This week we bring you another of our Throwback Thursday episodes. If you’re just now joining us, our Throwback Thursday series is comprised of earlier recordings that never made the final cut. Essentially podcast b-sides.

This particular episode takes us back to November 7th, 2012, just a day after the 2012 general election. In addition to the presidential election, statewide elections also took place and we draw our focus to two of those particular elections. The great states of Colorado and Washington both legalized marijuana. In doing so, both states took a huge step forward in eradicating the absolutely absurd idea of protecting people from themselves through the even more absurd moniker of “The War on Drugs”.

Perhaps even more important is that this action pointed a giant middle finger towards the federal government. Now 8 months later, both states seem to be doing just fine though we’re always curious to see what kind of threats federal agents have planned next.

We discuss the changing times, states rights, and Jad even provides us with some background on the Marijuana Tax Act of 1937. This begins a larger discussion on how the IRS may be used to control state’s rights in the future of drug prohibition.

Material from Podcast

Music

• Smoke Two Joints by Sublime.

Additional Reading

• The Marijuana Tax Act of 1937

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Transcript of Podcast

Kevin: Hello and welcome to another installment of the JK Podcast, an anti-authoritarian free speech zone passionately pursuing liberty, humanity, and equality for all people. This week we bring you another of our Throwback Thursday episodes. If you’re just now joining us, our Throwback Thursday episodes are comprised of earlier recordings that never made the final cut – essentially, they’re podcast B sides.

This particular episode takes us back to November 7^th, 2012, just a day after the 2012 general election. In addition to the presidential election, statewide elections also took place and we draw our focus to two of those particular elections. The great states of Colorado and Washington both legalized marijuana. In doing so, both states took a huge step towards eradicating the absolutely absurd idea of protecting people from themselves through the even more absurd moniker of the “war on drugs”. Perhaps even more important is that this action pointed a giant middle finger towards the federal government.

Now eight months later, both states still seem to be doing just fine, though we’re always curious to see what kind of threats federal agents have planned next. In this episode we discuss the changing times, state’s rights, and Jad even provides us with some background on the marijuana tax act of 1937. This begins a large discussion on how the IRS may be used to control state’s rights in the future of drug prohibition.

Joining us for this episode is our friend, Tom DeLorenzo, who incidentally was having some mic problems, and we apologize for the poor quality. As always, I’m joined by the co-creator, Jad Davis. I’m Kevin Ludlow, welcome back to our show.

Well I think that was a practical example that just came about yesterday, right? Colorado – the marijuana passing – and I really think an application in our society anyways you know – may have to put some real terms to it – but I think that’s I mean, it’s going to expose all sorts of questions because I think the reality is is that probably a lot of people in this country really do disagree with the way that the drug war works. I think most people are fairly rational about it, but at the same time nobody really seems willing to take the rational, scientific, statistical side of it – for whatever reason – it’s just a you know, it’s 100 years embedded into the culture, and all sorts of negative things, probably Judeo-Christian[?] things behind it, et cetera.

So I’m really curious to see what happens here now that we’ve got one state challenging – or two states in this case – challenging it. I think it would be really interesting as a social experiment to see exactly what that means because the rest of the country is just going to start kinda dogging on those two states and saying that this is horrible, they shouldn’t do this, this is socially unacceptable, this is terrible for children, it’s a poor influence, et cetera – like all those sorts of things. Or is the rest of the country going to very quickly kinda start realizing like, this is absolutely absurd that we’re even debating this. Of course we should change this law, it doesn’t make any sense whatsoever and from a statist point of view I mean, there’s tax money to be made from this, it’s safer, we can regulate it, we can end this dependency on whatever else – just fill in the blanks. So –

Tom: Well annoyingly for you enough I tend to be optimistic along those lines because yeah, I think maybe when new ideas, when new paradigms come along, people hear about them and they think about them and they might think they’re a good idea, but they look around and they see everybody else outwardly doesn’t support it, so they don’t.

Kevin: Right.

Tom: But it’s in their head and if you only see one or two people standing up with their protest signs or doing something it’s like man, you know, they’re on their own over there. Yeah, if a whole state changes a law like that you know, then the state next to it then goes, “well, we can do that.” I think it’s in people’s minds and they’re aware of it and they think it’s a good idea, and maybe one state, a state or two starts [?] then that might be enough for everybody to just say, “look, there’s enough people doing that. They’re allowed to, we should be able to do it because it’s a stupid idea, it was always a stupid idea, let’s just change it.”

So yeah, I can see how a small number, but large enough to kinda be perceived as a stable [?] is enough for people to jump in and say, “yep, good idea”, especially if they’ve been kinda marinating in that idea for a number of years. I think – especially with drugs – I think a lot of people are kinda relate[?] to the fact that it’s a little bit ridiculous, the technicalities that are –

Kevin: Sure.

Tom: – [?] marijuana, for example.

Kevin: Well I think it goes to a larger point and one that I’m very passionate about is the you know, state’s rights, 10^th amendment sort of thing, at least from a constitutional point of view because I mean we’ve all but removed state’s rights from the country at this point, so I’d be very curious to see how this plays out and to see if that has any effect on the state rights debate overall because really, this is the sort of thing that should’ve happened a long time ago because any one of the states should’ve been able to say unilaterally that they are going to do this, and if it’s a good idea then other states can follow, and if it turns out to be a bad idea then other states should you know, tend away from it. It’s the whole idea of the smaller states making up the larger government, I think in principle is a good idea.

Tom: I think you guys are more knowledgeable about it than I am, but what about California? I mean, they have some medical marijuana legislation that it’s legal to get it certain spots but then the federal government’s jumping in there and closing down places.

Kevin: That’s right. Colorado’s also had – or at least Ember – has had medical marijuana for some time also, and I think California’s just the biggest example because the entire state passed it and I think I read an article today that was saying that when that happened in California – at the peak of it anyways – there were more medical marijuana dispensaries than liquor stores in the state, which is pretty fascinating if you think about it seeing on how they would’ve had to open up essentially overnight and for them just to be propped up like that. But yeah absolutely, the Obama administration has really cracked down on it very hard. It’s a pretty negative talking point against the Obama administration at the moment.

Tom: Yeah and [?] it seems the federal [?] and stuff – the trump card.

Kevin: Well right, you’ve actually got two states that have done it, so Washington state did it, and then Colorado did it, and then you’ve got these few other states who are still allowing medical marijuana to exist. I think I was reading, I think it’s like 23 states right now actually that have some type of medical marijuana law, so it’s quite a bit more significant than I thought.

Jad: I had no idea it was that many.

Kevin: Yeah, I think that’s what I read today – maybe it was a little less, but – sorry, according to this medical marijuana page I just found, apparently it’s 19 states right now that have a medical marijuana law of some sort.

Jad: I had no idea. I was wondering, I guess it all depends upon how the federal government decides it wants to handle it, but I was thinking that they could do some of the same mildly coercive tactics that they did with like, the drinking age or whatever like they could say, “you can have you know, medical marijuana, but we’re not going to give you inner-state funds if you you know, if you have recreational marijuana”, or whatever, just that kinda like, stupid, petty exercise of control.

Kevin: Yeah.

Jad: I guess I don’t have to worry about that too much since they can right now send in storm troopers with machine guns and they can just kick down the store and take everything and arrest everybody, so they don’t have to worry about the soft, soft tactics yet.

Kevin: Yeah but that’s a really good point though. You know, Jim said to me today that he thought would be interesting is if they use the IRS for this, which apparently they have done in other cases before.

Since Jim has otherwise never been introduced into our show, here’s a little back story. Jim is a former co-worker of mine and a current co-worker of Jad’s. Like Jad and I, he is a software engineer, but he also happens to have family ties into the U.S. military. He has a passion for history, and on occasion provides Jad and I with pretty interesting talking points – in this case how the IRS could be used to thwart marijuana state distributors.

He felt that the IRS would actually become one of their most powerful agents in this. It kind of introduces this catch 22, right? So if you don’t admit to it – like if you’re selling marijuana legally per your state law, but if you’re selling the marijuana, you still owe a federal tax on that. So now you haven’t declared it and so now what they do is they set up sting operations and they start busting people for racketeering. Instead, the catch 22 is that if you do declare that you’re running a marijuana shop then the federal government charges you with you know, some sort of drug case, so I thought that was kind of an interesting way to consider it.

Jad: Yeah, the weird thing about – to kinda go with the IRS thing – the way they shut it down was just totally weird, it was like – I think it might even still be the case technically that you can buy and sell marijuana, you just have to have a stamp –

Kevin: In like, California you mean?

Jad: No, no, I’m sorry, like in the – this started in the 40s and 50s, like whenever they first started it in Arizona and New Mexico, like down by the border, the state of New Mexico and the state of Arizona said, “carry on as normal, marijuana’s still entirely legal just like it always has been, but if you’re going to buy or sell it, you need to get this stamp that you affix to the package that you sell it with”, you know, and that’s how it’s taxed or whatever, and then they just didn’t make any stamps – and that was it. So it was like what you were saying with the IRS thing, nobody was – nobody was selling something that was illegal to sell, they were just selling something without the appropriate paperwork or without the appropriate sanction.

And then again, that sort of thing seems so weird to me. I guess it’s just the breaking in of something, like if they were to say it’s illegal and we’re going to arrest you for doing it then people might get upset, but if they were like, “all you need to do is acquire one of these stamps to affix to the product to sell, and then just don’t give the stamps out” –

Kevin: Right.

Jad: – as a soft way of accomplishing the same goal.

Kevin: Well I think to the point of it – at least in my conspiratorial mind a little bit – you know, if you recall what I was saying at lunch about the banks, and just corporations and finances in general, the real short of it is just that I think the underlying goal that people have to keep in mind about any type of a business – but let’s just limit it to banks in this case – is that their sole goal is to make money, so no matter what you impose upon them, if all of a sudden you say, “OK, you can’t charge customers higher than a $15 chargeback on a bounced check”, then the bank says, “well, fine. We don’t want to comply with this but we will.”

So what are they going to do, are they just going to start losing the money that they were previously making – no, they’re just going to impose another rules that says, “OK well now we have a minimum that you have to hold in your account”, so they’re going to balance it to make the money and then maybe five years later the government says, “well you can’t have that minimum anymore”, and so they say, “OK, well now we’re going to charge a plastic fee for all of our debit cards, so you have to pay $5 a month just for the privilege to hold the card”, or whatever – it never ends.

And I think on the side of government, again, you have to look at what the end goal is, right? I think people want to believe that the end goal is to protect you, but in reality the end goal is to inhibit you from doing things and so if we recognize that that’s the goal, the government’s never going to lose. So no matter what they do – in my mind – there’s always going to be some caveat that exists where they say, “oh, marijuana’s completely legal, you just have to affix this stamp to it – we’re all out of the stamps, we’re really sorry.” So at the end of the day they’re always getting to still get their way – similar to the bank. They’re complying with everything, but in reality, the customer’s still getting just as screwed.

It helps – in my mind anyways – to present that illusion that there’s forward progress happening and the majority of people I think wind up being very complacent to it – never mind the 4%, 5%, even maybe 10% of the population that says, “Well wait a second, nothing has actually changed, you’ve just pushed the problem over to this issue so I still can’t get the marijuana”, that’s the end goal in that case.

Jad: Right.

Tom: You know, even if you’re [?] is your business, if nothing else the IRS can investigate your personal taxes and probably find something to mess you up with.

Jad: Sure, sure. I think that’s – I certainly subscribe to that particular dark theory that essentially the goal is to make sure everyone is breaking the law everyday so that whenever you need to, you can go pick somebody up and be like, “clearly you’re – don’t have an inspection sticker, your car is not registered, you’re driving too fast – whatever it is – you’re breaking a law and so you’ve gotta come with us.”

Kevin: Well I’m on that page for sure, that’s definitely what I was saying as far as the conspiracy theory. I think that’s the goal of the government, just like I always say what the goal of the business is.

Tom: Well you know, you can’t look at people who try and sell [?] you know, they get raided for some reason, I don’t know why. If it’s illegal, the guy who’s selling silver coins who got arrested, he was checking with the treasury for years before that to make sure that everything was cool and everything was fine until they arrest him.

Jad: Until it wasn’t. Yeah that’s the – another story that reminds me of in the category of just don’t ask, is the one where the – some family found like – I can’t remember what they’re called – but they were some particular kind of coin that was minted in the early 30s right before the gold seizure, and so all these coins were supposed to have been melted down. So they had this cash of coins, like 20 gold coins and like I said, it was inherited or you know, passed down, it was in a box in an attic or whatever it was, so they took them to the treasury to get them verified – I can’t remember if it was the mint or – I’m not sure what agency it was. But they took it to the federal agency to see like, are these real actual coins, and they seized them.

Kevin: Oh wow.

Jad: And so they had like – yeah, there were like 20 coins and they were worth $20,000 each or something like that, so – and yeah, they took them from them. So it’s also – and this is a tangent I think – but like they don’t call the police, if you’re – need someone to be shot to death – which you know, sometimes I guess maybe you do, you’re being attacked, whatever – that’s when you call the police. Like, noise violation, that sort of thing, you’re just waving around a loaded gun you know, and it seems like there’s an entire category of things where it’s best just not to ask the authorities because it’s probably going to end up badly for you.

Kevin: Yep.

Jad: Or those immediately around you.

Kevin: Yeah, absolutely. I think that’s very true, unfortunately. A few times I’ve to call 911 around here for various things. I definitely never give them my address because they’ll ask you at the end, they’re like, “do you want an officer to stop by and talk to you? Can we call you back”, and I don’t know that it makes a difference but I definitely say no on every single thing because I don’t want to have anything to do with whatever’s about to happen just in some random cases there’s some serious violence that I’ll see happening and pretty rare I get involved in that otherwise because the last thing I want is to have a run in with the police, even though I’m sure I’d be on the right side of it.

Jad: Well don’t be too sure.

Kevin: I say that, but at tongue and cheek, I mean it’s specifically why I don’t tell them. I don’t want to have anything to do with it.

Jad: Yeah.

Kevin: Just too many stories.

And so we conclude this week’s Throwback Thursday episode with our own personal PSA about calling your local police department. Thank you so very much for tuning in to the show and w e certainly hope you enjoyed the content. We do love hearing from our listeners, and so if you have any questions, comment, or ideas for the show, please contact us. You can reach us both through the podcast website at www.JKPod.com, or you can reach either of us individually – Jad is at www.Jad-Davis.com, and Kevin is at KevinLudlow.com. Transcription services for the JK Podcast are provided by Deidra Alexander of Galaxy Creative Media. Thanks again, and we’ll catch you next week.