Marijuana licenses must be granted exclusively to cooperatives

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Under legislation introduced on Tuesday in the Rhode Island House and Senate, 24 recreational marijuana retail licenses will be issued following the approval and subsequent enactment of the rules by the newly created “cannabis control commission.” Six licenses will be reserved for “social equity applicants,” that is, people who represent communities that suffered disproportionately over the several decades and ultimately failed in the “war on drugs.” Six more licenses will be reserved for issue to worker cooperatives, which are employee-owned businesses that share profits equally among all employees. The remaining twelve licenses will go to what I will refer to as the “Big Pot”: millionaire investors and venture capitalists from out of state.

This is a missed opportunity.

Certainly there should be licenses for social equity applicants. But why only six? If we were to somehow add up the costs of the drug war in terms of families separated, lives destroyed, and misery created, six licenses would seem like an insult, not an honest attempt to make up for decades of racialized surveillance and abuse. A more serious offer would be in the realm of 75% or more licenses for social equity applicants.

Rhode Island business incubators and the Department of Commerce You must be willing to provide the training and resources necessary to ensure the success of these new businesses. But these should not be ordinary business. Why should we allow millionaires and private equity investors to dominate Rhode Island’s fledgling marijuana industry when instead we can build a new kind of industry, the first anywhere, based entirely on a cooperative model?

In their simplest form, cooperatives are worker-owned businesses, run democratically by the workers, with profits shared equally between worker/owners. The money generated by this new industry of cooperative ventures will not flow out of the state and into New York banks, but will go to individuals and families here in the state, encouraging local investment and purchases. These families will build homes, spend money on local businesses, pay taxes here in Rhode Island, and start building generational wealth.

Imagine 24 new businesses, each with 30 employees, earning the amount of money that will support new families. We’re talking about hundreds and eventually more than a thousand families who prosper, work, live and spend right here in our state.

Dollars spent in the local community circulate through the local community, spreading that wealth. A family that earns enough to eat out will spend money at local restaurants and buy their food at local stores.

Cooperatives build communities, not only among the workers/owners, but also outside the business and in the community. Instead of fostering predatory money-stealing businesses like payday lenders, a worker/owner-led cooperative will have the community connections that lead to community investment.

All decisions made by cooperatives are decided democratically by the workers/owners. Companies with strong democratic ethics and profit sharing will attract top talent eager to get in on that action. Employees will be driven to succeed not because they want a paycheck and need to keep their millionaire bosses happy, but because they know that the harder they work, the more money the business they own will make.

If you lived in Seekonk and had to choose between spending your money at a corporate pot warehouse in Massachusetts or a super cool worker-owned co-op in East Providence, where would you rather shop? Employees/owners will see customer service as more than just selling the boss’s product, they’ll see it as a way to show pride in the business they’re so eager to make successful.

Cooperatives have challenges. For example, they have difficulty finding financing. This is where the government can step in and provide assistance. If the state is going to subsidize businesses, why not do it for an entirely new industry that has the potential to bring over a thousand people into the middle class in a few years?

Cooperatives also find it difficult to compete with companies that are not cooperatives. Decisions made democratically are slower than those made by a single entrepreneur making gut decisions quickly. There are ways to organize cooperatives to avoid some of this, but how much better would it be if the competition was entirely from other cooperatives? All cooperatives would be more or less on an equal footing and not have to worry about competing with companies that have millions in out-of-state investments and non-cooperative decision-making structures.

We are talking about 24 new multi-million dollar businesses, 75% of them with a social equity component and all focused on a worker/owner model. This can only have a positive effect on the Rhode Island economy. To encourage this, the government must step in with the seed money, legal structures, and business help these new businesses need. The mission and scope of the “cannabis control commission” should change. It should provide help with bookkeeping and taxes, location services, and anything else these businesses need to be successful. We have an opportunity to establish a strong new industry that may be unique to Rhode Island.

And while we’re at it, let’s ditch the name “cannabis control commission” and come up with something better, like “Cooperative Cannabis Incubator.”

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