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Inside Cannabis

Inside Cannabis (Oct 20th, 2017)

THE ENTREPRENEUR BUILDING REPARATIONS INTO THE INDUSTRY

If you've been following the growth of the legal cannabis industry, you probably know that diversity – or lack thereof – is a major topic of late. While no formal statistics exist to give a clear sense of just how unbalanced the industry is – the Drug Policy Alliance estimates that less than 1 percent of cannabis businesses are owned or operated by people of color while a Marijuana Business Daily survey found that 19 percent cannabis business owners or stakeholders are racial minorities – what is known is that the criminalization of cannabis, or "the war on drugs," has overwhelmingly impacted communities of color.

Though cannabis is becoming more widely accepted, this impact is ongoing. Blacks are still 3.73 times more likely to be arrested for marijuana possession than whites, according to the ACLU, and many laws in the states with legal cannabis markets ban people with criminal records from working in the industry, pushing an already marginalized group even further out.

In an effort to solve this glaring discrepancy, many jurisdictions have implemented or are working on implementing equity programs, which aim to ensure a certain amount of business permits and sometimes even investment capital are reserved for entrepreneurs of color. But Galen Pallas wants to take it a step further. Instead of relying on policies to dictate how people of color are supported in the industry, the cannabis entrepreneur plans to donate a portion of his for-profit business to African American youth as reparations for slavery and the war on drugs.

Through his yet-to-launch cannabis company, Kind Culture, Pallas will use 5 percent of the earnings to pay for the education and living expenses of African American youth from Oakland, California, who have a parent who is or was jailed due to the criminalization of cannabis. While he plans to start this himself by donating five percent of his profits to black youth, his ultimate goal is to get the entire legal cannabis industry on board with his plan.

Read on to get an inside look at Pallas' vision. This interview has been edited for length and clarity. 

Inside: What made you decide to use cannabis as a way to pay reparations to African-Americans?

Pallas: Growing up in Oakland, as a child, it really struck me as very strange that everyone in Oakland who was poor appeared to me to be the same color. And as an adult and as an older child, when I started learning about it, it didn't sit right with me, especially when you consider the disadvantage that the African-American community has been put at in this country because of its roots in slavery, and later the war on drugs. So I didn't feel right about taking part in an industry that was transitioning an illegal product to a legal market and financially benefiting myself and others from the exact same thing that it landed so many people in jail.   

And so, when I decided to go into the cannabis industry, I knew that a component of running a business for me would involve an aspect of taking care of that community. I had a sense that we could potentially solve a couple of huge problems all at the same time, or at least make headway into some pretty systemic problems in our country. 

I: Tell us about the youth outreach component of the business.

P: I believe that education for all children is vital for the development of a country and to the individual communities that those children belong. And my assumption is that if you provide free quality education, environments that are conducive to children learning, and eliminate worries that children shouldn't have to worry about that every kid will be able to be successful.   

So, we plan on taking a very holistic approach to each kid and making sure that not only is their school paid for but their food is paid for, and that they're part of the program for as long as they want to stay in it. So if someone joins the program in kindergarten and wants to become a doctor, my vision is to pay for everything along the way until that happens to make sure that they come out of the program debt free and obligation free, other than mentoring future generations coming into the program.

I: How are you planning to get the whole industry to jump onboard with this?

P: I think phase one is I lead by example. And phase two, I think the responsibility really comes on that first wave of children who go through the program. All I'm doing is giving money to an area where, quite frankly, there should already be money. And I'm simply repaying a debt that I wish didn't exist but that, because it does, I'm choosing to accept as my own. And so, I think the real work initially is going to come from the children showing that these resources are being maximized and that, given the opportunity, they will thrive.

Ideally, what I would like to have happen from there is to have individual cities and states, as they legalize recreational cannabis, include this in their equity programs. And in the long run, I would like to see that a percentage of every cannabis industry company be given back to the communities that have been ravaged by the war on drugs. Specifically, the African-American community for slavery reparation. I think that it's necessary.

I: Do you think the current equity programs are doing enough?

P: I think the fact that we've arrived in a place where, as the industry starts, politicians and city officials are willing to say, "Hey, we're gonna miss a deadline for going live because we want to get our equity program right," signals huge positive change in the attitude towards equity programs. I think that allowing access to entrepreneurism to anyone who wants to do it is the right move. So I think that Oakland is doing a fantastic job with their equity program. 

I: Final thoughts?

P: Anyone who enters this industry has the unique opportunity of knowing that there is a guaranteed demand for around $56 billion a year for cannabis in North America. And when you add on ancillary marijuana adjacent products, we're talking about over $250 billion a year in wealth. Five percent of that on an annual basis put back into communities that have been ravaged by the war on drugs and have been ravaged by systemic racism and systemic issues that date back to the founding of America, I think this is an opportunity for us as an industry to really put the weight of America's problem on our shoulders and say, "Let us help solve this. Let us take care of this. Let us be the bridge between left and right." So I'd like to see if we can try.

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