Marijuana And Money

In their effort to forge laws governing marijuana sales in Colorado, legislators are debating about the amount of taxes that should be associated with the sale. Colorado House of Representatives wants a 15% excise tax and a 10 or 15% tax on all sales in addition to the 2.9% state sales tax and any local taxes. Other cost relayed to the consumer will include the high licensing and application fees associated with starting a marijuana distribution center. Other legislative efforts that will continue to drive up costs are the rule governing that 70% of all marijuana sold must be grown by the distributor and no more than 30% may be furnished to another distributor. Also the legislators are considering limiting the amount of marijuana that can be sold and limiting the number of distributors state-wide which could create a shortage of legally sold marijuana. Shortages of supply would tend to drive the cost to consumers higher.

With taxes on sold marijuana approaching 30 to 35% it will be difficult to keep costs low enough to discourage a black market for marijuana. Brick and mortar stores have the added cost of a building, with all of its associated cost such as mortgage or rent, electricity, water, insurance and wages paid to a staff. Citizens of Colorado are allowed to grow their own marijuana and the profits of black market sales will be just too tempting for some to pass up, especially if the legal market is unable to meet demand.

Another problem facing marijuana distributors in Colorado is the continued prohibition of marijuana at the federal level. Since marijuana is still illegal by US law, it is difficult to find banks and insurance companies to do business with the distributors, forcing them into a cash only business with elaborate security systems. I’m sure the Federal government would not allow armed security in a business selling marijuana according to the Gun Control Act. This leads to increased security risks associated with robberies and burglaries and makes it difficult to obtain financing for startup and operating expenses. In addition the Federal Government has a long history of circumventing the will of the people by raiding marijuana distributors and confiscating their assets and property and incarcerating the owners.

All of these things combined make black market marijuana more appealing and profitable while making legal marijuana more expensive and easier targets for the Feds.

Randy Johnson

The Disparity of Prosecution in Drug Related Offences is Staggering

A deal worked out by the Assistant Attorney General Lanny Breuer has released top executives at HSBC from prosecution in a 1.9 billion dollar deal that allows them to escape prosecution for money laundering charges associated with the Mexican and Columbian drug cartels. Their punishment administered by HSBC is that their bonuses will be partially deferred. What a harsh way to treat those who looked the other way and helped as terrorists and murderers laundered billions of dollars over a decade of time. The Justice Department’s reasoning for allowing the non-prosecution fee (bribe) is that prosecuting top executives at HSBC would destabilize the financial institution causing ripples throughout the financial world. In a press release Breuer announced,  As a result of the government’s investigation, HSBC has . . . “clawed back” deferred compensation bonuses given to some of its most senior U.S. anti-money laundering and compliance officers, and agreed to partially defer bonus compensation for its most senior officials during the five-year period of the deferred prosecution agreement. The New York Times had this to say, “Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system.” The most criminal part in all of this is that the Justice Department did exactly the same thing, they took money to look the other way instead of prosecuting the crime.

For anyone who has ever been prosecuted for any drug violation or had their property confiscated in this failed war on drugs, this is a slap in the face. The poor and people of color are disproportionately prosecuted and persecuted in this failed war on drugs where their lives are destroyed and property taken.

Cornell Hood II was sentenced to life in prison for possesing two pounds of marijuana with intent to distribute in Louisiana. Louisiana is a state with a three strikes and your out policy. Sadly Cornell Hood II is not alone. The organization, has documented and tracked multiple cases similar to Hood’s where people are given extremely long sentences for non-violent marijuana charges.…_for_weed

Look what happened to Cameron Douglas, the white son of well-known actor Michael Douglas who was given the longest federal prison sentence ever for simple possession.

Or Aaron Sandusky who received a ten-year prison sentence for operating a medical marijuana dispensary. Because he was being tried in federal court, he was not allowed to mention that his activities were legal under California law. So much for “the truth the whole truth and nothing but the truth”.                                      

What happened to Chris Williams, a medical marijuana distributor in Montana is equally disturbing. Williams who believed he had done nothing wrong and wanted to challenge federal interference in Montana’s medical marijuana laws was quickly found guilty of all 4 marijuana charges against him because in federal court, evidence suggesting that his activities were legal by Montana law were not allowed. Since the federal government tied firearm possession charges to each of the drug charges, Williams faced 80 years mandatory minimum sentencing on the weapon charges alone, even though he had not handled the firearms. U.S. Attorney Micheal Cotter offered to drop enough charges to allow Williams to serve less than ten years if he would drop his appeal in the case. Williams refused and Cotter came back with a final offer of five years in prison in exchange for dropping all appeals. Since the federal prosecutors had already won their case and were trying to lessen Williams sentence, it would seem that they also believed the mandatory sentencing to be egregiously too harsh. Yet to take five years from a mans life for helping medical marijuana patients acquire their medicine legally under state law still seems wrong to me. But to not allow a defendant to present all evidence relevent to his defense, such as the fact that his activities were legal under state law that was voted in by the citizens of that state is a horrible miscarriage of justice. What is your opinion?                                       

Randy Johnson