The Future of Cannabis
Tammy and Meital Take a Hard Look at the State of the Industry & Ask: Is This Sustainable?
We’re back with more answers for your cannabis legal questions. Joining me again, we have attorney Meital of @420attorneys.
Meital: You've talked a little bit about the resurgence of ‘reefer madness’ in the media. Tell me about that.
Tammy: Oh, gosh, you know, we're getting to the point where the fever pitch for cannabis is reaching an all-time high.
One of the beauties of prohibition was it forced everyone to look at this plant. So an unintended consequence was that they made it very popular by prohibiting it.
And now we're seeing the media attacking the plant.
I know Fox News mentioned that the Uvalde shooter was somebody that was just sitting around smoking reefer and then he went and shot up a school—but that's not the cause of why somebody would go murder. It’s irrelevant.
It goes back to the the crazed Mexican that murdered a woman and children after he smoked the devil's lettuce. And none of this is true.
But again, when it comes to trying to get people afraid, they don't care if it's factual or not.
And it's the point where they're going to start relating it to Communism. If you look at the wheel of how prohibition is played out, Communism is going to be the next focal point for why cannabis should be illegal.
The story will be that the communists want you to smoke to make our country weaker and our people dumber.
And this strategy is working. There's an article out about edibles being so dangerous. And we're talking about plants. You can get liquor at Ralph's, Walmart, Target, and football games anywhere.
I was at the grocery store, looking at the wall of alcohol, and I was like, “Wow, one of those bottles contains death. Somebody's gonna get in their car and drive and kill somebody.” I was 100% sure that one of these items is going to cause death or harm.
Edibles are going to cause you to eat a lot and probably go to sleep. That's the most dangerous thing I would say. And then if you eat too much, you might feel like you're gonna die, but you won't.
Meital: Yeah, I think the media is looking to sensationalize. So if there's a robbery, it's way more interesting if it's at a dispensary for marijuana. And it confirms the association.
Tammy: Yeah. News isn't news anymore. It's entertainment. It's entertainment news. It's not factual. And then the stuff that is true, it's boring. So we have to sensationalize it.
This plant has gone through that before and it'll survive it again. But I feel that if you consume, you owe it to your use and what it does for you to tell the truth because it's begun.
Meital: Have you ever gotten so high that you can't function? What is your best story?
Tammy: Gosh. I ate 30 milligrams on a plane. And then I was like, “Wow, this feels way stronger.” And then I realized I ate 300 mils.
So I cried on the plane for five hours. And I was like, “How am I going to drive my car at the airport? I can't drive.”
I was so emotional. It was the worst plane ride.
When I finally landed, I'm walking to get my car–I flew all the time at Delta Airlines so they met me. They knew I landed, they met me, and they grabbed my bags. I don't know how I sobered up enough in time, but it had to be in the last 10 minutes.
Meital: How did you mistake 30 milligrams for 300?
Tammy: Oh my gosh! In Michigan, the labels were confusing. I thought the whole candy bar was 100 milligrams, but instead each piece was 100 milligrams.
Meital: Oh, like they were saying that the dose was one square, but you thought it was the whole bar?
Tammy: Yes. And this was before legalization. This is 2016. So I had a blanket on my head and cried.
Meital: So recently, I was at a lawyer event and a lawyer from the state of Texas gave me an edible.
So she says it’s a Delta-8 gummy and it's weaker. I thought, “Well, I'm not sure, maybe I'll just split it.” So thank God I split it with another attorney and then that other attorney and myself went two separate directions.
We had our evening and then we circled back the next morning. And both of us were dead then.
We thought we were taking the equivalent of five milligrams, but it was the equivalent of 30 milligrams. I have this total blackout moment that I have never had and was confused as to why I'm laying in my bed and incapable of getting up.
Tammy: I wonder if Delta-8 edibles have a different effect than Delta-9. I personally have not gone onto the Delta-8 train.
I'm in LA where there's Delta-9 everywhere.
And I know that some Delta-8 is synthetic. So I just stay away from it.
But I'm interested to know if it actually is a similar high or even stronger in some cases.
Meital: What was explained to me was that apparently they have to use fillers. It’s glycol or something. And so because they have to fill it with more stuff, it becomes more potent in the body. So it actually can be stronger than a Delta-9 gummy.
I generally stay away from Delta-8 as well. But it was just an opportunity. But it was very interesting.
It's a wild ride that further highlights the problems of this patchwork of laws where every state is different–no consistent labeling, no consistent dosage, no consistent regulations. And, you know, increasingly that stuff is hitting the market.
Tammy: I mean, they don't understand it and that's clear. CBD is legal if it comes from a hemp plant, but not a cannabis plant.
But you tell me when you put that CBD under a microscope what the difference is? Nobody can tell. A molecule is a molecule, whether it comes from a CBD plant or from a hemp plant or a cannabis plant.
And fun fact–they're the same thing, which is why your drug dogs can't tell the difference between hemp and cannabis. THC has no scent.
Meital: Well, cannabis is the name of the strain right? Of the plant.
Tammy: The scientific name. Hemp is a legal definition. If it's below 0.3% THC, it's hemp. But if it's 0.4%, it's Cannabis Sativa. If it is a high CBD, low THC, it’s the sativa strain. That's literally how it's marketed as hemp–it’s just a legal term.
Meital: Yeah. It's crazy. We just wrote an article called The Great Hemp Conundrum. And that's the third time I've written that article.
So over the years, we just revisit this issue. And it's so different every time.
Tammy: It's insane. But gosh, you can tell that as a nation, we're not really understanding.
States have CBN legal, but THC is illegal. And it's hilarious that you don't know why.
CBN is just a degradation of THC. That’s all Delta-9 is. It's psychoactive–maybe not as much as THC, but it's psychoactive.
Meital: I don't know what's going to happen. What's the future like? For cannabis, and for The Cannabis Cutie?
Tammy: Oh, you know, I thought that I wanted Federal legalization. I don't. I want to see this issue stay with the States and for the lawmakers to educate themselves.
I honestly want to believe that lawmakers are just ignorant of the science in the endocannabinoid system.
But if they learn all of this, and they still hold this same position, then we understand that there's much more at play.
Ideally, we learn, we grow, and we change our habits. But if not, the fight goes on.
I also have a fear that the Supreme Court might take this away from us because of what they just did to women. So I'm very worried about the future of cannabis.
But I also still have those glimmers of hope some days. And then there's other days, where you see what's happening and it worries you.
Meital: Yeah. I'm really worried about small businesses. I feel like the various licensing programs are messy, especially in California. We're seeing so many folks here in the industry that are struggling.
But I'm excited about some of the new developments–like New York. I think it’s really exciting to see a whole new industry emerge.
Tammy: Yeah, there is. There's no choice. I mean, you look at Oklahoma. That would be an ideal state because they’re central. So if they were able to do interstate commerce, they could be a distribution hub.
Meital: Well, they’re already doing that.
Tammy: Yeah. But interstate commerce is such a huge issue. And not every state wants to be huge cultivators. Some would rather just be distributors.
I know there are three different pieces of legislation that are in the House right now. Is it the MORE Act? Then there's another act that I know is being pushed hardcore by Chuck Schumer. I can't think of the name. It's a bunch of letters.
Meital: So you're talking about SAFE Banking. Oh, or the CAOA Act?
Tammy: Yeah, a whole bunch of letters.
Meital: Which used to be the CARES Act, I think?
Tammy: There's so many of them. Yeah, they all die. There's no point in following them, they're gonna die. You know, as soon as they make it through the House, they'll die in the Senate.
Meital: So how does the law or the regulation of cannabis affect your kind of business?
Tammy: So I'm non-plant touching. I'm mostly wanting to consult and help people. Like, if you have a product, I can help you with positioning or finding your target market if you don't know. I'm gonna help you there.
But I try to stay away from any kind of businesses that are plant touching. I don't feel like the time is right, especially for someone who's smaller.
In California, you've got to have upwards of a million dollars to be successful.
And I just don't see the point in jumping in right now with so much oversaturation.
So I want to help the businesses that are coming into the industry and would like a cultural perspective of somebody who actually consumes and understands the plant and is ingrained in the culture.
Meital: I love that.
Tammy: How does legalization affect the pricing of cannabis?
Meital: This has been a really interesting thing to watch, at least in California.
I think it's kind of true state by state—initially in the emerging market, the price is set.
And then we start to see, depending on the tax and the regulatory framework, how businesses can price their cannabis.
In California, it’s more expensive because regulated cannabis is way more expensive from a tax perspective to the consumer.
But on the back end, the wholesale price for growers and manufacturers has dropped heavily. And I think that's because over the years and over time, cannabis has become a commodity.
So it's become like the production of anything else.
And so we've really seen the price drop on the wholesale side.
When I first started practicing law, a pound would wholesale for $5,000 to $6,000. And now it’s maybe $3000 if it's top shelf.
So on the wholesale side, the price is really going down. The retail side—I don't really go to that many retail shops, so you tell me. What is your experience at the store?
Tammy: I don't really go to retail shops. But I know that taxes are between 23% and 34%.
So even if you're getting $100 worth of product, you still have another $23 to $34 in just tax. That's another product, honestly.
Meital: I would say I've seen on the retail side that the price has pretty much stayed the same. The only thing that I would say is that certain retailers have their own in-house brand that they can sell at a lower price.
But for the consumer, I think the price goes up for regular brands.
It's kind of this weird thing that as the price goes up for the regulated cannabis for the consumer but it goes down for the producer on the wholesale side.
All of these costs are regulation and taxes and not from the producer or manufacturer. So I think that's an issue that we're seeing with legalization.
I think that as each market becomes more and more mature, we're going to see an increase in taxes happen.
And I think with Federal legalization, that's going to be even more true. I think it's going to bottom out even more on the wholesale side and maybe go up.
Tammy: Is this sustainable?
Meital: I don't think it's sustainable in the way that it's structured right now. I think that we've been anticipating a large consolidation of licenses and brands by some of these bigger folks.
And I think that we're gonna have these big mega companies that are going to be there. And then you might get a franchise model, which would be interesting even as a social equity component.
But, yeah, I don't think it's sustainable, at least not on the business side. So we'll see what happens. It'll be really interesting.
Tammy: Would it be cheaper for someone to just go get their own plant and grow it and harvest it that way?
Meital: I have tried. It is not easy. Have you?
Tammy: I have tried. I did not succeed. I was doing it outdoors. It was a very hot summer. And the ashes stuck to the resin of my plant.
Meital: So in my office, we grew here for a season or whatever, maybe a year. And so we were growing them indoors. And then we got complaints from the rest of the office. So then we took them outside and they died.
Tammy: Oh, wow. Somebody didn't like the smell of the skunks.
Meital: Yeah, it was really strong. I mean, I get it. There's skunks in the building. I know the lawyers upstairs are growing weed.
Tammy: Well, maybe one day we can make it so that it's easy for people to grow at home and then they can save some money by growing from harvest to harvest.
Meital: Yeah, I guess you could grow your own tomatoes, your own lettuce, your own apples, but are you going to?
Tammy: You know, I do attempt it, especially knowing what we know now and what we all learned during COVID. So I do attempt it, I'm just not good at it.
It's like, once upon a time in America, everybody knew how to garden or how to grow their own food before we had mass commercialization of fruits and vegetables. So I think it's just a way to go back to land.
Meital: Yeah, I've tried it so many times. Every Spring I plant a brand new roof garden. And then they die.
Tammy: Yeah, I tried herbs. They fried.
Meital: So I don't know about the price of weed. I think it'll level out at some point. But we've been on this weird pendulum for many years.
I think it went down for the producer and I think it's bottomed out and starting to come back up. But it's still pretty low.
Tammy: Well, good discussion. I learned so much.
Thank you for joining us again. Stay tuned for more—we'll be coming at you very soon. Take care.
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