Horwitz and a Hopeful View of the Trump Effect

Horwitz and a Hopeful View of the Trump Effect

Pixabay / MIH83 / CC0 Public Domain

The second day at the California Cannabis Business Expo, Monday, March 6, kicked off with a discussion of the “Trump effect,” by Lawrence W. Horwitz, of Horwitz + Armstrong, a law firm and professional corporation headquartered in Lake Forest, California.

Horwitz, a board member of and general counsel to MJIC, began his presentation with reflections on the pace of change. Just three years ago there was no legal certainty. “People would sit down in our office and we’d start to talk about what a business plan should look like, and nobody knew.”

Now, especially in California, and “it is all about California right now,” the legal and regulatory environment has evolved to a point that makes compliance, and compliant planning, possible.


Scary Trump

But now, too, Donald Trump is the President of the United States. Trump is a scary figure to many, and he is — if not himself an enemy of the legal marijuana business — at least a patron of some who are its avowed enemies, notably his attorney general, Jeff Sessions.

But Horwitz takes the view that the Trump effect will mean in essence that there will be little or no further progress at the federal level over the coming years; no progress of the sort that there might have been had there been a Hillary Clinton administration.


Not a Bad Thing

That won’t be a bad thing for the people in the room, Horwitz in effect assured them. Federal liberalization would have normalized the industry, would have allowed Big Banking, Big Pharma and Big Tobacco to get their respective claws into it. But due to the Trump effect, those three Bigs might keep their distance, and the significance of economies of scale will remain limited, so there will arise no analogous Big Marijuana just yet either.

Thus, the Trump Effect means that there remains and will remain room for the individual entrepreneur, and for the idiosyncratic municipality as well.

One of the municipalities that Horwitz has in mind is California City, a town in the Mojave Desert, a place so middle-of-nowhere-ish that the KFC is the town’s outstanding dining establishment. And in California City the town’s political leaders “are all about cannabis,” about making life easy and taxation bearable for the cannabis entrepreneurs willing to come to town.

Not a bad thing for them, at all.

Christopher C. Faille, a Jamesian pragmatist, was one of the first reporters taking the hedge fund industry as a full-time beat, at the turn of the millennium, with HedgeWorld. His latest book, Gambling with Borrowed Chips, treats of common misunderstandings of the crisis of 2007-08.

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