Why State-Run Cannabis is a Bad Idea!
As more states and countries consider legalizing cannabis, it is important to learn from those who have already pioneered these policies. Places like Uruguay and Canada already established a legal framework to sell the plant without any criminal penalties – however, they did so under a “state-run regime”.
However, these programs have one thing in common – it really doesn’t work. Yes, the state has taken the humanitarian approach to cannabis consumption and understood that making it illegal is a violation of human rights. Yet, in the attempts to make the market “safer” and to “control” every aspect from seed to sale – they effectively allowed the black market to continue to thrive.
That’s because in places like Canada, the average cost per gram is sitting somewhere between $6-7. However, on the black market you can get a gram for as little as $3-$4. While this price difference might not seem so much, it does become a problem when you scale up.
For example, a typical ounce at “state prices” in Canada could be anywhere between $168-$200+ compared to the $84-$112 per ounce you can get on the streets. What’s more, in places like Canada, the weed you find on the streets often have more variety and a higher percentage of THC.
This is why roughly 70% of the cannabis market remained “illegal” despite the availability of cannabis anywhere in the country. With cheaper prices, more variety and easier access than the “legal way” – it doesn’t take a rocket scientist to figure out why the Canadian government is running into some walls within their legal schemes.
Why State-Run ‘Anything’ Hardly ever works!
I’m not saying we should burn everything down and become anarchists [Despite me being a romantic-anarchist], however, it’s important to understand that throughout history anything “state-run” eventually runs into issues.
A simple example is the Federally run marijuana program. Some of you might not have been aware that the United States actually has a “Medical Marijuana Program”. The problem with the program is that the weed grown by Uncle Sam is genetically closer to hemp than it is cannabis. Additionally, most of the samples contain roughly 3% THC and is packed with stems and seeds.
Compare this to the average THC level in private-run industries where the THC levels are between 15%-20% and the bud is pristine, covered with trichomes and smells through a mason jar.
There is a definitive differentiation between “free market weed” and “state-run weed”.
The real question is why?
Why State Run Weed Fails!
There are plenty of reasons why state run cannabis would always fail. Let’s walk through that list right now;
Zero Competition – With a lack of competition for market share, there is no incentive to innovate procedures. If you simply have a quota to fill, then you will fill that quota. However, when it comes to the free market, if you don’t have the best product with the best customer care – people will choose another provider.
It costs more! – The reason why state run cannabis will cost more is because they are forced to play by the rules they establish. Furthermore, they are trying to make money off it at every point of the supply chain. If they tax you for growing, packaging, shipping and buying weed - it adds up!
They Restrict Personal Cultivation – In Canada you can “technically” grow weed at home, but it won’t be considered “legal” unless you buy from a legitimate supplier. Currently, there are no seed suppliers in Canada that are “legitimate”. This means, that those who are willing to break the law will be able to cultivate – and probably sell to their personal networks, circumventing the legal system.
The Black/Grey Market – Finally, because things are so expensive – people tend to either grow it themselves [illegally] or buy it from illegal growers. It’s far more accessible and there’s a lot more variety on the illegal market compared to the legal market.
There are but a few of the reasons why a state run cannabis program will always run into problems. However, I don’t like to simply point out what’s wrong – let’s look at how Canada and any future country could fix the problem.
How to Make the best Legal Cannabis Program
I personally believe that Colorado has one of the best cannabis systems on the planet. They include personal cultivation, legal growers aren’t taxed to death and the government actually supports individuals to expand the marketplace.
In Colorado, the approach was “Free-Market” – meaning that if you have the capitol and the incentive – you can get in on the business. Furthermore, everyone can grow weed – meaning that the black market activities are far lower than in states like California. What has happened since?
It is one of the most stable cannabis economies in the world
It’s only been growing since the inception
It’s gotten more efficient, safer and dealt with more social problems than in Canada
It generated more money to be used on State programs
The state should not get into the business of “selling goods or services” to anyone. They should simply be there as an impartial entity that ensures that the market is fair and that the consumer is protected. Keep the taxes low, ensure that quality control measures are met – and let the people grow their own weed!
It’s a simple formula – but it works!
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