Can Big Pot and Big Alcohol Get Along?

Originally published in Talking Points Memo on August 15, 2014.
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On a chilly Sunday evening in early February, as tens of thousands of fans converged on the MetLife Stadium in East Rutherford, New Jersey, America’s first “Bong Bowl” began. The Seattle Seahawks and Denver Broncos—teams representing the only two states in the nation to have legalized recreational marijuana—were facing off to determine who would take home the coveted national football title. As they played, a static spectacle at the edge of the field raised eyebrows: massive advertisements slyly championing the merits of cannabis. Two billboards, one in the blue and green color scheme of the Seahawks, the other cloaked in Broncos’ orange and blue, read, “Marijuana is less harmful to our bodies than alcohol. Why does the league punish us for making the safer choice?”

Five months later the New York Times editorial board is asking the same question: why do we still prohibit marijuana? And the grey lady’s decision – to pit weed against alcohol – fits right up with some of the most vociferous advocates of repealing marijuana prohibition in America.

The Marijuana Policy Project (MPP), the country’s largest national advocacy organization solely committed to ending marijuana prohibition, purchased five billboard advertisements to surround the stadium for America’s most-watched football game. The organization’s goal was to challenge the NFL’s anti-pot policy and provoke a national conversation about the health benefits of marijuana—long-stigmatized and barely legal—compared to that of legal and relatively celebrated alcohol. One advert argued that marijuana is safer than both alcohol and football. Yet another demonstrated that the number of attendees to the last ten Super Bowls was roughly equal to the number of marijuana related arrests in 2012.

Celebrating smoking might have ruffled a few feathers, but the choice that caused the most consternation was to denigrate alcohol in favor of weed. “Marijuana is less toxic, less addictive, and less harmful to the body than alcohol,” said MPP Director of Communications Mason Tvert in a press release just days before the Super Bowl. “Why would the NFL want to steer its players toward drinking and away from making the safer choice to use marijuana instead?”

Once the pipe dream of Deadheads and aging hippies, marijuana is having a moment in State Houses – and editorial boardrooms – across the country. As marijuana goes mainstream, the alcohol industry is guardedly watching to see whether Team Pot can play nice. While not all cannabis advocates push for weed over beer, the voices who do claim weed is, indeed ‘better for you’ are loud, provocative and well-funded. And should it get ugly? The alcohol industry is preparing to fight back and challenge pot’s increasingly anodyne image.

A Growing Movement

Marijuana’s reputation – especially in comparison to alcohol – has undergone a radical change in a very short amount of time.

Nothing better exemplifies the public’s perception of pot during the early and mid-twentieth century than the now infamous 1930s propaganda film, Reefer Madness, where marijuana smokers actually lose their minds. Basically illegal beginning in 1937—when the federal government began taxing cannabis sales—by 1970, the federal government had passed the Controlled Substances Act which officially designated marijuana as illegal, and classified it as a Schedule I drug.

Beer, wine, and liquor reps, on the other hand, benefitted from the sheer American-ness of a good drink at the end of a hard day—a beer at the game, a cocktail at the bar, a glass of wine on a date. What could be more normal? Alcohol was everything, and weed was the margin.

But a lot can happen in forty-five years.

After so long in the shadows, the speed at which legalization is suddenly capturing the support of the American public is impressive; a recent Pew research poll found that 54% of Americans think that the drug should be legalized, up 2% from last year, and up 13 percentage points since 2010. When Gallup first began polling the public on this question in 1969, an era when marijuana had come to represent counter-culture, just 12% of Americans backed legalization.

It’s not just polling data. In July, Governor Andrew Cuomo signed legislation which made New York the 23rd U.S. state to legalize medical marijuana, following Missouri, which passed its own version in May. Over the last eighteen months, 36 states and Washington, D.C. have considered bills that would create new medical marijuana laws, lessen the penalty for possessing marijuana, or regulate marijuana more comparably to alcohol. Come this November, Alaskan voters will decide whether or not to join Washington and Colorado in legalizing recreational adult-use marijuana, with Oregon likely to follow suit.

And then, of course, there’s the New York Times editorial board, which just called for federal legalization, a move that delights marijuana advocates, and lobbyists.

But while for many of us the idea of legalized marijuana falls somewhere between inevitable and fairly distant as a political reality—the alcohol industry is way, way past that. Beer, wine and liquor do not care that legalization isn’t technically on the books. For them, it’s already a foregone conclusion. And that means that weed is already a real competitor.

 

PASS THE DUTCHIE ON THE LEFT HAND SIDE

If alcohol ignored marijuana as a real player in the world of party politics – small p – it’s no surprise. The world of pot smokers has been, for decades, a rag tag assemblage of Americans who smoke on the sly. But all of them shared one thing in common – they were toking up illegally and very few of them were lobbying to change their habit into something that could run as an advert on TV.

Even now, political momentum towards legalization aside, there is no such thing, really, as a “marijuana movement.” Instead, there are movements, and factions. And those divisions – to the degree they are really fissures – will not only determine the future availability of weed, but also how marijuana positions itself vis-à-vis the alcohol industry – both in terms of advertising, but also as a means of what helps this country loosen up.

“There are really two different sets of players on the cannabis side,” said Mark Kleiman, a professor at UCLA and leading marijuana policy expert. “There’s the weed movement and there’s the weed lobby.” Camps that are, themselves, internally divided.

For a long time, the pro-marijuana scene was part of the US counter-culture movement. The first campus legalization group began in 1967 at SUNY-Buffalo college: LEMAR, short for LEgalize MARijuana, was comprised of, as The Washington Post’s Marc Fisher puts it, “15 longhaired hippies who thought they could change the world.”

The “movement” to legalize really got its start though with the founding of the National Organization for the Reform of Marijuana Laws (NORML) in 1970. But at that time, no one would touch their cause, monetarily or otherwise. Indeed, the organization’s financial hurdles were almost its undoing. It was Hugh Hefner, a former alcohol-drinker-turned-pot-smoker, who decided to take a risk and offer NORML a small $5000 investment through the Playboy Foundation. Today NORML functions as a grassroots network with over 150 chapters across the country, promoting marijuana legalization with an emphasis on consumer needs.

In 1995, after months of infighting over strategy and tactics at NORML, some employees left the organization to found the Marijuana Policy Project. The new millennium brought still more players. Americans for Safe Access (ASA) founded in 2002, specifically advocates for medical marijuana on K Street. In 2010, came the baby – the National Cannabis Industry Association, (NCIA) – which promotes the trade interests of the burgeoning ‘cannabusiness’ sector- the likes of which would blow your Woodstock-era parents’ minds. NCIA represents more than 400 companies—like vaporizer sellers and automated rolling machine makers—in 20 states, a number that is projected to rise quickly.

This past June, 1,200 entrepreneurs, consultants, investors, accountants, attorneys and more came out to Denver, Colorado for NCIA’s first ever marijuana business summit.

Jazmin Hupp, a business and marketing specialist from New York City who grew up with a father who used medical marijuana for pain relief and “artistic mind expansion,” was there. Determined to challenge misconceptions around marijuana and those who use it, Hupp gives talks and workshops about marijuana myths; she’s also writing a book about effective branding strategies for cannabis companies. “One of the greatest parts of the conference for me was just the show of professionalism,” said Hupp who is weary of seeing marijuana users portrayed as dudes in dreadlocks smoking weed in dark basements. “I felt really inspired. This is a real industry.”

Cooperation and Conflict

A real industry, maybe, but one that hadn’t, until very, very recently had any perch on Capitol Hill, or anywhere near mainstream America.

That’s changing. In May, all the cannabis organizations lobbied to help pass an appropriations amendment in the House, offered by Rep. Dana Rohrabacher (R-Calif.). The amendment, which barred the DEA from spending funds to arrest state-licensed medical marijuana patients, was tacked on to the Commerce, Science and Justice Appropriations bill for fiscal year 2015. It passed 219-189. ASA issued a statement calling the House amendment “arguably the biggest victory yet in the contemporary fight for medical cannabis rights.”

“Rohrabacher was a real landmark, nobody had expected that quite yet,” said Dale Gieringer, state coordinator of California NORML. “We’ve been working on that bill for years.” Indeed: the first version of the Rohrabacher amendment was introduced in 2003, defeated in a vote 273-152. Five years before that a House Joint Resolution passed explicitly opposing statewide efforts to legalize medical marijuana under a doctor’s supervision. That 1998 resolution marked the first time in recent history that Congress formally took on medical marijuana as an issue.

But looking at the recent Rohrabacher win as proof that the marijuana organizations speak as a united front would be a mistake; some significant differences have emerged between the groups, and more seem likely to materialize in the future.

Marijuana organizations also anticipate fights with the other party drug – alcohol. In part that’s because even as marijuana begins to make positive inroads in public opinion, it can’t touch the role of alcohol in Western society, or Judeo-Christian culture writ large. MPP’s decision to bash alcohol was a gamble; poking the bear.

The Super Bowl was not the first time MPP attacked alcohol in such a high-profile way, and it likely won’t be the last. As an organization whose stated mission is to end marijuana prohibition and replace it with a system that is regulated like alcohol, MPP sees the comparison between the two substances as necessary and strategic.

Last summer, outside the NASCAR Brickyard 400 in Indianapolis, MPP purchased airtime to show an advertisement on the racetrack’s Jumbotron, touting marijuana’s safety compared to alcohol. It was no secret that two major sponsors of the race were Crown Royal Whiskey and Miller Lite. “Our goal is to make this weekend’s event as educational as it will be enjoyable,” said Tvert, of MPP, in a press release. “We simply want those adults who will be enjoying a beer or two at the race this weekend to think about the fact that marijuana is an objectively less harmful product.” The video ad presented marijuana as the “New Beer” –a substance “without all the calories or serious health problems”, that doesn’t contribute to hangovers, and is “not linked to violence or reckless behavior.” While the ad had the potential to reach hundreds of thousands of fans throughout the weekend, the Drug Free America Foundation, a group opposed to marijuana legalization, convinced the owners of the Jumbotron to pull it shortly after it first went up. No matter, its work was done: MPP’s advert racked up more than a million views on YouTube.

MPP has also been leading major state-level efforts to push for marijuana reform. In 2012, they funded the Campaign to Regulate Marijuana Like Alcohol, which was the historic Colorado grassroots effort to legalize recreational marijuana through a ballot initiative. Provocative billboards cropped up throughout the state, like one across from the Sports Authority Field at Mile High featuring a happy woman stating, “For many reasons, I prefer marijuana over alcohol. Does that make me a bad person?” The ad was positioned above a liquor store.

“The Colorado campaign was not run by us at all,” said Gieringer, who stressed that NORML prefers to maintain neutral relations with the alcohol industry. “They took swipes at the alcohol industry and tried to antagonize governors who took money from beer manufacturers.” The campaign took shots at Colorado Governor John Hickenlooper who opposed the amendment to legalize marijuana, arguing that as a former microbrewery owner, he was a hypocrite.

I ONLY SMOKE WHEN I DRINK.

Unlike the squabbling factions of the marijuana world, the alcohol industry long ago learned to speak with a unified voice in Washington D.C. “A lot of the policy vision and positions of all the groups are pretty much the same,” said Mike Kaiser, of Wine America, the trade association representing American wineries. On most regulatory issues, the alcohol industry tends to work together, bringing together brewers and oenologists to file joint comments to the Food and Drug Administration and to the Alcohol and Tobacco Trade Bureau.

Big alcohol, officially, is neutral on cannabis legalization. This hasn’t always been true: back in 2010, the California Beer and Beverage Distributors donated $10,000 towards an effort to defeat a marijuana legalization proposition on the ballot.

Yet, sanguinity on legalization doesn’t mean they will remain neutral on MPP’s rhetoric, or even with the idea of being grouped in the same category as marijuana.

Each industry has a slightly different way of framing the reputational risk to their product. Here the friendly kumbaya bits of the alcohol lobby starts to fall apart. The wine industry for example, feels that cannabis advocates are more focused on marketing weed as an alternative to other forms of alcohol, but not necessarily wine. “I think it’s more of an issue for beer,” said Kaiser of Wine America. “We’re monitoring the situation, but wine is generally considered to be more like a food than a beverage.”

Craft brewers, too, claim marijuana doesn’t scare them. “Craft brewers themselves are generally trying to change the paradigm of what beer looks like in this country, so the marijuana movement is not seen as a competitive thing for us, as it might be with larger brewers,” said Paul Gatza, Director of the Brewers Association, the trade group representing small independent American brewers. (He pointed out that there is often overlap between the populations who drink craft beer and those who blaze.)

Big beer, too, wants to draw a bright line between marijuana and beer. Beer, the implication, is wholesome – it reminds us of picnics, and parades, and baseball. It’s a socially acceptable way to unwind. Indeed the Beer Institute of America’s spokesman, Chris Thorne goes so far as to say it is “misleading to compare marijuana to beer, because beer is distinctly different as a product and industry.” Thorne doesn’t much like to see the two words – beer and marijuana – in the same sentence.

Robert Dupont, a long-time drug policy researcher and founding president of the Institute for Behavior and Health, says he regularly finds the alcohol industry to be quite unhappy when lumped together with marijuana. “They are very upset,” said Dupont, of those comparisons which equate alcohol and marijuana. “It’s really a problem for them, it’s tarring their product with the bad image. I see it all the time in my work with drunk driving, [alcohol folks] don’t like it when I say ‘alcohol and other drugs’ they wish I’d just say ‘alcohol and drugs.’”

And yet, of course, phrasing isn’t really the issue.

According to Pew research released this past April, about seven in ten Americans already believe alcohol is more harmful to a person’s health than marijuana. Moreover, 63% believe alcohol would still be more harmful to society, even if marijuana were as widely available.

DIME BAG BLUES

The billion-dollar question for the alcohol industry is literally that: cash. Will legal weed cut a deep hole into their bottom line? And if weed pushes the point – and wins it – that it’s a cleaner, safer high, what will that do to alcohol sales?

In 2012, the U.S. alcohol industry brought in $197.8 billion in retail sales dollars. If even a small percentage of Americans changed their substance-intake habits, the result would mean billions of dollars lost for the alcohol industry.

Problem is: no one knows what will happen if weed is legal. There is no historical data – even the Netherlands doesn’t have full legalization– so there is no way to judge, exactly how – or really, if – drinking habits will change with marijuana legalization. Are marijuana and alcohol substitutes rather than complementary substances as some studies suggest? Or will – as some researchers maintain – drinking actually increase as marijuana becomes more available? It’s impossible to know what the impact on alcohol use will be, if weed is sold similarly – available, controlled, but accessible, at every bodega.

The only thing researchers do know for sure is that marijuana, if legal, will be cheap. Given the low production costs associated with marijuana—(it’s basically just growing a plant)—experts like Beau Kilmer, Co-Director of the RAND Drug Policy Research Center, estimate that marijuana intoxication could, in a legalized world, cost pocket change. While we’re years away from this reality, you can just picture your high school brother making those economic tradeoffs in his head; weighing which controlled substance he and his friends should try and get next time your parents go out of town.

BREWSKIES AT THE GAME

Beer and wine may be as American as a baseball game, but Big Alcohol doesn’t feel at all relaxed about this debate. At alcohol trade association meetings, pot is already spoken of as a key competitor. A vigorous internal discussion has been taking place within the industry to figure out how they can establish working relationships with the marijuana world, and what to do if they can’t.

“I don’t think there’s necessarily any working together, but there’s certainly been some communication,” said Tvert, of MPP, who has spoken at several alcohol events, like the annual Wine and Spirits Daily Summit, which draws top executives in the wine and spirits industry. “But it’s generally been a matter of curiosity.”

Curiosity is a bit of a euphemism.

At the National Alcohol Beverage Control Association’s annual legal symposium, which draws state regulatory agency officials, corporate counsel, industry policymakers and private attorneys, a representative from the Marijuana Policy Project spoke. Attendees said that during the Q&A, “a couple people stood up and kind of attacked her” about MPP’s alcohol-bashing tactics.

“[T]he marijuana advocates are very unapologetic,” said William Earle, president of the National Association of Beverage Importers, (NABI), the trade association representing U.S. alcoholic beverage importers. “They are basically saying we’re going to continue to demonize alcohol because we think that’s a way to advance our message.”

Indeed, cannabis advocates feel very little pressure. “I’m not really too concerned about the alcohol industry,” said Tvert in an interview. “We are ending marijuana prohibition and it really has nothing to do with them.”

Since alcohol has been such a highly regulated industry ever since the end of prohibition in 1933, alcohol executives wonder, and worry, whether legal marijuana would be subjected to similar oversight. In the mean time, some are quietly reviewing and collecting all the available scientific literature, many of which challenge what they feel to be the public’s one-sided impression of marijuana’s health and safety effects.

For example, in July, Kane’s Beverage News Daily, an influential trade publication, published a piece entitled, “Why Does Marijuana Get a Pass on Pitching to Youth?” It argued that despite research suggesting young people are especially susceptible to social media influence, public health authorities go mum on things like Weed Tweets™, (@stillblazingtho), an unabashed pro-marijuana twitter account with over a million followers, 73% of whom are under 19. A team of researchers at Washington University School of Medicine in St. Louis, led by principal investigator Patricia A. Cavazos-Rehg, has been leading the social media research.

“I think there’s a concern that we’ve gotten our regulatory act together but would we be competing against an entity that does not,” said Earle of NABI. While groups like NORML welcome tight regulations for safe and consumer-friendly marijuana, other groups are interested more by the prospect of self-regulating their industry.

“We’re looking for regulation that’s fair,” said Taylor West, deputy director of NCIA, the marijuana trade association. West insists her organization understands the fragile nature of public opinion, the high level of scrutiny they’re all under, and the need to build a mature industry. “We are encouraging our members to adopt responsible practices from the outset, I think it’s more sustainable.”

With concerns over potential regulatory double standards, hesitant alcohol folks note that it’s much more difficult to monitor and punish drivers who are high than drivers who are drunk, which could hinder law enforcement’s ability to regulate it. It may already be happening: a National Institute on Drug Abuse study released in July showed high school seniors were more likely to drive high than drunk – but what that meant – in terms of affect on drivers, let alone penalty for the crime – was uncertain.

While Big Alcohol has expressed that they would prefer to co-exist amicably in the marketplace, in their minds, the marijuana industry has to make a choice: pot can choose to be their friend, or to be their enemy. And if Big Pot decides they want to continue to launch regular attacks on alcohol, then alcohol will ultimately fight back.

Earle says he finds marijuana’s attitude towards alcohol neither wise nor strategic. “It’s like you have the new kid on the block who thinks they can gain traction by just besmirching everyone else’s reputation.”

And perhaps they can. Or, another likely scenario is that MPP’s strategy could backfire. While there is no known fatal dose for marijuana, the drug is substantially more potent than it used to be. The University of Mississippi Potency Monitoring program found that the average THC level of all seized cannabis increased from 3.4% in 1993 to 8.8% in 2010. Researchers expect it will be only get easier to create and market highly potent marijuana, especially to teenagers, as legalization advances.

Everyone in the party biz knows one dirty little secret: A legal for-profit marijuana industry would, likely, be built around catering to the heaviest users. That’s how the alcohol industry works too: the top 20 percent of drinkers consume four out of five of total drinks sold.

Although the industry’s marketing efforts might feature a successful business executive who smokes occasionally on the weekends with her colleagues, and indeed, most users in a legalized world would only be casual users, the volume of drug consumption doesn’t depend very much on the total number of users. As writers of the book, Marijuana Legalization: What Everyone Needs to Know, put it, “One eight-joint-a-day smoker is more important to the marijuana industry—legal or illegal—than fifty people who smoke a joint a week…if we create a licit market, we should expect the industry’s product design, pricing, and marketing to be devoted to creating as much addiction as possible.”

“The minute you unleash the opportunity to make millions and millions of dollars, no matter how dangerous that is, people are going to try to do it,” said Alex Wagenaar, an alcohol policy researcher at the University of Florida. “Our capitalist system is great for a lot of things, but it’s not a great thing for drugs that are habit-forming, addictive, and have huge health care and social costs attached.”

And once you have more heavy users, you run the risk of greater problems. People who toke up, obviously, like the feeling: the relaxation, the blurring of lines, the mellowing out. Because, let’s face it, we’re not talking about sodas; this is not sobriety. A member of the alcohol industry who asked to speak on background put it like this: “Marijuana is still a drug. Something will inevitably happen, and they have made a huge misjudgment. No industry with any sense of the tort system, or how civil court damages work in this country would be making the health claims they’re making.” Whether that’s a car accident, injury or death—the potential for drug-related accidents certainly looms large.

In other words, while tobacco is, in many ways, far less risky than alcohol, these days, at least, you don’t see tobacco manufacturers putting up billboards calling it safe.

“I kind of view it as naïve,” added Earle, of NABI. “If [marijuana advocates] were good stewards of their lobbying efforts you’d think they’d realize that we’re both in the same regulatory wheelhouse.”

The marijuana lobby, though, is still in its infancy. NCIA hired its first full time industry lobbyist just in the past year. Compare that to the over 200 lobbyists in DC who lobby on behalf of wine, beer and liquor.

“The alcohol industry is massive and dwarfs us,” said West of NCIA, who thinks they are a long way off from the point where they might need to start worrying about their relationship to alcohol. “We’re also just in a completely different place right now in terms of still teaching people about why it makes sense to end prohibition.”

To some extent it’s true that the conflicts have not yet bubbled to the surface, but given the political momentum around legalization the country has seen recently, conflict might not be as far off as perhaps NCIA would like to suggest. The Arcview Group, a San Francisco investment and research firm that focuses on cannabis, valued the national legal market this year at $2.57 billion. They project that number to rise to $10.2 billion in the next 5 years.

That’s the kind of money that will buy a lot more billboards in years to come.

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