Future NY Times Headline - National Marijuana Tax Revenue Far Short Of Expectations

As we head into the holiday weekend - lets take a moment to relax our minds - and travel into the future to Dec. 2014; two years after a re-elected President Obama legalized marijuana. Indeed, to refresh your memory - in early December 2012, with the increased diversion of the `end of the world on Dec. 21st crowds' dominating the news - the President decided that he would `free every marijuana prisoner' in the nation and legalize and nationally tax the herb.

As you remember, by 2012, largely because of the Great Recession (as the downturn from the bank crisis of 2008 came to be called) 6 states had already legalized the plant and started to depend on the generated revenues and even on some increase in tourist trade (increases to the conventions in states with legal pot took off in comparison to `strict' states -as they - the non legal states - became to be known as). Indeed, the states that adopted the progressive `smoking bar' rules (letting over 21 age smoker establishments exist - like alcohol bars) - as opposed to the states which only allowed legal consumption in the home - did especially well in the revenue department. The `bar' states were also states that allowed advertising on billboards and most sold the herb in local shops and shut down the medical marijuana facilities. In these local shops, the product was sold at the price the market would bear and taxed at a higher rate than other goods and services - about 40%.

But, all states were not the same. By 2012, in 23 states, one could get a prescription for pot via ones personal doctor - but - still 28 states (The District Of Columbia became a state in 2011) were routinely arresting those in possession of pot. Interestingly, all of these arrest states had especially strong bar associations that had ties with local politicians.

But, the farce of readily available pot in one state and arrest in another - often - of course - within miles due to state lines - was becoming a little too much for even the worthless media and politicians to stand up in support of anymore. America was beginning to look like a place with no standard or morals when it came to justice -or marijuana policy. And, eventually, as you know, when the 4th budget with a trillion dollar deficit was announced - there was an outroar of protest to start ending the prosecution of all drug users - of `housing' millions at taxpayers expense.

The politicians in Washington knew they had to act and knew they had to compromise - so they passed on Dec. 4th 2012 - the National Marijuana Act (NMA). The NMA immediately declared marijuana a legal plant - and immediately set up a national chain of state run marijuana sellers stores - who would sell cannabis grown by the major tobacco companies (by this time the alcohol companies had bought the remaining tobacco firms) - in nearly every town with a population over 10,000.

The politicians were also pleased that as part of the negotiations over the NMA, they were able to still keep the prisons full (only a small % of those with longer sentences were pot users/sellers) and the lawyers busy with no change to the cocaine laws or sentences. Indeed, the prison industry said nary a word.

But, the best news - as it was sold to the non-marijuana smoking public - was that the price would be set at 50 dollars to 100 dollars an ounce and 85% was a TAX collected and split between the state and the national government (The stores were to run on the 15% of revenue as the rents were free - all were commercial properties that had been acquired by the banks the government owned since the Great Recession.) The other provision, of course, was the release of EVERY pot prisoner - no matter the charge - as long as the sentence was based solely on pot. Indeed, the joy of the 10's of thousands that December day two years ago was truly a proud moment in America. Real justice and just in time for Christmas. Indeed, the whole `legal pot thing' would quickly be swallowed up in the typical brainless media holiday spin. It was also expected that the new `low' price would keep home growing to a minimum. (Homeowners with children under 21 could only grow in a locked room was part of the NMA too.)

And, for a few months of 2013 - the added revenues were fairly significant. But, the politicians didn't figure on one thing - when they made possession of plants legal, totally legal, - a significant % of smokers started to grow their own needs - and found that it was very easy to do as most smokers needed less than a pound for a whole year - - even those that wanted more had no problem meeting their needs -as there was no limit on growing. (Outside growing on your own property was legal too.) And, by fall 2013 - with the first homegrown domestic crop - the sales in the stores began to dry up - as did the `revenue' the government wanted to make off the smokers backs. The same smokers they had ravaged the rights of for decades.

Because, those with lots of pot would give it to friends now - not even charge for it.

Oh, I forgot to say - when the NMA was passed - to satisfy the democrats concerns for `our children' and in deference to the republicans `religious right' - the law shut down all the smoker bars nationwide. Pot would NOT become an entertainment industry - this was not the first step down the slippery slope, the politicians promised - we would NOT be putting more druggies onto our nations roads. It would also guarantee the government as the sole legal source - I forgot to say that private selling was still illegal punishable with fine and `probation' (probation meant a monthly fee and contact with authorities for up to five years). Yes, the politics of the whole affair was complicated, but, done as only politicians can - wrongly.

Regardless, the free market price - rapidly returned to `the good old days' of the 70's -- regular smoke 15 an ounce, excellent smoke 35 an ounce. And, grown by a person one knew. And still sold in the friend network that worked so well for decades.

So, what was evident a year ago - winter 2013 - is now much worse. Virtually none of the oldtime smokers wanted to deal with the government in any way - even in a shop with killer 100 dollar an ounce pot. Indeed, almost 90% were now home growers and totally out of the market and tax scheme fostered by those who didn't know how smokers would react. Who didn't understand the remaining latent anger felt by them.

Indeed, about the only industries that directly benefited were the companies that made light systems and growing systems - because within a years time - the National Sales Stores were beginning to close. And, the anti-smoking forces had come out in force to discourage new pot smokers - who quickly dried up too. It seemed as if the laws really didn't discourage many from lighting up after all - despite decades of oppression and beyond stupid laws. If one wanted to smoke in 2011 before national legalization - one did.

And, then, I vaguely remembered an article I read on the internet. It had to be at least five years ago - perhaps in 2009. I swear, it had the same headline as I read here today December 14th 2014 - "National Marijuana Tax Revenue Far Short Of Expectations".

And, I chuckled to myself.

Is The Big Media Economy Cheerleading Getting Stale?

In my first post a few days ago - I alluded to the amazing big media `cheerleading' concerning the current economic situation. The cheerleading seems to be at all levels from CNBC to CNN to your hometown media outlets. The cheering seems based on the possibility that the level of the steepness of the crashing is easing. Nearly gone are the comments of `getting worse' - which is what nearly all the data still indicates. The populist idea is to take comfort that the system didn't and may not fall totally apart. (Nowhere are we to think that the people are MAD at the F-up of the big media watching big business - or the lack of control of the monetary system. The sheeple are to be quiet and happy the system didn't crash.)

Nowhere does the big media give credence to the idea that ONLY certain parts of the country went on a drunken binge concerning home prices. ONLY certain parts of the country had folks living off their house income for a few years. And, consequently, only PARTS of the country are REALLY being bailed out. Indeed, should the country pay for California's excess for the next decade? Or, should California have to pony up MUCH more?

Here's a link to a California blog that I have been following for the past two years - it makes the same point about the cheerleading of the media. I assure you, this is a website you should bookmark to know what is really going on.

http://housing-kaboom.blogspot.com/2009/05/has-median-stopped-cheerleading.html

Operation Northwoods

Sometimes, it is important to know just how politicians in power think - so - check out this wikipedia link that never gets talked about.

http://en.wikipedia.org/wiki/Operation_Northwoods

If you enjoyed these links - pass our new blog on to like minded friends - thanks. More posts from the last few days below too.