Goodbye marijuana industry

Government destroyed an important Southern Oregon industry: Legal cannabis. 

It didn't enforce its laws.

It was good while it lasted. 

Four years ago entrepreneur cannabis growers with an acre of marijuana in cultivation made a half million dollars and more in a season. Farm worker employees made $50,000 and $100,000 in a season. There had been a lot of cannabis money flowing through the local economy, identifiable by merchants because it was being paid with cash--currency--not plastic. Sometimes the currency had a whiff of cannabis smell. That era is ending.

From: Forbes

Southern Oregon had been the epicenter of top-quality outdoor cannabis. We have a concentration of professional expertise, geography, and investment capital. Our industry was made possible because THC-bearing cannabis was illegal in most places, but legal to grow here in small, regulated amounts. Demand was high, supply was low. Five years ago a pound of trimmed buds containing THC sold for $2,000 a pound. A single person managing a half-acre grow-site might produce 250 pounds of product--worth $500,000--at a cost of perhaps $60,000. This includes land preparation, plant starts, soil amendments, fertilizers, bug suppression, some hired help at planting and harvesting. Subtract $100/pound for the trimming process that turns dried flowers into a sellable package of buds. A person could net $400,000 if everything worked out.

Now the price is $200-$400 a pound, if it can be sold at all, and most cannot be. Now only perfect, beautiful, un-seeded product is sellable at any price. At 250 pounds, times $300 a pound, the gross revenue is $75,000. Then subtract the trimming cost. A grower might have net revenue of $50,000 after out-of-pocket costs of $60,000. It doesn't work. It could be even worse. There is the ever-present risk of an unsellable crop because of wet-weather mold, seeds from an upwind neighbor's male plants, or loss from hail or bugs or theft. 

Yes, next year's price could be higher. Farmers always hope for that. The price also might be lower. The U.S. House of Representatives just voted to decriminalize marijuana. Although gridlock and logjams are the norm in D.C., possibly the Senate will go along. If THC-cannabis can be grown anywhere and everywhere, prices will likely fall further. 

Entrepreneurs are leaving the business. Cannabis employees are seeking other work. Landowners who in previous years leased to marijuana growers are looking for other uses of their land.

Negligent law enforcement is the immediate cause of the collapse in prices for THC-bearing flowers. We have a THC glut. Growing THC-bearing cannabis legally has enormous regulatory burdens, and it is taxed at every level. Jumping through all the hoops kept quality high and supply low.

Arial view: hoop houses 

The 2021 growing season was a disaster for the industry. In 2019 and 2020 hemp (the cannabis with CBD, not THC) grew legally in open fields. Nearly everyone who grew it lost money. People expected a large market for CBD, but it did not materialize. In 2021 many out-of-area growers came to the area and set up shop claiming to grow CBD, while in fact growing THC. The plants look alike and can be distinguished only by testing them. On site and laboratory tests are readily available. 

What was happening quickly became obvious to every market participant. There was illegal THC being grown everywhere. Local law enforcement agencies and state regulators under the OLCC--the Oregon Liquor and Cannabis Commission--were ineffective in enforcing THC-cannabis rules. They appear to have given up. Their leaders spent time asking for more money, not demanding destruction of illegal fields of THC.  Literally thousands of hoop houses constructed from PVC tubes and sheets of plastic dotted farm areas. Most had no permits of any kind. Growers were brazen. Hoop houses were set up alongside roads. They were visible from the air. Some had permits to grow CBD, so they had a tissue-thin explanation for what they were doing or pretending to do. Most did not. The OLCC did some sporadic testing of licensed CBD grows--the ones with the "wink-wink" CBD excuse--but largely ignored the obviously illegal grows. In many cases crops got tested, were found to have illegal quantities of THC, but then nothing happened. The crop was allowed to grow to maturity and enter the market. The result is a massive oversupply of THC. 

This has been a difficult time to be an Oregon governor or other state officeholder. Southern Oregon citizens who are unhappy at the proliferation of hoop houses and the flagrant illegal water use in a drought year have reason to feel frustrated. Like the disturbances in Portland this summer, the cannabis grows here are another iteration of government being ineffective. This is one more thing in the list of frustration and discontent that will shape the 2022 election.

Pedophila

Marjorie Taylor Green is a money-raising machine.

She has enormous grass-roots support among GOP voters. 

The media is making a fuss over comments by U.S. Representative Marjorie Taylor Green (R. Ga). She stepped over the line this week by making the same mistake made by U.S. Rep. Madison Cawthorn (R. NC). She included Republicans in her attacks on politicians. Cawthorn said he was invited to cocaine and sex parties by unnamed, but apparently fellow-GOP Members of Congress. It is one thing to make casual accusations against Democrats, but this implicated Republicans. He got taken to the woodshed by Kevin McCarthy. Marjorie Taylor Green also went too far in tweets about the three U.S. Senators who announced they would vote to confirm Judge Jackson to the Supreme Court. Her accusations weren't casual.

Marjorie Taylor Green is a gift to Democrats. She, like Trump, hurts the GOP brand. This blog has asserted that Trump's unhinged mono-mania about the 2020 election is the single best asset for Democrats. Democrats have the headwind of Biden's inarticulate feebleness, but Republicans have the headwind of Trump's mono-mania. This gives Democrats a chance to avoid the normal off-year oscillation away from the party in the White House. 

Marjorie Taylor Green is a firebrand and un-typical of Republican officeholders, but the Jackson confirmation hearings demonstrated that she is not an outlier. Most GOP politicians do not oppose her. They follow in her draft. She is saying--crudely--things Republicans believe. Or sort of believe. Or at least refuse to say they do not believe.  Senators Cruz, Hawley, Cotton, and Lee all have obvious presidential ambitions. They picked up the pro-pedophile theme and used it repeatedly in criticizing Jackson in her senate confirmation hearings.

LA Times

To most Americans Marjorie Taylor Green's comments sound  "ludicrous," as the L.A. Times headline reports, quoting Senator Susan Collins of Maine: "She obviously can say whatever she wishes, but that’s clearly ludicrous and sadly typical of what I expect of her."

There is a reason ambitious GOP senators would pick up a pedophilia theme that is so extreme and viscous on its face that it is surely a net-negative for most voters. It is opposite of sober Pence, who represents a return to solid, conservative GOP sanity. Yet ambitious senators are crowding into the MTG-adjacent lane, not Pence's. Why? Because the kinds of things Marjorie Taylor Green says are not ludicrous to many Republicans.

A significant number of GOP voters tell pollsters at PRRI, the independent and non-partisan Public Religion Research Institute, that they believe the government, media, and financial worlds in the U.S. are controlled by a group of Satan-worshiping pedophiles who run a global child sex-trafficking operation.

Really. Satan-worshiping pedophiles. 

Public belief in Q-Anon themes persisted throughout 2021 and continue into 2022.  It has not exhausted itself over time, nor in Trump's absence from the White House. Q-Anon believers represent a significant plurality of the GOP primary election voter. Q-Anon believers and mostly-agreers skew toward poorer and less educated Americans, especially in the American South. Believers primarily watch Fox, Newsmax, and One America News. Q-Anon believers skew Republican, with 25% of all Republicans believing the major themes of the Q-Anon message. The presidential candidate who has the support of that block can win the GOP nomination.

 

The message in yesterday's blog post, and in many previous to that, is that the brands and policies of the two parties are being shaped by their extremes. Politicians hoping to appeal to the general electorate first need to be compliant with the reliable, activist partisan voter. For Republicans in 2022, that means making the claim that pedophilia--possibly by Satan-worshipers--is a widespread problem carried out by people who represent the Democratic establishment, most recently Judge Jackson.  

Do Cruz, Hawley, Cotton, and Lee believe Judge Jackson is pedophilia-friendly? Of course not. But they say it because a lot of GOP voters want to hear it because they believe it. Or sort of believe it.

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I have stopped giving campaign money to advocacy groups.

The perfect is the enemy of the good. 

Advocacy groups push candidates into unpopular positions.

Advocacy groups have a mission. They want to test the edges of the politically possible and move a policy from "extreme" into "mainstream." What may be a politically viable position in a congressional district in New York City may be a deeply unpopular one in a swing district. 

Advocacy groups want candidate victories, but their interests are not identical to those of candidates. A candidate loss is a policy setback, but the new, worse status quo can lay the groundwork for future victories. In the loss, the advocacy group is more necessary than ever. Look how bad things are! Funds pour in. They are not trying to lose. They are trying to make a point. Candidate casualties prove they are testing what is possible. Without casualties maybe they would be leaving something on the table. 

There are advocacy groups pushing the envelope on many sides of the political divide.

***Team red: Right to Life. National Rifle Association. Family Research Institute (favors criminalizing homosexuality).  New iterations of the KKK.

***Team blue: NARAL. League of Conservation Voters. Wilderness Society. Americans Against Fracking. Gender Justice League. GLADD. Public employee unions.

In the 2020 Democratic presidential primary, left-oriented individuals and groups demanded that Democratic candidates raise their hands for a position that was broadly unpopular: An unenforced southern border and free health care for people here illegally. Debate moderator Lester Holt asked candidates,  "Raise your hands if your government plan would provide coverage for undocumented immigrants." They all raised their hands.

Donald Trump pushed Democrats; if Trump was for it, it had to be wrong. "Medicare for All" pushed Democrats. Bernie Sanders and Elizabeth Warren defined anything less than Medicare for All as a sell-out. The George Floyd protests in the summer of 2020 quoted spokespeople saying "violence is the language of the oppressed." It conflated protests with violence. Looting was somehow payback or reparations. This was deeply unpopular, but Democratic messaging against it was muddled. 

On the political right, the National Rifle Association advocates nationwide concealed carry of handguns, near-unrestricted access to AR-15s, and it opposes laws requiring the safe storage of guns. Those are unpopular positions, but on-mission for the NRA. Anti-abortion advocates have momentum in the wake of the Texas law essentially ending abortions in Texas. That is unpopular to the general voting public.

Advocacy groups have endorsements to award, money to direct, mailing lists to contact. They seek candidates who are on board with their agenda. Then, in a phrase that reflects their sense of power and purpose, to "hold officeholders' feet to the fire." Those candidates are forced to defend their support for the least popular position of the advocacy group, e.g. a so-called "live birth" 22nd-week abortion or the right of a mentally ill person with a history of spousal abuse to buy and carry an AR-15. These are rare and extreme cases, and outrageous caricatures of typical abortion or gun use. That is why opponents use those examples.

Candidates are reluctant to disagree with activist friends and groups. That reluctance distracts politicians from the rootedness of public sentiment. In Oregon, Democratic state and local officeholders were unwilling to make sharp disagreement with friends aligned with the George Floyd protests, so they did not clearly communicate their opposition to a long summer of looting and arson. They are paying a price for that.

I have stopped giving to advocacy group PACs. I prefer advocacy groups to move public opinion, not to demand candidates lose gloriously after advocating positions they are pushed into. Advocacy groups act like bullies. I prefer candidates who stay clear of advocacy PACs, even ones I generally like. Democratic and non-affiliated voters in swing states tell polls that Democrats are "preachy" and "judgmental." I want that to be untrue. How to do that? Democrats shouldn't be preachy and judgmental.

Fortunately for Democrats, Republican candidates and officeholders have a parallel problem with their own advocacy groups. The NRA and Right to Life and anti-gay groups are bad, but not the worst of it. Trump is. Candidates dare not say that Trump attempted to overthrow the election and was wrong to do it. They are stuck with their leader. Their feet are held to the fire.

Two short videos: Volodymyr Zelenskyy and Ben Affleck

St. Paul to the Romans:

     "You ask how shall people believe in Him, if they have not heard of him? How can they hear, without a preacher?

     I tell you that faith cometh from hearing the sound of the spoken word."

            

The 2017 movie, The Darkest Hour, concluded with words that summed up Winston Churchill’s leadership in Britain. Lord Halifax said of Churchill, "He mobilized the English language and sent it into battle."

Churchill made people believe that Britain could survive.

This blog has repeatedly expressed frustration with President Biden. He tries, but persuasive communication is simply beyond his capability. He cannot do a key part of his job. The president is not a manager of a bureaucracy. The president is a leader. The power of a president is the power to persuade. 

Biden was an acceptable alternative to Trump and a majority of Americans wanted to excise the Trump malignancy. We weren't fussy. Since we weren't agreed on which alternative to Trump we wanted, Americans chose the one that was most familiar and generic: Biden. Now, 14 months into his presidency, Biden's limitations are fully revealed, and they were not resolved by his holding the office. He cannot express a narrative of economic and moral recovery. He cannot make Americans feel there is a positive national direction. He cannot persuade or inspire anyone who is not already committed to his partisan team. Therefore, the Republican strategy of obstruction is working. Even actions which should be easy and which should make Americans of both parties proud, like the elevation to the Supreme Court of an obviously well-qualified Appellate Court Judge, turns into an ugly partisan slog. 

Today I ask readers to observe two short videos. They make a simple point, the power of the spoken word when done by a skilled practitioner. I don't understand the Ukrainian in the first video, and it doesn't matter. Its power is in its simplicity. We hear the message: We are here. It is 31 seconds. Take a moment.

Click Here

The second video is of Ben Affleck, talking straight to the camera. This week high-achieving students learned which colleges accepted their applications. This is a moment of widespread disappointment for many young people. It is a time of massive rejection. Affleck grew up in Cambridge, Massachusetts and attended high school at the edge of the Harvard campus. Harvard accepted 3% of its applicants this year.  Out of over 400 Oregon applicants, about seven were accepted. Hear what he says.

Click Here

In powerful communication the messenger and message content are a single thing. The right messenger, with the right message, done the right way, changes people. We believe.

Deep Fake

Post Truth.

If nothing is true, you can believe anything you want.

What is real? Really real. René Descartes said there was a foundation of reality. He could think, therefore he was real. That was rock solid. 

Of course, we now know that rocks aren't solid, not really. They are made of atoms and electrons and protons and smaller things yet. Those particles move around and there appears to be space between each of those atomic and sub-atomic particles. And where they are at any one time is unknowable and a matter of probabilities.  A rock is a useful day-to-day concept, but it isn't a thing at the quantum physics level. 

I don't really know what I just wrote about rocks. I have read that physicists believe this about atoms and quantum physics. I read simplified summaries of what they think, and I take what they say on faith.

Elon Musk wrote that the universe may be a grand illusion.

If you assume any rate of improvement at all, games will eventually be indistinguishable from reality. We’re most likely in a simulation.

Maybe life is but a dream, like the song says. 

This revery on reality was occasioned by an email from a reader of this blog. It had a link to this video. It shows Ukrainian air defenses. It is a dangerous time to be a Russian helicopter pilot, he wrote. The video is 71 seconds long. Dangerous, indeed.

Click Here

It looks real to me. I have never seen helicopters being shot at by anti-aircraft missiles, so the video seemed plausible. It turns out to have been footage from a video game. So it was real--real video game footage. It wasn't really the Ukrainian sky.

TV viewers in Russia and Ukraine watched President Zelenskyy tell Ukraine soldiers to lay down their arms. Only it wasn't Zelenskyy. It was a Russian deep fake.

Journalists wrote that the voice was a bit off and the appearance was imperfect. I look at the two images and they look the same to me. In fact, the one on the left looks a bit more "real" than the other. Shortly after the Russians published the fake video Zelenskyy went on Ukrainian TV and said the images they were seeing now were the real Zelenskyy. Keep fighting, that TV image said.

A quick Google search of the words "deep fake" and "AOC" immediately brings one to a rich library of pornographic videos purporting to show Representative Alexandria Ocasio-Cortez in realistic close up. This is not "photoshop" where a face is pasted over the neck of someone else. In deep fake, the eyes, mouth, lips, tongue are somehow digitally transformed using data drawn from other videos of the deep fake victim. We are seeing real pixels of AOC. What is simulated is the rearrangement of the pixels depicting words and actions she didn't do.

I am sure the images of AOC are fake based on the broader context of other information I know. If AOC had really done these sex tapes, Pamela Anderson style, I would have heard. There would be news reports about invasion of privacy, and lawsuits. That media context would include sources Donald Trump and Fox News relentlessly term fake. The "real" news makes errors, too, but I generally believe they try to describe a reality that stands up to verification.

Apparently most people in Russia believe what they have been told that Ukrainians had been torturing and killing Russian speakers in Ukraine and that the "military action" is a humanitarian mission. In the broader context of what they have heard, it seems plausible to them. In the context of a regular viewer of Fox News, it makes sense that  Biden could not possibly have won the election, especially since Trump is so adamant he won. 

If nothing is really true for sure, then people are free to believe whatever story makes them happiest. This may not be consistent with a system of self-government.

Not Biden's fault (not that that matters.)

Oil prices are high worldwide, not just in the USA.  

U.S. oil companies are not jumping to produce more oil. It isn't because of something Biden is or isn't doing. It is because investors demand that oil companies be profitable.

Most Americans are less concerned about oil prices than they are with gasoline prices at the pump. Those prices move together and they are both up since Biden was inaugurated. Higher world oil prices have almost nothing to do with Biden or Biden's policies, but he is being blamed for it by Republicans. Good or bad, presidents routinely get blamed for things that aren't their doing. It is a fact of life. 

Presidents aren't defenseless. They have the bully pulpit, and a persuasive communicator tells a story to explain bad news. Biden is not that persuasive communicator, alas. A better communicator could be telling the story that gasoline prices were unusually low in the past because COVID put so many people out of work and so depressed the economy that there was a temporary oversupply of oil and refining capacity. Out of work people don't travel much. Closed factories don't use much energy. Oil prices are up because unemployment is down, because business is recovering, because America is working again. This is good!  Moreover, those good, patriotic working people of America--essential workers--are getting better paid, finally, and we should be happy about that. If Biden had the capacity to share an optimistic narrative, one is there to be shared. I am not angry with Biden. Biden's limitations were always apparent. Those limitations have consequences. Republicans are shaping a narrative of failure.  

I follow the price of oil stocks because I own them. The dividends are part of my retirement income. I don't feel shame, although I know some of my friends think I should. Oil companies have destroyed the world's climate, right?  No. consumers who use oil create the demand. The guilt is ours. Oil companies sell oil because we demand it. People who dislike fossil fuel companies are happy to see an open gas station when their tank registers "E." 

U.S. oil is a small part of the world's supply. It seems obvious that U.S. companies would respond to the higher prices of oil and gasoline by producing more to meet the need.  After all, if they were selling oil profitably when oil was $70/barrel and gasoline at $3, then they would be making money like gangbusters now that it is $100/barrel and $5. So it makes sense that they would ramp up production to take advantage of higher margins. Right?

No. Oil companies feel burned by the era of too-low oil prices caused by increased supply from Russian and Saudi production, then exacerbated by COVID's demand reduction. Investors punished those companies. They were losing money year after year. Stock prices sank. The companies had over-invested in expensive fracked shale oil. They had "stranded assets," i.e. oil that cost more to extract than it could be sold for. 

Data from Dallas Fed. Graph from Maudlin Economics

Investment company research describes the now-repentant companies as exercising "capital discipline." Capital discipline means they book their profits, increase dividends, buy back shares, and don't spend the extra money they are earning on new production. American consumers may have been delighted that oil companies over-invested and lost money selling gasoline, but oil company stockholders and executives want oil companies to be profitable. 

Data from Dallas Fed. Graph from Maudlin Economics

Can Biden do anything about this? Not much, which is why he is not doing much other than a symbolic gesture of taking oil from the strategic reserve. 

There is a bit of good news.  If oil companies were quite sure oil prices would go higher and stay above $100/barrel, they would change their investment strategy. They don't and they aren't. They expect gasoline prices to fall before long.

Shoot the Moon

The time has come.   
Just go.
GO!
I don't care how.
You can go by foot.
You can go
by cow.
Marvin K. Mooney,
will you

please go now!

Donald J. Trump isn't going away.

Trump is like a large cold sore on the lip of a contestant in a beauty pageant. It keeps oozing, so it needs constant attention. It is front and center in the middle of her face. It seems to have a mind of its own. And it won't go away.

Democrats aren't pretty. But Republicans have Donald Trump in the middle of their faces.  It is what can save Democrats in 2022. 

Democrats seem to be incapable of getting into sync with the public mood, or changing that mood. Yet Republicans will lose if they cannot get rid of the cold sore. Trump has believers. GOP officeholders and candidates go along for the ride.

Trump has moved into a manic phase. He keeps holding rallies. He gets a big audience response to his stolen election shtick. He sounds wild and desperate. He has a King Lear rage manner about him. March 29 he published seven statements, included this: 

Statement by Donald J. Trump, 45th President of the United States of America.

While they say that January 6 was an “attempted coup,” which it was not, they should add that the Election on November 3 was the actual coup. All you have to do is look at the massive evidence in Swing States, available upon request (with much more to come). Our Country is paying a big price for that Rigged Election!

And this:

Statement by Donald J. Trump, 45th President of the United States of America

So, let’s get this straight. The Democrats commit massive and overwhelming voter fraud in the 2020 Presidential Election, and they want the Republicans to go to jail for investigating and protesting a very crooked Election? Republicans must get tough (and smart!) and not let them get away with the Crime of the Century!

Democrats face a miserable midterm election. There is the usual pendulum swing of the off-year election, plus inflation, impatience with COVID, supply chain issues, and a general mood of discontent. I consider Biden's age, feebleness, and fumbling speech to contribute to the discontent. Biden communicates continuity, which isn't all bad, and general incapacity, which is very bad. Biden can say "change" and "new" but it doesn't matter. The messenger is part of the message. Biden looks like the grandpa who sits at the head of the table out of respect, but he is no longer the head of the family. After Thanksgiving dinner some younger family member drives him back to the Assisted Living facility because he really shouldn't drive anymore, especially at night. 

Trump can save Democrats. In the card game of Hearts, the winning strategy is to get as few points as possible. However, if one's hand is very bad, a sometimes-winning strategy is to reverse polarity and take all the points. Lose so big you win. That is the game in which Americans and Democrats find themselves. Trump is the Queen of Spades. He remains the giant, looming disaster for America, and enough people realize it to elect Democrats. Republican leaders are afraid to cross him and the GOP electorate he leads. 

America may well choose to continue the Trump Era and re-elect him and people who support him.  A majority of the Republican primary electorate likes what Trump has to say. That is a risk. But Trump makes a majority of Americans very uncomfortable. If he would just calm down and shut up, admit that Biden beat him but that he is coming back for a re-match, Rocky-style, he and Republicans might win big in 2022 and 2024. But he won't.

He isn't going and he isn't changing his story.