What Do Cannabis Entrepreneurs Owe Victims of the Drug War?

Overregulating the cannabis market to right past wrongs won't work.


Cynthia Nixon speaks at the NYC Cannibas Rally in Union Square, where activists gather to advocate for legalizing marijuana in New York State. Photo credit: Catherine Nance/Polaris/Newscom

"As public opinion has shifted toward legalization, rich white men like [former Rep. John] Boehner and the mega-corporations they serve are trying to cash in," writes New York gubernatorial candidate Cynthia Nixon. "We can't let them rake in profits while thousands of people, mostly people of color, continue to sit in jail for possession and use."

Those prisoners shouldn't be sitting in jail. But Nixon goes off track when she starts looking for ways to help the black and Hispanic communities that have been disproportionately harmed by prohibition. Rather than just calling for full legalization, she calls for

models similar to those created in places like Oakland, which sets aside half of its marijuana licenses for low-income residents who have been convicted of a marijuana-related crime or who live in a community targeted by the drug war. And in Massachusetts, the new statewide marijuana equity program provides additional support, including loans and technical support to applicants from impacted communities.

Using government licenses to privilege blacks and Hispanics over "rich white men" seems like a recipe for turning the industry into a tool of patronage politicians. There's also a long history of white contractors gaming rules that are supposed to help minority-owned businesses (here's an example from 1979 and another from 2013), and I don't think applying that template to the cannabis industry is going to do any more to reduce urban poverty. Better to lift the caps and open the market to all.

And yes: As in most other licensed industries, legislators in legal pot states prohibit many people with criminal records from working in the marijuana biz. Nixon is right that those restrictions should be abolished, but why limit that action to marijuana jobs?

Nixon also criticizes the New York Medical Cannabis Industry Association for suing the New York Health Department to stop the agency from doubling the number of licensed medical cannabis growers. The association argued that New York's law caps the number of growers at five, and that to expand the number of licenses (to 10) would make it harder for the incumbent license holders—backed by more than $50 million in venture capital—to turn a profit.

This kind of rent-seeking is infuriating, and she's right to denounce the suit. Yet I'm not sure the racial problems that Nixon notes would be solved by doubling (or tripling or quadrupling) the number of licensed growers in New York and requiring that some of them be people of color. Denver has 720 retail cultivators and 509 retail dispensaries, and yet the city continues to disproportionately arrest black and Latino residents for marijuana offenses. The same is true in Washington, D.C., where pot arrest rates have fallen but black residents still bear the brunt of enforcement.

So long as there are laws around who can grow and sell marijuana, people of color will be arrested for violating marijuana laws. If there are abundant jobs in the legal marijuana sector (as in Denver) or no constraints on who can grow marijuana (as in D.C.), the police can still disproportionately arrest people of color for public consumption and underage possession. Diversity quotas for licensing and public financing for minority entrepreneurs are shiny, low-impact proposals for a problem that will likely outlive the drug war writ large.

Nixon comes much closer to proposing something genuinely radical when she quotes Michelle Alexander on reparations:

"Here are white men poised to run big marijuana businesses, dreaming of cashing in big—big money, big businesses selling weed—after 40 years of impoverished Black kids getting prison time for selling weed, and their families and futures destroyed. Now, white men are planning to get rich doing precisely the same thing?"

"I think we have to be willing, as we're talking about legalization, to also start talking about reparations for the war on drugs, how to repair the harm caused."

Sen. Cory Booker (D-N.J.) tried to advance something like this in the Marijuana Justice Act of 2017. His proposal: a $500 million-a-year Community Reinvestment Fund, appropriated by Congress, to be spent on costs related to expungement as well as "public libraries, community centers, and programs and opportunities dedicated to youth." I didn't care for Booker's bill because it contains provisions almost certain to drive conservatives and law enforcement away from the bargaining table. I also think the aforementioned fund would end up benefiting politically connected developers more than at-risk kids.

But I think we should at least debate the merits of (and mechanisms for) compensating people who have served time for drug offenses. Last year, transhumanist Zoltan Istvan made the case here at Reason:

It wasn't just the defamatory criminal sentence many of us received. The government confiscated my Jeep Comanche and my beloved Honda motorcycle during the ordeal. What little money I had I spent on lawyers and judicial filings in our convoluted court system. My total financial loss a quarter of a century ago was $20,000 dollars. Had I been able to invest that money in the stock market, for example, I'd have over $100,000 now.

Some of us also want compensation for the financial damage forced upon us—for the literal theft of our property. Maybe that means a class action lawsuit insisting on government reparation for all damage caused, maybe in the form of tax credits or proceeds from the sale of unused Federal land, so as not to abuse the American taxpayer further over the drug war. It's safe to say—given the damage caused and the lives affected—such a suit would likely be in the billions of dollars.

Jonathan Rauch wrote about reparations for Reason back in 2001, arguing that we should compensate blacks who were forced to attend segregated schools just as we compensated Japanese-Americans who'd endured internment. (The Civil Liberties Act of 1988, which ordered compensation for living Japanese-Americans, turns 30 this August.) Rauch's argument against reparations for slavery—that we cannot punish living whites for the sins of their dead ancestors—does not undermine the case for compensating prisoners of the drug war, who were incarcerated by the political choices of their free neighbors. Straight cash seems like the right way to go about it.

NEXT: Tom Wolfe Is Dead but the 'Me Decade' Lives On (and That's a Good Thing)

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  1. The idea that smoking leaves should e 100% legal and government-hands-off just does not seem to register with progressives. For some progressives, legalization is just a new source of tax revenue. But to Nixon it’s just a means to correct social injustices. No proggie seems to want legalization simply because it’s none of your business what I put in my body.

    At least conservatives understand this and try to make a case that it is there business. They’re wrong, but they at least understand it.

  2. “Using government licenses to privilege blacks and Hispanics over “rich white men” seems like a recipe for turning the industry into a tool of patronage politicians.”

    In New York? Never!

    The more regulations you have, the more you’re showing favoritism to the rich – many of whom are, in fact, white and male, if you’re one of those racist sexists who think that makes it worse – imagine a politician bemoaning how Oprah is a “rich black woman” excluding worthy white men from broadcast markets! (PS – that’s not true, I’m just giving an example of awful racist rhetoric).

    1. This is why I seriously considered voting against the Arizona legalization measure. I ultimately voted for it, and it lost anyway, but it was distinctly cronyistic. With very explicit allotment only for those already with some access to regulators.

  3. Goes to show how crooked Congressmen are. Boehner spent his time in the House making sure unconstitutional drug “crimes” received harsh punishments and the police state and nanny state got bigger.

    Now he wants to make green off the barely legal marijuana businesses because they need him to run the Congressional gauntlet of hypocrites in Congress.

  4. Want a taste of CA cynicism?

    “On Tuesday, voters in California rejected a proposal to legalize marijuana for people over the age of 21. Proposition 19 lost 54% to 46%, with 11 of the state’s 58 counties voting in favor and 47 voting against. What may appear surprising to many people is that three of the counties where a majority of voters opposed legalization were Humboldt County, Mendocino County and Trinity County, an area, known as the “Emerald Triangle,” that is most dependent on marijuana as a crop. Yes, it’s true?many marijuana growers voted against legalization.
    Ted Kogon, a longtime Humboldt advocate of legalizing marijuana, opposed Proposition 19 because “it did not include a provision to release all people who have been jailed for non-violent marijuana-related offenses.”

    Right, Ted. You’re willing to toss many more folks in jail; this had nothing to do with the competition you’ll have to deal with.

  5. “”We can’t let them rake in profits while thousands of people, mostly people of color, continue to sit in jail for possession and use.””

    1) Actually, we can, and are. It’s almost like there’s no connection between the two things other than that dope got legalized in between.

    2) So, push your reps for a bill to release them all. That would be unequivocally good policy, and basically nobody would oppose it. So why are you railing against Mean Richies unrelated to that, rather than pushing for it?

    3) Isn’t it funny how her problem, from her wording, is not that anyone is profiting while those people are in jail, or that they’re still in jail even if nobody was profiting. It’s that rich, white men are among those making money.

    Pathetic identity politics makes for pathetic outcomes.

    1. Pathetic identity politics

      But you repeat yourself.

  6. I just find it baffling that people who abhor cigarette smoking so harshly seem to love marijuana so much.

  7. What Do Cannabis Entrepreneurs Owe Victims of the Drug War?

    Nothing. Individual drug-warring politicians and their enforcers, on the other hand, owe them whatever it takes to make up for a wrecked life.

  8. What Do Cannabis Entrepreneurs Owe Victims of the Drug War?

    Forty acres and a mule robot?

  9. No, no, no. No “reparations”. No racial set-asides. And I’m sorry you got shafted by the law in the past. Get over it. Otherwise you’re opening up multiple cans of worms that will never, ever be closed until the rest of us are bankrupt.

    1. But if someone accidentally mows over your petunia garden, by God the full force of government will be mobilized to redress it!

    2. No shit. I want the $100 fine I got for doing 65 on the interstate when 55 was the limit and years later changed to 65.

      1. Excellent example.

  10. The reparations should be investigating and possibly prosecuting those responsible for making and or perpetuating the stupid laws. Maybe if we held government responsible for the idiocy they cause they would be less likely to cause it to show us how much they are doing to save us from everything.

  11. White people prospering from injustices perpetrated on black people is the essential quality of America. Other than Ben Franklin inventing the turkey and whatnot.

    1. Glad to know that no white folks were in jail for pot.

  12. Well at some point we’re going to change the age of consent too. Should we free all the people in prison convicted of child rape at the time?

    1. Yes.

      If it’s “rape” in the sense that it was two consenting people, one of whom was underage. If it was actual rape, then no, of course not. Because rape is still illegal (as it should be).

  13. Am I reading this right? Offer to victims of past drug enforcement actions some special place in line to get into the biz? How many of those same people would even be the type to take advantage, let alone would be the type you’d want to favor?

  14. Zoltan Istvan —– $20,000 dollars. Had I been able to invest that money in the stock market, for example, I’d have over $100,000 now.

    Invertor extraordinaire,

    1. I want reparations for those savings bonds I put $30k into back in the early 90s. I think they’re worth about $60k before I pay the taxes

  15. arguing that we should compensate blacks who were forced to attend segregated schools just as we compensated Japanese-Americans who’d endured internment.

    Why? And what would the alumni of Dunbar High School be compensated for?

    1. I’d say that if you got a diploma from a Jim Crow school, you should be able to retroactively get a diploma from its white counterpart to which you’d have been assigned if you were white.

      And with formerly segregated colleges, let the graduates of a Jim Crow college get alumni status at a comparable college that used to be all white. With corresponding alumni family privileges when applicable.

      If you went to Dunbar, you probably won’t want a diploma from one of the lesser, whiter, schools, but you should be able to have that option.

      Just spitballing. It would certainly not be as expensive as a compensation fund for something that’s not really measureable.

  16. Quick, remind me…how much was paid to Al Capone, Lucky Luciano, and other Italian-Americans (among others) for the harm imposed upon them for the unjust enforcement of the Prohibition laws?

  17. Who are bigger victims of the drug war than cannabis entrepreneurs?

  18. I fully support anyone who suffered from a government policy being able to go and get full restitution from the specific government functionary or functionaries most responsible for the wrong.

    If that were an ongoing policy, we’d have our libertarian moment.

  19. i dont consider myself so much a victim of the drug war, but a veteran. close to achieving victory. stay the course.

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