Gavin Newsom Gave the Cannabis Industry Its Mask-Off Moment

You could say that Gov. Gavin Newsom saved the California cannabis industry.

Way back in March 2020, with the mysterious but deadly novel coronavirus spreading like an out-of-control and invisible late-fall wildfire, the governor declared all cannabis dispensaries essential businesses. This meant they could keep their doors open during the strict California stay-at-home order while bars, restaurants, and most other retail shut down. As public-health professionals clutched at pearls, the result was the biggest buying spree in marijuana legalization’s history, a 57 percent increase from the prior year.

You could also say that Gavin Newsom—one of the first prominent politicians with a national profile to come out for weed, who endorsed legalizing cannabis way back in 2012—is responsible for wrecking the state’s marijuana industry we knew it.

Though the state’s legalization ballot measure, 2016’s Prop. 64, promised small growers a head start, rules released in late 2017 allowed Big Weed’s immediate entry. More rules, passed by local governments, shut out most of the state to legal cannabis retail, gifting the traditional illicit market a prime opportunity.

True, that happened when Newsom was still lieutenant governor, with then-Gov. Jerry Brown still handling the reins of state. But since then, Newsom has done little to lower taxes or ease regulatory burdens like steep permit fees.

For these reasons, there was plenty of angst, anger, and fear to propel as much as half of the California weed industry to either support the Sept. 14 recall effort, or at least chime in with their own critiques of the governor ahead of the crucial vote.

A Sacramento-area cannabis lobbyist even went as far as to run as a replacement candidate (while somewhat incoherently also encouraging voters to keep the governor in place).

Weed Power

“I think he completely dropped the ball and overlooked this massive gold mine sitting in his pocket,” said Mark Ponticelli, CEO and founder of The People’s Remedy, a dispensary chain in Modesto, Calif., in the state’s conservative Central Valley.

That said, when Ponticelli faced the choice of kicking the governor out and selecting a replacement—most likely Larry Elder, the ultra-right, Trump-endorsed, anti-vaxxing talk radio host—he found there was no choice at all.

“Really,” he said, “the choices were just the bad and the ugly. There was no real hope, it seemed like.”

Ultimately, the cannabis industry’s complains were irrelevant. Despite some early scares, Newsom easily brushed aside the recall effort by a nearly 2-to-1 margin. As a result, his political career is riding higher than ever.

He has tens of millions of dollars in campaign cash ready to brush aside whomever might try to run against him in 2022. He’s a near-lock to be governor until Jan. 2027 (unless he tries to run for president first).

This means the cannabis industry in California will have to live with the governor—and after their summer of harsh words and support for the recall, some awkward conversations when they ask for the tax relief and other help they say they desperately need might ensue.

Fringe Candidate

Whether the cannabis industry’s boiled-over frustrations with the governor will cause a problem isn’t clear. Newsom’s office did not immediately respond to a request for comment. Reached Friday, officials from the Department of Cannabis Control said they were busy meeting with small cannabis business owners and were unavailable to discuss (though whom they were meeting with, they did not say).

But not everyone in weed wanted Newsom out. Ryan Bacchas is a Los Angeles-based campaign consultant and lobbyist. A self-described “fiscal conservative” who leans Republican, Bacchas is also president of the California Cannabis Coalition, active in trying to influence statewide drug policy. He estimates “about half” of the state industry wanted Newsom out—and he counted himself firmly in the pro-Newsom camp.

“Everybody else was out of their damn minds,” he said. “I know a lot of folks were putting out false information about the governor and some of the things he’s done as far as cannabis is concerned.”

“He didn’t have to declare the cannabis industry essential,” Bacchas added. “I understand some peoples’ frustration… but if people aren’t so happy with Gavin, we weren’t going to get anything done with a Republican governor.”

“I told people, the only sensible logic is, either we lose him, and we get someone new, or we keep him, and we keep going to work. And if he loses, all the progress is dead.”

“The people who wanted him gone, it was for very frivolous reasons,” he said, adding that some cannabis industry players’ behavior during the recall “made a mockery out of the industry.”

Lines Drawn, (Metaphorical) Masks Off

The real lasting impact of the Newsom recall—and California cannabis’s inability to affect the outcome one way or the other—may be internal. The uncertainty of the recall revealed the schisms and splits within the cannabis movement and industry.

“There’s been a lot said in the last year, about a lot of the racism, bigotry, and homophobia in the cannabis industry,” Bacchas said.

And the recall, “that’s who you saw, not just coming out, but making themselves known,” he added.