Obama trip draws marijuana protests

[CambsBill]

Who says the FT headline writers don't have a sense of humour

http://www.ft.com/cms/s/0/ed53f1de-d5b7-11e1-a5f3-...

[Marf]

Can't see it, not a subscriber.

[Oakey]

FT.com said:

Supporters of medical marijuana protested over President Barack Obama’s fund-raising visit to Oakland, California this week, vowing to pull their votes for the incumbent because of a recent federal crackdown on cannabis dispensaries.

Federal agents have raided several dispensaries – which are legal under state, but not national, law – and disrupted their operations by advising landlords, banks and credit card companies to stop working with the businesses.

They’re using these backdoor channels to attack dispensaries,” said Aaron Smith, executive director of the National Cannabis Industry Association, a trade group. “We’re asking President Obama to call off this unauthorised war on medical cannabis.”

Since Mr Obama came to office, his administration said it would de-prioritise prosecutions of medical marijuana users, instead devoting federal resources to serious, illegal drug traffickers, while respecting local and state laws.

Dispensary operators and supporters view the raids as a violation of that policy. Hundreds of them gathered outside Oakland’s city hall on Monday and surrounded the theatre where President Obama spoke that evening.

The mellow crowd wore beaded necklaces in the shape of marijuana leaves and carried signs reading “Obama Keep Your Promise” and “Fight Crime Not Cannabis”.

“Obama needs to reign in his dogs,” said Jeff Faure, a pharmacy manager who uses medical marijuana to treat chronic pain and migraines. “The government has its hand out for the dispensaries’ taxes, but then they go in and shut them down.”

Currently, 16 states have legalised medical marijuana. California’s tax authority estimates annual state-wide sales revenue for medical marijuana is as much as $1.3bn, generating sales tax up to $105m.

Several cities that have been struggling to make ends meet in the economic downturn have looked to local dispensaries for additional tax revenues. In Oakland, city officials tripled the business tax on dispensaries in 2010 to 5 per cent. Last year, it received $1.4m in taxes – 3 per cent of total business taxes for the city.

“You can do a lot with that money in a time when we’re closing libraries and youth programmes are being cut,” said David McPherson, the city’s tax administrator. “So it helps.”

From a fiscal standpoint, Mr McPherson would rather not see Oakland’s dispensaries shut down. But two of the city’s four have been targeted by federal authorities in recent months, including Harborside Health Center, the largest dispensary in the US.

That organisation received a letter from the Northern California US attorney’s office earlier this month threatening to seize the property from the landlord if he did not evict the dispensary.

In April, federal agents raided Oaksterdam University, an organisation that sells medical marijuana and teaches entrepreneurs “cannabusiness.” About 100 agents stormed the centre's seven locations early in the morning, said Richard Lee, the founder, taking all the plants, cannabis products, money, computers and files.

Though he does not know which federal agency was behind the raid because the order is sealed, he said the Internal Revenue Service had targeted him for violation of an obscure tax law that says that businesses that are considered illegal under federal law are not allowed to deduct standard business expenses, such as rent and supplies, from their income.

Other dispensaries have been hampered or effectively shut down by efforts of the Treasury department, which has advised banks to close accounts associated with medical marijuana businesses and told credit card companies to stop processing transactions from dispensaries.

“It makes it difficult to pay payroll and tax if you don’t have a bank account,” said Mr Smith, from the cannabis trade association.

Voters in three states will consider the legalisation of marijuana for recreational use in November, including Washington, Colorado, and Oregon, with supporters touting the hundreds of millions of tax revenues as a benefit. A similar ballot in California failed in 2010.

Still, the issue is unlikely to feature prominently in the presidential race. Mitt Romney, the Republican contender, has said he is opposed to the legalisation of marijuana, but that it was an issue for the states. Mr Obama did not mention it at his Oakland fundraiser.