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Feds Battle California’s Medical Marijuana Industry; Will Colorado Be Next?

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Alternative Medicine

The photographer writes: "Medical Marijuana dispensary, Colorado City. One of many in the area."

The federal government’s recent crackdown on the sale of medical marijuana in California has some people wondering if Colorado will be next.

Reporting in last Wednesday’s New York Times, Erik Eckholm writes that California’s billion-dollar medical marijuana industry has been badly shaken up by the federal government’s attack on growers and sellers. The U.S. government’s anti-medical-marijuana policies are starkly opposed to California’s law, which went into effect after which voters approved the sale of the drug in 1996.

Eckholm writes:

In the last several weeks, federal prosecutors have raided or threatened to seize the property of scores of growers and dispensaries in California that, in some cases, are regarded by local officials as law-abiding models. At the same time, the Internal Revenue Service has levied large, disputed tax charges against the state’s largest dispensary, threatening its ability to continue. […]

‘The federal and state laws exist in parallel universes,’ said Thomas D. Allman, the Mendocino County sheriff, in his office in Ukiah. He is as tough as anyone on the illegal marijuana trade, he said, but ‘growing and using medical marijuana is a right of a California citizen.’

Now, he said, the 94 collectives that receive permits and plant tags from his office are frightened.

Colorado legalized medical marijuana in 2000, and business is booming (with more than 127,000 paying customers), according to Eric Spitznagel, writing for Bloomberg. He says that although 16 states allow some form of legalized medical marijuana (according to Bloomberg Businessweek‘s Nov. 21 edition), Colorado is the only state that allows the sale of the substance as a for-profit business.

Spitznagel quotes Michael Bellingham, the co-owner of one of Boulder’s oldest suppliers as saying these business need to be self-financed: “You can’t go to a bank and say, ‘I have a business plan and I need to borrow money.’ Banks are federally regulated, and marijuana is against federal law, so they won’t touch you.”

Across the U.S., there are 17.4 million Americans who use marijuana in general, according to a 2010 survey conducted by the Substance Abuse and Mental Health Services Administration, Spitznagel writes. He adds: “The challenge for would-be marijuana tycoons is trying to keep up in an increasingly competitive business while marketing a product that is, at least on a national level, illegal.”

Thomas R. Raynes, executive director of the Colorado District Attorneys’ Council, told Spitznagel: “At any moment in time the federal government can exercise its power of preemption and do what they want.”

Spitznagel writes:

There are ominous signs from California, where in October several medical marijuana dispensaries were closed or raided in a statewide crackdown. […]

It was a scary message to anybody in the medical marijuana trade but especially for dispensary owners in Colorado, many of whom make no secret that they’re ‘profiteers.’ If a federal crackdown could happen in California, they wonder, why couldn’t it happen here?

Meanwhile, as Zusha Elinson writes in The New York Times on Friday, on Thursday, The Discovery Channel will broadcast the first episode of Weed Wars, a new four-part series that gives an inside look at the medical marijuana business in Harborside Health Center in Oakland, the largest dispensary on the West Coast. And Carolyn Sackariason reports in Aspen Daily News Online that the National Geographic Channel is filming a documentary on Colorado’s medical marijuana industry. The film is scheduled to air some time early next year.

Image by Gruenemann (John W. Schulze), used under its Creative Commons license.


3 Responses to “Feds Battle California’s Medical Marijuana Industry; Will Colorado Be Next?”

  • […] new study finds fewer traffic deaths in states that have legalized medical marijuana, theorizing that in those states, some people are substituting marijuana for alcohol, at least some […]

  • gman says:

    I firmly believe that, since the government is an elected force, that the route to toleration on the federal level is through congressional and representative support. Let’s not forget we live in a democracy and should leverage the natural flow of our system. Getting politicians to move will require proof that communities can benefit from the sales of medical marajuana, and generate more income than what the authorities generate through arrests and seizures, revenue which by the way remains in the hands of law enforcements agencies. We also need to remind authorities that they are there to serve the people, not the motives or antiquated beliefs of a select few.

  • […] News Colorado reports that more than 700 medical marijuana dispensaries are licensed by Colorado, that there are as many as 56 such facilities within 1,000 […]