cannabisnews.com: Marijuana Sales Distribution Major Part of Economy










  Marijuana Sales Distribution Major Part of Economy

Posted by CN Staff on October 27, 2006 at 09:43:16 PT
By John Hazlehurst  
Source: Colorado Springs Business Journal 

Colorado -- On Nov. 7, Colorado voters will decide whether to legalize the possession of up to an ounce of marijuana by any person over 21. Initiative 44, which is modeled after an ordinance that Denver voters approved in 2004, is seen by both supporters and opponents as a first step toward comprehensive legalization and regulation of marijuana.
Eliminate the legal, social and moral arguments, and one thing becomes very clear: even without Initiative 44, the marijuana trade in El Paso County is a major contributor to the local economy.According to the National Survey of Drug Use and Health, 13.3 percent of Colorado residents use marijuana. Use spikes between the ages of 18 and 25, a demographic in which fully a third of all Coloradoans are users.In Colorado Springs, where age demographics trend younger than statewide figures, as many as 15 percent of residents might be marijuana users. Given a metropolitan population of 550,000, that translates to 80,000 people.Law enforcement officials, users and dealers estimated that the average marijuana user in Colorado Springs purchases/consumes about three ounces annually at a cost of about $1,000.That translates into a yearly retail market of $80 million, derived from the distribution of 1,250 pounds of marijuana every month, or 41 pounds a day.A typical Wal-Mart superstore, such as the one currently under construction on Baptist Road south of Monument, generates $45 million in annual retail sales. Is the impact of the marijuana trade, then, roughly equivalent to a pair of big-box superstores?Difficult To Compare Sue Piatt of the Colorado Office of Economic Development is cautious about making any such comparisons. She points out that such stores not only pay sales taxes, but, unlike the marijuana trade, also rely upon a complex infrastructure of buildings, suppliers, transporters and administrators.A better measure of the magnitude of the marijuana trade, she suggested, might be to compare it to the gross annual sales of selected jurisdictions — information that’s available from the state Department of Revenue.Manitou Springs, for example, has gross annual retail sales of about $65 million. Buena Vista is a little higher, at $90 million, while Crested Butte, at $79.5 million, nearly matches the estimated annual volume of the local marijuana trade.At the Business Journal’s request, Fred Crowley, a research economist at the University of Colorado at Colorado Springs, created an input/output model of the marijuana business (see sidebar). In an e-mail, Crowley commented briefly on the model.“[My] analysis is based on the assumption the money from the sale of marijuana is spent in the local community. It was assumed $80,000,000 income is made from the sale of marijuana.“It was assumed the income is earned by a cross section of households selling the drug from lower to higher income levels.“Needless to say, the analysis is not an endorsement of the activity. Rather, it is an effort to identify the economic effects of the money being spent in El Paso County as a result of the sale of the marijuana. Social costs have not been included since I do not have the data on these items.”This is what the input/output analysis determined:Job creation: 1,100Income creation: $29.83 million annuallySales tax collections (state, county and city): $1.76 millionTough To Quantify Underground economies are notoriously difficult to quantify, since the usual metrics simply don’t apply. You can’t track store receipts, or sales tax collections, or wholesale inventories or bank deposits. But you can track people — people who are supplementing their incomes by selling or growing marijuana. Their ranks include not only bartenders and musicians but also middle-aged businessmen and spirited grandmothers. “Dave,” a slender, cheerful man in his early 20s, is seated at a rickety wooden table in the kitchen of his modest downtown apartment. “You won’t see anything better than this,” he says, passing over a plastic bag of high-grade marijuana. “This is B.C. bud. You want an ounce — it’s $400.” B.C. bud is a generic term for high-potency marijuana, much of which is thought to originate in British Columbia.Dave is a small-time marijuana dealer — the last link in the supply chain. He’s been selling to a small circle of friends and acquaintances since he was in high school.“I used to ride my bike around Rockrimmon to make deliveries,” he said. “Now I just e-mail my list, and they come by.”For Dave, selling marijuana is a simple, painless and, he thinks, relatively risk-free way to make extra money. “I don’t make much, maybe a thousand a month,” he said. “But I can work part-time doing construction, and have plenty of time for my music. Next year, I’m going to finish up at UCCS. I’d like to go to law school after that. I don’t want to be doing construction all my life.”Projecting The Size Law enforcement officials have long sought to estimate the size of drug markets by applying a multiplier to the quantity of drugs seized in transit. Typically, authorities have estimated that no more than 5 percent of marijuana shipments are successfully interdicted. As a point of reference, last year, 2,391 pounds of “processed marijuana” were seized in Colorado, as well as 7,383 cultivated plants. Of the plants, 3,919 came from indoor “grows,” and 3,464 from outdoor plots.According to local dealers, native-grown marijuana is almost exclusively cultivated indoors, under the lights. If undetected, it’s a profitable business. “Jim,” a popular Springs bartender, described one such grow. “It’s almost as big as the bar,” he said, indicating, with a sweep of his hand, an area about 30 feet by 50 feet. “And the plants are like six feet tall.”As a retail business, the marijuana trade appears to have several unique characteristics:It requires none of the infrastructure associated with similarly-sized retail businesses. There are no fleets of delivery trucks, no warehouses, no inventory control systems, no point-of-sale systems, no licensing and no direct tax payments.Retail distribution is entirely in the hands of small individual entrepreneurs, with little access to capital.There is little incentive for most of those individuals to increase their sales activity beyond a certain point. Every additional customer heightens the risk of detection and arrest.It seems likely that most small-time dealers net $1,000 or less per month, and expend the money as it is received. Might Be MoreSitting in her light-filled North End home, “Lilith,” a 50-something professional who has lived in Colorado Springs for more than 20 years, reflects on her years as a marijuana dealer. Told that NSDUS estimates suggest that there are more than 80,000 marijuana users in the Pikes Peak region, she smiles gently.“I think that’s low,” she said. “You wouldn’t believe who my customers are — they’re very straight, very respectable. I’ve never had more than half a dozen. The problem has always been finding suppliers. I need to find a grower.”If marijuana were to be legalized and regulated, what would be the economic impact of such a change?Present channels of sales and distribution would likely disappear. Prices also would likely plummet, even if the product was, like tobacco, heavily taxed. Thousands of individuals would lose a substantial portion of their income.If, as Crowley’s model suggests, the marijuana trade is responsible for more than a thousand jobs in the Pikes Peak Region, the economic impact of legalization would be comparable to the closure of a manufacturing business employing a thousand people.“We’d be out of business — just like the bookies and numbers runners went broke when Lotto came in,” said “Gary,” a former hippie and now a successful Springs businessman. “Back then, there weren’t so many gamblers, the odds were better, and it was a nice, quiet little business — so there’d be a lot more stoners, bad dope and nobody would make any money.“But”, he added, brightening, “I guess the cops would be out of work, too.”Complete Title: Marijuana Sales, Distribution Major Part of Local EconomyNote: Impact in Colorado Springs could be equivalent to $80 million in retail sales, account for 1,100 jobs.Complete Article with Chart: http://www.thepbj.com/story.cfm?ID=9934Source: Colorado Springs Business Journal (CO)Author: John Hazlehurst Published: October 27, 2006Copyright: 2006, The Colorado Springs Business JournalWebsite: http://www.thepbj.com/Contact: John.Hazlehurst csbj.comRelated Articles & Web Sites:Safer Coloradohttp://www.safercolorado.org/Safer Choicehttp://www.saferchoice.org/ So Why is Pot Really Illegal?http://cannabisnews.com/news/thread22323.shtmlSafety at Heart of Pot Debatehttp://cannabisnews.com/news/thread22317.shtmlNo Logical Reason To Punish Adults for Marijuanahttp://cannabisnews.com/news/thread22312.shtml 

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Comment #22 posted by whig on October 30, 2006 at 09:21:45 PT
museman
Do you despise people who are born with different gifts than yours?
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Comment #21 posted by museman on October 29, 2006 at 10:00:36 PT
politics then and now
Teddy can't be held accountable for the ignorance of future republicans... or can he? Because he was raised in the 'upper-crust' of old established American aristocracy, his view of humanity was steeped in those ingrained prejudices we see so clearly today, though in those days it was considered 'on the up and up' to aspire to such (by the media, and status quo controllers of the time - William Randolf Hearst, Rockefeller, etc.) so the fact that Teddy thought nothing of butchering peasant farmers in the 'mexican-american war' doesn't seem to taint his historical 'american' image much.It's possible that 'he did not know any better' and that his concern for the safety and conservation of nature wasn't held in a higher esteem and priority than his concern for human rights. His sense of 'temperance' however was no different than todays moral assumptions made by his social, economic, and political descendants.Nobody is perfect. I personally admire the man because he overcame his inherited physical infirmities through sheer will and determination. But knowing as I do the actual roots of poitical intent and agenda in America- starting from the rich backers of the Revolutionary War who wanted to make George king, who threw out the original agreements made to the people that actually fought and died for freedom, I cannot feel any special 'patriotic grattitude' for any of these rich bastards who rule our planet. They contrived and succeeded in creating a system of laws interpretable only by an elite class of 'special' people (lawyers), and even their memorable concession to ammending the constitution to include the 'bill of rights' is proving to have been not much more than a placebo. Why else would every single issue of personal liberty and human rights have to be battled out in their court?This country is founded on many lies, and it is those lies that hold the power, and the sway. All victories of the people are still to this day being legislated out of existence. The U.S. Government is a government of the rich by the rich, and for the rich. Since when did a truly impoverished man ever 'rise' to political power-without at the very least the backing of wealth? Special interests, lobbying, legal language deliberately written in psuedo-intellectual balther to confuse the common man, media progamming generations to buy, buy, buy. Political leaders who have been proven depraved, disgusting, truly immoral, and liars all. Who's kidding who?
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Comment #20 posted by FoM on October 29, 2006 at 07:30:49 PT

Hope
So that's where a the name Teddy Bear came from. That's cool. That was a cute video about Patches the horse. I bet it's hard to keep the house clean though! LOL! I don't use Firefox so I don't know anything about it but the reviews are that IE and Firefox upgrades are good. I remember IE3! I'm glad the browser and computers are getting more stable finally.
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Comment #19 posted by Hope on October 29, 2006 at 07:06:03 PT

The new Explorer
No. I haven't downloaded it yet. Ever since I've learned to use the f11 key to clear away that page search device that Foxfire has, I've been pretty happy with Foxfire. I've lost the thread now...but I watched that film about Patches the horse. Wonderful! That was right up my Dad's alley. He would have loved to have had a horse...and the car... that would do all that stuff. Thanks. I got a kick out of it.Teddy Roosevelt rode West...alone, as a young man...and lived the life of a roaming cowboy...with all the other, rough, roaming cowboys of that era. He was an avid hunter and health fanatic. He was invited on a bear hunt, in I forget what state. It was a big deal.People were there. Photographers...the whole works. He may have already been President at the time. Everybody was there but a decent sized bear to hunt.The people behind the hunt brought up a big bear cub for Roosevelt to shoot...so he could bag a bear.He wouldn't shoot it. He saved the little bear. Pictures were taken. Articles were written. The next Christmas the big gift to have was a "Teddy Bear" to hug and cuddle.
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Comment #18 posted by FoM on October 28, 2006 at 22:08:48 PT

Hope
Have you downloaded the Internet Explorer 7 yet? I did a few days ago and it is working really well. The next windows update it will be installed automatically if people don't install it. The reviews are very good. Must-Have Browser Upgradeshttp://www.washingtonpost.com/wp-dyn/content/article/2006/10/28/AR2006102800029.html
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Comment #17 posted by FoM on October 28, 2006 at 21:47:44 PT

Hope
It's sound like he was a good person. I know people with money that are down to earth. They can be compatible. Actually Neil Young would be a person like that. Down to earth and very wealthy.
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Comment #16 posted by Hope on October 28, 2006 at 21:38:33 PT

Teddy Roosevelt
My admiration of him and the life he pursued has nothing to do with politics. He was just a pretty astounding and amazing and admirable man.
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Comment #15 posted by Hope on October 28, 2006 at 21:36:54 PT

Teddy Roosevelt
Gave us the "Teddy Bear". He gave us the Rough Riders. He was an amazing guy that was a sickly child that exercised and health nutted his way to great physical and spiritual and mental strength. He was a pretty amazing guy.He was a rich man from a rich family...yet he got down and dirty with the common man regularly. 
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Comment #14 posted by FoM on October 28, 2006 at 20:55:37 PT

Wayne 
I just found your comment. It really is strange that people think so much about politics. Life is short and full of adventure and politics aren't fair no matter what because no one seems to care about issues just being in power. I am going to vote for the first time this year in a non presidential election but then it will be over for me. Hopefully I will feel relief and maybe even a little yippie but I know the republicans can spin lies and misinformation so I won't be surprised if they win again. American history, the little I know, seems way different then how it is today. The current system is really all about big corporations and money and not much more in my opinion.
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Comment #13 posted by JR Bob Dobbs on October 28, 2006 at 06:47:53 PT

T.R. speech
Amazingly enough, Archive.org has a part of a speech given by Teddy Roosevelt - from 1901! The content of the speech isn't too fascinating, but it's kind of impressive just to hear his voice!
http://www.archive.org/details/roosvelt1901
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Comment #12 posted by Wayne on October 27, 2006 at 23:37:21 PT

Re: FoM
Don't feel bad, you weren't missing much. Each president had their own quirks, but pretty much every president we've had save for Washington and Jefferson has had their own agenda and has courted the financial backing of corporate entities. But what makes Teddy Roosevelt unique is that he cared enough about the environment and wildlife to enact legislation directly to protect it. And I say thank God for that, because Roosevelt also believed in individual rights too. In retrospect, he was actually a more than a halfway decent president.
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Comment #11 posted by FoM on October 27, 2006 at 20:55:47 PT

Presidents
I don't remember learning much about american history in school but maybe I just tuned out. Politics just weren't something that anyone I knew even mentioned. I have no idea what Roosevelt did. 
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Comment #10 posted by Hope on October 27, 2006 at 20:47:56 PT

Teddy Roosevelt
Glad to hear Teddy Roosevelt wasn't a cannabis prohibitionist. I've always admired him from what I know of him and I would have been very disappointed to hear that he was for persecuting people for using cannabis.
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Comment #9 posted by Wayne on October 27, 2006 at 19:25:11 PT

Roosevelt
Don't get me wrong, I do admire the man. Prohibitionism was one of his very few undesirable traits. His dedication to the environment and wildlife, and to basic American ideals in general, more than make up for it. And what's amazing is that he was a Republican. A Republican who was committed to protecting our environment, protecting individual rights, and free enterprise. My how 100 years can change things. He believed in carring a 'big stick', but he also believed in NOT using it at all costs. Dubya could have learned good a lesson from that, but then he kind of has a habit of not learning much of anything.
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Comment #8 posted by goneposthole on October 27, 2006 at 18:23:45 PT

It remained legal until 1934
Teddy Roosevelt opposed heroin suppositories for six-month old children.I would too.It was some thirty years later that cannabis is federally regulated.Teddy Roosevelt was out of the picture by then.Just trying to be fair. He was the original conservationist. I don't picture Teddy Roosevelt out their chopping down hemp. Didn't seem to bother him too much back then. 
laugh link
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Comment #7 posted by Wayne on October 27, 2006 at 18:12:03 PT

p.s.
And just an after-thought on "snake oil"... with all these ads I'm seeing on TV today for hard-on drugs and restless-leg syndrome, it seems like we may be experiencing a new form of the "snake oil" phenomenon. This time around, instead of inventing new useless substances, we are inventing new useless diseases to use the same blend of substances on. I mean come on, how many possible chemical elements can affect the human mind?And on that note, it seems like whether we have too few food & drug regulations or too many, we experience the rip-off effect. One would wonder if striking that balance might quell that effect?
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Comment #6 posted by Wayne on October 27, 2006 at 18:07:17 PT

Max
Oh no, you're absolutely right. The original Pure Food & Drug Act probably did more good than bad. But it is worth noting that everything in that department was probably alright until 1962, when the act was amended with a requirement that drugs not only be proven to be 'safe', but also 'effective'. THAT, in effect, is what has put us in our current quagmire with health and prescription medication. And also inadvertantly created the foundation on which the Controlled Substances Act was built.It's kind of a pendulum effect, really. In the beginning, we had no regulations. Food and drug producers could put whatever they wanted on the shelves with nearly zero oversight. Then Congress started passing safety regulations, and things got a little better in terms of overall health and safety. Then with the CSA in 1970, we entered the era of too MUCH regulation. We've been there ever since, but my hope is that sometime soon the pendulum will swing back the other way and we will come closer to striking a balance. After all, that's what life is all about, isn't it? Finding a balance. It's just a shame that this particular pendulum takes such a long time to move.
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Comment #5 posted by Max Flowers on October 27, 2006 at 17:13:22 PT

The Pure Food and Drug Act
...wasn't all bad actually, even though as you say it was the first step in what became the misguided stumbling path of prohibition.In that era (late 1880s into very early 1900s), there were a ton of shady people selling bottles of "cures" without any oversight whatsoever and they didn't have to state what was in the weird bottled liquids. People concocted all kinds of strange things and not all were innocuous I'm sure (alongside tons of harmless but inactive rip-offs). I believe it's where the term "snake oil" came from. 
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Comment #4 posted by Wayne on October 27, 2006 at 16:19:23 PT

re: goneposthole
Sad to say, I think you may be wrong. Teddy Roosevelt was, for most purposes, a pretty decent president and an excellent role model. But he was THE original Prohibitionist president. He believed that controlling the importation of opium and coca crops would eventually lead to abstinence on the part of Americans. The Pure Food & Drug Act was passed in 1906 under his watch, and he put the steps in place toward the establishment of the Harrison Act after he left office. In effect, he was the one who started us down this dark, ugly road.No, I'd say when it comes to finding allies for legalization, I wouldn't even bother looking at the White House. Jimmy Carter was the closest thing we had to an ally as a President, and even HE was forced to change his mind.
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Comment #3 posted by goneposthole on October 27, 2006 at 13:30:04 PT

What would Teddy Roosevelt say?
Maybe he would say this: "Speak softly and fire up a big joint."Yeppers, I think he would have said that.'Big Joint' diplomacy works better.
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Comment #2 posted by FoM on October 27, 2006 at 12:21:14 PT

Pot Proponents Shout Down Governor
Rally Against Amendment 44 Gets HeatedOctober 27, 2006DENVER -- A rally at the state Capitol on Friday morning turned into a shouting match between the groups for and against a proposed amendment that would legalize small amounts of marijuana in Colorado.Gov. Bill Owens and the state's top law enforcement officers planned a press event on the west steps of the Capitol to urge voters to turn down Amendment 44, which would legalize adult possession of one ounce of marijuana.Supporters of pot legalization tried to shout them down. 
 "You say drink, we say no," the group chanted loudly.Members of the group Safer Alternative For Enjoyable Recreation, or SAFER, who believe it should be legal to possess less than an ounce of marijuana, angrily denounced the governor and the amendment's opponents.They argued that alcohol is much more dangerous than pot and believe the state's law enforcement priorities are out of whack.However, as they tried to shout down the governor and other speakers, things got testy and the governor became visibly angry."I am very concerned. And if you really want to see the difference, look at the men and women who were with me up here today, and then look at who is out here yelling at us, not allowing us to speak. It is very concerning," Owens said.Joining Owens on Friday was Attorney General John Suthers, Colorado State Patrol Lt. Col. Rick Salas, Park County Sheriff Fred Wegener, Arapahoe County Sheriff Grayson Robinson and Englewood Chief of Police Chris Olson, the president of the Colorado Association of Chiefs of Police.The governor argued that Amendment 44 is a misguided, poorly drafted proposal that would only make law enforcement's job tougher."There is no question that legalizing marijuana will have a long-term negative impact on the welfare and safety of Colorado families," Owens said during his speech. "Making marijuana more available is a recipe for disaster for everyone in Colorado, particularly for our younger populations."In addition to human costs, legalizing marijuana is sure to have an economic impact on every Colorado citizen. These costs include increased costs for substance abuse treatment and other social programs as well as lost revenue due to decreased worker productivity. Colorado voters need to ask themselves, 'Is this what we want for our families?' Clearly, the answer is no," Owens said."People should consider whether they want to see Colorado become a haven for drug use in America and what that might mean for the level of crime and quality of life in our communities," argued Suthers.Wegener, who is the president of the County Sheriffs of Colorado, said, "We are also concerned that legalizing marijuana will cause a spike in impaired driving fatalities and injuries caused by more motorists driving impaired on marijuana. The reality also exist that its is more difficult for law enforcement to detect impairment caused by marijuana and other drugs as compared to alcohol."Proponents of Amendment 44 brought out Seattle's former police chief to speak at the rally and argue in favor of legalizing marijuana, but his presence was overshadowed by the raucous turn of events.Supporters of the amendment also seemed disappointed at how their peaceful presence turned ugly, believing that it was not a way to put forward a rational argument for pot legalization.Passage of Amendment 44 would make Colorado the only state to legalize the possession of marijuana for all purposes, including use as a party drug, opponents said. According to pro-legalization sources, an ounce of marijuana makes between 30 and 120 joints, which is enough to supply a daily user of the drug for between one and six months.SAFER also announced Friday that it has enough money to run a few TV commercials before the Nov. 7 election.Please watch 7NEWS at 4 p.m. and 5 p.m. for more on this story.Copyright: 2006 by TheDenverChannel.comhttp://www.thedenverchannel.com/politics/10174806/detail.html
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Comment #1 posted by FoM on October 27, 2006 at 10:08:54 PT

Reefer Madness: 'Hemp for Farming' 

 http://www.austinchronicle.com/gyrobase/Issue/story?oid=oid%3A414381
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