The new federal crackdown on medical marijuana announced October 7 by the four California U.S. Attorneys sent chills throughout the industry. It was a stunning reversal by the Obama administration.
Only two years ago, Deputy U.S. Attorney General David Ogden wrote his infamous "Ogden Memo," announcing that the feds wouldn't bother businesses in compliance with their own state laws.
It proved a dose of Miracle-Gro to California, where pot-selling stores have multiplied since voters approved the state's 1996 medical marijuana law. By late last year, California reportedly had more dispensaries than Starbucks outlets.
The same thing was happening to varying degrees in 17 states, from Arizona to Washington, New Jersey to Colorado. In Florida, Rep. Jeff Clemens of Lake Worth submitted a resolution that would put a medical-marijuana amendment before voters next year, although it's unlikely to make it through the Republican-dominated Legislature.
If a constitutional amendment makes it to the ballot, it's likely to pass; a statewide poll in March found that 57 percent of Floridians favor legalizing medical marijuana.
"There's no question this has gone totally mainstream," says Karen Goldstein, director of NORML of Florida and a former teacher. "Once politicians realize people really want this, they'll have no choice but to get onboard."
But the feds' tolerance isn't quite what it seemed. While legal weed grew to an estimated $10 billion to $100 billion industry — no one's quite sure of the exact figure — activists noticed an alarming undercurrent to the rhetoric: Raids on growers and dispensaries actually increased under Obama.
As hundreds of thousands of state-approved, doctor-recommended patients happily bought their medicine in well-lit stores from knowledgeable "budtenders," the ire of cops and prohibitionists rose.
Marijuana supporters figured Obama would call off the attack. In 2006, he told an audience of magazine editors: "When I was a kid, I inhaled frequently. That was the point."
The first sign of Obama's subterfuge came in late 2010, as California prepared to vote on a ballot proposition that would have legalized growing and possessing small amounts of marijuana for anyone over 21. Under pressure from teetotalers — nine former Drug Enforcement Agency chiefs begged Obama to oppose the measure — Attorney General Eric Holder said it didn't matter what Californians thought. The feds would continue to bust people regardless of the election.
The measure got 46 percent of the vote, but not enough to pass. Yet the medical side of things kept going strong — too strong for Obama.
After the Oakland City Council prepared last year to authorize large-scale cultivation centers, Melinda Haag, the U.S. attorney for California's Northern District, issued the first in what would become a series of letters from her fellow attorneys general. She reminded residents — in no uncertain terms — that marijuana was still criminalized under federal law, considered equal to heroin or meth, irrespective of its medicinal value.
Nor did she care what California law said. Her "core priority" would be to prosecute "business enterprises that unlawfully market and sell marijuana" under federal law.
Over the next few months, attorneys general from Maine to Washington wrote their own increasingly menacing letters. In Washington, the feds even threatened to arrest state workers who helped facilitate the industry.
Then the Obama administration released a new letter to "clarify" the infamous Ogden Memo. Deputy U.S. Attorney General James Cole verified the about-face: The only people safe from arrest were the "seriously ill" patients and their caregivers.
Everyone else? Be warned.
The letter didn't target just those directly involved in the trade. Cole was also threatening supporting industries with money-laundering charges for dealing in the proceeds from marijuana. Obama had launched a full-on attack on industries essential to any functioning enterprise.
Laura Duffy, the U.S attorney from California's Southern District, went so far as to threaten media with prosecution for taking pot advertising. (Disclosure: Papers owned by New Times' parent company, Village Voice Media, accept such ads.)
Banks responded by canceling their weed-related accounts. "Perhaps there may be a few financial institutions here or there that are still accepting accounts," says Caroline Joy, a spokeswoman for the Colorado Bankers Association. "Those facilities don't want to reveal who they are."
The president's push grew louder last month. The U.S. Alcohol, Tobacco, Firearms, and Explosives bureau warned medical-marijuana patients that they couldn't legally use pot and own or buy guns.
Then came a one-two punch.
On October 5, the IRS ruled that one of the largest California dispensaries, Harborside Health Center, owed $2.5 million in taxes because federal law precluded standard deductions for businesses engaging in illegal activity.
In other words, Obama was not only blowing off state laws. He was declaring that legal businesses were now nothing more than criminal rackets. And he was carving away every tool they needed to function.
Harborside's owner said he'd go out of business if the IRS didn't reverse course. Dispensaries nationwide saw it as a crippling decision.
Obama was seemingly intent on killing an entire industry — in the middle of a depression, no less. Left unexplained was why, especially since he was giving the finger to voters in 16 states just a year before he would face them in his own reelection.
Democratic strategists were perplexed. Roger Salazar, a California party consultant, believes the president may be trying to reach out to a broader base. But that doesn't explain the attack on his own base; Democrats support medical marijuana at high percentages. It doesn't even make sense in luring conservatives. With the country in economic tatters, no one has weed high on his radar. Except one group, says Salazar: "My sense is it's coming from law enforcement."
Earlier this month, in a timely coincidence, the California Medical Association's board voted to encourage the feds to legalize marijuana. Though spokeswoman Molly Weedn emphasizes that the decision by the doctors group hinges on a call for more research, a report studied by the CMA board before its decision makes it clear that — at the least — marijuana shows promise as a medicine.
The CMA's Council on Clinical and Scientific Affairs "has also concluded that components of medical cannabis may be effective for the treatment of pain, nausea, anorexia, and other conditions."
A new Gallup poll, meanwhile, shows that a record 50 percent of Americans believe that marijuana — and not just the medical kind — should be legalized. The poll follows a continuing trend over the past several years of increasing support for legalization.
Obama has chosen to swim against the tide. But there's reason to believe his fight is about politics, not public safety. If this were about safety, alcohol would be his primary target.
Politics causes both sides to fudge the truth. Yet prohibitionists and the government have been particularly egregious. The government is using taxpayer dollars to prop up its side, with the U.S. Justice Department's 64-page booklet, "Speaking Out About Drug Legalization," being a prime example.
The booklet, distributed in print and online, states that "smoked marijuana is not scientifically approved medicine." Forget that by labeling it a drug on par with heroin, the DEA is curtailing the proper study of marijuana, since it prevents even scientists from possessing it for research. The publicly funded propaganda also flies in the face of the opinion of doctors, who see pot's potential as medicine.
Federal law is, for now, on the side of the prohibitionists. And it's difficult for any politician to stand up for marijuana. He or she will be quickly painted as pro-pothead. Like women's suffrage, the medical marijuana movement has — in ten states, anyway — benefited by the direct democracy of citizen initiatives. These elections have taken the pulse of voters in a way that congressional elections cannot.
In six other states and Washington, D.C., medical marijuana was legalized by local lawmakers. Other states, possibly by petition in Florida, are bound to vote in favor of decriminalizing pot in the next few years in spite of federal laws.
Across the country, advocates are returning fire of their own in the court system. Which means Obama won't be able to do battle by the relatively cheap means of letters and threats. He'll likely end up burning through millions of dollars in litigation — money he doesn't have.
Goldstein thinks the president may have underestimated his foe. In Florida, there's a petition circulating to get a constitutional amendment on the ballot that would legalize medical marijuana. Many of those gathering signatures aren't ex-hippies but young professionals who grew up understanding the benefits of pot. "The government has no idea who it's fighting," Goldstein says.
The latest crackdown may be bad for the pot business, but Obama could be doing much more. He could go after patients. Over the summer, a federal judge ruled that the DEA could peek at the names on Michigan's patient registry. Because marijuana is illegal under federal law, said Judge Hugh Brenneman Jr., patients can't expect privacy.
The feds could also hit pot-tolerant cities. The law doesn't allow municipal workers to be jailed in such prosecutions, but cities or counties could be heavily fined just for setting up zoning requirements for dispensaries.
There's a huge downside to that, of course. Obama will only appear mean and small for having sickly grandmas arrested. And fining cities just enrages residents picking up the tab — the very people the president will need a year from now.
Last week, the feds raided several growing operations in California and Oregon, including one in Mendocino County that appeared to be playing by the state rules. But it seems safe to assume that few of the hundreds of other growers in Mendocino County uprooted their crops in response — just as the hundreds of dispensaries in California did not immediately close their doors after the feds' ominous warning on October 7.
The industry seems to be practicing a form of civil disobedience. And it has tens of thousands of seriously sick people behind it who will holler loudly if they're forced back to the black market.
Landlords, worried the feds will steal their property, will tell dispensaries to move out. Banks won't handle money for pot-themed businesses. Dispensaries will be taxed so heavily that they won't be able to cover the payroll or pay the electric bill.
Yet it remains to be seen whether federal prosecutors, who undoubtedly have even more serious criminals with whom to contend, are willing and able to carry out the threat. When Jack Gillund, Melinda Haag's spokesman, was asked whether her office had the resources to go after every dispensary or grower who doesn't comply with the 45-day deadline, he offered a simple reply: "No comment."
Lauren Horwood, a spokeswoman for U.S. Attorney Benjamin Wagner in California's Eastern District, says Wagner's goal isn't to shut down everything. He's focusing on "large, professional, money-making operations — the commercial operations."
Horwood also says that it's wrong to call it "Obama's crackdown." She says the California U.S. attorneys decided to take action on their own because the situation has grown out of control among recreational users. But she acknowledges that they received Obama's blessing.
It's classic political strategy: Send the underlings out to take the heat while the bosses hide under their skirts.
Either way, the result casts Obama as even more zealous than George W. Bush. Bush threatened owners of dispensary properties in 2007 but never followed up. Meanwhile, Colorado and other states have seen no similar crackdowns. Only time will tell whether Obama plans to destroy the entire medical marijuana industry or merely smack California around for a bit.
"I'm willing to give the Obama administration the benefit of the doubt," says Blair Butterworth, a Democratic consultant in Seattle, where about 100 dispensaries operate. "In California, they may be sitting on uncontrollable drug sales. They need to slap some wrists."
It's easy to pick on California, a state known for its excesses. But Butterworth says: "The last thing Obama needs right now is to go to war nationally with the medical marijuana community."
