Most of the clowns pretending to legislate on Capitol Hill spend the majority of their time raising money, so better serving their constituents with social justice and public health probably won’t motivate them to end the 80-year prohibition of cannabis. Unfortunately, this is a political arena where New York Assemblyman Steve Katz can vote against medical cannabis bill one year before being arrested for cannabis possession. It is also the reason why nearly every state that legalized medical and/or recreational cannabis did so through citizen-led ballot initiatives, not the state legislatures.
What makes politicians so averse to legalization? Well, it’s certainly not reasoned arguments for prohibition. Rather, just as graveyard revenues suffer under gun control legislation, a legal cannabis market negatively affects several industries willing to pay lobbyists to exert their political influence to stop it. Epitomizing profits over people, K Street (a major center for lobbyists in D.C.) historically fought countless reforms that would benefit the American people, and it is usually money well spent for their personal interests. For example, the Catholic Church in New York paid more than $2 million to lobby against child sex abuse accountability laws, and Pennsylvania spent more than $5 million, yet the church is officially against cannabis legalization because “with evil there can be no yielding or compromise.”
What are the industries spending millions to prop up prohibition? These are the big four.
Investigative journalist Lee Fang is the leader exposing Big Pharma’s role in prohibition. His 2014 exposé in The Nation detailed how prohibitionist groups like the Community Anti-Drug Coalition of America (CADCA), American Society of Addiction Medicine and Partnership for Drug-Free Kids (of “this is your brain on drugs” fame) rail against cannabis all day long while taking money from opioid producers like Purdue Pharma (OxyContin), Abbott Laboratories (Vicodin) and Alkermes. The latter company created Zohydro, a dangerous opioid approved by the FDA after its advisory panel voted 11 to 2 against it. Though they did not show support for rescheduling hydrocodone (Vicodin) to Schedule II (up from the less-restrictive Schedule III), CADCA and Partnership did petition the government to keep cannabis Schedule I. Fang also noted in VICE that Big Pharma (called the "new mafia" by The Daily Beast) supports anti-cannabis doctors like Herbert Kleber, Mark Kraus and Anne Eden Evins directly through research grants, speaking fees and “consultant” gigs.
Arizona-based Insys Therapeutics—which produces a sublingual opioid spray 50 times stronger than heroin—recently saw two of its executives plead guilty to using speaking fees to get doctors to promote their drugs. The same company, which is set to introduce a synthetic tetrahydrocannabinol (THC) spray, dropped half a million dollars in August to fight the legalization initiative (Prop 205) in its home state. Per a disclosure statement submitted to the Securities and Exchange Commission (SEC), Insys argued, “If marijuana or non-synthetic cannabinoids were legalized in the United States, the market for dronabinol product sales would likely be significantly reduced and our ability to generate revenue and our business prospects would be materially adversely affected.” Keep in mind, synthetic cannabis itself (which isn’t cannabis at all) emerged from a desire to create cannabinoid equivalents that pharmaceutical companies can copyright and exploit financially.
Still, the bigger concern might be painkiller sales. Studies show that cannabis can help people overcome painkiller addiction, which cuts into Big Pharma sales, and cannabis is a more affordable alternative to many drugs. A 2016 study published in Health Affairs found that drug sales (especially painkillers) were much lower in the 17 states that legalized medical cannabis. The findings suggest state medical cannabis programs provided more than $165 million in Medicare savings in 2013 and $180 million in Medicaid savings in 2014.
In a story that used these findings to show “why pharma companies are fighting legal marijuana,” the Washington Post wrote, “The drops [in drug prescriptions] were quite significant: In medical-marijuana states, the average doctor prescribed 265 fewer doses of antidepressants each year, 486 fewer doses of seizure medication, 541 fewer anti-nausea doses and 562 fewer doses of anti-anxiety medication.” Forbes, meanwhile, summarized the findings this way: “Pharmaceutical interests would like to keep marijuana illegal so Americans don’t have the option of cheap medical alternatives to their products.”
Prison Industrial Complex
In 2008, county judges in Pennsylvania were busted (and later convicted) for taking millions in bribes from private-sector prisons for juvenile offenders in what the media dubbed the “kids for cash” scandal. These for-profit prisons received government money for each person in its system, and the judges helped send kids their way by issuing ridiculous sentences for the smallest offenses. Kids literally got prison time for silly acts like mocking a school principal on MySpace. This is a nightmare scenario where major corporations run private prisons whose only source of income is tied to occupancy, and the two largest systems take in more than $3 billion per year from government contracts.
In 2015, the Bureau of Justice Statistics issued a summary that said half of all federal and 16 percent of state inmates are in prison for drug-related convictions. These private prison systems—which have spent tens of millions on lobbyists—obviously don’t want the drug war to end. Even the prison guard unions spent millions to fight against efforts to promote treatment over incarceration, reduce sentences for nonviolent drug offenders and legalize cannabis.
The private prison industrial complex has always had a vested financial interest in cannabis prohibition. Consider this 2010 SEC filing from Corrections Corporation of America (CCA), the largest of the private prison systems, which said the following: “Filling these available beds would provide substantial growth in revenues, cash flow, and earnings per share.... The demand for our facilities and services could be adversely affected by the relaxation of enforcement efforts, leniency in conviction or parole standards and sentencing practices or through the decriminalization of certain activities that are currently proscribed by our criminal laws. For instance, any changes with respect to drugs and controlled substances or illegal immigration could affect the number of persons arrested, convicted, and sentenced, thereby potentially reducing demand for correctional facilities to house them.”
Note the reference to changes in the “controlled substances” list. This is likely a reference to the Schedule I status of cannabis, which CCA would naturally hope to maintain.
Now here is the good news. In August 2016, the Obama Administration announced that the government would phase out using private prisons. Officials were told not to renew current contracts with private prison systems. This only pertains to federal prisons, but many state systems are already following suit. This is a huge win on many levels as it will reduce the amount of lobbying money spent by private prison peddlers.
The Alcohol Industry
Someone, maybe the Russians, hacked the Democratic National Convention’s (DNC) emails and gave the information to WikiLeaks. Maybe you heard? Well, you might not have heard about one particular email from the Wine & Spirits Wholesalers of America (WSWA), a national trade association charged with protecting the financial interests of alcohol producers, distributors and retailers. After claiming the association was neutral on cannabis legalization, the email proceeded to call for stifling regulation to protect America from reefer mania.
Per the leaked email, “WSWA believes states that legalize marijuana need to ensure appropriate and effective regulations are enacted to protect the public from the dangers associated with the abuse and misuse of marijuana.... In the years since the state legalized medicinal use, Colorado law enforcement officials have documented a significant increase in traffic fatalities in which drivers tested positive for marijuana…. Congress should fully fund Section 4008 of the FAST Act (PL 114-94) in the FY 2017 Appropriations process to document the prevalence of marijuana impaired driving, outline impairment standards and determine driving impairment detection methods.”
The alcohol industry fears competition from cannabis. Simply put, imagine the damage it might do to the industry if the U.S. ever allowed Amsterdam-style coffee shops or Barcelona-style social clubs that compete with bars. For this reason, the California Beer & Beverage Distributors gave $10,000 to fight the 2010 attempt to legalize recreational cannabis in the Golden State, while the Arizona Wine and Spirits Association gave the same amount to fight legalization in its home state. As noted by Slate, the alcohol industry in Massachusetts is actually leading the charge to stop the legalization initiative there. The Boston Beer Company (who produce Sam Adams) even admitted their fears in an SEC filing, stating, “Legal marijuana usage could adversely impact the demand for the Company’s products.”
An interesting outlier, however, is the alcohol industry in Nevada which has largely supported the pro-legalization effort. Why? According to U.S. News and World Report, “In Nevada, the initiative would require that licensed distributors act as middlemen between cultivators and retailers, with licenses going for the first 18 months to alcohol distributors.” In other words, alcohol distributors in Nevada have a vested financial interest in seeing legalization happen.
In 2012, the aforementioned journalist Lee Fang wrote this for Republic Report: “Police departments across the country have become dependent on federal drug war grants to finance their budget. In March, we published a story revealing that a police union lobbyist in California coordinated the effort to defeat Prop 19, a ballot measure in 2010 to legalize marijuana, while helping his police department clients collect tens of millions in federal marijuana-eradication grants. And it’s not just in California. Federal lobbying disclosures show that other police union lobbyists have pushed for stiffer penalties for marijuana-related crimes nationwide.”
Per The Nation, a poll found that nearly two-thirds of police officers thought cannabis laws needed to be reformed, with nearly 40 percent wanting full legalization, but the Drug War provides a significant amount of funding for law enforcement. Police departments can seize and sell property from people busted for drugs, and often times these forfeitures can happen without charging or convicting the person. In Florida alone, asset seizures from cannabis busts bring in about a million dollars per year. Naturally, this type of cash cow results in many abuses. Taking away Drug War grants and asset seizures related to cannabis, police departments must deal with less funding, and this can result in substantial layoffs.
“The only difference now compared to the times of alcohol prohibition is that, in the times of alcohol prohibition, law enforcement—the police and judges—got their money in brown paper bags,” said a retired Los Angeles Police Department (LAPD) deputy chief in The Nation article. “Today, they get their money through legitimate, systematic programs run by the federal government. That’s why they’re using their lobbying organizations to fight every reform.”
The Impact of Ending Prohibition
In 2010, the Cato Institute published a white paper titled “The Budgetary Impact of Ending Drug Prohibition.” The findings stated, “Legalization means reduced expenditure on enforcement and an increase in tax revenue from legalized sales. This report estimates that legalizing drugs would save roughly $41.3 billion per year in government expenditure on enforcement of prohibition. Of these savings, $25.7 billion would accrue to state and local governments, while $15.6 billion would accrue to the federal government…. The report also estimates that drug legalization would yield tax revenue of $46.7 billion annually, assuming legal drugs were taxed at rates comparable to those on alcohol and tobacco.”
Ending prohibition would add up to $90 billion in savings and revenue for the government, but part of the savings would be at the expense of drug companies, prisons and law enforcement agencies. For this reason, industries at risk pay lobbyists big bucks to maintain prohibition. Indeed, if legalization is about social justice, personal freedom and medical treatment, prohibition is about putting profits and self-survival ahead of the public good. After all, pushing special interests at the expense of the common interest is, per disgraced lobbyist Jack Abramoff, what most lobbyists are paid to do.