B.C.'S GRASS REALLY IS GREENER

Home-grown, highly potent marijuana is now as economically important to the
province as logging

WALK DOWN the creaking stairs into the basement of the man who calls
himself Ken Black and there it is, the wave of the future, the saviour of
the creaky British Columbian economy, the newest Canadian export success
story.

Dope. Also known as grass. A.k.a pot. Real name, marijuana. Green gold.

B.C. marijuana plantations are no longer just isolated plots located deep
in the province's interior.

Now, most B.C. dope is cultivated indoors in Greater Vancouver usually in
private homes.

Black (who, for obvious reasons, prefers to use a pseudonym) is a
small-scale grower. His 65 plants, growing under high-intensity lamps in an
otherwise unremarkable Vancouver house, will produce about six pounds of
prilne B.C. marijuana this year.

That six pounds will be worth $18,000.

"Most of it will be for me and my friends," he says. "But I'd like to sell
a couple of ounces a month just to cover expenses."

Black is typical. In B.C.'s lower Mainland, marijuana cultivation has
become a wide-spread and lucrative cottage industry.

Stroll down any street, particularly in Surrey, a bedroom suburb situated
right smack against the U.S. border, and you're sure to run into what is
called a grow house.

If the heavily curtained windows don't give away what's inside, the whir of
fans and the occasional skunky-sweet smell of maturing marijuana plants
will.

Constable Vince Arsenault, of the RCMP's Surrey drug squad, estimates a
sophisticated grower can produce $150,000 worth of marijuana in his
basement every three months - on an initial $8,000 investment.

He also estimates that on some streets in his city of 325,000 every second
home is a grow house.

"It's absolutely phenomenal," says Arsenault. "We average one (bust) per
shift - and we're focusing only on the commercial-level, large-scale
operations.

"We're just scratching the surface."

The value of the B.C. marijuana crop is equally phenomenal. Officially, the
RCMP estimates the crop is worth about $1 billion a year. But Constable
Scott Rintoul of the RCMP's drug awareness branch says the real number
could be closer to $2 billion.

That would make pot as economically important to B.C. as logging, and
roughly twice as important as the entire pulp and paper industry.

Salmon fishing, which has captured so many headlines recentlv, doesn't hold
a candle. Accordiug to Statistics Canada, the entire B.C. fishery was worth
less than $300 million last year.

Throughout B.C., the mood is gloomy, as these traditional industries,
battered by a combination of overfishing and the Asian crisis, head into
recession.

By comparison, marijuana has taken off.

Thanks to the introduction of sophisticated growing and marketing
techniques, B.C. marijuana is prized throughout the world.

A pound of prime B.C. pot sells for $3,000 in Vancouver and $3,000 (U.S.)
just a few feet across the border in Blaine, Wash., says Arsenault.

By the time that pound of dope reaches Los Angeles, it is worth $6,000
(U.S.) and can be exchanged for a pound of cocaine.

Indeed, some of B.C.'s marijuana traders deal in barter - taking pot across
the border and returning with cocaine.

But Arsenault says that for drug dealers, cocaine is passe. Many are
getting into marijuana.

"The only people dealing in coke and heroin are those who are too lazy to
grow dope. The profit margins in marijuana are so much bigger."

The story of B.C.'s marijuana miracle is almost a textbook case of
successful late-2Oth century capitalism.

All the ingredients touted by the best business schools were present:
modern scientific methods, innovative entrepreneurs, free trade and an
industry-friendly regulatory regime.

Dope had been grown up and down the Pacific coast of North America.

But when, under presidents Ronald Reagan and George Bush, the U.S.
government began to crack down on drugs, even first-time marijuana growers
in that country found themselves facing mandatory two-year jail terms.

As late as 1994, by contrast, first-time offenders nabbed in B.C. were
likely to get no more than a $1,500 fine for growing marijuana.

Arsenault says growers referred to their fines as "paying the GST," a cost
of doing business.

At the same time, savvy B.C. pot smokers were busy experimenting with new
strains of marijuana.

Dana Larsen, the editor of Vancouver's Cannabis Culture magazine, points
out the province has had a long experience with marijuana. It was only
natural to put this investment in human capital to use.

Essentially, B.C. growers came up with the same techniques used by
scientific farmers in other fields. Careful breeding would produce the
plants richest in tetrahydrocannabinol, or THC, the mood-altering
ingredient in marijuana.

As in large-scale, corporate hog farming, quality control could be achieved
through the technique of total confinement - growing the plants indoors
under meticulously regulated artificial lighting conditions.

Some growers found that hydroponic methods, growing the plants in soil-less
water-soaked sponges, produced superior yields.

The most recent technique. says Larsen, is aeroponics - hanging the plants
in the air and spraying their roots regularly with a nutrient-filled, water
mist.

"Some people swear by hydroponics. others say aeroponics is the way to go,"
he says. "Others stick with soil. Who knows? It's a real debate."

The 18th-century political economist Adam Smith, often referred to as the
father of free enterprise, pointed out long ago that the division of labour
could lead to superior profitability

It's a lesson not lost on B.C. dope growers. Arsenault says there are two
increasingly common models for the industry.

In one, a grow-house specialist will set up an entire marijuana operation
for the client - lights, water, fans. The specialist is then paid his fee
and walks away to do the next job.

This is akin to the turnkey operations used by large-scale engineering
firms who build nuclear reactors.

In the second, or McDonald's model, an investor will set up what are in
effect franchises. He will provide the capital to a subcontractor, on the
condition that he grow the marijuana to specified quality standards.

The crop is usually divided between the two, with the bulk going to the backer.

For the labour-intensive task of harvesting, growers will often take
advantage of specialized employment firms. Arsenault calls it
dial-a-harvest.

These firms import pickers, often from regions of high unemployment in
Atlantic Canada. Paid about $20 an hour, and offered inducements in kind,
the pickers will carefully separate and bag the THC-rich marijuana buds
from each plant.

Most of the product is then shipped across the border. The RCMP estimates
that 75 per cent of B.C.'s indoor marijuana crop is exported to the United
States.

Here. as in so many other export industries, the North American Free Trade
Agreement has been a blessing. Traffic is brisk across the border between
B.C. and Washington state; U.S. Customs agents cannot search every vehicle.

As well, knowledgeable insiders say, some entrepreneurs have taken
advantage of the no-inspection lanes established for those otherwise
legitimate Canadians who do regular cross-border business.

As in any high-growth industry, B.C.'s small-scale marijuana growers face
threats from predatory competitors.

The RCMP claim that already 70 per cent of B.C's commercial manjuana
operations are controlled by the Hell's Angels motorcycle club.

Others dispute this figure.

"I think the Hells Angels connection is overstated," says Cannabis
Culture's Larsen.

"The police say that to discredit the pot growers. I know people who cross
the border regularly with up to 100 pounds a week and they're no Hells
Angels."

Arsenault acknowledges that no member of Hells Angels has ever been
indicted in the Lower Mainland for involvement in a marijuana grow house.

However, he says, club members have been involved in franchise operations,
renting properties that are used by others to grow marijuana.

"But that in itself isn't sufficient to prosecute."

Rintoul, of the RCMP drug awareness branch, says the international nature
of the business requires a sophisticated organization.

"The demand in the U.S. is so intense. Each order might be 50 to 200 pounds
a week. To move that amount, you need organization."

By organized crime, he says he does not mean just organization like the
Mafia. Many B.C. pot operations are independent of the more traditional
gangs.

Ken Black acknowledges there are risks involved in an industry that
operates outside the law. In some ways, the B.C. pot industry is like
Russian capitalism. Growers never know when an armed competitor might break
in to make off with the goods.

"And you can't call the police if you're ripped off," says Black.

Still, he says he doubts that the entire trade could ever be monopolized by
the organized gangs. It is just too easy, he says, to grow marijuana at
home and slip it into the U.S.

Look at him.

He bought a couple of high-intensity lamps at a local gardening store, some
plastic sheeting, a timer, two small fans and seeds - all for less than
$1,500.

He had a friend wire his lights into his clothes dryer ("It means we can
use the dryer only six hours a day, which is a bit tough with a baby, but
oh well.")

And if Black wanted to export, who could stop him?

Stuff 10 pounds of grass into a backpack, take the bus to Surrey, step
across the ditch at the edge of town into the U.S. and there you are.

With this, Arsenault agrees. 'While not a supporter of marijuana use, he
says he is fighting an uphill battle.

"We lost the war against drugs years ago. Anyone who thinks we can win it
though enforcement alone is foolish.

"Still, we've got to try as hard as we can."


Checked-by: (Joel W. Johnson)