This just in:
Image by Ryan Williams Photography.
When I read this New York Times article about a ballot measure in Ohio that would create a marijuana growing monopoly, it hit me like a brick of weed: will “big” marijuana in the U.S. go the way of “big” wine?
In the era following the repeal of Prohibition in 1933, the U.S. federal government basically told states that they could decide internally how they wanted to regulate the production, distribution, and sale of wine and alcohol.
Intended to hamper monopolistic and unfair business practices in our country, the Interstate Commerce Act (1887) would continue to apply to nearly every other commercial category. But alcohol would remain a matter for states to decide.
As a result, every state of the union has its own laws regulating the distribution and sale of alcohol.
More than 80 years after the end of Prohibition, this anti-system had led to the rise of virtual monopolies in many states. Just last month, a new merger of family-owned wine distribution companies in the U.S. created yet another behemoth among behemoths of wine sales. According to Tom Wark, a California-based marketer and wine blogger who has devoted much of his career to battling the forces of “big” wine in this country, “five companies (families) [now] control well over 50% of the alcohol box moving business in the United States.”
Today, as I write this, voters in Ohio are deciding whether or not to pass an amendment that was “bankrolled by wealthy investors [who have spent] nearly $25 million to put it on the ballot and sell it to voters. If it passes, they will have exclusive rights to growing commercial marijuana in Ohio” (New York Times).
The parallels are uncanny.
As more and more recreational marijuana comes online in this country, the wine and spirits industry has been paying close attention.
In September of this year, Republic National Distributing Company, one of the biggest distributors in the U.S., published a report on marijuana’s effect on wine sales in Colorado (recreational marijuana became legal there on January 1, 2014).
According to the author of the study, marijuana sales have had a positive effect on wine sales.
Republic (as it is known in the trade) isn’t the only “big” wine company to look carefully at marijuana sales. I know of least one other major U.S. wine and spirits distributor who has received state funding for marijuana sales feasibility studies (you might be surprised by the state government that funded the research but that’s a story for another day).
Currently, marijuana is completely legal in Alaska, Colorado, Oregon, and Washington. Today, Ohio could become the fifth state to legalize marijuana and at least six other states — including California — are considering legislative paths to legalization.
However you feel about the issue, there’s no getting around the fact that marijuana prohibition is rapidly coming to an end in our country.
When Prohibition was repealed in 1933, Americans were still a long way from the current fine wine culture.
During Prohibition, wine and spirits were produced and sold legally in the U.S. as tonics, in other words, medicine — another uncanny parallel with historic marijuana in this country.
In the more than 80 years since the end of Prohibition, the wine and spirits industry has grown into a major force in the luxury product industry. It’s possible — and in my view likely — that marijuana will follow the same path.
Will “big” wine be the model for “big” weed? We’ll see…