Marijuana Smokers See Dope Prices Escalate

marijuana Marijuana smokers are seeing dope prices escalate, as the cost of getting high gets higher.  That was the message that was driven home a few months ago , when a Massachusetts man was busted for keeping a marijuana grow house in a suburban Massachusetts town that was capable of producing up to two or three pounds of the stuff per month.  The alleged pot farmer said that his produce was for personal consumption.  Some people smoke a lot.

What is wrong with this picture? America is at a marijuana crossroads, with individual states slowly but surely throwing off the yoke of Federal repression by legalizing the sale and possession of marijuana while other states are imprisoning their citizens for doing precisely the same thing. What happened to the free enterprise system? Where is that entrepreneurial spirit the Republicans keep talking about?

In the current issue of Mother Jones, reporter Josh Harkinson, tells us that American pot farmers are putting Mexican cartels out of business, or at least that is what the title of his article proclaims.

Not so fast, buddy. No one is putting the cartels out of business, because the cartels are not in the business of growing marijuana. The cartels are in the import-export business, buying marijuana, other botanicals, and man-made concoctions from local sources, then exporting the stuff to the United States, where it is worth 10, 20 even 100 times what they paid for it. While losing some or all of the American marijuana business will cut into their gross revenues, the loss of the American pot market is not going to put them out of business. Suggestions to the contrary are simply ridiculous.

marijuanaThe marijuana farmers are another matter. They subsist on their marijuana crops, but there is not enough of a domestic market for marijuana to enable them to subsist on local sales alone. Everyone in Mexico grows their own. Pot is everywhere. Mexican kids do not buy their dope. They steal it right out of the ground.

In the U.S., marijuana users are seeing dope prices escalate precisely because the cheaper Mexican product is no longer on the shelves….which is, itself, an oddity. Usually, cheaper foreign goods force more expensive American made products out of the market. This time, however, the shoe is on the other foot: more expensive American grown grass is forcing out the cheaper Mexican weed.  It helps sales when neither side of the transaction has to worry about whether the other party is a narc or not.

With 20 states and the District of Columbia having either decriminalized marijuana or just plain declared it legal, that still leaves 30 states where smoking up a storm – or just trying to buy some weed to smoke – could put the erstwhile smoker behind bars for a while. In those 30 states, the cartels still have a potential market because transporting marijuana across state lines is still a federal crime, and growing pot in one state but selling it in another state was a situation not anticipated by the framers of the state statutes.

In the meantime, even if they do not get captured by the stormtroopers, pot smokers can still be canned from their jobs for smoking dope, even in states where it is now legal to smoke. Continuing to make arrests for marijuana possession no longer make any sense, given the fact that an additional 12 states are now considering pulling the switch on their own marijuana laws. Firing people for smoking dope makes even less sense, unless they are not cutting the mustard at work.

marijuana The disparity between federal and state laws creates a confusing problem for states’ rights advocates, who are usually also gun owners, usually opposed to abortion, in favor of the death penalty, and purely hate Obamacare…because the legalization of marijuana puts the federal government and the states on a collision course. Federal laws have not changed. Marijuana is a controlled substance under federal law. So, what happens when the states declare marijuana legal anyway?

A constitutional crisis might have been in the offing if it were not for the fact that the feds, themselves, are backing away from their previous enforcement policies. So far, the feds and the states have politely ignored the issue, as long as the marijuana trafficking does not cross state lines. That policy – of not attempting arrest and imprison marijuana traffickers in states where marijuana trafficking is legal – has clearly come down from on high. Officially, President Barack Obama is opposed to the legalization of pot. Unofficially, off the record, he has clearly decided that enough is enough and has simply intimated to his top cops that he does not want them busting people for small weights in states where pot has cross the line from illegal to perfectly all right in small doses. The hands-off policy was outlined in a Department of Justice memo to that effect in August of 2013.

But this really is a states’ rights issue, because these 21 jurisdictions (a polite way to include DC with the several states) have declared legal what the federal government has declared not. Wars have been fought over such things.

A recent CBS poll indicates that 51 percent of the American people support full legalization of marijuana. Gallup polls have pushed that number up to 58 percent, but either number puts marijuana’s poll number equal to or better than Obama received in the 2012 election. Compared to his current popularity figures, hovering around 50 percent, according to Rasmussen Reports, and 45 percent according to Gallup, pot is way more popular right now than the president is.

marijuana Nevertheless, there are still widespread concerns that legalization will result in an epidemic of marijuana addiction. There is, however, no such thing as marijuana addiction. Addiction is a condition in which the patient suffers acute, and sometimes life-threatening physiological symptoms during withdrawal. A pothead denied his smokes may feel miserable, may be miserable, for a certain amount of time, but will not manifest physiological withdrawal symptoms. Ipso facto, no addiction.

There is such a thing, however, as psychological addiction. Everyone is addicted to something. For some people, it is salt, for others, sugar. Or chocolate, or ice cream, or expensive call girls….if it exists, someone is hooked on it. Some people are psychologically dependent on marijuana. They may smoke themselves into oblivion five time a day, but they are doing that already, if they are doing that at all. Legalizing marijuana does not make it any easier to get high or stay high…but making marijuana legal might just make it harder to get, rather than easier.

As a matter of fact, legalization may in fact make it harder to stay high. Since legalization, the cost of getting high in America’s mile high city has escalated rapidly. Before legalization, marijuana that once sold in Denver for around $25 for an eighth of an ounce, is now selling for anywhere from $35 to as much as $70 for an eighth of an ounce of the top of the line products. Using the lowest number, $35 per eighth, an ounce of dope is selling in Denver for around $280, or $4,480 a pound.

A kilogram of marijuana used to sell for around $100 on the Mexican side of the border. Since the pot party began in the U.S., the kilogram price has dropped to $25 according to the Mother Jones article. Using the higher figure,$100 a kilogram,one pound of Mexican dope, south of the border, would cost around $45.45 today.

To put it bluntly, the smokers and the tokers in Colorado are getting hosed. Licensed and regulated, with the cost of doing business and government taxes thrown in, legal marijuana is approximately 100 times more expensive today than it should be. Marijuana is, after all, just a weed…as some people call it.

Of course, the operating expenses of the American growers are higher, even before they slap on the retailers’ overhead and the tax man’s piece of the action, so it stands to reason that legal dope would cost more than illegal dope…but not that much more.

Clearly, legalization and the concomitant regulatory process, has turned the occasional smokers weekend bliss into the equivalent of a night on the town. An eighth of an ounce does not go far, three, four joints at most. Two “lids”of dope, enough to keep four people happy for a long weekend, could run anywhere from $70 to $150. (The term “lid” is the now-ancient slang expression for an eighth of an ounce, equivalent to the amount of grass that would fill the plastic lid on a coffee can.) For the heavy-duty toker, that cost ratio is close to impossible….unless the toker goes out and gets a job, which defeats the whole purpose of being high all the time in the first place.

At the risk of being labelled rabble-rousers, some people think there is a simple solution to this dilemma. Cut out the middle men. “Grow your own,” as the late Abbie Hoffman used to say.

There is a precedent for this. During Prohibition in the United States, while the manufacturing for sale and public consumption of alcohol was illegal, it was legal for heads of households to brew up their own personal libations for domestic use only. Beer, wine, gin, and even sour mash whiskey were all perfectly legal, when brewed for home use only. Of course, some of those moonshiners had very large families, so their claims of personal use only were often ignored by the Federales.

Nevertheless,the Prohibition experience paves the way for a secondary movement among the marijuana users to decriminalize the cultivation of marijuana for personal use. Two states, Colorado and Washington, have decriminalized cultivation for personal use. In other states, however, even where marijuana has been decriminalized, there are still laws on the books that make it impossible to cultivate pot for personal use because they impose criminal penalties for the possession of more than four ounces (and sometimes even less) of the stuff. The average yield for a good pot farmer is around 3.5 ounces per plant and no one ever plants just one. If that one dies the farmers in question are just plain out of luck. The usual practice to plant a sequence of plants over a period of time, so that there would be a constant yield sufficient to cover the pot farmer’s consumption pattern.

In the meantime, however, here is an investment tip: Track down companies that manufacture hydroponic growing systems and grow lights. They are not publicly traded, for the most part, but they are always looking for investors. Marijuana smokers are seeing dope prices escalate and, in the short-term, there is not much that they can do about that. In the long run, however, more and more smokers will graduate from rolling their own to growing their own.

By Alan M. Milner
Look for me on Twitter:@alanmilner

Sources:
Mother Jones
ProCon.Org
Huffington Post
Rasmussen Reports
Gallup Daily Poll
Prosebeforehos

2 Responses to "Marijuana Smokers See Dope Prices Escalate"

  1. Wayne Kerr   May 7, 2014 at 10:46 pm

    Economics 101; Supply and Demand
    The demand for legal cannabis has gone up due to legalization while the supply of legally grown cannabis has not. They’ve only just begun growing more than needed for Medical Marijuana and when the supply catches up the prices will go down. In the mean time we can just continue to buy cheaper smoke from the black market since their supply has gone untouched. Our old dealers, people we’ve been buying from for years in many cases, are still out there. And we still buy from them.

    Reply

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