Marijuana today is a craft-scale industry. It may not stay that way very long. Bigger players are waiting in the wings. In the past year, Allen St. Pierre, executive director of NORML, the nation's biggest marijuana-advocacy group, has met half a dozen times with representatives of the beer, wine and liquor industries. They've talked about the coming legalization of marijuana and what it will mean for the sector of what St. Pierre calls "problematic adult commerce." The NORML leader didn't ask for those meetings. The booze people came to him.
It's easy to assume that Big Tobacco and Big Alcohol are licking their chops at the emerging marijuana industry, waiting for their chance to scoop up a massive share of the market. In truth, it's not that simple. Tobacco, St. Pierre tells me, has production and distribution channels that could easily absorb cannabis. "But they don't have the Dionysian background," he says. "The alcohol guys, they're in the pleasure business. They know how that works."
Beer companies are the most likely first movers. Beer sales have been slipping in recent decades, as more Americans move up to wine or cocktails. Their customer seeks an inexpensive, low-level buzz. Here's one way to think about it: At the end of the week, the beer consumer has 20 bucks in his pocket. He can spend that all on beer, or maybe he buys a six-pack and a gram of pot. "I think they'll be happy to sell you both," says St. Pierre.
Alcohol companies also have excellent working relationships with state lawmakers and regulators. That's no small thing. Legalization rides on the growing belief that marijuana should be treated like alcohol, not like heroin or cocaine. For the feds to go along with these pilot projects, they need assurance that state officials can turn pot into a product as tightly regulated as beer or wine.
As it turned out, fate blessed the legalization movement with two governors prepared to offer that assurance. Gov. John Hickenlooper (D-Colo.) and Gov. Jay Inslee (D-Wash.) could have obstructed or delayed implementation of the adult-use laws. Both opposed it during the campaign. But once the voters spoke, both governors chose to heed the will of their citizens and carry out the laws. To do that, they would have to persuade U.S. Attorney General Eric Holder to allow their risky experiments to proceed.
Holder, like President Obama, was not a man inclined to give a stoner a break. For the past five years, the attorney general has left marijuana enforcement in the hands of local U.S. attorneys, who acted as drug czars in their own jurisdictions. Some dispensaries got raided, others didn't. If Holder didn't want legalization to proceed, he could dispatch the DEA and quash it overnight.
Starting in January 2013, state officials fed the Department of Justice a continuous stream of updates on the construction of their regulatory systems – things like security regulations, seed-to-sale tracking systems, background checks and leakage safeguards. The success of Colorado's 2011 MMJ regulations was a key selling point. Message: We can handle this.
In March, Sen. Patrick Leahy (D-Vt.) offered Holder political cover. "If you're going to be – because of budget cuts – prioritizing matters, I would suggest there are more serious things than minor possession of marijuana," he told the attorney general at a Senate hearing. Leahy also teamed with Tea Party darling Rand Paul (R-Ky.) to introduce legislation calling for reform of federal mandatory-minimum sentences in drug cases. The Leahy-Paul bill represented a signal moment in the beginning of the end of the War on Drugs: the alliance of drug-reform Democrats with libertarian Republicans.
Holder saw an opening and took it. He and Obama are well-aware of the toll the War on Drugs has taken on black communities. In a little-noticed mid-August memo, Holder ordered federal prosecutors to back off on mandatory minimums in low-level drug cases.
That was a good sign. But Holder remained mum about state-legal pot. Through back-channel talks with the office of John Walsh, U.S. attorney for the District of Colorado, Hickenlooper's staff had an idea of what federal officials were most concerned about (leakage into other states and the 1,000-foot rule, mainly). Neither governor had any indication of Holder's leanings. But they had hope. "During various meetings with federal officials, we were never told, 'Forget it, you're nuts,'" recalls David Postman, Inslee's communications director.
Finally, on August 29th, the attorney general placed a noon conference call to Hickenlooper and Inslee. In Denver and Olympia, a coterie of staffers gathered in the governors' offices. Holder came on the line and spoke about his decision: a green light. His office sent over a four-page memo prepared by Deputy Attorney General James Cole. The key passage: In states with "strong and effective regulatory and enforcement systems to control the cultivation, distribution, sale and possession of marijuana," federal officials would largely allow state and local law enforcement to address marijuana-related activity.
The operative term was "control." For the past 76 years, that word had been "prohibited." The feds didn't abandon their authority over marijuana. The Cole memo said that for now, federal law enforcement agencies would step back and let state and local officials proceed with their pilot project in cannabis control.
The staffers in the two governors' offices held their breath as Inslee and Hickenlooper thanked the attorney general. Then they hung up. There were no great hurrahs or backslaps in Denver or Olympia. Just relief that nearly a year's worth of work had not been in vain, and a feeling of confidence that the system each state had designed was going to work.
Marijuana is legal in Colorado and Washington, at least until President Obama leaves office in January 2017. The two states have exactly three years to show the rest of the nation that a safe and sane post-prohibition world is possible.
This story is from the January 16th, 2014 issue of Rolling Stone.
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