Part 4: MMJ limits cannabis’ contribution to GDP to a fraction of what it could be
When you’re Cannabis Commerce, and an eager world turns to you for the real poteconomics lowdown — on a Fourth of July weekend no less — you’ve got to give the people what they want. And what they want is fireworks. Check. This section illuminates cannabis commerce’s contribution to Gross Domestic Product [GDP].
Why is GDP a big deal? It has everything to do with the perception of confidence in the economy, at home and abroad.
Let’s see if we can shoot off a Roman Candle or two and shine white light on this neglected topic.
Ah — here’s one. If activist Jon Gettman and cable colossus CNBC are correct, MJ and MMJ combine for $115 billion in annual sales. Of course MJ sales bring home the bacon to the tune of $113 billion a year. MMJ sales contribute all of . . . $1.7 billion.
In Part 2, it’s fair to say yours truly was disdainful about MMJ’s $1.7 billion contribution to GDP. If I recall correctly, my poetic metaphor for that constricted trickle of a revenue stream was “newt piss.”
Yet even that humble-sounding MMJ number absolutely sparkles when you stack it up against crops one might imagine sell circles around it. Take oranges, for instance. Oranges are a $2 billion a year industry. Total orange sales don’t exceed total MMJ sales by whole heckuva lot. And America the edible consumes an awful lot of oranges [I’m reaching for one now].
Did I pick that $2 billion number out of hat? Yeah — a 10-gallon hat worn by a lil agency called the United States Department of Agriculture [USDA]. USDA crop statistics are available here.
You may also be surprised to discover that peanuts are worth, well . . . peanuts. I was. Mr. Peanut’s a real trooper. But despite the dancing legume’s best efforts, Americans ”shell out” a mere $1 billion a year for the all-American nut.
At first glance, the USDA stats for “competing” crops seem shockingly low. I stared at them awfully hard before they sank in.
The USDA has cotton down for $7 billion a year. Wheat — a.k.a. the “amber waves of grain” — weighs in at $13 billion. Apples total $2 billion. Rice chips in with sales of $3 billion.
You may also be astonished to learn, as I was, that the coffee industry in the United States is valued at only $19 billion a year [courtesy of coffeemarvel.com].
How about “pitting” MMJ vs. the champion of the drupes? Peaches don’t even add up to a billion in annual sales and neither do cherries. I’m still having a hard time processing the fact MMJ outsells peaches and cherries put together. But it’s all there in black and white.
What legerdemain explains how MMJ sales compete so favorably with the above-mentioned staples? Uh, there is none.
Commodities priced at $3,500 a pound are always going to add up a thousand times faster than sales for commodities priced at $3.50 a pound. So much for that mystery.
Now let’s compare the largely outlaw MJ crop, valued around at $113 billion a year, against all crop sales in the United States for 2010. The USDA values these at $160 billion. That tells us that all crop sales put together are only 40% higher than MJ sales alone. Gonzo for ganja, Americans may soon spend as much on marijuana as they do on all other domestic crops combined — if the upward trend continues.
Here’s another Roman Candle.
The total US GDP in 2010 was $14.7 trillion, according to the Department of the Treasury. The performance of cannabis, with $115 billion in sales, isn’t shabby at all. Seen in a different light [one without MMJ’s glow], cannabis commerce has all the makings of a shining star in an otherwise dismal economy.
There’s just one problem.
We can’t count it.
Any of it.
It’s all off the books.
It never happened.
Agrimoney.com doesn’t give us a syllable about cannabis . . . or hemp. They don’t exist. It’s the biggest joke in the history of commodities, crops, or agriculture. But the joke’s on us. All of us.
What we’re seeing is a scintillating display of economic might that we can’t count.
If we could count it, we could tax it. Then we might feel better about our ability to chip away at the national debt, break out of the austerity cycle, and adapt to forthcoming green imperatives. That omnipresent sense of economic foreboding might lift.
Going one step further, if cannabis and hemp sales counted toward GDP, other countries would naturally want to replicate our success — couched as a reprise of “good old American ingenuity.” We’ve already seen that cannabis prohibition is a world problem, not a national problem, as reported in Further Reflections on Cannabis Commerce in The Netherlands.
But we’re getting ahead of ourselves. The big question in the here and now is, “As far as GDP is concerned, why are actual sales phantom sales?”
I can give you the answer in an extended treatise or reduce it to eight words. Let’s go with the eight words.
It all comes down to MMJ vs. MJ.
MMJ sales, which count, are a dribble compared to the free-flowing MJ sales, which don’t. Simple as that.
Cannabis commerce’s contribution to GDP is hogtied. Most likely, it will remain in irons unless until sanity is somehow restored.
Alternatively, we could be bragging to a “me, too” world about how we set an example for every country to emulate. “Look! We did it. We turned around an eroding economy by nurturing our emerging cannabis and hemp industries into the shining economic stars they wanted to be all along.”
Nope. Too idealistic — at least for the time being.
The town criers are mum.
No one’s protesting in front of Town Hall.
Cannabis — America’s #1 cash crop — is a ghost commodity.
Table of Contents:
Part 1: Dynamic MMJ laws force businesses onto the streetPart 2: MMJ limits cannatax to a fraction of what it could be
Part 3: MMJ limits job incubation to a fraction of what it could be
Part 4: MMJ limits cannabis' contribution to GDP to a fraction of what it could be
Part 5: Ironically, MMJ blocks clinical research into cannabis’ healing properties
Part 6: It's taking the tranquilizing drug of gradualism
Part 7: The foot-in-the-door theory is flawed
Part 8: Emphasizing MMJ in the present pushes true legalization back to the future
Part 9: MMJ trivializes recreational and industrial use
Part 10: Fuck the patients
[Bonus] Part 11: It keeps 45,000 pot "offenders" imprisoned
[Bonus] Part 12: It keeps the DEA in business
[Bonus] Part 13: Cities and counties can vote it out anytime
7 comments
Thomas Chong says:
Jul 25, 2011
You must remember medical marijuana has opened the door that can never be shut again so rather than oppose or criticize the the “medical approach”, embrace it. The truth is we all smoke for a medical reason whether we know it or not. Stress relief is probably the number one “medical” reason we healthy people smoke it. “It relaxes me”. ” Helps me enjoy my time off” or helps me enjoy doing boring things. Airline pilots use it for long flights. Athletes use it to wind down after a hard game or practice. Stress relief. But the most compelling argument has to be the “take it or leave it” qualities. Pot is not physically addicting. Studies have shown people who smoked for years can and have stopped cold turkey with no physical side effects. And the good news is stopping a heavy pot habit can be beneficial to ones well being. So don’t get cute and knock the medical approach and realize the number one harmful addiction in America is junk food.
This addiction is killing Americans faster than drunk drivers. Over eating leads to heart problems, diabetics, and a host of other ailments that is encouraged by our so-called American culture of television ads and sit/coms that promote unhealthy habits as a way of life rather than a way of death. Pot, hemp, cannibis was given to us by our Creator when the Universe was created.”I give thee Green Herb and it shall be for meat” Genesis 29. And it was the disgraced President Nixon who gave us the DEA criminal gang and the money draining drug laws. So lets support the medical approach toward pot and educate the masses about the many ills pot can help with instead of trying to be ultra clever with the outlaw comedian approach….tc
Lory Kohn says:
Jul 25, 2011
I could take exception to several of your points. However, you are the co-author of the immortal lines:
mama try to tell me
try to tell me how to live
but I don’t listen to her
cause my head is like a sieve
So you can write whatever you want, whenever you want to write it, and I’ll be grateful for the contribution. Thank you for taking the time to comment.
Don McAdams says:
Oct 15, 2011
Len Richmond’s movie is excellent. Under your picture of the youtube video, you state that, “Schedule 1 drugs can’t be tested on humans.” This is actually not the case. NIDA has a mandate that no Schedule 1 drugs can be tested for any benefits, but tests for potential harm are ran all the time. For a host of research, I recommend, well, Len Richmond’s movie. As something just as valuable, if not more so, is this 20 minute seminar from Dr. Abrams, http://projectcbd.org/Medicine.html#CME . He has over 30 years of NIDA funded MJ research that he talks about, as well as other research being done around the world, Dr. Guzman’s work from Spain being the most ground-breaking to date, mitigating glioblastoma multiforme, or brain tumors. Then I would suggest Dr. Tashkin’s NIDA funded 30+ year study confirming no link to MJ and lung cancer – it even suggested a protective effect from the cigarette smokers. I agree with Tommy Chong and Jack Herer – all use is medical. That being said, the MMJ initiatives may have a huge flaw of not offering enough, especially in the way of research, but it was a necessary step. We would never be talking about full legalization or repealing Prohibition 2 in a serious tone today if it wasn’t for the MMJ road paved for US. And yes, certain indicas high in CBD are better for physical treatments, while sativas high in THC and THCV are better for mental treatments, so recommended strains for the ailments isn’t entirely voodoo… You do bring up a necessary reminder for US all, though – no matter if we’re doing a medical or recreational attempt, research should always be included in the wording…
Lory Kohn says:
Oct 19, 2011
I disagree with your theory that MMJ is paving the way for full legalization, as opposed to blocking it — but respect your opinion. More on this soon. btw, is cannabis effective against spam?
Don McAdams says:
Oct 25, 2011
There is some truth that if Cali would have fully legalized cannabis in ’96, we could likely have 16 legal states today instead of medical states. The growing plethora of medical research could very likely have kept cannabis in a medical box for some time, and may have slowed the repeal / legalize progress. Considering how rigid the government still is on “legalizing,” though, medical really was (and unfortunately still is for the most part) the best avenue to get some freedom. I agree that there needs to be a break from medical to legal, and that would have been nice to see happen already. I believe that its lack of harm and vast medical efficacy will create a rapid shift from medical to repeal very soon, though, and that, almost unarguably, would have never been possible had cannabis not been a hot topic already these past several years, and that would have never happened without mmj initiatives being passed by the People. Perhaps it’s not really a paved road. It’s more like a dirt trail, and we need to get on the interstate. I agree with your sentiment of abandoning the medical model now, that time has come, but it’s not as easy to say for the 34 states that have no mj allowances… Our legalization init is lagging in Ohio, and still has all the hoops to get through yet, while the medical init here has jumped through the last hoop and is now collecting the half million signatures needed to get it on the ballot for 2012. I’m still gonna support both efforts, even though I have no qualifying medical condition…
Lory Kohn says:
Oct 25, 2011
Don, thanks for providing those links and sources to the groundbreaking research that has been performed.
You seem to like to write a bit — how’s about writing an article for CC clarifying what research can and can’t be performed on Schedule One drugs in the USA, and perhaps contrasting those regulations with international regulations?
I will admit that there have been benefits that have evolved from the flirtation with MMJ. For example, it has really pushed the envelope in medibles. I’ll be at my “caregiver,” Evergreen Apothecary today, listening to customers’ tales of how medibles have been helping them with their conditions, a variation on the “treat yourself” theme …
air jordan 11 says:
May 27, 2016
I want to say – thank you for this!