Proposed Californian drug law a threat to local economy

Castlegar Source
By Castlegar Source
November 3rd, 2010

By Timothy Schafer, The Nelson Daily

The other shoe could drop on the ailing West Kootenay economy if Californians vote to legalize marijuana during mid-term elections Tuesday.

On the block is Proposition 19, a move to legalize marijuana at the state level (but remain illegal at the federal level), allowing municipal governments to legalize the use and possession of up to 28.5 grams of marijuana by adults and cultivation for personal use — in a space as large as 25 square feet — and allowing commercial growth and sales.

With allegedly close to 90 per cent of the province and the region’s marijuana crop heading south to the U.S., a vote to allow the herb to be grown legally in California could effectively cut the price per pound by half (to $1,500) and gut the Kootenay market, said George Penfold, the regional research innovation chair for rural economic development at Selkirk College.

With the second highest unemployment rate in the province — and reportedly one of the largest underground pot economies — the Kootenay region could really hurt if the vote goes green.

“The combination of those two things, the ability of folks in California who smoke pot to grow their own, combined potentially with legal commercial sales, means that a big part of the market will disappear,” he said.

The Rand Corporation in the U.S. estimated the price could drop at street level by as much as 80 per cent in the U.S.

The pervasive economic impact of the bud industry in B.C. has been likened, in studies by Simon Fraser University economist Stephen Easton, to the impact of the forestry sector before the recession hit in 2008.

That would mean up to $4 billion worth of marijuana exported from B.C. would be affected, according to the study, and around 18,000 grow operations.

“So it’s big business but most people think that if it is illegal, it just disappears and doesn’t have an impact,” he said. “The reality is that $4 billion flows around the economy.

“So the folks that grow here use that money to do the same sorts of things that those of us who don’t grow here do: they buy trucks, ski club memberships, groceries, pay the mortgage. All of that money essentially become part of the legal economy and if it disappears, it has a huge impact.”

Ed Note: Proposition 19 was defeated Tuesday.

Categories: General


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