In California, Even The Popular Marijuana Business Needs A Bailout

Implementing the marijuana industry into California, arguably the country’s most liberal state, should have been seamless.

Getting constituents on board was no problem. Cutting DEA funds to account for the lack of court revenue falls right in line with the defund the police movement. The governor himself was even a major proponent of the still-federally-outlawed industry. And yet, five years since voting in Prop 64, California's brave new endeavor already needs bailout money.

The Los Angeles Times broke down the specifics of the $100M rescue last week. Refreshingly enough, the state’s favorite word to explain its own failures, COVID-19, was never used once in the entire report. If anything, COVID should have helped the weed industry, like it did alcohol. But weed proprietors are struggling to compete with non-licensed operations nonetheless.

The liberal Times dances around the real culprit, of course, which is bloated bureaucracy and state stagnation. The state of California wants its finger in the pie at every possible turn, and it’s making the industry unsustainable for small businesses.

(Photo by Lauren DeCicca/Getty Images)

Essentially, state-required licensing measures can’t move forward without a massive government review period aimed at placating the environmental groups who think the world is always one melted glacier away from total destruction.

A myriad of issues are stemming from this overwrought review process, most notably companies stuck in perpetual legal limbo (which destroys their ability to grow and invest) and local governments that can’t keep up with staffing demands. That’s right, somehow the highest taxes in the nation can’t pay for enough city officials to keep the stream moving and the money flowing for everyone involved.

To legally own and operate a dispensary or grow farm in California, you’re willingly subjecting yourself to a hornet’s nest of red tape. You will have one government agency harassing you about taxes, one hassling you about the environment, and another one giving you the runaround about licensing.

(Photo by Mario Tama/Getty Images)

And when the house of cards start to fall, like it is doing now, will the government bail YOU out for all of their clogs and missteps? Of course not. The $100M bailout is earmarked for local governments to further misspend and mismanage, under the guise of “helping legitimate businesses succeed.” Instead of changing an arduous process that has proven unsuccessful, California has effectively decided to beef it up further.

The entire mess is underscored by the fact that non-licensed distributors are absolutely dominating the market. For pennies on the dollar, your average drug dealer with a half-decent grower connection can pump out the same vape pens that high-end retailers sell for $60. Their margins are astronomical because they aren’t subjected to CA’s wild cannabis taxes, either. And thanks to now non-existent police interference for public consumption, slinging cannabis has never been easier or more profitable for everyone—everyone not waiting on an environmental assessment, that is.

Californians were promised a second gold rush with the advent of legalized pot, and that’s exactly what is happening for everyone except the hardworking gold miner. If you want to get in on the action, it’s probably best to take the criminal route: either join a gang, or join the government. Both seem to be rolling in the dough.