As far as I am aware, there are two guys in my neighborhood that sell the weed they grow. However, this is southern California so I assume that I should be multiplying this number a hundred times over.
Then again, I live in a small town within Greater Los Angeles and have five dispensaries within so many blocks of my home.
It’s Easier To Buy Weed Than It Is To Buy Ripe Avocados in LA
Los Angeles is the first pit-stop for cartel trade after Mexico. Surely the black market for weed should be huge here, right?
In a recent conversation with a source, I was laughed at when I asked how much his Latino gang made from selling weed.
“We don’t make nothing from that shit no more.”
I wasn’t surprised; this is rapidly becoming the norm.
Writing for Time, Ioan Grillo’s article from 2015 describes how agents on the Mexican-American border are seeing a decrease in weed. Sure, there is an unstoppable flow of hard drugs like meth and cocaine, but the green stuff is in decline.
In 2011, the Border Patrol seized 2.5 million pounds. In 2014 that number had decreased to 1.9 million. Even Mexico’s army has seen a decline of 32 percent between 2014 and 2015.
By 2015, the agents on the southwest border barely scraped 1.5 million pounds of marijuana. This is a four million pound drop since the peak in 2009.
Increased competition from legalization, decriminalization, and medical marijuana is crippling the cost of weed. A few years ago, a kilogram of weed was for $60 – $90. Now, it’s barely $30 – $40.
Quality Is Also An Issue
In the 2015 National Drug Threat Assessment, the DEA wrote:
“The quality of marijuana produced in Mexico and the Caribbean is thought to be inferior to the marijuana produced domestically in the United States or in Canada”
Mexican growers can no longer compete with domestic production.
Weed farmers in Sinaloa have all but stopped planting as a result of this hemorrhage in revenue.
Will This Have Any Lasting Impact?
An article by VICE News suggested that the legalization effort is also impacting on the relationship between the DEA and Sinaloa Cartel.
A court testimony by Jesus Vicente Zambada-Niebla discussed the DEA’s vested interest in keeping weed illegal. The son of Sinaloa leader Ismael “El Mayo” Zambada claimed that DEA agents offered him deals in exchange for snitching on rival cartels.
Even if his claims are true, it does not seem to be having an impact on legalization efforts stateside.
Eight states are set to vote on various cannabis laws this coming November, and most are polling in favor of weed.
Could this be a win for law enforcement tackling the cartel culture sweeping the continent?
In a word, no.
Just like Uber and Lyft have created competition for the taxicab monopoly in urban America, so too are the dispensaries for the cartel.
We Live In A Capitalist World, And Cartels Are A Corporation
Rates of heroin and methamphetamine being smuggled into the USA has risen steadily over the last five years. One report stated that rates of seizures along the border have gone up 5.2 percent and 9.8 percent respectively.
At present, marijuana makes up anywhere between 16 percent and 30 percent of cartel revenue.
Many writers are arguing that the drug trade needs to be accepted as a social norm. If drugs are available then people will buy them. That is just that.
The issue with the cartels is that they specialize in violence. This is their competitive advantage. Even if we see full legalization of weed, the cartels can adapt their business model to other means.
The scope of the cartel’s industry reaches from not only narcotics, but to oil, arms, kidnapping, and extortion.
Legalizing marijuana will see an immediate dent in their revenue, but they will adapt. Every industry adapts to market fluctuations and unfortunately, so will the cartels.
This video breaks down some of the numbers the cartels are facing:
