerged. One is a modified version of the old model where the law turned a blind eye to white middle-class drug use. This is represented by today’s more expensive, relatively risk-free world of legal cannabis – a world of boutique shops for the affluent, where tourists fly in for pot tours. The other world is the illegal informal market, which remains cheaper and is now far more cutthroat. Because of the extreme racism and poverty in America, the illegal world cannot find a road to legality and continues on and worsens. For the first time in years, politicians are beginning to again talk about “law and order” and driving out the illegal cannabis world: an impossibility under capitalism. Once again Republican and Democratic politicians are exploiting anxieties about crime rates to advance their election prospects and to justify continued massive handouts to police departments. 

While token gestures are embedded in legislation to make legalization seem fairer, there is no political will to fight for genuine equality by the establishment super-majority Democrats in California. Starting a marijuana dispensary costs hundreds of thousands, if not millions of dollars. Interest for loans for big business are at record lows, whereas interest rates for those starting a business, especially in cannabis, can be as high as 20% a year. 

Cannabis Workers: Essential to Profits

COVID has worsened progress on expunging records mandated by Assembly Bill 1793. Additionally, because medical cannabis is considered “essential”, most cannabis workers have been working the entire time, often without hazard pay. The first recreational cannabis sales in California began in January 2018, so half of the time recreational dispensaries have been open has been during COVID. 

The workforce of the cannabis industry in California encompasses cultivators, processors, distributors, and retail employees. A lot of these jobs are minimum wage or only slightly above it. 

Jobs like trimming and harvesting are often temporary and contract-based, and often paid by output instead of an hourly wage. Many cannabis farms, like other agriculture businesses, employ immigrants to harvest and trim their crops, and take advantage of their vulnerable position to exploit them as much as possible. Workers on farms in Oregon have reported being underpaid or not paid at all, while working in brutal conditions that have left many workers exposed to COVID due to their bosses providing no PPE, handwashing equipment, or ability to social distance. Any worker that attempts to claim their unpaid wages is often threatened by their employer to have immigration services called on them. Because cannabis is still federally illegal, the Department of Homeland Security is quick to deny citizenship to anyone who has been employed at a cannabis-related business, even in states where recreational use is completely legal. 

Retail workers in dispensaries are paid the same as any other retail work, and it’s often part time and minimum wage. Retail work requires a level of expertise that includes a rigorous knowledge of state regulations regarding sale and intake of all cannabis products, medical and recreational alike. Marijuana still being federally illegal means many banks and finance companies are unwilling to provide services to companies participating in distribution and sale. This means a huge portion of the industry still deals in cash and under-the-table pay for its workers. It’s not uncommon to hear of people who are given cannabis product as compensation instead of wages. 

After Newsom’s first stay-at-home order on March 19, 2020, he clarified in an order a few days later that one of the businesses considered to be essential was retail cannabis sales, meaning anyone in a job supporting cannabis retail, including dispensary employees and distributors, had to show up to work. Since dispensaries still provide cannabis to those using it medically, there is no longer a distinction within the market between medical and recreational. 

Unionization and a Way Forward

Within the last two years of the pandemic, sales have skyrocketed. Taxable sales in 2019 add up to $2.7 billion to the California economy. In 2020, that number climbed to almost $4.5 billion. That’s over a billion dollars per quarter. But despite more sales than ever before, there were still a huge amount of layoffs in the middle of 2020 as companies sought to increase profit rates. This is in an industry with an already fairly high turnover rate. And now, bosses in the industry are complaining about labor shortages, a thriving black market, and high taxes, using this to justify paying workers next to nothing. Like many other industries, those at the top of the cannabis world used the pandemic as an excuse to squeeze as much profit out of its workforce than ever before. 

But also like many other industries, the cannabis world is unionizing. The pandemic has pushed the cannabis workforce to a breaking point, and now there are cannabis businesses unionizing in California, New York, Florida, Colorado, and more over the last year. There are 10,000 cannabis retail workers currently organized with the United Food and Commercial Workers (UFCW) union. New York cannabis legislation included the provision of a Labor Peace Agreement, which means employers will not interfere with unionization efforts. However, it includes restrictions that the workers agree not to strike or interfere with business at all, which takes away workers’ critical tools for fighting back against the exploitation of their bosses. 

Furthermore, the UFCW is not demanding the county superior courts follow through on their promises of clearing and sealing records. It is a start to have so many thousands already unionized, and represents a clear desire of workers in the industry to organize as we are seeing in so many other industries across the country right now. But as this process continues, it is important that these new cannabis unions push the ruling class to address past injustices via expunging records that are preventing people with past convictions from finding housing, getting jobs, and voting.

Cannabis businesses, though becoming increasingly common, are still very far from the mainstream public’s eye. Even in California, 80% of the state, either on the city or the county level, still do not allow the operation of any cannabis businesses within their limits. Many are still staunchly against its use, or view it only as a luxury product. A sweep of organizing in the industry may not necessarily have the same broad, popular support that organizing something like Starbucks is having. However, only when all workers are unionized can we begin to end the dictatorship over our workplaces that the bosses represent. 

For millions of workers, marijuana represents a relatively safe form of pain management or a moment free of anxiety. The inequality, injustice, and oppression of capitalist life generates much of that pain and anxiety. We need a world where workers are not only organized for a living wage and decent working conditions, but a world where political change is centered around what is good for working class people and our communities. We need our own independent political party, free of corporate influence, that is going to fight for jobs for all, free healthcare and education, and a sustainable economy based on the needs of working people. 

The pathway to legalization is still not entirely clear. As crime rates are increasing, Republican and Democratic politicians alike talk tough on policing. The failure of the Defund the Police movement as the result of co-optation by Democrats and NGOs has now left the door open to future increased repression, especially in America’s poorer neighborhoods. 

Legalization of marijuana is a positive and important step forward, however under capitalism it is a mess that mirrors and accentuates all the injustices that came before it. Capitalists in search of new avenues of exploitation will not push the ruling class to expedite the process of clearing records, or provide safe and well-paid jobs to its workers, as they focus on profit above all else. The cannabis industry runs on the labor of harvesters, trimmers, extractors, packagers, drivers, and retail employees, and it is with them, not big business owners, that the power of this billion-dollar industry lies – to fight for Medicare for All, full legalization on a federal level, and an end to mass incarceration and private prisons that the War on Drugs has fueled for years.