The Future of Cannabis is Corporate

Monsanto, the large agricultural seed company often synonymous with genetically modified foods, may be going after the cannabis industry.

Bayer AG, the multinational chemical and pharmaceutical company, is “advancing together” with Monsanto, recently purchasing the company for over $60 billion.

The Monsanto acquisition by Bayer AG also means syndication with Bayer’s core relationship banks — Bank of America, Merrill Lynch, Credit Suisse, Goldman Sachs, HSBC and JP Morgan.

As George Carlin said, “It’s a big club and you ain’t in it.”

Or, as Goldman Sachs CEO Lloyd Blankfein put it, 

“That all industries are being disrupted to some extent by new entrants coming in from technology. We, again, being, you know, technology-oriented ourselves, try to disrupt ourselves and try to figure out what’s the new thing, and come up with new platforms, new forms of distribution, new products. But in some ways, and there are some parts of our business, where it’s very hard for outside entrants to come in, disrupt our business, simply because we’re so regulated. You’ll hear people in our industry talk about the regulation. And they talk about it, you know, with a sigh: Look at the burdens of regulation. But in some cases, the burdensome regulation acts as a bit of a moat around our business.”

As legalization for incidental possession rolls out, state-regulated practices give companies with a lot of capital, such as Bayer-Monsanto, a reason to influence how cannabis is produced and what extractions can and will be derived from it.

If Trudeau’s “Legalization 1.0” looks like prohibition 2.0, what kind of influence would BC Bud’s decentralized and competitive extractions industry (still regarded as illegal) have against the money and influence of multinational corporations?

Scotts Miracle-Gro has long been partnered with Monsanto to spread their RoundUp brand.

Within the last year, Monsanto has expanded that partnership to provide a “diverse range of lawn and garden solutions.”

To what extent? Non-selective herbicides or capital goods for growing cannabis?

Hawthorne Gardening Company is a front group for Scotts. “A wholly-owned subsidiary focused primarily on the emerging areas of indoor and urban gardening products,” Hawthorne has been buying up the capital goods sector for cannabis production.

Starting in Colorado where Scotts bought the struggling AeroGrow company in 2013, after a tripling of sales in three years, Scotts formed Hawthorne and bought out Gavita, a lighting company, and the nutrients firm Botanicare.

As Scotts acquires the cannabis capital goods sector, Bayer AG is partnering with GW Pharmaceuticals on a marketing strategy, “pioneering new cannabis-based treatment.”

While regular Brits are fined and imprisoned for cannabis, the world’s largest cannabis farm is in Kent and run by GW Pharmaceuticals.

But, instead of extracting quality shatter or cannabis oil, they extract patented products like Sativex.

Cannabis connoisseurs have every reason to be cautious of these companies’ interest in cannabis.

Like with seeds, foods, and medicine, these companies have no problem using patent laws and government lobbying to protect their top-dog status.

According to the “Marijuana Don” Mike Straumietis, owner of Advanced Nutrients, Monsanto was behind the legalization of cannabis in Uruguay so they could quickly patent their own cannabis seed.

The writing is on the wall. The future is corporate. It’s not some “conspiracy theory,” it’s the fact of state regulation. “Public-choice” economists call it rent-seeking. “Austrian” economists describe it with precision.

State regulations in farming, foods and medicines undermine free market competition, rewarding capital-intensive, large-scale agricultural and pharmaceutical companies.

A cannabis regime preventing new entrants from emerging, that protects the companies already on top, will not legalize cannabis in the liberal sense.

Canada’s BC Bud market can be a gateway to fixing that. A regime that emphasizes market-based regulation, spoiling false beliefs about free markets, private property and “unregulated” commerce.

A regime that is exempt from traditional statist regulation, undercutting corporate giants, influencing those in non-cannabis sectors, and finally breaking the bureaucratic mold the state has placed on entrepreneurs.

Or, cannabis in Canada can be a victim to the crony-capitalist model the West operates on.

So far, the odds look in favour of the latter.