Money not well spent: Fraser
Sheila Fraser, the federal Auditor-General, yesterday released her latest report on Ottawa’s management of its programs and spending. As in the past, the Auditor-General found many areas in which government spending was excessive or lacked proper oversight.

The federal government is charging too much for passports, doesn’t know what to charge for medical marijuana and may not be charging enough for some other fees it collects.

Yesterday’s report indicated Ottawa collected $1.9-billion in fees on everything from issuing passports to granting licences to manufacture drugs. The money represents a small fraction of the more than $200-billion collected every year in taxes and duties.

[T]he auditors discovered Health Canada is probably undercharging Canadians who are allowed to buy marijuana for medical purposes. Health Canada charges $5 for a gram of dried marijuana or $20 for a packet of 30 marijuana seeds. Some “compassion” clubs, which try to assist those who need marijuana to ease chronic pain, charge twice as much for similar amounts.

Health Canada plans to recalculate its charge.

There’s just one problem with this analysis: the marijuana being supplied by Health Canada is of very poor quality compared to that which is sold in the compassion clubs.  It is only worth half of what the quality marijuana is worth.

Health Canada maintains a monopoly supply on government medical marijuana.  The herb is grown 500 feet below the earth in an abandoned zinc and copper mine in Flin Flon, Manitoba.  I’ve spoken with Philippe Lucas from the Vancouver Island Compassion Society about this issue, and he tells me that not only is the Flin Flon weed quite schwaggy, but also there are concerns about its safety after being grown where so many harsh mining chemicals had been used.

Health Canada needs to open up the production of marijuana to the many excellent independent growers in Canada.  British Columbia itself could probably manufacture enough high-quality marijuana to supply the whole country.

But here is where the prohibition rub comes in.  Because there is a lucrative black market both in Canada and the US for high-quality marijuana, the price of marijuana is artificially inflated by prohibition risk.  BC growers want to divert their strains to the top dollar buyers, not to some government that will fix the price and create many bureaucratic headaches.

And the government must either grow poor quality weed that can remain low cost and out of competition with “BC Bud”, or raise quality and prices to match the black market.  Government can’t charge less for good medicine, else people will purchase it and resell it on the black market for the margin.

Come on now.  $5, $10, $15 for a gram for a weed?  $20 to $50 for a packet of seeds?  Can you name any other consumer agricultural product that demands such exorbitant pricing (yes: tobacco, due to high taxes and saffron, which grows in few places during a short season and must be harvested by hand by picking the individual stigma off the flower)?  What do you think marijuana would cost if it were completely legal and farmers could grow acres of it outdoors?

Tags: Canada, Health Canada

This entry was posted on Wednesday, May 7th, 2008 at 7:10 am and is filed under 4:20 NewsHour, International, Medical Marijuana. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a trackback from your own site.