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Marijuana, the GOP & Shale Gas Development

Marijuana, the GOP & Shale Gas Development

Monday, April 22, 2013

by Larry Ciptak

frack_uOil & Gas needs marijuana now more than ever.

Hyperbole aside, if you desire Republican rule in 2016 you’re going to want to read this.

In one corner, you have Oil & Gas–not thrilled with the current administration which has done little but stymie the inevitability of natural gas development–looking for hope that the next election will change both political and economic climates. But O&G understands that the Republican Party isn’t what it used to be, is in disarray and seemingly unable to do much more than trip on their own feet as they scramble for ways to remain relevant, of which there is little to no evidence of. Oil & Gas wants real GOP leadership–and legislative branch control to go along with it.

In another corner, you have the Republican Party sweating at the prospect of Hillary Clinton as the next President. Their ranks aren’t exactly swelling with young people sorely needed to repopulate a dwindling and faltering party base. Frankly, GOP leadership has shown itself miserably incapable of reaching young people.
The energy industry needs a reasonable administration to work with to develop this vast natural gas resource. As a nation we’ll again be economically robust, but this time without dependency on foreign energy sources. If the Republicans don’t somehow get their act together and turn things around soon, it’ll be very bad for business. So O&G is rightfully very concerned, especially as they mull over the idea of investing billions on infrastructure that will be necessary for large-scale natural gas development. It needs to be a good investment. O&G needs to anticipate a healthy profit. Some very large multinational corporations are sitting on the shale sidelines waiting to see what happens next before they jump in, because they’re not yet convinced it’s going to happen.

But there is a solution, and it’s great news for the Oil & Gas industry.

It’s called marijuana. The Republican Party may not yet publicly admit it, but they’re seriously looking at making medical marijuana their platform for 2016. Right now it’s apparently a toss-up between that and immigration. But in the near future you may well be hearing incredible public discussions concerning medical marijuana, from top party leaders on down.

If the Republicans embrace medical marijuana before the Democrats do, they’ll attract a multitude of young voters, and not because of the marijuana issue itself. Young people (who work and pay taxes) will see the rational and humane thinking on the party’s part concerning medical marijuana. The Republicans will become instantly relevant to tens of millions of voters who are thoroughly disinterested in them right now.

With the Republicans now having the full attention of these younger voters, they can smartly address the much larger issues of immigration, taxation, job creation, energy infrastructure, etc. Backing medical marijuana isn’t itself going to get the votes–but it will draw a hell of a lot of attention to what the party has to say about other important matters. If the younger demographic (18-29) then relates, their votes will follow. And the party begins to rebuild with a young base.
Eighteen states and D.C. have approved the use and production of marijuana for medicinal use. Colorado and Washington also allow recreational use. The reason? Money. Loads of it. Why not make a mountain of tax money off of weed instead of fighting a “war” that’s already been lost? States are wising up. The inevitable has begun in earnest. First party to claim a stake here wins big.

Most Americans–52-percent of adults–are in favor of legalizing marijuana. This is up 11 points in just the past three years (Pew Research Center). That number is expected to increase further.

Problem for the Republicans. According to the Pew research, 59% of Democrats favor marijuana legalization while only 37% of Republicans do. Add to that the fact that 64% of those age 18-29 and 55% of those 30-49 support marijuana legalization. Just how do Republicans plan to attract those voters? By putting yet another RWG (Rich White Guy) with coiffed hair and $10k suit front and center? Time for a little re-imaging as well.

Any additional social costs from marijuana legalization will be negligible. According to Pew, 48% of American adults have already tried pot. They already have fixed opinions on it. Current pot smokers will finally have access to a potpourri of potted (and for the first time, taxed) product. Pot smokers–a considerable demographic–will continue to smoke and will constitute this new, huge tax and voting base. The fruit is ripe and the fact is someone is going to pick it first.

Bear in mind that states will never fully “legalize” marijuana. Financially, they can’t. Legalization would cut states out of the tax loop. Instead, states will tightly control the industry and impose heavy taxation, making loads of money off of something that history shows is going to continue unfettered anyway.

With the existing states who allow medical marijuana, 2012 marijuana sales are estimated to be between $1.2-$1.3 billion, according to the National Cannabis Industry Association. Couple these tax revenues with a tremendous reduction in court and imprisonment costs and you get an idea of true economic impact. Since no amount of government effort has ever dramatically changed the percentage of Americans who smoke marijuana, working with it instead makes complete sense. And 50% of American no longer consider marijuana usage to be a moral issue (Pew).

Back to party politics. With this platform, young and swing voters will back the Republican Party across the board, because the party will logically make it clear to their new constituency that the GOP needs support in all elections, national, state and local. Mobilize the masses. The goal? Control of both Executive and Legislative branches. Bills could then be passed that are healthy for the economy and based on long-standing and time-tested American principals, and not those of European socialistic models that are now being jammed down our throats and killing us economically.

With the Republicans back in power, pro-drilling legislation will easily get pushed through, and real commerce can commence.

While the newly-elected Republican-centric government is at it, they agree to let O&G export its glut of natural gas reserves–and make an ungodly profit on it–with the understanding that O&G will put some of that profit into the development of the necessary pipeline infrastructure to truly connect this nation with natural gas and make the U.S. a world’s energy production leader.

Of course people will get hurt by this. OPEC will be the biggest loser. And the money currently being spent on overseas wars could be diverted into education and real health care reform that avoids government nationalization. But there’s always North Korea or Indonesia or Bali or somewhere else that’s going to need our friendly military intervention, so expect the flow of arms to continue, just in other countries for other reasons. In a lot of ways it’ll remain business as usual, just a tad bit smarter and with Republicans truly in power.

So there you have the Republican solution to the 2016 election conundrum. Marijuana, followed by some creative strategy. Ironic, yes. Far-fetched? Absolutely not.

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Larry Ciptak