THE COLOR OF POT CAMPAIGN IS GREEN, AND BASED IN OAKLAND

Win or lose, the marijuana legalization measure on November's ballot
proves one thing: The pot industry has arrived in California politics.

Oakland's most prominent purveyor of medical cannabis has almost
single-handedly financed the Tax Cannabis 2010 campaign - a
once-unthinkable occurrence. Election experts say it's a sign that
the pot industry has reached a rarefied political pinnacle: Pot can
afford to buy its way into voter-approved legitimacy.

Just as PG&E spent $46.4 million to push Proposition 16 and Mercury
Insurance spent $15.9 million to push Proposition 17 to further their
own interests this spring, so too is Oaksterdam University in Oakland
shelling out millions to invest in its own economic future.

And Oaksterdam's owner, Richard Lee, could arguably make a mint if
the measure passes.

Sure, the June primary's two corporate-backed measures failed. This
one might, too: Early polling shows voter support is soft at best.

But legalized or not, marijuana, long an underground, counterculture
province, is taking its place in California's political and business
establishment alongside "The Man" - traditional corporate interests
such as power utilities and insurance companies.

For his part, Lee agrees, though he doesn't embrace being "The Man."

"When we started the campaign, we did want to make this a legitimate
political issue and I think we've succeeded already, win or lose," he said.

He and his measure's supporters have done so by framing it not just
as drug legalization but as an issue of civil rights, by claiming
hypocrisy in the legality and rampant advertising of alcohol; by
arguing that a booming, legal cannabis industry could create
much-needed jobs; and by touting public policy benefits, in that law
enforcement costs would plummet while local governments could reap a
windfall of new tax revenue.

But they'd not have had the forum to make these arguments in earnest
had Lee not shelled $1.4 million of his own money to put the measure
on November's ballot.

Capitalist Activists

"If you have enough money, you can qualify almost anything on the
ballot," said Bob Stern, president of the nonprofit, nonpartisan
Center for Governmental Studies in Los Angeles. That goes for
marijuana just like any other industry.

"Clearly it's going to be the most controversial and interesting
measure on the ballot, it'll be the measure most people will be
talking about, so he's clearly achieved that - it will be front and
center in the debate," Stern said. "I think it'll increase voter
turnout, both on the libertarian and the liberal sides."

San Jose State political science professor Larry Gerston agreed.

"You see an opportunity and you take it," Gerston said. "I can't
fault these people for being enterprising capitalists in a market
that is virtually unregulated. They're pretty smart.

"These guys will have lobbyists; they're already building trade
associations. It's all part and parcel of a burgeoning industry."

Some might say Lee stands to make a lot of money, more so if the
measure passes. He has built a business infrastructure that includes
a medical marijuana dispensary, a grow operation and a center that
teaches others how to grow, all of which would put him at the
forefront of recreational cannabis horticulture, sales and marketing
as soon as it's legal. Even if it doesn't pass, the campaign is
drawing attention to Oaksterdam University and its related businesses.

Lee said he doesn't see it that way.

"It's also a big risk, it's putting a big target on me, not to
mention all the money that's being lost," he said. "And I see it as
making it possible to have more competition."

The Politics of Pot

Signs of the industry's political mainstreaming abound. Oakland last
year became the first U.S. city to tax medical cannabis proceeds - a
tax masterminded by Lee.

"My goodness, that was a stroke of brilliance," Gerston said, in
terms of legitimizing and mainstreaming the industry.

Last month, workers at Oakland cannabis businesses including Lee's
joined United Food and Commercial Workers Local 5. Some now wonder
whether union slate mailers this fall will urge a yes vote on the Tax
Cannabis measure.

On the national scene, 14 states and the District of Columbia have
adopted medical marijuana laws; bills are pending in other states,
and voters in Arizona and South Dakota will see such ballot measures
in November, as California and possibly Nevada vote on recreational
legalization measures. And politicians on either side of the aisle -
including Oakland mayoral candidate and former state Senate President
Pro Tem Don Perata, a Democrat, and former New Mexico Gov. Gary
Johnson, a Republican - endorse Lee's measure.

In fact, about a month after Perata's endorsement, Lee's S.K. Seymour
LLC gave $10,000 to Perata's committee for a tobacco-tax measure.
Coincidence, or a classic you-scratch-my-back-and-I'll-scratch-yours
political moment?

Of the $1.41 million Lee put into his own measure, almost $990,000
went to Masterton & Wright, a Bolinas firm that gathers petition
signatures for ballot measures.

But the campaign also is paying top-shelf pros such as spokesman Dan
Newman, who also works for Democratic lieutenant governor nominee
Gavin Newsom's campaign and for the "Level the Playing Field"
independent-expenditure committee waging war on Republican
gubernatorial nominee Meg Whitman. Blue State Digital, a Washington,
D.C.-based firm with past clients including the Obama for America
presidential campaign, the Democratic National Committee and the
AFL-CIO, designed the measure's website. And Chris Lehane, a renowned
political communications strategist dubbed a "master of disaster" for
his spin work in the Clinton White House and campaigns, is doing work
for the campaign free of charge.

"It's a serious campaign, it's gone beyond working on the fringes,"
said assistant professor Corey Cook, director of the University of
San Francisco's Leo T. McCarthy Center for Public Service and the Common Good.

Raising the Green

It will be an uphill battle. Of three polls released last month, only
the campaign's own showed more than 50 percent support, and even then
by only a small margin. Any California political observer would say
that's a tough place from which to start.

Lee said the campaign is using focus groups in order to target
undecided voters and mobilize new voters, but he's done paying the bills.

"My main part was getting the language written," he said, "and then
getting the petitions to get it on the ballot, and then to turn it
over to the professionals to get it passed."

Yet an e-mailed fundraising plea raised $50,000 in April, he said.
"We hope to raise $10 million, $10 each from a million people," Lee
said, acknowledging that's not much for a California ballot measure
but arguing a little will go a long way on the issue. "Our numbers go
way up when we explain the issues and the measure in depth."

Cook agreed: "$10 million is nothing in California," he said -
especially given the rise in advertising rates likely to accompany
record spending in 2010's gubernatorial and senatorial elections.
"But I would kind of be surprised, given a lot of other things going
on in the state, if there's a lot of money pumped in on the 'no' side."

A "Public Safety First" coalition with members such as the California
Police Chiefs Association, Mothers Against Drunk Driving and the
California Bus Association already is speaking out against Lee's
measure, yet none of these groups has deep pockets.

Meanwhile, Tax Cannabis 2010 is building people power: Its Facebook
page is "liked" by more than 97,000 people. For context, Democratic
gubernatorial nominee Jerry Brown has just more than 27,000 and
Republican gubernatorial nominee Meg Whitman has close to 28,000.

"Three times as many contributions and three times as many votes, and
you're in good shape," Cook observed, noting Facebook support doesn't
necessarily translate to either. The committee won't report its
finances again until early August.

Yet Tax Cannabis 2010 might have advantages that last month's
corporate-funded measures lacked, Cook said.

PG&E and Mercury Insurance tried to educate the public for the first
time about problems that, to many, seemed like no problem at all,
while this measure addresses an issue that has been talked about for
decades. "There's an idea that its time has come," Cook said.

"Part of it is the aging of the California electorate," he added,
noting baby boomers in their 50s and 60s in many cases did and still
do smoke marijuana. "That is the establishment now."

And while efforts to legalize marijuana always could have been framed
as a revenue-raising effort, there's no better time to make that
pitch than in the midst of a national recession and state fiscal crisis.

"This was a solution in search of a problem, but now there's a
problem that matches it," Cook said, adding Lee and the measure's
supporters "would be crazy not to be taking advantage of the
political opportunity that's in front of them."