How the Failed War on Drugs Contributes to Inequality in Today’s Cannabis Industry

Cannabis is the world’s hottest new industry. From Canada down to Mexico, and across the Atlantic to Spain and the Netherlands, cannabis has been legalized and fully embraced as an economic boon and job creator. 

Here in the United States, legalization has been slowly creeping through individual states. Dispensaries and ancillary businesses have been cropping up across the country, creating 33,000 jobs in 2019 as they opened. 

While many celebrate as state governments begin to recognize their right to consume and cultivate cannabis, minority communities have not enjoyed the same freedoms. 

Despite the decriminalization and legalization of cannabis in several states, racial disparity in arrests for possession persists across the country. While legal cannabis states usually have lower rates of racial disparity, the rate has actually increased in 31 states since 2010. Today, black people are 3.6 times more likely to be arrested for cannabis than white people.

A 2017 survey by Marijuana Business Daily found that only 19 percent of those who have opened their own cannabis business or hold ownership stake are minorities. Of that 19 percent, only 4.3 percent are black. 

This data is just one piece of evidence illustrating that legalization is not enough. The war on drugs has left a devastating impact on communities of color, a legacy that to this day perpetuates the racial wealth gap and the mass incarceration of black people. It’s going to take a whole lot of conscious work and effort to dismantle the systemic inequalities present in today’s industry. And that starts with understanding the history behind it. 

Don’t know much about the war on drugs? That’s not surprising. It doesn’t exactly paint a nice picture of the United States. But we should talk about it. 

The history of the failed war on drugs

The government-led movement started in the 1970s and had ill intentions from the start. In the 1960s, drugs like cannabis had become increasingly more popular and were associated with rebellion and civil unrest.  

In 1970, Congress passed the Comprehensive Drug Abuse Prevention and Control Act which classified cannabis as a Schedule 1 drug. This meant that in the eyes of the federal government, cannabis had no potential medicinal uses.

Meanwhile, the Nixon administration was expanding the power of law enforcement and anti-drug agencies. Strict penalties such as mandatory prison sentences for drug crimes were instituted. In 1973, the Drug Enforcement Administration (DEA) was created in an effort to target drug use and smuggling. 

A top level Nixon aide has since admitted the campaign was an excuse for the Nixon administration to target “the anti-war left and black people.”

John Ehrlichman, Nixon’s domestic policy chief, told Harper’s Magazine in a 1994 interview “We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities.

“We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.”

But Nixon wasn’t the only president responsible for the war on drug’s far-reaching impact on communities of color. The campaign was greatly expanded under Ronald Reagan’s administration in the 1980s. First Lady Nancy Reagan launched her own anti-drug campaign centered around the slogan “Just Say No.”  

More money was allocated to drug prevention programs and enforcement. Imprisonment for nonviolent drug violations surged in the 80s, increasing from 50,000 in 1980 to 400,000 by 1997.

By the time Bill Clinton took office in the early 90s, calls for drug policy reform had begun. In 1987, the Drug Policy Foundation was created in direct opposition to the war on drugs and they have played a major role in drug policy reform ever since. The ACLU Director Ira Glasser had come out in support of ending drug prohibition as well. 

States on the west coast began passing bills allowing the sale of medical cannabis, acknowledging its potential medicinal benefits. Medical cannabis slowly crept across the states during the 2000s. In 2012, Colorado became the first state to legalize the recreational use of cannabis.

Today’s Industry

Many states, including Massachusetts, have implemented equity programs meant to enable participation in the industry by minority individuals from communities affected by the war on the drugs. The implementation of these programs was a huge step in a right direction, but they are not without their faults. 

In Los Angeles, where recreational sales began in January 2018, the two-year-old equity program has been widely criticized. Less than 20 of the 100 businesses waiting to receive a license are black-owned. And only six of the 200 dispensaries previously approved for medical sales are black-owned. 

When the city began reviewing social equity applications for new storefronts in September 2019, they planned to give out 100 social equity licenses on a first come, first serve basis. 

Shortly after 1,800 businesses submitted applications, allegations that some had received early access to the online application portal surfaced, leading to an independent audit of the process. The audit kept the application process in limbo for eight months. 

The freeze only led to more problems for equity applicants. Those in Phase 3, which requires an active lease on the property where they intend to run their dispensary, were forced to pay rent for those eight months. A survey done by the Cannabis Equity Retailer Association estimated that applicants spent more than $10 million on rent collectively since September 2019.

Furthermore, some activists say the applicants who secured those 100 spots are not an accurate representation of LA’s war on drugs victims. Only 18 of the 100, they said, are black-owned.

Similar issues have been noticed in Massachusetts where economic empowerment applicants waited on the sidelines for two years watching other cannabis companies with more capital, usually led by white men, open across the state. It wasn’t until earlier this year that the state’s first black-owned dispensary was approved and finally opened its doors in Boston. 

And the aforementioned racial wealth gap remains a huge obstacle as well. While the Massachusetts equity program prioritizes economic empowerment applications and offers them reduced or completely waived fees, there are still several financial aspects to the industry that make opening a cannabis business nearly impossible without enough capital. 

There is still a lot of work to be done in making the industry a more equitable space. Equity programs that don’t address racial wealth gaps will continue to fall short. Programs created without input from activists and community members will never fully address the needs of minority communities. Programs that enact complicated and costly procedures to obtain a license will also continue to leave those communities in the dust. Equity applicants must be prioritized, financed, empowered. And big-name cannabis companies must be held responsible and do their part in giving back to the communities this industry was built off of.