Will Oakland Kill Its Infant Marijuana Industry?

 

For years, my town of Oakland has been at the center of the commercial marijuana business in America. Downtown is studded with medical marijuana clinics and small shops selling paraphernalia. (I, myself, have had a medical marijuana card for a long time.) Oakland’s pot entrepreneurs were forward-looking visionaries who never doubted that pot would be legal someday. They wanted to be like Henry Ford or Thomas Edison: in the forefront of an industry that would be very, very big.

On the last election day—which also saw the catastrophic election of Trump—California voters overwhelmingly passed Proposition 64, the California Marijuana Legalization Initiative (sponsored by my old friend, Lt. Gov. Gavin Newsom). It now is legal for Californians 21 years or older to grow and use pot. The proposition also placed two different kinds of taxes on pot: one on cultivation, for growers, and the other on users, at the retail price end. However, and apparently, Prop 64 does not mandate that other jurisdictions, such as cities and counties, cannot place additional taxes and restrictions on commercial marijuana. That’s where Oakland enters the picture—in a way that does not paint a very flattering picture of it.

A hard-core splinter group of city councilmembers is pushing for Oakland to do things that would effectively kill Oakland’s nascent pot industry, thereby undoing all the work of recent years. These council members are demanding that retail licenses be granted only to people living in districts—largely Black—in which large numbers of residents have been formerly convicted of violating marijuana laws, when weed was illegal. This would effectively limit license holders to those living in minority districts; its proponents call it “an equity permit program” but it’s really race-based discrimination against everyone else who lives in Oakland.

I suppose you could argue that minorities have been disproportionately convicted of drug crimes, although whether that’s true for pot, as opposed to crack cocaine, is arguable. Even if it is true, two wrongs don’t make a right. This is a misguided attempt—when you examine it closely—at a kind of reverse discrimination I find troubling.

As if this proposed rule isn’t bad enough, the rogue supervisors pushing it have another dumb idea: they want the City of Oakland to seize 25% of all pot business profits for the General Fund. Put yourself in the shoes of an aspiring marijuana entrepreneur: your margins are going to be thin enough, what with massive competition (including from Big Tobacco). Now, these morons from Oakland want to take one-quarter of your profits! Are you really sure you want to open a pot business in Oakland?

It’s unbelievable. Oakland is a city badly in need of revenue. The 1989 Loma Prieta Earthquake destroyed downtown; it was twenty years before it began to recover, and then, Wham! the Great Recession put us right back into the hole. Since then, however, downtown Oakland has seen an exciting revitalization of restaurants, clubs, wine bars and the like, capped by Uber deciding to headquarter here, in the old Sears building (which also happens to be in the heart of the marijuana district). Revenues from pot dealers would have brought extraordinary sums into the City’s coffers. Instead, selfish, short-sighted councilmembers are trying their damnedest to kill the goose that’s laying the golden egg. Oakland politics has been broken for years because of race, and it’s really time for narrow-minded politicians to think of the City as a whole and put their parochial concerns aside.