Pubdate: Wed, 19 Nov 2014
Source: Citizens' Voice, The (Wilkes-Barre, PA)
Copyright: 2014 The Citizens' Voice
Contact:  http://www.citizensvoice.com/
Details: http://www.mapinc.org/media/1334
Author: Thomas Maier, Newsday
Page: 16

WHEN CRIMINAL VICES BECOME LEGAL, SAVVY INVESTORS STAND TO MAKE MILLIONS

Big-time investors hoping to profit from America's emerging business 
in legalized marijuana might see a bit of themselves in the historic 
example of Joseph P. Kennedy - the father of President John F. Kennedy.

Back in 1933, the Kennedy patriarch made sure his liquor firm would 
be the first to make millions as Prohibition's decade-long ban on 
alcohol sales ended. He did so with a blend of politics, cash and 
timely maneuvers.

Today's pot entrepreneurs - looking to cash in on the estimated $20 
billion market in marijuana sales by 2020 - may find from some 
striking then-and-now similarities in Kennedy's experiences.

Just like pro-marijuana advocates have witnessed in recent years, 
Kennedy anticipated a change in America's attitudes about alcohol. 
Prohibition's good intentions toward sobriety had backfired, creating 
more crime and bootlegging by the 1930s. While Kennedy already had 
earned a fortune on Wall Street and in Hollywood, he realized he 
could make some more money by selling liquor to an America tired of 
legal restrictions. Well before Prohibition ended in December 1933, 
Kennedy set out a strategy to beat out his potential competition.

He began by offering alcohol for medical reasons, just like today's 
pot entrepreneurs in states such as Colorado where medical marijuana 
was first sold before it was approved for recreational use.

Similar to today's pot entrepreneurs - who sometimes hire expensive 
lobbyists and publicity experts, or contribute to pro-marijuana 
candidates - Kennedy also learned how to influence public policy.

Unlike his conservative Wall Street friends, Kennedy supported New 
York Gov. Franklin D. Roosevelt, the winning 1932 Democratic Party 
candidate for president, rather than the GOP incumbent Herbert 
Hoover. FDR wanted to make booze legal, while Hoover defended 
Prohibition as a "noble" cause. With Roosevelt's election, Kennedy 
knew Prohibition would soon be over.

Like today's marijuana entrepreneurs looking for farms and warehouses 
to grow their carefully cultivated weed, Kennedy sought a guaranteed 
supply of top-grade alcohol. Because many U.S. distilleries had 
closed because of Prohibition, he orchestrated a deal to import 
British whiskey, gin and other liquor to America.

Before leaving for England, where he later served as U.S. ambassador, 
Kennedy gained the exclusive New England rights to sell "various 
brands of alcohol beverages" handled by the National Distillers 
Products Corp., the firm headed by fellow FDR campaign contributor 
Seton Porter. Prohibition had nearly killed Porter's business. It 
crawled out of bankruptcy court protection by selling wine for 
religious services. Now that the Roosevelt team ruled Washington, 
both Kennedy and National Distillers expected to grow dramatically.

Exquisite timing also helped. In October 1933 - two months before 
Prohibition ended - Kennedy secured the British liquor deal by 
traveling to London with FDR's oldest son, Jimmy, on a trip that 
included a visit with Winston Churchill. Kennedy's firm saw its 
business in the United States soar, selling 150,000 cases of Scotch 
whisky in the first full year. By the end of 1934, National 
Distillers, including its New England franchise run by Kennedy, 
declared that its net profits had quadrupled in a year.

For today's budding millionaires in the booming marijuana market, Joe 
Kennedy's historical example with alcohol is a lesson in how much 
money can be made when once criminal vices become legal. It's not 
clear whether any entrepreneur investing in cannabis is as ambitious 
as Joe Kennedy. But maybe someday a future U.S. president will owe 
his or her backing to the marijuana industry.
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MAP posted-by: Jay Bergstrom