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from THE BOOK
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Bud Inc.
Inside Canada's Marijuana Industry
by Ian Mulgrew
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Current Affairs •
Random House Canada •
Hardcover, 304 pages •
November 2005 •
$35.00 •
0-679-31329-X
Ian Mulgrew takes us inside Canada's marijuana industry.
Stephen Easton sat in a small, spartan office behind
a desktop cluttered with computer printouts detailing
his latest calculations. A senior scholar at Canada's
conservative think-tank, The Fraser Institute, and an
economics professor at Simon Fraser University, Easton
was astonished by the numbers his formula spat out.
If they were correct, marijuana was Canada's most valuable
agricultural product. Forget iconic wheat — golden
shimmering symbol of the country's farming heartland.
Stinky, lime-green pot contributed more to the economy.
Much, much more.
"Over the last three or four years, I think most people now would say
my estimates are low," he laughed. "Especially the police!"
In 2000, Easton figured, Canadian cannabis consumers
annually spent at least $1.8 billion on bud. That's
almost as much as Canadians spent on tobacco —
$2.3 billion. And it means consumption in the previous
decade had doubled. Easton also believed exports to
the United States dwarf those figures.
He projected the size of the B.C. export market alone
at 1,433 metric tons worth $2 billion dollars in 2000
— almost 3 per cent of the provincial GDP. By
way of comparison, that was nearly the size of the B.C.
mining and oil-and-gas sectors combined. Easton added
that the total intentionally understated the value of
the industry because he used only wholesale prices.
It didn't reflect the final sale price, which includes
markups and the cut that goes to every middleman no
matter what the commodity. If you looked at the true
value of the crop in 2000, Easton thought, you could
plausibly produce a figure between $5.6 billion and
$7.1 billion.
The latest figures are as staggering. Pot production
in B.C., which grows the lion's share of the country's
crop, has more than tripled during the last seven years
— from an estimated 19,727 kilograms in 1997 to
79,817 kilograms in 2003. In Ontario and Quebec, the
growth in hydroponic production has been exponential.
Growing pot indoors has become uncomplicated and highly
profitable — in just three months a closet, a
basement, a bedroom, a barn or a bathroom anywhere can
produce a down payment on a house. In most cities, towns,
villages and rural areas across the continent, someone
is doing it. The same is true in Europe. Hydroponic
sales in sunny Spain are skyrocketing — and the
growers are not producing heirloom tomatoes.
Easton estimated that based on the most recently available
2003 figures, wholesale marijuana was worth about $2.2
billion to the B.C. economy — $7.7 billion retail
if consumers paid top dollar. That's larger than the
province's legitimate agri-cultural sector. Across the
country, he estimated that the industry was worth $5.7
billion wholesale and $19.5 billion if high-end retail
pricing is assumed. That's about the size of the Canadian
cattle industry ($5.2 billion).
******
Last year, across British Columbia more than 25,000 growing operations
came to the attention of the police, but they investigated fewer than
17,000 and only about half of those were prosecuted. More than half
the growing operations police raided over the past seven years
resulted in seizures but no charges. Police are charging people in
fewer and fewer cases and seem to be increasingly reluctant to act at
all. The same is true elsewhere in Canada.
******
It's time to admit the cannabis prohibition is a failure. More and
more, it is revealed as a public policy disaster, a crisis for our
communities and local politicians, and a legal quagmire for police and
judges. The damage prohibition causes is exacerbated by the violence
endemic to the pernicious black market it spawns, eroding confidence
in law enforcement and respect for the courts. Taxpayers must deal
with the problems of the illicit pot industry but receive no benefit,
and as long as it's underground, we have no ability to regulate it or
control the commerce.
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