Ohio voters overwhelmingly rejected marijuana legalization on Tuesday, delivering a defeat on state-level cannabis reform.
The 66 percent “no” vote means at least a couple more years of criminal prohibition in Ohio, with all the racial disparities and petty injustices prohibition breeds continuing indefinitely. But the story of Ohio’s Issue 3 isn’t quite so simple as a heartland state deciding not to follow the hippie lead of its western counterparts.
Issue 3 was designed as a giveaway to wealthy investors. Unlike the tax-and-regulate proposals that have made recreational pot legal and profitable in Colorado, Washington, Oregon, and elsewhere, Ohio’s ballot measure sought to give the initiative’s backers a permanent stranglehold on cannabis production in statewide.
Had Issue 3 passed, marijuana could only have been legally grown on 10 pre-determined sites around the state. There would have been no competitive bidding for a limited supply of business licenses. The 10 parcels of land are already owned by a cadre of about 20 investors, including household names like former NBA great Oscar Robertson and former reality TV beefcake Nick Lachey. These investors also financed the multimillion dollar lobbying effort for “yes” votes on Issue 3, and that campaign’s leaders
Any state that legalizes the drug for recreational sale has a legitimate interest in monitoring and controlling the supply of cannabis in the new market. Such oversight is critical both for the kinds of public health issues inherent to any biological product and to ensuring legalization states can harvest tax revenue accurately. In Colorado, Washington, and Oregon, voters approved legalization initiatives that asked lawmakers to create a system of regulations from seed to sale to consumption.
Ohio’s version of legalization offered no such legislative flexibility over how to ensure growers would meet health, environmental, book-keeping, and other standards. It locked in a sort of pot aristocracy, creating a near-monopoly over the production of the drug in Ohio that would have fenced every other would-be entrepreneur out of the cultivation game.
Issue 3’s self-interested backers justify their approach by pointing to a lengthy Rand Corporation analysis of varying approaches to legalization, in which researchers argue that such quasi-monopoly approaches may be superior to the market-oriented approach that other states are taking. The primary benefit to the Ohio-style approach, they say, would be greater state control over physical cannabis plants and flowers and less “diversion” of legally-grown pot into the black market. And because it’s still early days for legal cannabis, it’s hard to say for certain which approach to distribution, cultivation, and sale will be best for states. Shifting from a monopoly system to a market down the road would be easy, but replacing an established market with a monopoly would be very difficult, the report argues.
Ohio’s ballot measure would’ve written the growers’ aristocracy into the state Constitution, however, “thereby entrenching the cartel’s legal privilege” so deeply that lawmakers couldn’t undo it. Entrepreneurs of all ethnicities and backgrounds would have been limited to serving in service and labor jobs at these companies and walled out of the more lucrative ownership class established by Issue 3. (Retail sales companies are a different story, and would-be business owners fenced out of cultivation could have sought one of roughly 1,100 retail sales permits the state would have issued had the initiative passed.)
Some commentators have argued that despite the crony capitalism inherent to Issue 3, the benefits of ending the pot portion of the drug war outweighed the cartel-creation costs. Marijuana prosecutions overwhelmingly target black people, and prohibition has been an important driver of America’s mass incarceration crisis.
But as activists from the Black Lives Matter movement have noted, simple legalization is an insufficient remedy to the acute racial injustices of the drug war. In conversations with presidential candidates, group representatives have stressed “making sure that people of color…do not get locked out of the emerging legalized marijuana economy because of criminal records tied to possessing or distributing marijuana.”
Behind that specific policy question about criminal records, there’s a broader concern: Who profits from legalization? Ohio’s answer to that question helped sink legalization in the state, where 58 percent of voters support allowing adults to possess and use the drug.