Marijuana in the Governor’s Races

Political Races

As election day 2014 nears, the politics of marijuana use, either medical or recreational or both, impinges upon several gubernatorial races: Oregon, Florida, California, Illinois, Massachusetts and Colorado.

One can’t help but notice a split between the views of the political/governing class as it exists in several states on the one hand and the broad populace on the other. The cause of legalization makes headway when its advocates can make an end-run around the governing class, and appeal directly to the whole body of voters, as they did quite recently in Massachusetts, Washington and Colorado.

However, since then, important segments of the political class in several such states have sought to roll back these changes.



In California, Proposition 215 established–one might say pioneered–the legal status of medical marijuana, or Compassionate Use, quite early, in 1996.

Efforts to push forward, using ballot initiatives to achieve recreational marijuana use, or “full legalization” as it is sometimes called, have so far stalled.

Some passionate anti-legalization voices persist in California. One of these voices belongs to Roger Morgan, chairman and executive director of the Coalition for a Drug-Free California, who emailed an inquisitive reporter a lengthy brief on the dangers posed by marijuana, contending for example that “marijuana use by either parent can cause brain damage, physical deformities or death to a fetus.”

But even such passionate anti-pot voices, even Morgan himself, concedes that for some patients “the benefits may outweigh the harms, such as in relieving nausea and vomiting in Chemo patients.”

Asked about investors in the field, Morgan cautioned that they are speculating on “an illicit drug that is rightly classified as a Schedule I drug by the federal government,” and are taking on the concomitant risk.

Morgan, though, seems out of the political mainstream in the state, where the general movement of the broad public is toward laxer enforcement policies.

And here is where the grass roots, so to speak, have been consistently ahead of the political class. Nobody now running for Governor in California favors full legalization. Earlier this year on March 2, 2014, the incumbent, Jerry Brown, commented that he is not convinced legal recreational marijuana is a good idea because, he said, “there is a tendency to go to extremes.”

His opponent, Neel Kashkari, said,“I’m not in favor of legalization though I believe we need sentencing reform.” The phrasing is odd unless it is meant to suggest reform in the direction of fewer imprisonments and shorter sentences. Still, even if it were more explicit, the suggestion that marijuana should be punished criminally but with more lenient sentences than at present would do little to assure investors.

Yet even if Brown and Kashkari, not to mention Morgan, agree in opposition to full legalization, there is a good chance it will happen: just the way that the move to legal medical use happened, through a direct appeal to voters.

The bottom line for potential investors in marijuana is that the voters of California as a whole have been friendly, and officialdom much less so.



In Colorado, meanwhile, we see a purer form of the pattern described above. The gubernatorial candidate of the Democratic Party is incumbent John Hickenlooper, who has long been an opponent of the direction his state has taken by legalizing marijuana.

His Republican opponent, Bob Beauprez, a former Congressman, says on his campaign website that he “personally opposed Amendment 64 in 2012.” In some of his interviews he has gone considerably further, saying that he would work for a rollback and the restoration of prohibition.

At a debate Monday, October 6, 2014, the two men agreed that the state’s move to the legalization of recreational marijuana was “reckless.”

Of course, even if the political class were united in its distrust of the changes the populace has accepted, it would face a problem. Any rollback would now come with a high revenue cost. As to Colorado in particular the International Business Times has estimated sales tax revenue from marijuana in this, the first year of the implementation of Amendment 64, at $40 million.



Just two years ago Massachusetts voters passed a measure, Question 3, legalizing medical marijuana. Again, it was an appeal by advocates directly to the voters, not a decision of elected officials. And again, the latter are wary of it. In this year’s campaign, the incumbent–a Democrat–is retiring, and the party’s candidate to replace him is Martha Coakley, Republican Charlie Baker opposes her in that endeavor.

As the state attorney general, Coakley has already been involved in the issue, and has been supportive of legal medicinal use. For example, she issued an important decision in March 2013 limiting any town’s ability to create zoning ordinances adopting a NIMBY attitude toward marijuana.

In her capacity as a candidate, though, she has been more cautious. Asked whether she supported the legalization of recreational use of marijuana, she said she would like to see the results of experiments in Colorado and Washington.

Baker unequivocally opposes “full legalization” and wants a “reboot” on the issue of medical marijuana.

Here again, then, the people who voted for Question 3 face a governing class that is in some instances opposed and is in other cases simply unenthusiastic about implementing their mandate.



Then there is the great state of money. A recent AP story perceptively analyzed the pull that political donations will bring the nascent industry. Reporter Kristin Wyatt quoted Jared Polis, who represents Colorado’s 2nd Congressional District in the U.S. House of Representatives, saying, “As long as the industry is following our state marijuana laws, their contributions are the same as those from any other legal donors.”

Even if tax revenue doesn’t secure the future of the industry, a form of revenue even more valuable to elected officials, their constant hunger for revenue sources for their campaigns, might do the trick. In that case, any backlash against the trend of legalization-from-the-base will prove abortive.

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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