In the long and contentious fight for marijuana legalization, lawmakers across the country won over skeptical colleagues by promising social justice: The economic benefits of cannabis sales would be targeted at communities marred by decades of racist drug enforcement policies.
However, a recent POLITICO investigation found that these efforts have largely failed to deliver the promised economic justice. Instead, the cannabis boom has been dominated by overwhelmingly white and wealthy investors.
The reasons for these failures vary from state to state, but some of the key factors behind the blunders of state equity programs were lack of funding, shoddy implementation, legal fights and struggles to access banking services. Many frustrated minority entrepreneurs say they’ve emptied their bank accounts to take advantage of what were touted as extraordinary economic opportunities only to find their plans derailed by the botched enactment of poorly designed policies.
Even for those who’ve successfully overcome the regulatory hurdles, the anticipated financial windfall from legal weed sales has proven illusory. The vast majority of companies are hemorrhaging red ink, even as their owners bank on future growth. The 10 largest publicly traded U.S. weed companies lost more than $2 billion in 2022, according to a POLITICO analysis of financial filings.
Efforts to redress the repercussions of the war on drugs have moved forward in some places — but not because of marijuana legalization. State programs to scrap old marijuana-related convictions have spared millions of people the stigma of criminal records, which can hamper them in seeking housing, employment or other basic needs. In Illinois alone, more than 500,000 convictions have been wiped away.
But the major selling point of legalization — that it’s a way to make amends for decades of enforcement policies that disproportionately targeted Black and brown communities — has failed to materialize.
The 10 largest publicly traded U.S. weed companies lost more than $2 billion in 2022, according to a POLITICO analysis of financial filings.
“You can’t get racial justice until you get economic justice,” said Toi Hutchinson, who served as Illinois’ first cannabis czar and is the former executive director of legalization advocacy group Marijuana Policy Project, in an interview. “There’s nowhere you [can] go and say that’s where it works. That’s not happening. This is still very, very nascent.”
State equity programs have proven to be “an almost complete failure,” said UC Davis economist Daniel Sumner, co-author of the book Can Legal Weed Win?
In Sumner’s view, cannabis regulators should be delivering a blunt message to prospective social equity entrepreneurs: “Take all the money you can scrape together, we’ll help you [and] you’re almost surely to lose everything.”
This is a stark reminder of the importance of fair and honest policy implementation. As we continue to navigate the complexities of our Constitutional Republic, it is crucial that we remain vigilant in our pursuit of truth and justice. The failure of marijuana legalization to deliver on its promises is a sobering example of the consequences of political corruption and the importance of holding our elected officials accountable.
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