XPost: alt.atheism, sac.politics, talk.politics.guns   
   XPost: alt.society.liberalism   
   From: dirtbag@gavinnewsom.turds   
      
   California's legal cannabis market has hit another grim milestone: There   
   are now 10,828 inactive and surrendered pot licenses in the state and   
   only 8,514 active ones, meaning dead pot licenses now outnumber active   
   ones, according to the Department of Cannabis Control's data dashboard.   
      
   This inversion comes seven years after the legal cannabis market opened.   
   While it's not clear exactly when the threshold was crossed, because the   
   state does not release historical licensing information, California's   
   legal market has been struggling for years, with thousands of companies   
   going out of business.   
      
   Jonatan Cvetko, a cannabis advocate and executive director of the United   
   Cannabis Business Association, said the figures show that state   
   regulators and the entire regulatory framework for cannabis in   
   California is a "complete failure."   
      
   "We've finally hit a threshold where we've seen the number of   
   participants who have come into the industry who have failed outweighs   
   the number of people succeeding, and succeeding is probably too strong   
   of a word," Cvetko said.   
      
   Company failures are certainly not unique to the legal cannabis   
   industry. Startup companies in the technology market are notorious for   
   failing the majority of the time, with one 2023 study estimating that   
   75% of all venture-backed tech companies fail within five years. And one   
   2016 study found that roughly 20% of new restaurants in the Los Angeles   
   area failed between 2003 and 2008.   
      
   But Cvetko said business failures in California's cannabis industry are   
   especially bad because California's legal market has only a fraction of   
   operators today compared with California's medical market that existed   
   prior to legalization.   
      
   "This is not anywhere near what we see with restaurants, because we   
   already had an industry in California, and California destroyed the   
   industry that we had," Cvetko said.   
      
   State law requires a cannabis license from the Department of Cannabis   
   Control before a company can legally engage in any cannabis work, with   
   over three dozen license types. A single cannabis business often needs   
   multiple types of licenses to do its work, so the number of surrendered   
   licenses doesn't directly equate to the number of failed businesses.   
      
   David Hafner, a spokesperson for the department, strongly pushed back on   
   the idea that the data shows a market failure.   
      
   "The number of inactive cannabis licenses is not indicative to the   
   health of the licensed cannabis market, let alone a statement on the   
   established framework for the regulation of it," Hafner said.   
      
   Hafner said that some of the drop in active licenses is because of a   
   procedural change in 2023 that allowed cannabis farms to consolidate   
   multiple smaller licenses into one large license type. This   
   consolidation is responsible for 1,071 licenses that are now inactive   
   but "did not involve businesses closing down or downsizing." according   
   to Hafner.   
      
   Even removing those 1,071 consolidated licenses, there are still 9,757   
   other licenses that are inactive for a variety of reasons, from being   
   canceled to revoked or surrendered. The vast majority of dead licenses   
   are related to growing cannabis, with over 7,100 inactive cultivation   
   licenses. Those figures reflect a severe drop in the number of   
   small-scale farms operating in Northern California, which used to be the   
   capital of pot farming in America but has been diminished thanks to   
   large-scale farming in Southern California.   
      
   There are also over 1,100 inactive distribution licenses, nearly 500   
   inactive delivery licenses and over 300 inactive retail licenses.   
      
   Dan Sumner, a UC Davis professor who has extensively studied   
   California's legal cannabis cultivation industry, said he was not   
   surprised to see so many farming licenses go inactive. He said he's   
   documented many large farming operations shut down quickly because   
   falling wholesale cannabis prices made their businesses unprofitable.   
   Sumner added that extensive regulations have also made it more expensive   
   to run a legal cannabis farm.   
      
   "If you want to be a lettuce grower, grow lettuce. You don't need a   
   license to grow lettuce, but if you want to take that same acre and grow   
   cannabis, it's a whole different process, and you have to engage with 10   
   different agencies," Sumner said.   
      
   Cvetko said the industry is struggling because the regulations make it   
   too expensive to get and maintain a cannabis license, and then   
   lackluster enforcement against the illicit market has allowed unlicensed   
   cannabis operators to proliferate and sell cheaper marijuana that   
   undercuts legal companies.   
      
   "When you're constantly competing against an unlicensed market that   
   doesn't have those taxes and overhead, and there's no effective   
   enforcement, then the state has completely failed to make this a viable   
   industry," Cvetko said.   
      
   https://www.sfgate.com/cannabis/article/complete-failure-calif-pot-indust   
   ry-dead-licenses-20165785.php   
      
   --- SoupGate-DOS v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)