Pubdate: Tue, 27 Jun 2017
Source: Guardian, The (CN PI)
Copyright: 2017 The Guardian, Charlottetown Guardian Group Incorporated
Contact:  http://www.theguardian.pe.ca/
Details: http://www.mapinc.org/media/174
Author: Wayne Carver
Page: A11

OLIGOPOLY THRIVES ON P.E.I.

Other than Mayor Clifford Lee, nobody addressed the cost associated
with new legislation

Islanders are familiar with the practice of oligopoly. We saw it in
spades with the PNP where it still continues under the secrecy of
government control. It is a state of limited competition in which a
market is shared by a small number of producers or sellers.

That is what happened with the PNP and that is what is happening with
the legalization and production of marijuana. The federal and
provincial governments are being criticized for creating an oligopoly
of major companies to grow marijuana, called licensed producers,
rather than a free market model which would open up the market to
those with an entrepreneurial spirit and an interest in producing the
product.

The June issue of MacLean's Magazine 
(http://archive.macleans.ca/issue/20170601)
a must read, contains an article entitled "Friends in High Places" and
describes how some senior bureaucrats and former political leaders, at
the federal and provincial levels, are buying into big weed, raising
fears of conflict of interest and cronyism. It almost makes one think
that our political leaders would like to become the Bronfman's of
marijuana, not for the greater public good, but for their own
financial gain.

Since 2013 several licensed producers have been created. One being
Mettrum Ltd where Joshua Tepper, the $400,000 president of Health
Quality Ontario, a government body that evaluates and directs the
provinces health policy, was listed as an independent director. The
names of the directors on the board at Mettrum reads like the Who's
Who of corporate Canada. Another company Tweed, was co-founded by
Chuck Rifici, the chief financial officer to the Liberal Party of
Canada during the last election when Justin Trudeau spoke of
legalizing weed and regulating the industry.

Canada's Island Garden, here in Charlottetown's BioCommons Research
Park, broke ground on its facility in the spring of 2015 and finished
construction in December of the same year. They received approval to
cultivate marijuana in June 2015, long before the legislation was ever
introduced. Is there any doubt about the legislation being passed?
More recently, April 19, 2017, Canada's Island Garden joined Canopy
Growth Corporation (TSX:WEED).

Bruce Linton, chairman & CEO, Canopy Growth and cofounder of Tweed,
announced the launch of Tweed's curated CraftGrow line which includes
product grown by Island Garden, among others, to bring high quality
grown by a diverse set of producers. Chuck Rifici, the chief financial
officer to the Liberal Party, was also a cofounder of Tweed.

Provincial authorities virtually ignore the marijuana issue. We do not
hear a peep from our Members of Parliament or our Members of the
Legislative Assembly, not even the opposition parties. Other than
Mayor Clifford Lee of Charlottetown, nobody addressed the cost
associated with the new legislation. One would expect that if the
government were going to get into the marijuana business they would
create a Crown corporation similar to the liquor control board where
the earnings are returned to the consolidated revenue fund of the
jurisdiction in which the product is sold.

Not in this case. Our political leaders and corporate Canada have
succeeded in listing the marijuana companies on the stock exchange and
some investors who previously wore a public service hat now seem to be
preferred shareholders with accrued shares in some case. Meanwhile
some of the directors of the companies continue to wear two hats, that
of a public servant or former public servant and a director or
investor in the marijuana companies.

Strangely, the cost of implementing the new legislation has not been
addressed. From all appearances, it will remain for the taxpayer to
bear the cost of the implementation, administration, enforcement and
the rehabilitation programs. The ramifications of this legislation are
huge.

The manner in which the federal government introduced the marijuana
legislation was somewhat deceiving. It was put forward as an attempt
to reduce the criminality associated in the drug trafficking business.
I am reluctant to call it an industry but that is what it will be when
it is government controlled. It seems the first priority was to create
the grow operations and get the companies listed on the stock exchange.

Now the dickering about who will pay begins and we all know how that
works out. Citizens are hopeful we could at least use some of the
earnings to off set some of the pubic debt, which is spiralling out of
control, or help create a pharmacare program.

It doesn't seem that anything that civic-minded is about to happen.

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Wayne Carver of Long Creek is an ardent supporter of electoral reform 
and comments frequently on other social issues.
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MAP posted-by: Matt