Ohio Initiative's Cannabis Cartel Could Defeat Legalization

Pot prohibitionists appeal to libertarians by opposing economic privileges.


Responsible Ohio

Backers of the marijuana legalization initiative that qualified for Ohio's 2015 ballot last week plan to challenge the official description of that measure, which they say is slanted against them. They have a point, but the biggest challenge they face is one they created: a cannabis cultivation cartel that alienates their natural supporters.

The Toledo Blade calls the ballot language, which was supported by the Ohio Ballot Board's three Republican members and opposed by the two Democrats, a victory for opponents of legalization. It's not hard to see why.

For example, Issue 3 generally bans marijuana businesses within 1,000 feet of churches, libraries, playgrounds, schools, and day care centers. It makes an exception for growers if those uses were established after January 1 of this year and for other cannabusinesses if they apply for licenses before the uses are established (which seems only fair, even if we assume these buffer zones make sense to begin with). The board-approved ballot language highlights the exceptions rather than the rule. Similarly, it emphasizes the limits that Issue 3 puts on local authority to regulate marijuana businesses.

The description also says adults 21 or older would be allowed to "purchase, grow, possess, use, transport and share over one-half pound of marijuana…at a time." The basis for this statement is the eight-ounce limit on homegrown marijuana, in addition to which people could legally buy and possess up to one ounce at a time. Calling the amount "over one-half pound" makes it sound as if there is no upper limit. Furthermore, there is a one-ounce limit on sales, noncommercial transfers, transportation, and public possession. A home grower arguably could give a friend more than an ounce, but the friend would not be allowed to take more than an ounce with him. Hence it is not true that Issue 3 lets people "purchase," "transport," or (for all practical purposes) "share" more than half a pound at a time. 

But one of the problems that Responsible Ohio, the group sponsoring Issue 3, sees in the ballot language is simply an accurate description of the initiative's worst feature. The board's first bullet point notes that Issue 3 would "endow exclusive rights for commercial marijuana growth, cultivation, and extraction to self-designated landowners who own 10 predetermined parcels of land" in 10 counties. It adds that "one additional location may be allowed for in four years."

According to the Blade, Responsible Ohio objects to this language because it suggests that Issue 3 "sets up a monopoly." But Issue 3 does set up a monopoly—or, to be more precise, a legally enforced oligopoly. This cannabis cultivation cartel, which consists of Issue 3's main financial supporters, is highly controversial even among supporters of legalization, and rightly so. That is not the fault of the Ohio Ballot Board, although its Republican members clearly thought playing up that aspect of the initiative would help turn voters against it.

Another way the initiative's backers could be defeated by their own greed: An initiative placed on the ballot by the state legislature says "the power of the initiative shall not be used to pass an amendment to this constitution that would grant or create a monopoly or a special interest, privilege, benefit, right, or license of an economic nature to any person, partnership, association, corporation, organization, or other nonpublic entity, or any combination thereof, however organized, that is not available to other similarly situated persons or entities at the time the amendment is scheduled to become effective." That initiative, like Issue 3, is a constitutional amendment, passage of which requires just a simple majority.

What happens if both amendments pass? It's not entirely clear. "The Ohio Constitution says if two conflicting amendments on the same ballot pass, the one that gets the most votes becomes law," the Cleveland Plain Dealer notes. "But the constitution also says citizen-initiated amendments, such as the marijuana legalization amendment, become law 30 days after an election while legislature-sponsored amendments become law immediately." That suggets that if voters approve both initiatives, Issue 3 would be invalidated before it took effect. Just in case, anti-pot legislators added an amendment to the anti-monopoly initiative aimed squarely at Issue 3:

If, at the general election held on November 3, 2015, the electors approve a proposed constitutional amendment that conflicts with division (B)(1) of this section with regard to the creation of a monopoly, oligopoly, or cartel for the sale, distribution, or other use of any federal Schedule I controlled substance…that entire proposed constitutional amendment shall not take effect.

That language seems to be aimed at preventing the parts of Issue 3 that don't create economic privileges for particular people from taking effect. No doubt the issue would still end up in the courts. But this whole problem could have been avoided with a more open and competitive approach to legalization. If I lived in Ohio, I probably would hold my nose and vote for Issue 3 on the grounds that it's better than prohibition. But I also would find the anti-monopoly initiative very appealing, even knowing that it might block Issue 3. Opponents of legalization have cannily adopted a strategy that enlists libertarians in the cause of maintaining prohibition, which is possible only because of the misguided strategy adopted by supporters of legalization.

[Thanks to Marc Sandhaus for the Plain Dealer link.]