Win or lose, the marijuana legalization measure on November's ballot proves one thing: The pot industry has arrived in California politics.
Oakland's most prominent purveyor of medical cannabis has almost single-handedly financed the Tax Cannabis 2010 campaign — a once-unthinkable occurrence. Election experts say it's a sign that the pot industry has reached a rarefied political pinnacle: Pot can afford to buy its way into voter-approved legitimacy.
Just as PG&E spent $46.4 million to push Proposition 16 and Mercury Insurance spent $15.9 million to push Proposition 17 to further their own interests this spring, so too is Oaksterdam University in Oakland shelling out millions to invest in its own economic future.
And Oaksterdam's owner, Richard Lee, could arguably make a mint if the measure passes.
Sure, the June primary's two corporate-backed measures failed. This one might, too: Early polling shows voter support is soft at best.
But legalized or not, marijuana, long an underground, counterculture province, is taking its place in California's political and business establishment alongside "The Man" — traditional corporate interests such as power utilities and insurance companies.
For his part, Lee agrees, though he doesn't embrace being "The Man."
"When we started the campaign, we did want to make this a legitimate political issue and I think we've succeeded already, win or lose," he said.
He and his measure's supporters have done so by framing it not just as drug legalization but as an issue of civil rights, by claiming hypocrisy in the legality and rampant advertising of alcohol; by arguing that a booming, legal cannabis industry could create much-needed jobs; and by touting public policy benefits, in that law enforcement costs would plummet while local governments could reap a windfall of new tax revenue.
But they'd not have had the forum to make these arguments in earnest had Lee not shelled $1.4 million of his own money to put the measure on November's ballot.
"If you have enough money, you can qualify almost anything on the ballot," said Bob Stern, president of the nonprofit, nonpartisan Center for Governmental Studies in Los Angeles. That goes for marijuana just like any other industry.
"Clearly it's going to be the most controversial and interesting measure on the ballot, it'll be the measure most people will be talking about, so he's clearly achieved that — it will be front and center in the debate," Stern said. "I think it'll increase voter turnout, both on the libertarian and the liberal sides."
San Jose State political science professor Larry Gerston agreed.
"You see an opportunity and you take it," Gerston said. "I can't fault these people for being enterprising capitalists in a market that is virtually unregulated. They're pretty smart.
"These guys will have lobbyists; they're already building trade associations. It's all part and parcel of a burgeoning industry."
Some might say Lee stands to make a lot of money, more so if the measure passes. He has built a business infrastructure that includes a medical marijuana dispensary, a grow operation and a center that teaches others how to grow, all of which would put him at the forefront of recreational cannabis horticulture, sales and marketing as soon as it's legal. Even if it doesn't pass, the campaign is drawing attention to Oaksterdam University and its related businesses.
Lee said he doesn't see it that way.
"It's also a big risk, it's putting a big target on me, not to mention all the money that's being lost," he said. "And I see it as making it possible to have more competition."
The politics of pot
Signs of the industry's political mainstreaming abound. Oakland last year became the first U.S. city to tax medical cannabis proceeds — a tax masterminded by Lee.
"My goodness, that was a stroke of brilliance," Gerston said, in terms of legitimizing and mainstreaming the industry.
Last month, workers at Oakland cannabis businesses including Lee's joined United Food and Commercial Workers Local 5. Some now wonder whether union slate mailers this fall will urge a yes vote on the Tax Cannabis measure.
On the national scene, 14 states and the District of Columbia have adopted medical marijuana laws; bills are pending in other states, and voters in Arizona and South Dakota will see such ballot measures in November, as California and possibly Nevada vote on recreational legalization measures. And politicians on either side of the aisle — including Oakland mayoral candidate and former state Senate President Pro Tem Don Perata, a Democrat, and former New Mexico Gov. Gary Johnson, a Republican — endorse Lee's measure.
In fact, about a month after Perata's endorsement, Lee's S.K. Seymour LLC gave $10,000 to Perata's committee for a tobacco-tax measure. Coincidence, or a classic you-scratch-my-back-and-I'll-scratch-yours political moment?
Of the $1.41 million Lee put into his own measure, almost $990,000 went to Masterton & Wright, a Bolinas firm that gathers petition signatures for ballot measures.
But the campaign also is paying top-shelf pros such as spokesman Dan Newman, who also works for Democratic lieutenant governor nominee Gavin Newsom's campaign and for the "Level the Playing Field" independent-expenditure committee waging war on Republican gubernatorial nominee Meg Whitman. Blue State Digital, a Washington, D.C.-based firm with past clients including the Obama for America presidential campaign, the Democratic National Committee and the AFL-CIO, designed the measure's website. And Chris Lehane, a renowned political communications strategist dubbed a "master of disaster" for his spin work in the Clinton White House and campaigns, is doing work for the campaign free of charge.
"It's a serious campaign, it's gone beyond working on the fringes," said assistant professor Corey Cook, director of the University of San Francisco's Leo T. McCarthy Center for Public Service and the Common Good.
Raising the green
It will be an uphill battle. Of three polls released last month, only the campaign's own showed more than 50 percent support, and even then by only a small margin. Any California political observer would say that's a tough place from which to start.
Lee said the campaign is using focus groups in order to target undecided voters and mobilize new voters, but he's done paying the bills.
"My main part was getting the language written," he said, "and then getting the petitions to get it on the ballot, and then to turn it over to the professionals to get it passed."
Yet an e-mailed fundraising plea raised $50,000 in April, he said. "We hope to raise $10 million, $10 each from a million people," Lee said, acknowledging that's not much for a California ballot measure but arguing a little will go a long way on the issue. "Our numbers go way up when we explain the issues and the measure in depth."
Cook agreed: "$10 million is nothing in California," he said — especially given the rise in advertising rates likely to accompany record spending in 2010's gubernatorial and senatorial elections. "But I would kind of be surprised, given a lot of other things going on in the state, if there's a lot of money pumped in on the 'no' side."
A "Public Safety First" coalition with members such as the California Police Chiefs Association, Mothers Against Drunk Driving and the California Bus Association already is speaking out against Lee's measure, yet none of these groups has deep pockets.
Meanwhile, Tax Cannabis 2010 is building people power: Its Facebook page is "liked" by more than 97,000 people. For context, Democratic gubernatorial nominee Jerry Brown has just more than 27,000 and Republican gubernatorial nominee Meg Whitman has close to 28,000.
"Three times as many contributions and three times as many votes, and you're in good shape," Cook observed, noting Facebook support doesn't necessarily translate to either. The committee won't report its finances again until early August.
Yet Tax Cannabis 2010 might have advantages that last month's corporate-funded measures lacked, Cook said.
PG&E and Mercury Insurance tried to educate the public for the first time about problems that, to many, seemed like no problem at all, while this measure addresses an issue that has been talked about for decades. "There's an idea that its time has come," Cook said.
"Part of it is the aging of the California electorate," he added, noting baby boomers in their 50s and 60s in many cases did and still do smoke marijuana. "That is the establishment now."
And while efforts to legalize marijuana always could have been framed as a revenue-raising effort, there's no better time to make that pitch than in the midst of a national recession and state fiscal crisis.
"This was a solution in search of a problem, but now there's a problem that matches it," Cook said, adding Lee and the measure's supporters "would be crazy not to be taking advantage of the political opportunity that's in front of them."
Contact Josh Richman at 510-208-6428. Read the Political Blotter at IBABuzz.com/politicalblotter.
S.K. Seymour LLC, formed in 2006, names Richard Lee as its sole manager and controls a variety of "cannabusinesses":