General Question

pleiades's avatar

If marijuana were legalized in the U.S.A. who would be the benefactors: Small businesses or big tobacco companies?

Asked by pleiades (6576points) March 2nd, 2014

It is a no brainer that big tobacco companies would open up shop the moment marijuana would become legalized and recognized federally. My question is, would small time businesses such as the private plantations that are alive today be overtaken by big tobacco?

Or would it be fair game to whomever creates the coolest looking, “cigaweed” brand logo?

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16 Answers

bolwerk's avatar

It could entirely depend on how it’s regulated. The barriers to entry for cigarettes are high. It’s easy to grow tobacco, but probably takes an army of lawyers and tax accountants to distribute it.

Same goes for both fermentation and distillation.

XOIIO's avatar

Big tobacco of course, it would just be another product to roll out for them.

PhiNotPi's avatar

I fully expect big tobacco to win. The small private plantations are no match for mechanized farming.

talljasperman's avatar

The snack food industry will boom.

CWOTUS's avatar

There is no way of knowing in advance. Anyone can make predictions, and some of them may come true, but there’s no certain cause and effect in this. No way to make a point-by-point argument that has any degree of certainty.

For example, now that tea taxes are a non-issue in the USA and now that we’re friends with Great Britain (the UK) for the past 200 years, you might think that the East India Tea Company should have made out like bandits years ago. But where are they now? Who had ever heard of Lipton prior to the 1900s?

There is just no way to give a fully supportable response to the question – aside from @talljasperman,‘s that is.

Smashley's avatar

The benefactors would be the people. However the chips fall in the emerging industry of it all, the companies that manufacture and distribute marijuana will need to offer a good product at a cost that can compete with home growing. Unlike quality alcohols and tobacco, excellent marijuana can be produced almost anywhere in the US, with few start up costs. It will be finally abundant and available to all who choose to consume it.

Marijuana is simply too hard to control, history has shown that. Maybe that’s why they banned it in the first place.

kritiper's avatar

Everybody would win. Money for you, money for me, money for big biz and little biz, the tobacco companies, Uncle Sam,... Need I go on???

ragingloli's avatar

The private prison industry would get shafted though, as they would be deprived of millions of drug offenders, and thus, money.

Jonesn4burgers's avatar

I’ll be doing business with whomever sells the best creeper. I like that sudden realization, “Whoa, I think it’s here, my mouth is furry.”

kritiper's avatar

@ragingloli Oh, well! You can’t have your pot and smoke it, too. Besides, there are all of the other drugs that would still stock the prisons and the public would benefit because their tax dollars would go to get these drug dealers rather than wasting time chasing pot transporters. More effective overall results.

Strauss's avatar

@ragingloli I wouldn’t worry about the private prison industry. As long as there are judges like President Judge Mark Ciavarella and Senior Judge Michael Conahan the industry will survive.

As long it is illegal to transport cannabis across state lines, there will be no explicit activity on the part of any national corporation. Until then, as the individual states proceed with decriminalization (first of medical, then recreational) we will see the rise of small to medium grow/wholesale/retail operations, which will expand due to market pressures.

Cruiser's avatar

Altria parent company of Phillip Morris has already secured internet domain names and so you can bet it is already a sealed deal they will be a leader in this new pot industry.

I will also bet they already have their army of lobbyists scurrying up and down “K” street making all sorts of deals with legislators to make sure a law is written that limits or even makes it very illegal to grow your own pot.

bolwerk's avatar

@Cruiser: sounds like Rhine capitalism!

Cruiser's avatar

@bolwerk I wish I knew enough about Social market economy to know what you meant by your comment

bolwerk's avatar

@Cruiser: Not so much a commentary on the social market economy, but traditionally Central Europe (not just Germany) views monopolies more positively based on the theory that a big conglomerate is more stable. Americans usually prefer a competitive market, but have opted for pseudo-monopolies to dominate vice industries.

Cruiser's avatar

@bolwerk I just wonder how this whole pot thing will play out if the Feds do ever legalize it. I grew up on the tails of the 60’s and the whole pop culture atmosphere in and around pot, hippies and rock and roll. The kids are the ones who owned and created that whole pop culture world and will smoking pot have that same ethereal and exciting appeal if Phillip Morris sinks it’s corporate claws into the industry??

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