A newly released study found that legalizing marijuana could be a major economic boon in Australia.
ABC Radio Perth reports that the study, which comes via the University of Western Australia, found that cannabis legalization could bring $243.5 million per year in the first five years to Western Australia.
According to the outlet, the study “quantified the revenue the state could make through legalising cannabis,” and “considered data about the form and frequency of cannabis use, as well as the estimated cost of enforcing current laws that prohibit cannabis use.”
“We wanted to find out the actual truth on this, and we commissioned this not expecting any particular result,” Brian Walker, leader of the Legalise Cannabis WA Party, the group that commissioned the report, told ABC Radio Perth.
“This is the first time anyone has shown their working, and set out exactly how their figures were arrived at. On the spending side we’ve got stuff like your police — for chasing a cannabis crime — the courts and the corrective services for managing that. Altogether, that’s about $100 million per year.”
Cannabis is illegal in Australia, with penalties varying from state to state. In Western Australia, according to the Guardian, “[f]ines range from $2,000 to $20,000 and up to two years in prison,” but for “possession up to 10g police [law enforcement] can use discretion to order the person to a counselling session (one for adults, two for children).”
Walker told ABC Radio Perth: “When you engage in something illegal, there’s a price to be paid. How do you account for the losses if you’ve been raided and you’ve lost a million dollars in crop? That all has a cost associated with it. Once you legalise, that risk premium falls away.”
ABC Radio Perth has more background on the study: “The data for the report — An Economic Case to Legalise Cannabis in Western Australia — came from a wide range of sources including the Australian National Drug Strategy Survey, Australian Crime Commission, Australian Criminal Intelligence Commission, and the National Drug and Alcohol Research Centre at the University of NSW. The report, which looked at projected figures for a five-year period after legislation, found a moderate 25 per cent tax on adult-use recreational cannabis would generate approximately $137 million of direct tax revenue in WA based on annual sales of ‘around $686 million.’ Licensing fees for businesses intending to sell cannabis would generate an estimated $6.5 million for the economy each year.”
Cannabis legalization in Australia may soon move from the realm of the theoretical and into actual policy. The Greens, the minor party in Australia, said last year that the country’s constitution empowers parliament to override states and legalize pot for recreational use.
According to the Guardian, the proposal from the Greens would “allow for the regulation and sale of approved cannabis strains for recreational consumption in Australia, joining the handful of countries (and US states) that have already moved to legalise it.”
“Greens senator David Shoebridge plans to introduce the bill to the Senate once the party has taken on board the results of that consultation,” the Guardian reported last month. “To get anywhere, the bill would need government support and Labor hasn’t yet given any indication it would throw its weight behind the legislation.”
As the Guardian explained, “under the constitution [in Australia], the states have responsibility for criminal law,” but the Greens “think that once cannabis was legalised federally, the commonwealth would have the power to create a national, legal cannabis market.”
According to data from the cannabis research firm Whitney Economics, the cannabis industry paid an excess of $1.8 billion in additional taxes in 2022 alone. And, spoiler alert: This article doesn’t have a happy ending. Cision PR Newsletter reports that this number is expected to jump to $2.1 billion in 2023.
As High Times continuously writes, with deep frustration, so far, the legal cannabis industry has largely not succeeded in creating an accessible business model. California, among other states, is seeing a mass exodus as legal cannabis companies, such as Jerry Garcia’s legacy brand, leave the state due to exorbitantly high taxes and red tape. Despite ongoing efforts to help communities most impacted by the War on Drugs enter the legal market, if celebrity brands can’t make a profit, how is one starting life after the financial and mental turmoil of going to prison for a non-violent cannabis offense supposed to make a decent living?
So why are the taxes so damn high for cannabis businesses? Don’t forget that your pretty pre-rolls and vegan edibles are technically still a Schedule I substance, meaning that, according to the Feds, cannabis has “no currently accepted medical use and a high potential for abuse.” This is scientifically inaccurate and regressive, not to mention hypocritical, as 38 states and Washington D.C. currently have medical marijuana programs. The taxes inflicted on folks in the legal market indicate that legalization is not the utopia we hoped for and may help the black market, which continues to flourish. Overtaxing legal cannabis companies is not only harmful to business owners, but it raises prices and thus isolates potential clients.
Cannabis companies are subject to the federal tax provision 280E, which “penalizes traffickers of Schedule I or II drugs by disallowing the deduction of “ordinary and necessary” business expenses—such as below-the-line deductions—after reducing gross receipts by the cost of goods sold, or COGS, essentially resulting in federal income tax liability calculated based on gross income, not net income,” according to Bloomberg Tax.
If you pour the stress of 280E on top of other cannabis business hurdles, such as difficulty accessing banking services and regulations against any interstate commerce, the result is that for many companies, it’s impossible to make a profit in the legal cannabis biz. The effective tax rates are often higher than 70% for cannabis retailers.
As Cision PR Newsletter reports, as a result, 24.4% of cannabis operators surveyed indicated that they are profitable. And things are becoming more dire last year; the figure was 42%. And, while it’s tempting to blame a post-pandemic economy, other industries are actually flourishing. According to Bloomberg, in 2022, U.S. corporate profits saw the largest margins since the 1950s.
As warned earlier in this article, don’t expect the legal market to have a breakthrough and get better anytime soon. Whitney Economics is releasing a survey later this month stating that cannabis businesses are hanging on by the skin of their teeth and should not expect a positive shift in the immediate future.
“The cannabis industry is under extreme economic distress, and the current regulatory and taxation environment is untenable, even in the short term,” says Beau Whitney, chief economist at Whitney Economics, according to a press release. She adds that many state markets are on “the brink of systemic collapse.” The report suggests that tax reform is the only answer to the problem. Under the right tax laws, the cannabis industry could be bringing in billions—and not just for the government to collect in taxes. Whitney Economics predicts that with the proper reform of 280E and cannabis policy, industry employment will increase, and economic activity will rise by $35.2 billion over ten years.
Reuters reports that three Senate Democrats introduced a bill to remove cannabis from the Controlled Substances Act in July of 2022, thus nullifying Code Sec. 280E. The Cannabis Administration and Opportunity Act would impose a top excise tax of 25% on products sold by large cannabis businesses. At time of reporting, it is still pending.
An economic winter is coming, but don’t worry; we’ve compiled ten ways cannabis can revive a depressed economy. When many people hear “cannabis,” they may think of it as a recreational activity or a medical necessity. And it is. But it’s more than that. So while politicians will inevitably announce “stimulus” and bailouts, the real solution will come from entrepreneurs in a free market. And since Canada has already legalized cannabis, that’s one hurdle out of the way. Next, cut […]
Sales of legal cannabis in the United States are projected to grow by 14% in 2023, according to a recent report from Colorado-based cannabis industry market analysis firm BDSA. In an updated five-year global legal cannabis market forecast, the company reports that global spending on legal cannabis increased by 4.8% to $32 billion in 2022. BDSA projects that the global cannabis market will see a compound annual growth rate (CAGR) of 13.2% from 2022 to 2027, resulting in a total worldwide regulated cannabis market size of $59.6 billion by 2027.
The U.S. legal cannabis market has shown significant growth across the industry as more and more states legalize adult-use cannabis and medical marijuana. And while the industry’s growth slowed in 2022 in response to market conditions including rising inflation and economic uncertainty, BDSA expects the U.S. legal weed market to again show significant growth this year, projecting a 14% increase in the market in 2023.
“Legal cannabis spending slowed significantly in 2022 due to rapid price declines across all markets,” Roy Bingham, co-founder and CEO of BDSA, said in a statement from the company. “Despite this, our updated forecast predicts strong growth in the U.S. driven by developing markets, particularly the adult-use markets of Missouri, New Jersey and New York.”
Currently, 21 states have legalized cannabis for adults, while 37 states, the District of Columbia and three U.S. territories have passed laws to legalize the medicinal use of marijuana. Additionally, 11 states permit the use of low-THC cannabis formulations for medicinal purposes. Only Idaho and Nebraska continue to prohibit all forms of cannabis.
Some Mature Cannabis Markets Contracted In 2022
The U.S. cannabis market posted rapid growth during the height of the COVID-19 pandemic as lockdowns kept consumers home and dispensaries were designated as essential businesses in many states. But last year marked the first decline in overall cannabis spending in some mature cannabis markets in the United States. In the West, early cannabis policy reform adopters California, Colorado, Nevada and Oregon saw a combined drop in spending on legal adult-use cannabis of 16.5% in 2022, according to the updated report. BDSA expects most mature cannabis markets in the U.S. to return to positive growth in 2024, although more slowly through 2027 than in the years leading up to the pandemic.
Newer legal cannabis markets showed strong growth in 2022, despite the decline seen in more mature markets. BDSA also projects new legal adult-use cannabis markets to launch by 2027, predicting a start of legal sales in Maryland in 2024 and in Florida and Ohio in 2025. The launch of new recreational marijuana cannabis markets is also possible in Minnesota and Hawaii by 2027, BDSA notes, but the company does not expect to see federal cannabis legalization during the five-year forecast period.
Brian Vicente, founding partner of the cannabis law firm Vicente LLP, agreed that emerging markets will help fuel the growth of the legal cannabis industry in the upcoming years.
“The future remains bright for the cannabis industry in the United States. Despite a recent setback at the polls, with Oklahoma voters shooting down legalization this month, we are still seeing other domestic markets expand and commence sales,” Vicente wrote in an email. “This includes significant revenue growth in newly-legal cannabis markets like Missouri and New Jersey, and also emerging medical markets like Mississippi. With additional states like Florida and Ohio looking likely to legalize in the next several years, we can expect continued expansion in cannabis sales.”
By 2027, U.S. sales of adult-use cannabis are forecasted to contribute 78% of the total spending on legal cannabis worldwide, up from 64% in 2022. U.S. legal cannabis spending is expected to grow at a CAGR of 11.3%, from $26.1 billion in 2022 to $44.5 billion in 2027, with the industry’s growth driven primarily by the New York, Florida, New Jersey and California recreational marijuana markets.
Globally, cannabis markets outside the U.S. and Canada are forecast to grow at a CAGR of 40% to $9.5 billion in 2027, up from $1.8 billion in 2022. BDSA forecasts the Canadian market will see overall growth of 12% this year, increasing to a $5.7 billion market by 2027 at a CAGR of 6.3%. New adult-use markets in Germany and Mexico are expected to be the primary drivers of global growth, while existing limited medical cannabis programs are expected to expand, particularly in the European Union and Latin America.
The report, released last week by the Oregon Liquor & Cannabis Commission, detailed that, after a “banner sales year” in 2020, cannabis producers in the state “entered 2021 exuberant and optimistic about the future of the market – and made their planting decisions accordingly.”
“However, the fading of demand as 2021 progressed, exacerbated by a record outdoor harvest in October 2021, set off a slide in prices that put the entirety of the supply chain under pressure in 2022,” the report said. “The overabundance of supply throughout 2021 and 2022 resulted in historically low wholesale and retail prices for both usable marijuana and concentrate/extract products. The declining prices, in combination with a tempering in the growth of quantities purchased, resulted in the first-ever decrease in annual sales (from $1.2 billion in 2021 to $994 million in 2022).”
That combination of overabundant supply and fading demand, the commission said in the report, has left the Oregon recreational cannabis market in perhaps its most precarious state since it opened for business about seven years ago.
“Previous market cycles have been buoyed by large annual increases in consumer demand, and Oregon’s recreational marijuana market has successfully transitioned most in-state consumers to the legal market. However, the Oregon recreational marijuana market is in arguably the weakest economic position it has been in since the inception of the program in 2016 due to a decrease in the growth of demand in Oregon, a production cycle that responds to market signals on a lag, and increasing stockpiles of inventory,” the report said.
The post-pandemic sales dip has become a troublesome trend for Oregon’s cannabis producers.
Last fall, the state’s Liquor & Cannabis Commission sounded the alarm on year-over-year sales numbers in Oregon, noting that sales in October 2022 declined by about $15 million from October 2021.
In the commission’s latest report released last week, the regulators “[m]arket dynamics on the demand side also point to a turbulent 2023.”
“Overall, consumer demand since 2021 has been at a lower rate than prior years, and there has been a notable shift down in the demand trend line. Moreover, the distribution of demand is shifting away from usable marijuana – both as an intermediate and final product. In previous years, OLCC Processors have proven to be a ‘safety net’ for Producers by purchasing large amounts of usable marijuana and giving Producers an additional outlet for their product,” the report said. “However, just like usable marijuana inventory, stocks of concentrate and extract products are at all-time highs and Processors are less likely than in the past to turn to Producers for new inventory. This also comes at a time when consumers are shifting towards other product types (particularly edibles) and away from usable marijuana. These factors all point in the same direction: fewer outlets for usable marijuana, and lower prices for licensees.”
The commission said that, although the state’s recreational cannabis market “has proven resilient…two fundamental facts remain unchanged” until the federal government takes action and reschedules pot: “in-state supply is boundless, while in-state demand can only grow so much,” according to the report.
“Oregon’s extremely competitive marketplace features low prices for consumers that have positioned the state’s legal market to compete successfully with the illicit market. The corollary, however, is that these low consumer prices force businesses to operate under low margins and extreme pressure. The narrowness of those margins, and the ability for Oregon cannabis businesses to operate under them, remains to be seen as we enter 2023,” the report said.
Argentina officially launched a new government agency on Wednesday as part of an effort to bolster the country’s medical marijuana and hemp industry.
Reuters reports that the agency, known as the Regulatory Agency for the Hemp and Medicinal Cannabis Industry, or ARICCAME, represents “the first working group of a new national agency to regularize and promote the country’s nascent cannabis industry, which ministers hope will create new jobs and exports generating fresh income for the South American nation.”
“This opens the door for Argentina to start a new path in terms of industrial exports, on the basis of huge global demand,” said Argentina’s economy minister Sergio Massa at an event marking the launch of the new agency.
According to Reuters, “Massa said that the agency would from Thursday begin regularizing programs and coordinating with various provinces and [the] industrial sector, adding Argentina already counted on demand for projects linked to the agro-industrial sector.”
On the official website for ARICCAME, the agency outlines its mission and objectives.
“We are the Agency that regulates the import, export, cultivation, industrial production, manufacture, commercialization and acquisition, by any title, of seeds of the cannabis plant, cannabis and its derivative products for medicinal or industrial purposes,” the website reads, via an English translation.
The website lists the following “general objectives” for the agency: “Establish through the respective regulations, the regulatory framework for the entire production chain and national marketing and/or export of the Cannabis Sativa L. plant, seeds and derivatives for use in favor of health and industrial hemp; Promote a new agro-industrial productive sector for the commercial manufacture of medicines, phytotherapeutics, food and cosmetics for human use, medicines and food for veterinary use, as well as the different products made possible by industrial hemp; Generate the framework for the adaptation to the regulatory regime, of the cultivation and production of cannabis derivatives for use in existing health, guaranteeing the traceability and quality of the products in order to safeguard the right to health of the users of medical cannabis; Reintroduce hemp in Argentina and all its derivatives: food, construction materials, textile fiber, cellulose and bioplastics with low environmental impact; [and] Promote scientific research and sectoral technological progress, promoting favorable conditions for these existing industries in our country.”
ARICCAME’s specific objectives include: “Establish clear rules that provide legal certainty to the sector and encourage federal participation; Articulate through agreements and conventions with other State entities with intervention in the matter: INASE, SENASA, INTA, INTI, AFIP, INAES, BCRA, UIF, National Universities, etc; Determine the system of licenses and administrative authorizations for the productive chain; Generate quality standards that safeguard the right to health of users and consumers of cannabis/hemp products; [and] Control non-compliance with the regulatory regime.”
Argentine policymakers legalized cannabis oil for medical use in 2017. Three years later, the country legalized home cannabis cultivation for medical marijuana patients.
The launch of the new agency is part of a border effort by the Argentine government to continue to reform the medical cannabis program, something that the South American country identified as a priority last year.
According to Reuters, the newly launched agency will be helmed by Francisco Echarren, who “said the industry could generate thousands of new jobs, as well as create technological developments and new products for export.”
“We have a huge challenge ahead of us,” Echarren said, as quoted by Reuters, “not only getting a new industry on its feet, but giving millions of Argentines access to products that improve quality of life.”
I struggled for a minute, thinking about what this end-of-year digest should say. Typically, year-end missives consider what has happened while offering a forward-looking view, one that’s hopefully positive. I hate to kick a horse while it’s down, which, in this case, is the wider cannabis industry and culture, but the truth is: shit sucks right now. It would be putting lipstick on a pig to pretend otherwise. So, basically, I’m here to commiserate with everyone.
Even the Wall Street guys are pissed, so you know it’s bad. Usually, when the culture is upset, it’s because of dynamics that have big business grinning while the little guys get crushed. In this current climate, everyone is hurting. Jesse Redmond, a former hedge fund manager who writes the Green Giants newsletter, which details retail cannabis stocks investing, tweeted yesterday, “New all-time low on $MSOS. The ETF has dropped 88% over the past 686 days and is down 46% MTD. It will take an 830% return to get back to the all-time high.” MSOS is a fund that includes some of the most recognizable publicly traded multi-state operators, like Curaleaf, Trulieve, Green Thumb, and Verano.
The main reason they’re so pissed (this time) is because of repeated stalling on legislative action at the federal level, the most recent of which was SAFE banking’s demise. The Republican blocking of that legislation, while harmful to some actors in the cannabis space, is indicative of a much larger problem, one that affects everyone who touches cannabis in any way: weed is still politically radioactive for some factions of power, despite remaining overwhelmingly popular with voters. Because of this, a common refrain among advocates of all stripes is that federal legalization won’t come anytime soon unless Biden decides to truly go “Dank Brandon” beyond his half-assed pardon of federal marijuana prisoners incarcerated for possession (of which, there are not many).
That’s bad news for everyone. But things are infinitely worse for those on the ground, especially growers. California is, once again, experiencing oversupply, now with a bumper crop to boot, worsening the already severe problem exacerbated by high taxes. “Growers in states such as California, Colorado, Michigan and Washington [are] already seeing rock-bottom wholesale prices, a flood of cheaper, outdoor-grown flower hitting the market in the coming months could push prices even lower,” reported MJBizDaily’s Bart Schaneman in November. Also in California, a debt bubble exists in its supply chain, which finds retailers, distributors, and growers unable to pay taxes and bills. Currently, the state reports around $500 million are owed in taxes.
In New York, which just began legal adult-use sales, operators have been scrambling to keep up with ever-shifting legislation to get to that recreationally legal moment. A thriving grey market — arguably New York’s golden era of weed, for which I’m sure many will be one day nostalgic — threatens the health of said legalization, but the truth is there’s never been a better time for the average New Yorker to get killer buds. It remains to be seen how the above-board landscape will fare. So far, it hasn’t been great: a lawsuit threatens to overturn residency requirements for operators, holding up some would-be licensees from selling. The first 36 approved licenses in the state, which would benefit from a $200 million state social equity fund, have not received funding nor notification of how they might, stalling their openings. As of Dec 29, the first day of legal sales in the state, only one licensee can open.
Workers aren’t doing much better. Layoffs at companies like Dutchie, Weedmaps, Leafly, Curaleaf, Trulieve, The Parent Company, Leaflink, and many more abound. One worker died at a Trulieve processing facility in Massachusetts. Who knows how many other casualties there were in the greyer segments of the market.
As for the culture, it’s hard to argue that the mood is anything but down. Attendance at big events that attract more than just suits, like Hall of Flowers or the Emerald Cup Harvest Ball, was lighter this season — folks just don’t have the cash or are busy putting out literal and proverbial fires. A mold scandal infected a new grower-focused cannabis competition in Oklahoma, and so on. Many players are dropping out of the legal market, some unable to survive while others lost their taste for the rat race. Others in the traditional market gave up on the legal one years ago, and some never even tried to join up, sensing that things would likely go sideways.
Now other long-time pot advocates are abandoning support for certain aspects of legalization based on well-founded fears that the market is headed toward an inevitable monopoly. Reporter (and High Times alum) Mary Jane Gibson asks, “is legal weed doomed to be run by big business?” In her Vox piece, she reports that activists and advocates, including some from NORML, find that certain laws will just be twisted to suit the needs of corporations, like the aforementioned SAFE banking measure, or efforts to reschedule cannabis at the federal level. She details the efforts by organizations like the nonprofit Coalition for Cannabis Policy, Education, and Regulation (CPEAR), whose goal is to “advance a comprehensive federal regulatory framework for cannabis.” She mentions the group is funded by tobacco and alcohol brands, like, “Altria, the parent company of Philip Morris USA; the Molson Coors Beverage Company; Constellation Brands, the conglomerate behind Corona and Modelo; and the National Association of Convenience Stores, among others.”
But the die-hards persist, as they always have. Grassroots events, like Transbay Challenge, The New York Growers Cup, and Ego Clash, are still well-attended, representing an OG culture segment that won’t fold, regardless of whatever legalization hurls its way. The people are still imbibing, as they always have, I found while reporting for the New York Times earlier this fall, making the most of time-honored practices, accessibility and market challenges be damned. There’s hope there, for sure, however niche it may be.
If there are silver linings, it’s the same as there always will be in the age of legal cannabis: a few more states legalized this year, and fewer people are going to jail for the plant than ever. Brittney Griner came home. Consumers who lacked solid access to the traditional market now have other avenues to obtain weed. That it comes at a much higher price, especially for medical patients, and with degrees of varying quality (not to mention questionable testing results) puts some dull on that shine, however.
Dominic Corva, Assistant Professor of Sociology and Cannabis Studies Program Director at Cal Poly Humboldt, said he agreed with me that it’s a bad time in the history of cannabis culture. He especially feels for those in the legacy world: those who stayed, and those who made a run for legality based on the state’s promises that heading out of the shadows would benefit them.
“Because alternative livelihoods are disappearing at a time when they are desperately needed. How do you ride out the global polycrisis without a resilient informal economy?” he asks, referring to the variety of social and economic ills our society faces — not just in the cannabis universe. “The cannabis countercultural economy flourished because it was a refuge from the ‘Rat Race to the Bottom’ ruining everything since the 1980s, including the dissolution of previously significant formal social safety nets. Now we have neither. ‘Get racing, rats’ could be the slogan of actually existing cannabis legalization.”
There’s not much more to say than that. I bid adieu to 2022 and welcome 2023 with open arms. To better days ahead — I’m not sure when those will be or what they’ll look like, but I hope for them all the same.
A report published by the cannabis data company BDSA projects that by 2026, global cannabis sales will rise to $57 billion—an increase from the $30 billion of global cannabis sales collected in 2021. The “Global Market Forecast” was published on Sept. 13, and reviews expected milestones for the cannabis industry to hit within the next five years.
“The ‘hockey stick’ trend of sales growth seen in the early years of legal cannabis has passed, and economic and regulatory headwinds are exerting pressure on legal cannabis markets,” said BDSA CEO Roy Bingham in a press release. “Still, our updated forecast predicts that steady gains in developing U.S. markets will continue to drive single-digit annual growth in total U.S. legal sales in 2022, with continued growth prospects out to 2026.”
BDSA addresses how mature cannabis market prices are experiencing historically low prices. According to the Colorado Department of Revenue, adult-use sales continue to drop. Recreational sales in June 2022 reached $127,157,358, compared to June 2021 which reached $152,719,813. Medical cannabis sales in Colorado also follow a similar dip compared to last year’s sales data.
However, BDSA adds that states such as Oregon and Washington have implemented moratoriums to prevent over supply. Newer markets such as Illinois are continuing to do well though, having collected $2 billion in total sales in 2022 so far (14% more than sales collected in 2021). The report notes that markets like New Jersey, which recently launched its adult-use program, and New York, which is preparing for recreational cannabis sales very soon, will be high contributors to sales in the U.S. by 2026.
Between New Jersey and New York, there are 22 million adults who are expected to contribute $5 billion to the total $42 billion expected to be collected in 2026. “Though mature legal cannabis markets in the U.S. saw sales soften in 2022, the cannabis market is still forecast to see topline growth in 2022, driven by strong sales in new and emerging markets, such as the populous states of New Jersey and New York,” Bingham said. “The U.S. will continue to dominate global sales over the next few years, but we see potential from emerging global markets such as Germany and Mexico.”
Medical cannabis sales continue to decline, especially in markets that recently legalized adult-use sales like Arizona. “BDSA projects annual dollar sales in Arizona’s medical channel will be 30% lower than the 2021 annual dollar sales total and roughly half the annual sales total seen in 2020—the last full year of medical-only sales,” BDSA states in a press release. “By contrast, the Colorado medical channel still saw modest growth in annual sales for roughly two years after the launch of its adult-use market in 2014.”
On an international scale, larger countries are continuing to ramp up their medical and or recreational cannabis programs. Germany recently hit a roadblock with the concern that an adult-use reform measure might be rejected by the European Union. Mexico decriminalized cannabis last summer, but adult-use cannabis has not yet been legalized. Smaller countries are beginning to take action, such as the U.S. Virgin Islands, which released a draft of medical cannabis rules in August. Bermuda, a territory of the United Kingdom, recently made plans to implement a legalization bill, but it was rejected by U.K. officials.
The nationwide popularity of the Earth Week 1990 festivities showed the concern that Americans feel about the continuing degradation of the global environment. The twentieth anniversary celebration of the original Earth Day focused on ways that individual citizens can reduce waste and retard pollution. From coast to coast, a plethora of multimedia displays demonstrated the need for recycling used materials and lowering power consumption. They showed the changes in lifestyle necessary to halt the poisoning of the Earth.
An environmentally-conscious populace would prove to be a frugal one if those Earth Week programs were adopted. Assuming that the American people would be willing to cut back on energy consumption and muster the effort to recycle their trash, would industrial corporations and energy producers be willing to do the same? Would corporate America drop the aggressive sales pitches, stop spending billions to encourage people to buy impulsively? Would people be able to kick the mass consumption habit that’s been generations in the making? Would corporate America ever entertain the idea of abstaining from its short-term profit fix, and consider the consequences of quick-return capitalism for future generations of life on Earth?
President Bush’s speech—given just days after Earth Week 1990 at the 17-nation conference dealing with global pollution held in Washington, DC—drew criticism from European participants. Bush’s emphasis on scientific and economic uncertainties was seen as White House foot dragging on the environmental issue.
A memo prepared by administration staffers for members of the US delegation, under the heading “Debates To Avoid,” instructed delegates to avoid discussion of “whether there is or is not [global] warming, or how much or how little warming. In the eyes of the public we will lose this debate. A better approach is to raise the many uncertainties that need to be better understood on this issue.”
Bush repeatedly stressed the need to find policies that do not limit economic growth: “Environmental policies that ignore the economic factor, are destined to fail” [Science News, April 28,1990].
President Bush publicly prides himself on his career in the oil industry. He is, to say the least, an energy-industry celebrity. But he has also gone to great lengths to represent himself as the “environmental president.” If the Bush administration believes that “in the eyes of the public” they will lose any debate questioning the scientific validity of the greenhouse effect, is it possible they don’t believe that excessive accumulation of greenhouse gasses generated by fossil fuel-burning is unbalancing the global carbon-dioxide cycle? Or is it possible that the corporate/industrial-energy complex, which controls the trillion-dollar-per-year energy industry, fears profit losses and—unlike the American people—is in no way willing to make a sacrifice in corporate “lifestyle” to help heal the Earth?
President Bush is right about one thing. “Policies that ignore the economic factor, the human factor, are destined to fail.” In this case, the economic factor and the human factor converge into dire straits: If we do not convert from a fossil-fueled economy to a biomass-fueled economy, the human factor will become part of the fossil history on Planet Earth.
The corporate/industrial-energy complex is collectively holding its breath on the topic of biomass resource-conversion to replace fossil fuels. The industrial energy giants spend millions in public relations explaining how they are environmentally responsible, yet the fossil-fuel resources they peddle are endangering our fragile ecosphere. The majority of scientists throughout the world agree: The single most effective way to halt the greenhouse effect is to stop burning fossil fuels.
It was proven in the 1970s that biomass, specifically plant mass, can be converted to fuels that could replace every type of fossil fuel currently produced by industry—and these biomass fuels are essentially non-polluting.
Fossil-fuel materials—coal, oil and natural gas—were made by nature from Earth biomass that lived over 160 million years ago. Crude fossil fuels contain hydrocarbon compounds that were made by plant life during the process of photosynthesis.
Carbon dioxide and water were converted into hydrocarbon-rich cellulose. Plants manufacture many other biochemicals in the complex and mysterious act of living—but cellulose and lignin are the compounds that give plants structure, body, and strength. They are the main components of plant mass.
Nature took millions of years to concentrate the ancient plant mass into what we call fossil fuels. The eons-long process that converted the once-living biomass into hydrocarbon-rich fossils also compressed sulfur into the fossil biomass. It is this sulfur that causes acid rain when belched out of power-plant smokestacks. According to the Brookhaven National Laboratory, 50,000 Americans and 10,000 Canadians die each year from exposure to acid rain. Humankind, through the science of chemical engineering, can transform modern biomass into hydrocarbon-rich fuels that contain no sulfur because fresh plant mass contains no sulfur. And the scientific method of biomass conversion into hydrocarbon fuels requires mere hours instead of eons to accomplish.
The inherent problem with burning fossil fuels to power industrial energy systems and economies is the mega-ton release of carbon dioxide (CO2) into the air. However, biomass-derived fuels are part of the present-day global CO2 cycle. The quantity of CO2 released into the air from burning biomass fuels equals the amount of CO2 that the biomass energy crop absorbed while it grew. If the energy crop is an annual plant, then one year’s biomass fuel (when burned) will supply the CO2 needed for the next year’s fuel biomass growth. There will be no net increase in atmospheric CO2.
For over 100 years industrialized nations have burned hydrocarbon fuels that are not part of the current ecosystem. The delicate balance between life and climatic cycles is being unbalanced by injecting ancestral CO2 into the atmosphere.
The only way to reduce the ever-thickening blanket of carbon dioxide warming the earth is to grow more plants to absorb it. Yet the Bush administration’s plan to plant one billion trees a year will only reduce by 15 percent the amount of CO2 predicted for the end of the century. However, American CO2 production (from burning fossil fuels) will rise by 35 percent during the same time period [Science News, April 28,1990]. The Bush administration’s plan is futile as long as fossil fuels remain America’s major energy resource. And at the rate forests are being cut down to make the paper our society is wrapped up in, a billion saplings a year will barely compensate for that loss in CO2 absorption. In addition, wood happens to be the government’s chief biomass candidate to replace the dwindling fossil-fuel supply. Officials claim US yearly energy consumption can be met by harvesting one-third of the trees in the National Forests on a rotating basis coupled with more intensive silvaculture (tree farming) techniques. Estimated yearly biomass production in the National Forests is one ton per acre [Progress in Biomass Conversion, Vol. 1; Kyosti V. Sarkenen and David Tillman, editors]. However, private industry has been, without conscience, clear-cutting unprotected timber stands in National Forest and Parks, and none of that wood is going into biomass fuel conversion. The US Forestry Service is the government bureaucracy promoting this ludicrous forests-for-fuel idea.
The trees of the world are the biosphere’s C02-cycle safety valve. Since a tree will live for centuries, forests can gradually pull the excess CO2 out of the air. Trees are not only aesthetically pleasing—they can cure our ailing atmosphere.
Is it realistic to halt construction to save trees, or to ask people to stop using paper?
If wood resources cannot hope to meet the demand for lumber, paper and biomass fuels, can any plant be cultivated to meet those needs? This problem is not new. Civilizations have been exhausting vital resources and dooming themselves for centuries. Versatility, cleverness and common sense are the hallmarks of the ones that survive.
About 75 years ago, two dedicated USDA scientists projected that at the rate the US was using paper, we would deplete the forests in our lifetime. Those government scientists were endowed with common sense—something government officials are hopelessly lacking nowadays. So USDA scientists Dewey and Merrill looked for an alternate agricultural resource for paper products to prevent the disaster we now face.
They found the ideal candidate to be the waste material left in the fields after the hemp harvest. The leftover pulp, called hemp hurds, was traditionally burned in the fields when the hemp fiber had been removed after completion of the time-consuming retting process (partially rotting the hemp stalk to separate the fiber from the hurds).
Since hemp hurds are richer in cellulose and contain less lignin than wood pulp, Dewey and Merrill found that the harsh sulfur acids used to break down the lignin in wood pulp were not necessary when making paper from hemp hurds. Sulfur-acid wastes from paper mills are known to be a major source of waterway pollution. The coarse paper they made from hemp hurds was stronger and had greater folding durability than coarse wood-pulp paper. Hemp hurd paper would make better cardboard and paper-bag products than wood paper. They found the fine print quality of hemp hurd paper to be equal to writing-quality wood pulp paper [USDA Bulletin, no. 404].
The only problem in implementing the change from wood to hemp hurds was that machinery to separate hemp fiber from the hurds needed to be developed. Separation was still done by hand after the machine breaks had softened the hemp stalks. The “decorticating” machine that separated the fiber and hurds wasn’t developed until the early 1930s. Popular Mechanics declared in 1937 that hemp would be a billion-dollar-a-year crop because of this new machinery and their predictions did not take into consideration hemp’s potential as a biomass-fuel resource. But they did not predict that hemp would be maligned. Its flower tops and leaves condemned as marijuana, hemp was outlawed-just when the fiber/hurd separating machinery had been perfected.
If America had not been infected with anti-marijuana hysteria, hemp would be solving our energy problems today. When marijuana was outlawed, most people did not know that “marijuana” was Mexican slang for cannabis hemp. The American people, including doctors who routinely prescribed cannabis extract medicines, thought hemp and marijuana were two different plants. Otherwise hemp prohibition might never have happened.
Eastern Europeans were not subjected to the hysterical anti-marijuana syndrome plaguing the West. Poland, Hungary and Czechoslovakia, among others, continued to make clothing from hemp fibers and medicines from hemp flowers. They pressed the versatile and edible oil from the seeds and used the leftover high-protein seed mash to make breakfast cereal and livestock feed. And they used surplus hemp for building insulation.
Here in the US, a private firm called Mansion Industries is pioneering the use of agricultural fibers to make sturdy, light-weight construction paneling to replace plywood. Mansion uses straw to make their Envirocore (TM) panels. According to Dewey and Merrill’s test results, if hemp was an available resource, Envirocore (TM) construction paneling would be even stronger.
It’s not too late to save our environment, but it is absolutely essential that we start now. Restoring the balance to the biosphere’s ecosystem will require courage and determination, but not self-denial. We need not give up our comfort or quality of life.
America stands at the crossroads of greatness and decline. The might of our weaponry will not sustain us anymore. Our chance to again lead the world will require the same kind of determination we once used to turn our peacetime economy into war production during the 1940s. But the “war mentality” will no longer help us. This time we must be innovative and change the very way we produce our energy resources. Hemp prohibition must end at once in order to inaugurate a nationwide green economy. To save the world that gives us life, we must begin immediately to grow our own energy.
Hemp is the only plant capable of becoming the American biomass-energy standard. Hemp grows well everywhere on earth, except for the polar regions. Hemp will out-produce wood at a rate greater than four-to-one per acre in cellulose/pulp. And by analyzing pre-prohibition hemp-crop reports from various states, ten tons per acre becomes a reasonable biomass production figure. Hemp will make ten times more biomass per acre than forest wood.
Wood is not a viable fuel resource. The forests are essential to scrub the CO2 from the air. Soft-wood forests should not be harvested for paper products or biomass—their only economic value. Hemp can supply that need. Hardwood trees should be harvested, utilizing sustainable-yield ecology, for board and finishing lumber only. Hemp will make pressed-board lighter and more durable than plywood.
Hemp can be grown for crude biomass fuels on energy farms; fiber/hurds for textiles, pressed-board and hurd cellulose products; seed for oil and high-protein foods; flowers for pharmaceutical-grade extract medicines and recreational herbal products for adults.
The green economy based on a hemp multi-industry complex will provide income for farmers in every state. Regions for each hemp agricultural industry application will be established through open, free-market competition. The historically traditional hemp fiber growing areas in the eastern US will re-emerge, creating new jobs in an old industry. The economically devastated northern plains will see a boom as the nation’s energy-farming states. Medicinal and intoxicant-grade hemp will be grown on less-productive, higher-elevation lands. Mountainous areas have traditionally produced intoxicant-quality hemp.
Ironically, although the target of prohibitionist “reefer madness” propaganda, the hemp medicine and intoxicant industry will generate the least amount of capital.
The hemp-seed oil and food-resource industries, and the hemp-textile and cellulose industries will develop thousands of sustainable new jobs. Hemp-energy farming will become the backbone of a trillion-dollar-a-year non-polluting energy-production industry. And the petroleum industries need not fear this, for their expertise, hardware and manpower are vital to turn the farmers’ raw biomass into refined fuels.
These projections could represent a tremendous boon to our flagging economy, a by-product of the need to save our world from human-induced biocide. If we as a society have the courage and determination to set upon this bold path of planetary restoration, we can in our lifetimes leave a healthier world to our children as well as a lifestyle based on renewable resources in a balanced ecosystem that our children can leave to their children for generations to come.
What’s the relationship between cannabis and the Taliban? August 30, 2021, marked the day the US left Afghanistan after a twenty-year-long campaign. Just like a body with a physical dependency suddenly being cut off, Afghanistan went into withdrawal as the entire world held its breath. With the Taliban poised to take over the country and […]