Broke? Try Selling Pot

Tony slams shut the trunk and climbs into the driver's seat. He sets his phone down on the console and turns the ignition. I sit in the passenger seat. Tony is a lot like any other 20-something California guy. His cell phone buzzes constantly. He's working on a college degree. He has a girlfriend. He's even started his own business.

But I have to ask him, as he backs the car out of the parking spot, how much marijuana are we driving around?

"Forty-four plants," he laughs. "Not that many."

Not that many?

Tony makes his living growing and tending clones -- marijuana plants -- that he distributes to Sacramento medical cannabis dispensaries.

While he makes a delivery, he's letting me tag along -- with a few stipulations, of course. First, "Tony" isn't his real name. Second, some details about his life and business have been tweaked or left out here. While he insists that his operation is legal -- California's Proposition 215 legalized marijuana for medical use -- he still worries about legal action from the Feds, as marijuana is still illegal under federal law.

Young Americans have taken a hard hit in this recession. The New York Times' Steve Greenhouse's coined the term "Generation R" -- "the millions of teenagers and 20-somethings struggling to carve out a future for themselves when the nation’s economy is in its worst shape in decades." Borrowing Greenhouse's term, academics have launched the website Generation Recession, which studies the short- and long-term effects of the economic climate on young Americans.

While jobs remain painfully scarce, some young people are finding employment in the medical marijuana industry. Tony is one of them. Of course, legal or not, selling pot in California has always been a profitable business endeavor. Now, though, it's gaining traction as a legitimate business. Several factors are probably influencing the change, including revenue in a recession and politicians both liberal and conservative speaking out about the downside of continued prohibition.

As he drives toward a dispensary, past half-empty shopping centers, Tony tells me his story.

A couple of years ago Tony was laid off from his government job. With work scarce, he tried something new: "Then I started selling buds online to cancer patients," he says.

Business was good. Soon he was making just as much as he was at his desk job. Business grew until he was distributing clones to Sacramento-area dispensaries. Tony prides himself on carrying strains nobody else grows.

The idea behind cloning is deceptively simple: take a productive marijuana plant, slice off one of its branches, then plant the branch until it produces its own buds.

Simple? Yes. But it requires a lot of work -- and a lot of investment. On a good month, Tony makes around $10,000 in sales. But his monthly expenses, including the staff he uses to tend the plants, can run upwards of $8,000.

We pull into the dispensary parking lot. It's a small, unassuming building sitting on a major road. Driving by, you'd have no idea what was sold inside. I help Tony carry the clones inside, plastic bins filled with foot-high plants.

Inside, three workers man the counter -- "budtenders" they're called. Tony says he sees mostly young people working the counters because it's a lot like any other retail job.

The medical marijuana business has boomed since California was the first state to approve its use in 1996. Since then, 14 more states and Washington, D.C. have approved medical cannabis by ballot initiative or legislation.

Just how much money is in the marijuana business? The 2006 study "Marijuana Production in the United States" put the figure at $35.8 billion, making marijuana the largest U.S. cash crop.

But Aaron Smith, executive director of the newly formed National Cannabis Industry Association, later tells me the medical cannabis industry does a lot more than provide sales jobs.

"You have people writing point-of-sale software being used at the collectives. You have insurance companies insuring the collectives. You have security companies creating security solutions for the collectives. You have people making the containers the medical cannabis is sold in," Smith says. "There are a lot of different jobs associated with the cannabis beyond what you see right there at the retail counter."

Smith says an average dispensary provides work for anywhere from eight to 80 people, with most averaging a couple of dozen employees. He hopes policy makers will notice medical marijuana's positive economic impact.

"I think that's something that our policy makers in Washington, D.C. and in the states across the country need to look at and consider the power that this industry has as a force for economic recovery," Smith says.

We're not just talking jobs, either. A spokeswoman for California's State Board of Equalization tells me the state takes in an estimated $58 million to $105 million in taxes annually. Sure, it's a small drop in the tax bucket of the world's seventh-largest economy, but it's a growing revenue source.

Or as reported in the Colorado Springs Gazette, from April 2009 to June 2010, the city's monthly tax revenue from medical marijuana jumped from $4,000 to $40,000. And the city sees other gains outside of the tax boost.

“The medical marijuana industry may be accounting for more sales tax revenue increases than is simply reflected in the amount of sales tax collected on the sale of marijuana,” Councilman Tom Gallagher told the Gazette. “There’s a lot of electricians and carpenters and plumbers that are being employed.”

As we leave the dispensary, Tony tells me his biggest worry. Even though medical cannabis is legal, and even though Gov. Schwarzenegger decriminalized possession of up to an ounce of marijuana, he can still get in trouble with the Feds.

Several times during our field trip, Tony mentions the arrest of Chris Bartkowicz, a Colorado medical pot grower who appeared in a local television station interview. Soon after the interview, DEA agents raided his house and charged him with possession of marijuana with the intent to distribute, saying he even grew more marijuana than what's allowed under Colorado's medical marijuana laws. He faces five to 40 years in prison.

Tony is sure -- well, pretty sure -- his grow operation is within California's legal limits. An attorney has double-checked everything and he keeps his paperwork in his car. He says the police have stopped by his grow operation three times.

As we head back to our original meet-up spot, Tony sounds hesitant when he talks about finishing his degree. Tuition money could just as easily go toward his clone business, and the way the economy is going, might prove to be a better investment.

He was studying to be an anesthesiologist. Now, it seems, he's found another way to get people their medicine.

"I don't like to see people sad and in pain," he says.

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