#106 - Weed for the People—Taxed or Otherwise: Elliot Lewis Unfiltered - High Spirits: The Cannabis Business Podcast

Episode Transcript
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Elliot Lewis (00:00):
the same people that stole the fire aid money,
or the same people stealing thecannabis money.
So the management of the stateis just really bad.
The money that is going to thenon-profits doesn't really get
down to the causes that theyclaim to be for.
But they have really nice fancywords that everybody likes and
makes them feel virtuous tosupport these causes.
But really it's just a bunch ofgrifting right a bunch of

(00:34):
grifting right.

Ben Larson (00:35):
Hey everybody, welcome to episode 106 of High
Spirits.
I'm Ben Larson, I'm back andI'm with my co host as always,
NRA Grabstein.
We're recording Thursday,September 23, 2025.
And boy, do we have a show foryou today.
We have the man, the myth, thelegend, Elliot Lewis from
Catalyst Cannabis, and we'regoing to dive into all things

(00:55):
top of Elliot's mind, startingwith California, of course.
But before we get there, AnnaRae, thank you for letting me
take another week off.
I very much enjoyed theMendocino Coast, the Redwoods.
I needed that.
It was a nice deep breath.

AnnaRae Grabstein (01:12):
Yeah, you feeling reborn from the ocean
spirit.

Ben Larson (01:15):
Yeah, I kind of want to go back to it already.
It's like you take, you know,as a CEO, you take a couple days
off.
It's really refreshing.
You come back and it turns outthat you have five days packed
into three, and so it allevaporates quite quickly.

Yeah, well, we're actually recording on the
Jewish New Year, so Shana Tovato all the people that are
celebrating.

Ben Larson (01:37):
Happy New Year.

Yeah, Happy New Year.
And you're just talking aboutbeing in nature and I was put a
little thought over the weekendinto kind of some intentions for
the new year and where my headis that I would just want to
have transformative experiencesin nature as best as I can, kind
of trying to balance it withall the other hectic things in
life, because that's totally iswhat gets me grounded.

(01:59):
I've been actually trying toput my feet on the physical dirt
every single day.

Ben Larson (02:05):
Yeah Well, and you just acquired a new asset that
will allow you to achieve thatright.

Yeah, I got a camper van and it's going to be
a mobile podcast studio, butalso for adventures and meeting
with clients all over the place,so it will be super fun.

Ben Larson (02:17):
Is this gonna be one of those Instagram things?
Do you have like a vision forit?
Where are you gonna likeremodel it?

I'm not gonna like be a van lifer.
I feel like there's a wholebunch of people doing that and
you know, I'm somebody's mom andI own a business and I think
that's that's a good place forme to land.
But I'm gonna have lots ofawesome adventures and hopefully
make some good content for thisshow while in the sprinter van
so you guys, hook up the starlink and and, uh, surprise us

(02:44):
with your next location.
Totally.
That sounds great.
Well, let's jump into a quicknews update and then we'll bring
our guest on.
Yesterday, Governor Newsomsigned the tax rollback, which
was a huge win for Californiacannabis operators, who have
been fighting tooth and nailjust to get the taxes back to

(03:06):
where they were before they gotraised Again.
This is not good enough.
We've talked about this a tonon the show, but it is a win.
It's a win.
That's not good enough.
So we'll dive into this withElliot more on that when we
bring him on.
But, yeah, California.

Ben Larson (03:22):
I guess small wins can take that there's.
There's other bills sitting onthe governor's desk.
We'll see what they go through.
But yeah, california, aKentucky-based company,
cornbread Hemp, has filed afederal lawsuit in Tennessee

(03:45):
challenging House Bill 1376,which essentially is a bill that
prevents direct-to-consumershipping, and Cornbread is
wagering that this stopsinterstate commerce and limits
that.
But I don't know, man,tennessee struggled to create
access for cannabis but openedup the intoxicating hemp market

(04:08):
and so people have access to it,and so it feels like this is a
little greedy.
I don't know.
I don't want to cast too manystones to the cornbread hemp
folks, but I never expectedTennessee to have cannabis, and
in some ways they created itthrough their hemp program.
It's an interesting play, it'slike you know.
Lawsuits have their place inbusiness and politics, but I

(04:29):
don't know how I feel about thisone.
What are your thoughts?

Well, so Cornbread Hemp is one of the
bigger hemp operators, andTennessee is giving them a path
to operate, and so they're justsuing the state because it's not
good enough.
And I think that sometimes,when a business or a person or
anyone wants to make a policychange going, the judicial route
is the path.
So whether or not you agreewith Brett Hemp, it's their

(04:54):
right to the government if theyso choose.

Ben Larson (04:58):
I don't know if it is the path anymore, because
governments, whether federal orstate, have proven that you also
have to play into favoritism alittle bit and bringing them to
the table.
I mean, Sacramento has provenif they don't like you, they're
not going to invite you into theroom.
I'm a little bit of a novicewhen it comes to dealing with
politics.
It seems like it might shut thedoor for further conversation

(05:21):
and make them a little bitbitter towards the broader
category.

That's what I wonder is is if they should
just be happy that Tennessee isletting them sell intoxicating
hemp at all and that this justmight be might be going a little
, a little beyond, but I'm sureit's a calculation.
They know how much they'reselling direct to consumer and
they want to try to maintain it.
Look, I think people love toget products delivered to their

(05:45):
homes, and I certainly envisiona day where people have broad
access to cannabis in manydifferent ways, and so I don't
know Good for them.
This is their right.
I hope that they don't digthemselves into a hole that
creates unintended consequencesfor others that are trying to

(06:06):
operate the right way.

Ben Larson (06:07):
It is interesting to see Kentucky residents suing
Tennessee about THC.
I mean, this is a world that Inever expected to live in,
totally.

Totally Well shoot.
I think that we should justbring on Elliot.
He's going to have a lot to sayabout suing the government.
Anyway, I'm going to cue it up.

Ben Larson (06:26):
Do it yeah.

Today, we're joined by one of the most
outspoken and polarizing voicesin California cannabis Elliot
Lewis.
He's the CEO of Catalyst.
Elliot has grown Catalyst intoone of the state's largest
retail chains, with over 25stores, hundreds of employees,
while also waging war on thegovernment about taxes,

(06:49):
corruption, unions, regulators.
He's been called by differentmedia publications the angriest
weed CEO in California.
But as he's been called that,he's also built a loyal
following through his raw onlinevideos and whiteboard
breakdowns that strip theindustry down to its numbers.
From lawsuits with Glasshouseand fights against the state to

(07:14):
pushing back on Prop 64 and trapshops, elliot has never been
afraid to name names or takeheat, so we're excited for an
unfiltered conversation aboutCalifornia cannabis and what's
broken, what might still befixed and where Catalyst goes
from here.
Welcome, elliot.

Thanks so much for having me on you guys.
I always appreciate some timeto discuss the issues in
California cannabis.
I really appreciate being here.

Ben Larson (07:37):
Yeah, I mean, Elliot , I think you've gained so much
traction because you are ourinner monologues as fellow
cannabis CEOs.
You just say the shit.
That really is top of mind formost of us.
I think it's appreciated.
I think the rawness isappreciated by the community.
Thanks, I hope so Sometimes Notby everyone.

I think some people might take issue when
they're on the receiving end.
We do the best we can to justcall balls and strikes how we
see them try to leave the biasout of it.

You know you're always going to have some
business biases, but you know,do our best just to as much as
we have a platform we think itis Well.
So then let's just dive in.
I want to know how do youreconcile being the guy who
railed against the system butwho now sits atop one of
California's biggest legalcannabis businesses across the
state one?

of California's biggest legal cannabis
businesses across the state?
Yeah, no, that's a goodquestion.
Look, two things.
One, the size thing I'm verycognitive of and it's funny, you
know people will say so owninga chain.
And you're like, ooh, do I owna chain?
And you're like, I guess that'swhat you would say it is.
So you know, we always try toplay small ball.
I stay in really close contactwith the customers, the bud
tenders and all that kind ofthing, and just the best we can

(08:46):
try to build a community thatthe little things still matter.
When we open a new store, do mybest to try to interview every
employee, even though they'regoing to get a job.
Some people think it's silly,but I think it's some of the
more important work.
The little things are the bigbig things.
And then you know, look I thinkit's in hindsight what would we
do if we knew what we knew in2016?

(09:06):
Would we get in bed with thegovernment and, you know,
basically turn ourselves into aglorified tax collector
middleman for the state ofCalifornia?
You know, I've asked myselfthis a lot of times.
I mean, at this point we're potcommitted.
You know we've already blazedthe road the best we can and try
to pioneer a legal cannabisindustry.
So you know I'm on team legalcannabis, but you know we do

(09:28):
have a partner that you knowwe're not that fond of in
particular.
You know, not only the federalgovernment with the 280E tax
that's, you know, not reallyequitable.
The California state governmentand the way they run the
cannabis program is just, I mean, it's painful to be a part of.
And I've definitely had plentyof online comments that say like
, bro, you should have known,got in bed with the government

(09:51):
and it's kind of like, yeah,touche, I don't really have an
argument against that.
But you know, look, we try tocome from an optimistic
standpoint and work within thelegal framework.
That's the framework thateverybody dreamed up.
You know there's some geniesout of the bottle, that you know
I don't think.
You know we're out of Pandora'sbox that I don't think you're
ever getting put back in.
But such is life.
But the best we can we try toadvocate within the, you know,

(10:13):
legal cannabis space.

Ben Larson (10:15):
Let's talk about the foundation a little bit,
because everyone's bias, so tospeak, comes from their baseline
perspective, and you talkedabout the onboarding of the
legal marketplace.
Let's talk about your legacyroots a little bit.
What was your perspectivecoming into legalization?
What did you expectlegalization to look like, so
that we can get an understandingof how far departed we are from

(10:37):
what we're actually livingthrough?
Prop 16?

Well look you know my roots aren't as deep as some
, but you know deeper thanothers.
But you know, really, I was inBerkeley from 96 to 01.
That's when 215 passed.
So we did a lot of stuff and we, you know small stuff, you know
like little three-legged rowsand selling pounds and stuff.
So when I was going to schooljust whatever all sorts of
hustler shit you know was one ofthe first medical patients I

(11:01):
think they could get a card.
Back then there was only onedoctor and it was 150 bucks and
whatever.
That was 1997 money.
So I'd probably be like, Idon't know, 400 bucks today,
right?
So, uh, now they're like 35bucks.
You can get them online.
You had to know somebody to geta doctor.
So that's kind of my firstexposure.
You know, nothing too crazy.
I wouldn't call it a business.
So you know.

(11:21):
Then there's a lot of historythat happened in the 2000s, you
know I just wasn't around for.
And then, and like you know,2012, 2013, some of my buddies
that stayed in cannabis that youknow I went to school with, you
know, encouraged me to do anindoor grow.
Uh, I was like, all right,we'll screw around with this.
And then, you know, we starteddoing a few indoor grows down
here.
We got bigger, started growingup north.

(11:41):
So, you know, we had like threeish, really the kind of 215
when we'll pass 2016, so threeor five years in the in, like
whatever you want to call it thegray market.
And then when the firstlicensing came to Long Beach my
hometown, born and raised youknow my antennas were up just
enough to, you know, get intolegal cannabis and really it
just started out.
I only just wanted to get theone store right.

(12:02):
Right, you know, here we aretoday.
Somehow the second largestretailer in the state wasn't
really part of the plan, but youknow, I definitely thought
something that you know I'vebeen passionate about since a
young age, just cannabis ingeneral.
But you know, we thought thebusiness would be a little more
lucrative and didn't see a lotof the things that have arisen
over the years.

(12:22):
And then, you know, I've alwaysbeen a little skeptical of
government, but havinginterfaced with them now for
nine years in the most highlyregulated industry on the planet
, it's just super frustratingthe way that they approach
things.
It's hard to figure out ifthey're more stupid or more
greedy or more evil, but an evilis a strong word, I don't use

(12:43):
it lightly, but I'm going togive them all three, and
figuring out which one of thethree is worse is very hard.
Sometimes it just wants to makeyou bang your head into the
wall.

Well, it's clear that the government has
not made it easy for cannabis tobe successful in California,
but it was a voter initiativeProp 64, that got us in this
situation.
Prop 64 promised legalstorefronts and equity programs
and tax revenue for everybody,but the industry.
We kind of call it a bait andswitch at this point and what

(13:15):
really ended up happening washigh taxes, local control,
endless red tape.
Was it fatally flawed from thebeginning?
Like did we realize that wewere getting ourselves into this
mess and like, what's the pathforward here?

I'll say two things.
You know one the biggestproblem that I don't think we
could ever put the tooth back inthe toothpaste is the promise
to everybody that was incannabis when they passed it
into the small humble farmerswas there was going to be a one
acre cap right.
And so late at night in somemeeting somewhere I imagine a

(13:50):
smoke-filled uh you know roomsomebody got real clever and
what they did.
So the way that works, there'sthree different cultivation
licenses.
One is a one acre, the otherone's a 10 000 square foot and
whatever the other one says, 5000.
So what they did is you couldonly have one one acre license,
but you could have unlimitedtier two licenses.
So there's guys with, you know,550, 400 tier two licenses.

(14:12):
So that really kind of wipedout the diversity within the
marketplace created anoversupply which led to the
burner distribution problem.
By their own mathematics.
You know, 90% of what's grownlegally is getting backdoored in
the state of California.
And then you know the taxquestion.
I just don't think peoplereally understood that if a few

(14:35):
people got it right, right, butmost people didn't understand
that there would be local taxespiled onto the 15% you know, and
so on and so forth and thatmore people would come under the
regulated side.
But at the end of the day, ifyou over-regulate something and
you tax it 40%, the black marketand the people that have been
doing this for their entire lifethey're smarter, they're more
clever, they're more gritty,they have more will.

(14:56):
This is their livelihood.
They're always going to find away to get it to market.
So you know, I think thePandora's box thing with the
unlimited canopy is a genie thatcan't put back in the bottle.
You know we were talking about564 on the way in here and how
the government actually works,right?
So when 564, which is the taxesback from 15 to 19, I don't

(15:19):
think I'm breaking anyconfidence by saying these.
But now you know, because weformed COCOA, which I'm really
proud of, you know, a couple ofguys got together, we got all
the industry leaders inCalifornia and we're doing the
best we can.
We got seven figure money orsix sorry, five figure money and
we're up against, you know,seven and eight figure money,
right?
So like it's not really a fairfight.
Why do they take money from us?
Cause they can, right.

(15:40):
So that bill was supposed to bea rider originally, not be its
own independent bill and get,get the tax freeze.
And what ultimately happened?
Mcguire, who is the head of acommittee one guy right,
wouldn't do the rider.
And why wouldn't you do therider?
Because the SEIU gets 20percent of the money, the
environmentalists get 20 percentof the money, and then all

(16:00):
these fake nonprofits, which aresome of the biggest problems
80% of them formed the lastthree years.
They get 60% of the money.
And so he's running forinsurance commissioner and it
never made the floor right.
He was just supposed to add awriter.
Everything looked good and he'sactually been really friendly
to the humble farmers and kindof been an advocate.
But now he's got to run foroffice.

(16:20):
What does he need?
He needs money, and everybodythought we were on a glide path
to keep it at 15 and he killedit Right, just so he could.
You know and again, you can'thave the specific conversation,
but it's the way politics worksjust so we can raise money for
his insurance commissioner race.
I think we're going to like atleast send a message to people
like that.
We're debating where themessage needs to go.

(16:41):
But you know, my opinion isthese guys only kind of respond
to fear so we might plan thatelection, and just, you know we
can't be easily steamrolled.
Ultimately, the bill came backand it passed, but I have mixed
feelings, like I'm glad it gotback to 15.
You know, ab8 looks like it'sgoing to pass, which, by the way
, in its original form, wouldhave been the end of California

(17:02):
cannabis.
You know, as we know it shoutout to our guy here who caught
some of the language, becausenow we're finally in the rooms,
you know, through our tradeassociation, to read some of
these bills.
So we've been, you know, goingback and forth with them.
And then there's an internetbill that you know limits what
you can do online.
But that's just back to wherewe started.
You know, basically three yearsago, before anybody foresaw the

(17:22):
2018 farm loophole and, youknow, nobody thought they would
raise the tax.
So we really just made it backto where we were and, yeah, you
know they're solid wins.
You know, I'm proud of the workthat we did at Kakoa.
There's a lot of people thatworked really hard just to get
it there.
So I don't want to undermine anddownplay that, but like it's
kind of sick and disgusting, andI read the headline somebody

(17:44):
sent me, you know, whatever itwas.
You know california reducescannabis tax because governor
newsom wants to see, you know, along-lasting, sustainable in
you know, industry.
Meanwhile, half the stuff I'mlooking at, you know, as of this
week, is all companies goingout of business and in, you know
, foreclosure and inreceivership and yeah, the sales
, the overall sales, are down.

(18:05):
But the other thing you got tokeep in mind if people are going
out of business and justputting their companies through
receivership, basically as astrategy, like there's a huge
systemic problem and they justwant to ignore it and not
address it.
But the problem is that thepeople that get the it's not a
lot of money, it's like $600million.
That's earmarked money on a$300 billion budget.

(18:26):
But the problem is the forces,in particular the SEIU, but also
those nonprofits.
It's all the same nonprofitsthat steal from everything,
whether it's homelessness,whether it's the fires in LA I'm
actually working on puttingsomething together for Spencer
Pratt.
The same people that stole thefire aid money are the same
people stealing the cannabismoney.
So the management of the stateis just really bad.

(18:48):
The money that is going to thenonprofits doesn't really get
down to the causes that theyclaim to be for, but they have
really nice fancy words thateverybody likes and makes them
feel virtuous to support thesecauses, but really it's just a
bunch of grifting right.
And take CCF, which is the samecompany that likely stole some
of the fire money.
They have a $1.6 billionbalance sheet.

(19:11):
They take in 560 million inrevenue.
Their CEO makes over 600,000,so on and so forth.
They have all these hugesalaries on there.
They're supposed to be anonprofit Nobody, and they're
richer probably than everysingle retailer balance sheet
wise in cannabis.
Yet they got to get their youknow little hat in the ring.

(19:32):
But again, they're just.
Their move is then they donateto other in quote causes that
actually have the profit to thendonate back to the politicians.
So the cannabis money isbasically just a closed-loop
system of money laundering thatkeeps the current power brokers
in power and then the extrascraps their elites and their

(19:54):
friends get to steal.
That's the system that we'recurrently up against, which is
probably not somethinglegislatively or executive wise
that we could defeat.
We're going to give it our besteffort.
But to your point earlier ofjudicial challenges, you know
when the executive and thelegislature basically just don't
care about you and they see youas a target right, which is how

(20:18):
they their worldview.
Once you understand theirworldview is they're running
this government like a businessand they're trying to figure out
how to steal as much money fromyou under the guise of virtue.
Then it starts to make a lotmore sense and that's basically
what we've been up against forthe last nine years.

Ben Larson (20:36):
LA.
You're obviously incrediblyinformed with, just like, the
inner workings of all of thisand I know as I've become more
informed, I get more enraged ormore disgusted with how things
work and with that comes angerdirected at certain people or
entities.
Where does the buck stop, likeis it appropriate?

(20:59):
Or do you have feelings aboutthe governor and his genuineness
towards actually wanting tosupport the cannabis industry?
And maybe I'm projecting alittle bit?
That's certainly where I have afair amount of anger.
I don't know if that'sappropriate or fair.
I do remember Governor Newsomin his gubernatorial race doing
cannabis-oriented events andpulling in donations through

(21:20):
those events and feeling thatand how we just feel
misrepresented, how we get taxedand feel misrepresented.
And I'm just curious, you know,like, because of your
visibility and all this, like,where do you land?
Like, where do we need todemand better support from?

Yeah, I mean, look , my guess is, if the governor
really had the political will todo it, he would do it.
You know, I just don't thinkwe're an important issue.
I don't think they put thatmuch mind on us.
Again, we're just super small.
No matter what the crisis is orthe industry, they'll steal
from it.
We're just weak, so we're easyto steal from, so they steal
from us.
It's really just that simple.

(21:59):
Look, you know what I think isprobably the end game and how it
gets fixed is.
You know it's a sad statementon what it is.
But yeah, of course, you know,kind of the initial thing is to
get angry.
You know, I think we weretalking a little bit before I
got on.
I'm just kind of like, you know, getting ready to throw my
hands up on it all and justwhatever.
Like you know, is it evenchangeable until, you know,

(22:22):
probably probably the inevitablehappens, which is big alcohol,
whose alcohol sales are down bigtime 10 year over year.
Right, so they need to get, Ithink they need to get the
cannabis industry.
That seems to be who's knockinga little bit, so nobody's going
to move until federallegalization.
But if that was to happen, thenthey have the kind of money
they can move the politicalsystem.

(22:43):
So it's really, really I thinkthat the question and it sounds
like an oversimplification it'sjust money.
If we had $20 million sittingin a fund to run candidates and
eliminate candidates and play inthe races like the machine that
controls California, then youknow we would be a threat and
then it would be in theirpolitical interest to align more

(23:07):
with cannabis.
But since we haven't played inany statewide elections yet,
that might change.
You know, who knows, we mightmake an example or two out of a
few just to say, like, don't dothat.
But again, the power structureis so strong and the amount of
money you really need to make adifference in California sadly,
that's the American politicalsystem is a mind boggling amount

(23:30):
.
So we're in the early stages.
It's really cool, you know,like I said, cocoa really proud
that we formed it.
Just about every major retaileris in there.
A lot of the brands are inthere.
Both major distributors are inthere, so there's been like a
piece that's come over theindustry for the most part.
You know where everybody's likehey, man, let's just all work
together on this stuff.
I think there's a lot of goodbusiness that's arising out of
there as well.

(23:51):
You know, just trying to figureout how to, you know, optimize,
you know, different functionsthat we have business-wise, and
then it's our best, you know,chance to, you know, make some
inroads with the state, uh,legislatively, but again, when
it just takes, basically, youknow McGuire running for
insurance commissioner andneeding a campaign contribution
to derail something that isdestroying people's lives, right

(24:15):
, I mean, for me it's just hardto watch.
Everybody obviously wants araise.
If you want to work in cannabis, you're going to be underpaid.
I have to monitor the money.
It's the thing that I load themost but all I see is money
leaving that could go to peoplethat I love and respect, that
have been, you know, standingside by side with us.
I see an industry that's severalhundred thousand jobs short in
California of what it could be,and they just don't care because

(24:38):
, at the end of the day, they'reearmarked money for their
nonprofits.
Friends and the SEIU is moreimportant than creating jobs and
doing the right thing, what'smoral and ethical.
They just don't care.
And again, it's 600 million ona $300 billion budget.
Just to put that in perspective.
They lost 20 billion.
Lost it in homelessness.
I'd be in jail, right, theybuilt a train to nowhere.

(25:01):
There's 16 billion into thetrain to nowhere.
It was supposed to go from SFto LA.
Now I think the latest route isMerced to Bakersfield or
something which nobody wouldtake, and they shut that down.
The way they torch money is sodisgusting, and to take this
little tiny bit from cannabisthat does so much destruction,
it's just really hard to watch.

(25:22):
But again, I just think theentrenched forces, the more we
bounce up against them, are justtoo strong and too powerful.
And you know, at least on thetax issue, we've taken that, you
know, to the judicial, whichyou know.
Whatever, that's probably our,our fairest shake.
But I think unless there's aballot measure, a judicial
challenge on something and orlike a ballot measure, uh, which

(25:46):
would be very hard and veryexpensive, I don't see a lot of
change happening up thereanytime soon.
Uh, maybe very smallincremental change, but I don't
see any substantial changehappening until real capital
comes back into space.
The other thing is all thecapital left, california, for
the most part right, so you'reon your own as far as capital
goes.
California cannabis isgenerally considered

(26:07):
uninvestable or you might splasha little bit, but you know, all
the kind of bigger money thatwas in early is all out, and so
the next wave of money will beeven bigger money, which I'm
guessing will be big.
Alcohol and tobacco Pharmaprobably does little niche drugs
.
Some people think pharma, butthey're more into like
collecting on the insurance andstuff.

(26:28):
So like they probably developsome drugs.
But then I think once thathappens, sadly, and the pioneers
are all bought out for pennieson the dollar, then we'll have
lobbying powers.
I mean, think of Southern wineand spirits, not calling them
out, but like I don't know.
I think they spent eightfigures a year to keep their
distribution monopoly in alcohol.
Alcohol, right, they wouldnever get pushed around like

(26:49):
this.
Why?
Because they got the money.
So, and now you see the hempguys, which is some interesting
discussion, having more moneythan the cannabis guys.
Go to chance looks like thefucking vatican city.
Go to hall of flowers lookslike a third world country,
right.
So, uh, you know, suckers,suckers.
I've seen, you know again, notanything personal, but I'm

(27:10):
looking over on the other side.
I'm seeing people that failedillegal cannabis.
You know that aren'toverwhelmingly talented, just my
objective assessment.
They're crushing it now, right,uh, so there's this weird
dichotomy going on now wherewhere the hemp guys got all the
money.
So so you know they might endup winning the federal lobby
lobbying war as well.
They sure as hell look likethey bought Rand Paul, which is

(27:30):
all they really needed.
So you know it's going to beinteresting to kind of see it
play itself out.
But the hemp is not organized.
They got fuck you money, moneythat cannabis don't have, and
you know how that plays out atthe Fed will be interesting.

Well, so I want to let Ben ask you the
question about hemp, but beforewe do that and we can get to it
right after this I think thatsome context like you're talking
about the big guys, you talkedabout alcohol and tobacco, but
you also called out that you'rethe second biggest retailer in
the state and it wouldn't takemuch for you to become the

(28:11):
biggest retailer in the state,and so, like I want to know what
your vision is, what, what areyou wanting to build with
California for Catalyst?
What about multi-stateexpansion?
Like how?
How do you see, how do you seethe levers that are in front of
you and what is the level ofambition that you are taking to
the future of Catalyst?

Honestly, I don't even know.
It's so day to day.
At one point I thought, man,I'm going to do this till the
wheels fall off and weed for thepeople while they're me.
Let's get California and let'smove east.
But there's a thing calledreality that's starting to set
in.
And when you say the secondlargest company, that's true
today.

(28:47):
My guess is alcohol is going toget eight or ten of us and
that's it.
It's going to be like Coke andPepsi.
That's kind of what I think isgoing to happen.
They'll have to buy the cultureso people from within the
culture might stick around, evenif someday we monetize

(29:07):
Cadillacs, which is notnecessarily what I want to do.
You have to be realistic and wehave shareholders and the whole
thing.
You know that might keep me onfor a few years as a trained
monkey, but I think the future,it seems, post federal
legalization, that real money isgoing to come in, swoop us up
and try to, you know,structurally fix it.
I wish that wasn't the case.
You know I'm always open tosomething that happens in the

(29:31):
interim.
You know, trying to predict thisspace over, you know more than
a.
You know, six month, one yearcurve is impossible.
Nobody saw the 2018 farm billcoming.
You know loophole coming.
Nobody saw burner distributionscoming.
Nobody thought metric didn'twork at all, right, you know.
So on and so forth.
So it's super hard to predictthe future.
You know it's super day-to-daywith me.

(29:52):
You know some things like Iwant to go out there and start
moving it east and tackle theworld.
And then other times I'm like,bro, just let's.
You know we've slowed down alot.
It's the first time ever we'vehad shovels down.
We might build one out laterthis year, but you know we
always had projects going right.
So to have shovels down for sixmonths since we've been doing
this, it's just hard to justifybuilding another brick and

(30:14):
mortar in California.
Right, it's like why would wedo that?
You know, if there's distressedassets that we can get on the
cheap, you know we're looking atreally more of those now.
And then we do want toeventually expand east, where
it's a little bit easier ground.
But again, it's just at somepoint Insanity is doing the same
thing over and over again, asthey say, and expecting

(30:34):
different results.
I kind of feel like we'regetting to that point in
California and I wish I had alittle more optimistic viewpoint
today on it, but I mean when Ithink it's.
Four out of the top 10companies are in receivership or
they, you know, had to mergewithin the last six months.
Those are retailers.
All three of the top deliverieshave busted out.

(30:54):
The the second largestdistributor has busted out, like
so on and so forth.
Like this is like what are weeven talking about?
So this idea that somehow thestate is giving you know any
fucks about cannabis is just ajoke.
And like you could show it tothem on a platter, like I'm
litigating with them on this DCCissue and I'm just trying to

(31:15):
get a crumb, like I know itwould just be a pure victory.
I'm just trying to get a crumb.
They won't give us a crumb, soit's, it's and they just don't
care.
Right, and that's the thing yourealize.
Like they just don't care andit's uh, you know it's a little
disheartening and and you knowthe the sadness turns to anger
and a little bit of fight.
But then at some point I justkind of been in this weird

(31:36):
reflective place over the lastmonth or so which is like is
this just a delusion?
Like just fucking bend over,take it, survive and hand it off
.
Like that seems like thefucking way that this thing is
gonna go right.
I mean the fact that we'rebegging to get back to the
status quo on the taxes again.
I'm proud of all the work wedid.

(31:57):
I'm not trying to downplay.
A lot of people did a lot ofwork on it.
I'm super grateful for all that, but objectively it's kind of
pathetic.

Ben Larson (32:05):
Yeah, yeah, look, I mean I, I I've been a licensed
cannabis operator for the lastseven years in California.
I've been in the industry for10 years.
I have a lot of empathy as a,as a business owner, and so I
understand what it takes tosurvive in this, in this
industry.
I'm also in the uniqueperspective of, you know, being

(32:27):
an ingredient company andworking on now both sides of the
fence of hemp and cannabis andI know the California
conversations deeply entrenched.
You know regulated cannabis anythreat from the outside makes
it that much harder.
But I am curious from your lensof like.
You know weed for the people,right?

(32:47):
You know my North Star hasalways been get people access to
cannabis, get people out ofjail like normalize, and I have
the privilege of trying to skateto the where the puck is going
and seeing the convergence ofhemp and cannabis and NRA and I
have talked about this in thepast.
What is your perspective on thebroader, with a broader lens of

(33:15):
like, how hemp and cannabisworks together to create greater
access?
You know, across the nation.

Yeah, I mean, look , I I probably am a States
rights guy on this and you knowI'm, I'm, I'm painfully biased
here in California just becauseof you know what we set up,
right, I mean hemp.
We'll just call it what it is.
It's a euphemism for untaxedweed, so we can just have an
honest conversation about it,right?
Um, which, again, I think it's.
It's been really useful in somestates that don't have access.

(33:40):
Getting it as access, gettingit as access.
But, look, we've done a lot ofhemp testing, you know,
primarily on the vapes, 70, 80%dirty, right.
So you know, if they're goingto do a hemp market, it needs to
be regulated.
You know, my position would be,and you know, maybe this is
biased by business, but if thestate itself has a cannabis
program, that seems to be theway to do it right.
Or if you're just going to openit up, like, why are you taxing

(34:03):
some weed and not taxing otherweed?
Right?
So there's just like a doctrineof fairness, like, oh, like
I've even said, like well, I'lljust turn my can, I can, I just
turn my stores into hemp storesand like get away from the
regulation.
So like it's an ideology, ofcourse, like you know, let's do
it.
You know I'm not a big fan ofgovernment regulation, but you

(34:24):
know the hemp is, for now, alittle bit of a dumping ground
for the dirty cannabis.
Remember, 90 percent of it getsback door.
If you know your connection andyou know I don't want to paint
with a broad brush you know it'sprobably fine.
The flower is not, as you know,dirty, as the is the babes.
But you know we're like 70percent dirty on the babes, that
that that we tested on the, uh,the hemp side.

(34:46):
So you know, you know I'd sayit's a state's rights thing.
Uh, you know, it's kind of asad state of affairs that, like
people that in theory should befrom the same camp, the weed
guys and the hemp guys are, youknow, kind of battling it out.
You know, look, here inCalifornia we're in legal
cannabis, so to allow untaxedyou know weed sales, my position

(35:07):
would be like, okay, then giveus untaxed weed sales.
I know I can out-compete theseguys, right, but like you know,
giving somebody a 40% advantageto selling untaxed weed and
calling it hemp is a littlefrustrating from where I'm
sitting.
But don't get me wrong.
Like you know, I'm not tryingto hate on the hustle or the
access.
We're looking at hemp out ofstate.
There's like 10 or 11 statesthat are still allowing it.

(35:28):
It's all in flux.
We'll see what Texas doesSounds like a little news from
Kentucky was actually new newsFor me.
I know that's one of the statesthat's on there that we've
looked at a little bit.
In short, I'd say, look, it's a,it's a state's right issue.
Uh, you know, if there's legalcannabis in the state, it seems

(35:50):
like that's a more fairframework to work through.
I'll be the first one to admitmy views are probably biased by
the fact that I'm in a legalcannabis.
But you know again, if, ifyou're going to tax weed, then
you know, and I don't like thetactic of anything, but then you
know, and I don't like the taxto give anything, then you have
to tax on tax weed.
Right, and you know, guys cancall it hemp all they want, but

(36:11):
100 of what we tested has failedthe hemp qualifications.
And of course they like hangtheir hat on the d-carb thing
but like nobody's under 0.3 thcwith a legit test.
It's very rare.
Uh, if you, unless you testearly, or you know, you know,
manipulate it or whatever and itdoesn't say anywhere.
You know how you have to testit.
So you know, look, and I'veoperated under plenty of, you

(36:33):
know, impulse loopholes in my,in my life.
So you know I appreciate thehustle, you know I I think to
your point.
It's been great getting accessand all these states.
But how far do you want to takeit now?
We got gas, gas station sticks.
You know I didn't go to chancebut I understand.
As these guys are now sellinglike at one point it was kind of
like the freedom we're notgoing to sign up with the
government.
I think it's getting a littledarker.

(36:54):
You know they're selling allsorts of like fake Oxycontin and
all sorts of weird shit, shitthat looks like cocaine and
that's not what I'm trying to beabout.
So, uh, you know it's aninteresting conversation.
You know, again, if it's a road, let me let me click on
something on this, then.

So you know you're, you're a retailer in
california and so it makes sensethat you are protecting your
business like full stop.
I totally get it.
Let's let's think about a statewhere um not outside of
californ, where you're notoperating.
I think one of the reallyinteresting things that I've
witnessed with hemp is that,because it's been appearing in

(37:33):
all these different retailchannels that aren't
dispensaries, like grocerystores or bodegas on the corner,
that there's been a differentconsumer that's been getting
access to cannabis that wehaven't been able to bring into
the dispensaries in California.
Like, I think back to when thelegal market was starting, there
were all these startup brandsthat wanted to make products for

(37:57):
soccer moms and yoga ladies and, like, ultimately, like a lot
of those products just likedidn't stick in the legal market
because the soccer moms didn'tcome to dispensaries, and it's
been kind of cool for me to seethat actually, like in other
channels, there are differentconsumers that aren't touched by
the dispensaries right now andI'm wondering, like, how you see

(38:20):
that like, within a regulatedcannabis market like california,
we aren't serving all thecustomers, we aren't capturing
all the people that wantcannabis, be it the soccer moms
or the people that are at trapshops.
So what?
What's broken about thedispensary model that um is
making it so that all theconsumers aren't aren't coming

(38:41):
there?
Aside from taxes and pricing,which could you could reason for
trap?

Well, I mean, I think, I think taxes is the main
issue.
Look, we might get in half outof state.
So, like you know, again, ifit's going on in other states,
you know, we would just bringour ethos, which is, you know,
we wouldn't sell anything thatwasn't, you know, full panel,
tested and safe.
And you know, know, I actuallythink that that might be a good
approach to have a.
It's the right thing to do.

(39:08):
Like you know, in fact, some ofthe most important work we're
doing is is probably, you know,we, you know, cleaned up our
shelf.
You know, almost entirely, youknow, I think, right, we hope,
or at least 99 level where itwasn't there before, right, so
this is super important you'retalking about.
I feel like we kind of had ourtobacco moment and we'll see if
we can work our way out of it.
Where, you know, we will lookback 20 years and be like, wow,

(39:29):
we were sure stupid, we didn'thave pymetrazine, which is
Endeavor on the, you know,testing schedule, and you know
people were huffing stuff.
That's a felony to imply.
You know, on scale, inCalifornia, like I don't really
buy the access issue, you know,again, to each their own opinion
.
It's just my opinion, you knowthe soccer mom, the reason those

(39:54):
brands didn't work?
They're just lighter consumers.
Right, they do consume, and welove the soccer mom and we love
grandma and we love everybody.
Bring them all in, but theyjust consume a little bit less.
You know, I would go out on alimb and say that a soccer mom
is probably more comfortablewalking into a dispensary than
walking in to like a halfsketchy looking smoke shop.
You know, selling some untestedhemp.
That's just my.
You know I could be wrong, butI'm just thinking that that's,

(40:18):
you know, the kind of thereality of it.
You know, as far as out ofstate goes, you know you are
bringing access, no doubt toplaces that haven't had access,
but those places have always hadsome form of access.
It's just getting moreaffordable now because of you
know, basically, it's allcalifornia and oklahoma weed is
is.
We're generalizing, but that'swhat it is grown legally, by the

(40:38):
way, sold his hemp.
Uh, I mean, when you reallythink about how this happened,
it's uh, you know it's aninteresting mind fuck.
But like.
But, like I said, we're lookingat it in other states to get in
.
You know, it does seem likeit's been a good vehicle for
access.
There is a lot of good actors inthe space that we don't have
issue with, but if hemp wants tohave a future, I think they

(40:59):
need to look a little closer atself-regulating.
You know kind of what they'redoing, because you know there's
no doubt that it is a dumpingground for dirty product.
And you know as well as thatI've seen some other weird shit
making an appearance that youknow, all sorts of weird
synthetics and other stuff thatyou know seems to go against the
principles of what we weretrying to do here with

(41:20):
legalization.
Now, guys are whatever, th, youknow, delta 10, delta 8, you
know cbh, o, o, th, o, o, thesefucking different compounds,
they're not safe.
The conversion of, uh, actualhemp leaders into cannabis, uh,
you know, the science is, youknow, debatable.
On that some people think it'salso, you know, not safe.

(41:42):
So again, my thing is if we'regoing to do it, let's just do it
.
They'll put everything aboveboard and you know not get into
this game of like, you know, Imean just to do it.
You kind of have to game thetest out.
I guess there's no, you know,prohibition against that and
because of the D carb you getyourself plausible uh,
deniability.

(42:02):
But you know, look, I can getinto the argument that it's
definitely brought access toother states.
I just think California, like,if you want access, you have
access.
The only thing I would say is,if you want 40% off and you're
willing to gamble on you knowsomething that's probably not as
well tested or vetted andyou're on a budget, then kind of
what it is.
But like there's a million waysto get weed and you know, uh,

(42:26):
you know california.
But I'll push back a little biton this idea that I think the
soccer mom feels morecomfortable in a legal cannabis
store, uh, than anywhere else.
My take is the soccer mom onlybrands didn't work just because
they're, you know, lighterconsumers that the youngsters
and I'm talking you know like 34and under you know they're
really the more heavy consumers.

(42:46):
Again, we, we market toeverybody, try to get them all,
but you know that's really thethe fat of the bat in the
industry, working class.
You know 34 and under, really44 and under.
You know I'm out of, you knowI'm half out of the demo.
Even me.
I smoke weed every night.
It still takes me a while toget through a vape, like
whatever.
If I get through one or two amonth.

(43:06):
That's a lot for me.
So there's some guys smokingthree or four vapes a week and I
think that's the consumer thata lot of the dispensaries are
relying on.
So if you're only relying onthe soccer mom, I think the
reason those brands failed isnot because the soccer mom is
all of a sudden getting accesssome other way.
Mom is all of a sudden, youknow, getting access some other

(43:27):
way to have.
I will say there's probably onecarve out, which was when the
edibles and the drinks were atthe grocery store.
Uh, I kind of put those in theirown, you know, category cause
they're digestible, they'reprobably not as dangerous and
those are more for thecatacurious, or whatever you
want to call it, and you couldkind of, you know, bring them in
.
So there was a time, you know,in California, not that long ago
, where they had chocolates and,you know, gummies and drinks

(43:50):
right there at the grocery store.
California looks like it'sgoing to be full ban.
If I had a bet, because thealcohol boys are already in
there, basically taking it overafter doing zero pioneering, as
the world would have it, I thinkmost of the other 49 states are
never going to get rid ofbeverages and most of the
anti-hemp laws will go towardssmoking.
And then, funny enough, oncealcohol has a foothold in drinks

(44:14):
, they will also be on team banthe rest of hemp.
That's just how this thingworks.
But it looks like I thinkalcohol is going to keep the
drinks in almost every state,and you'll see those.
You know, I think California isgoing to kill them.
Uh, that's what it looks likeright now.
Uh, but I think in those statesyou're going to see drinks that
are, you know, five, tenmilligrams or whatever, here to

(44:35):
stay for, you know, indefinitely.

Ben Larson (44:37):
Those aren't going away yeah, yeah, look, I totally
agree with you on the qualityneeds and we do.
We do a lot of self-policing onthat.
Everything that we learned inthe Regulate Cannabis place
we've taken to at least what wesell.
We have a very targeted networkthat we sell that into.
Right.
It's like beverages, somegummies, at the federal level.

(44:58):
The people I work with alsoagree.
It's like we need to have thislevel of safety enforcement.
We need to allow states todecide what's right for
themselves.
Like we need to have this levelof safety enforcement.
We need to allow states todecide what's right for
themselves and we need toprotect that, because I mean,
that's american right, one ofthe other.

But as soon as you start regulating up in a real
way?
Let me just ask you thisquestion as soon as you start
regulating heaven in a real way,do you think the outlaws just
call them the outlaws are anoutlaw culture is coming along?

Ben Larson (45:24):
no, I I mean champs turns into something else, right
, like you mentioned.
Like that, that always exists.
There's always going to be anunderground that we're going to
perpetually fight.
You can't stop demand and youcan't stop supply.
That's why countries likeportugal moved to a like let's
try to regulate it.

I think that probably failed and let me ask
you the next question then.
So let's say, let's say you,let's say you regulate hemp
right and you actually now haveto go to a real lab to get a
test right and there's testingstandards that basically test it
after it's cured because that'swhen it should be tested and
none of it qualifies for hemp.
What happens then?

Ben Larson (46:02):
yeah, I think it's.
It's.
It's a great question.
I think people are trying to,in parallel, get qualifications
for what is hemp.
You know, there's the total thcconversation that isn't in
stone.
There's the the source argument.
You know, was it hemp at onepoint?
Uh, is is like the other, likelegal argument that is being

(46:24):
done and what is actually beingput in.

So the ultimate end game in your mind of hemp is
to be able to sell untaxed weedagainst people that are selling
tax free.
Just so I understand yourargument.

Ben Larson (46:34):
No, I don't think that is the argument.
I think the argument is likehow do we do something that's
fair and leverage this nationalsupply chain that has been set
up?
Like we've understood that lowdose beverages in particular
that's the bulk of our businessis creating access points, safe
access points.
You know, these are testedproducts that have clean product

(46:56):
.
There's no residuals in them,People aren't smoking them,
obviously and it's creating newon ramps for for consumers, and
so it's creating opportunitieswhere it's like are there ways
to manipulate the frameworksthat we have in place today to
get us to a better end that hasmore access to people, more

(47:16):
normalization of a product?

It seems like nobody is arguing for like
within this context.
It seems like, really, whatwe're all arguing for is access
broadly, and that there is notaccess in a lot of places, and
hemp is is filling a void in ina lot, a lot of states that
don't have any legal access.

Ben Larson (47:36):
And then, ben, what you're talking about is
beverages, filling a differentniche that is separate than what
ellie, yeah and I'm I'm veryclear I only advocate, I really
on the hemp side, like I reallyonly advocated for the beverage
category, and that really pissessome people off on the hemp
side.
Right, they, they want me to gofull bore advocating for one

(47:58):
plant.
You know, it's like I don'tknow if I can go that far,
because I did come up throughthe, the regulated california
system, and I do understand bothsides of the argument, but I
guess the question is okay.

So you know, and I hear hemp folks say, oh, we
want to regulate.
Okay, so if you wanted toregulate then we would get rid
of the word hemp, Right, but wewere also sold a really bad bill
of goods with cannabis and likeyou know, we talked to Aaron
Smith the other week.

Ben Larson (48:28):
He's like this is not what we meant when we said
we wanted to legalize.
It's a bad bill of goods.

So then hemp gets to write their own rules or the
government's going to write them, and then the outlaws are just
going to stay outlawed and findanother way to get to the
consumer.
I mean, I've heard the hempguys say, hey, we're ready for
the regulation, but as soon asthat happens and there's any
taxes that need to be paid,right, then you're going to lose
90% of the industry.
That's my opinion, right.

(48:54):
Maybe there's 10% good actors.
It's mostly and it's not thatthey're bad people, but I'm just
saying people willing to begood actors.
So what you're reallyadvocating for, in my opinion,
is untaxed cannabis, which isfine.
But if we're going to have anhonest dialogue about what we're
advocating for and again, I'mopen minded to like, hey, let's
advocate for untaxed cannabis,but, like you, don't get to

(49:18):
manipulate a definition that wasaccidental in the farm bill,
right, and then manipulate thetesting and then have an honest
discussion about, in quotes,hemp, anytime somebody says hemp
, just substitute in the wordfor hemp as untaxed cannabis,
where we don't have to deal withall the government bullshit,
and then we could have an honestdebate about what hemp is.

(49:42):
But hemp is not hemp.
Hemp is untaxed cannabis.
The amount of actual industrialhemp is being sold as hemp is
less than 1%, right?
So let's just start there.
I get the beverages, you divideby the amount of liquid and you
get there that way, right?
But that is Delta nine, fullycarved, put into a thing,

(50:03):
distillate, that would gothrough a process and violate,
you know, all definitions ofwhat you know any reasonable
person thought hemp would be.
Now it's real clever.
They picked up on this THCAthing, you know pre-decarb, but
in order for it to be classifiedas hemp, you have to cheat or
manipulate, since there's noclear standards on the test.

(50:24):
If the hemp market came out andsaid, well, I'll tell you what
we'll do, we'll make sure thatthe testing happens after the
product is cured and we willanything that has been turned
into Delta 9, we'll classifythat all as cannabis, then you
wouldn't have anything toadvocate for.

(50:45):
So what you're asking, whatyou're really advocating for
through hemp, if we're having anhonest conversation, is not
look, we're probably going toend up doing a little bit out of
state, but what you'readvocating is for unregulated or
less regulated or currentlyunregulated, untaxed weed.

Ben Larson (51:00):
I mean, let's just be honest with the people with
the most resources to fightthings either direction are the
ones who are skirting the lawsthe most and it puts the rest of

(51:31):
us, be it, you know, entrenchedin regulated cannabis or those
of us in the middle that aretrying to straddle both lanes,
like it's hard to outshine orout influence those that have
just a ton of resources.
So these broad brush strokesthat that are defining, you know
hemp, so to speak, is beingrepresented by a few with just

(51:53):
deeper pockets than than therest of us that are willing to
shoulder taxation, fair taxation, represented taxation, but just
broader access to the plant,because the regulated markets
haven't delivered on it.

The taxation that hemp would lobby for in
California, I would hope, wouldbe substantially less than the
taxation on cannabis.
So then, what you're reallyarguing for is a subset of
cannabis businesses to be taxedat a lower rate than other
subset of cannabis businesses.
That's what you're arguing forin essence, correct.

Ben Larson (52:26):
We had a conversation with cannabis
operators where we were willingto cede and have tax parity with
a pathway of lowering it forboth sides.
When it comes to the Californiaconversation, well, in
California.

if they put it on parity, the hemp guys
would lose, lowering it for bothsides when it comes to the
california conversation well incalifornia, if, if, if they put
it on parody, the hemp guyswould lose in california.

If you put it on parody, not all but like,
generally not in the beveragecategory, because we know,
low-dose beverages don't sell inthose shops.

Ben Larson (52:52):
We can, to your point the the low-dose consumer
consumes a lot less products andit just doesn't make economic
sense to stack.
Like you know, you can go toheadset.
The top 100 beverages or thetop 10 beverages sold in
dispensaries are 100 milligramproducts.
The quote unquote soccer momsare not gravitating towards
those products, they are goingto total wine and picking up

(53:14):
four packs of five milligramdrinks, and so that's the big
disparity that we see and that'sthe opportunity we see to
create access and normalizationof THC in general.

But again, at its root you want a different tax
structure.

Ben Larson (53:32):
I'm not saying anything about taxes.
I'm talking about access.
We can include taxes.

When the hemp guys say we want to be regulated
right and again I'm open to thedialogue and to me it's sad that
we can't get all on the samepage.
But let's just have an honestconversation.
You don't want to be regulatedlike they regulate cannabis.
You want to be able to sellcannabis in a different subset
of regulations that are muchmore favorable than they.

(53:57):
Leave these other guys overhere I think everyone should
want that.

Ben Larson (54:00):
Yeah, I I do.
I do think everyone should wantthat.

I think everyone should be want to be out from
underneath the thumb of prop 64and the bullshit that is
sacramento you're going to lose95 of the 95 of the hemp market
as soon as it gets regulated,just because they don't want to
be regulated.
And of the the 5% that stays,very few of them will succeed
because they can't beat thepeople that have lasted this
long.

Ben Larson (54:24):
I'm actually okay with that, because at least then
we don't have to have the hempversus cannabis conversation
anymore.

It's weed versus untaxed weed.
Let's just be again.
If we're not purposeful withour language, then like hemp is
a made up thing, let's juststart with that premise.
Like it's a made up thing.
We're not talking about theMayflowers sales, those were
hemp.
We're not talking about coveredwagons, those are hemp.
Actually interesting historyEven the oil used for the wheels
, those are hemp.

(54:51):
Right, that's hemp.
We're not talking about that.
We're talking about the verycannabis that gets grown legally

(55:26):
.
In the track and trace systemand metric, we have discovered
that even red states lovefucking weed.
I agree with you.
Like my point is is that I'lltell you what it's.
It's shown that and, of course,like every like, the weed is
fairly non-partisan at thispoint.
It's like 70 some odd percentapproval, uh, which is why I
hope they do?

Ben Larson (55:36):
we don't even have 70 access in california, and
that's the bullshit that we've,we've been forced to to swallow
we don't have 70 access.

No, like like other, than from counties in
california that have accepted it95 of people are within like 30
minutes driving distance of auh, a dispensary.
If bakersfield came on, I thinkthat would be every then
bakersfield's like the last bigcannabis desert there isn't a
dispensary.
If you live in California,you're 20 minutes from a

(56:05):
dispensary, maybe outside youknow you live way out there
you're 30, 40 minutes.
But the access argument, Iagree, local control is an issue
.
But again, you want to talkabout political powers and why
local control exists.
The League of Cities is the oneof the most powerful political
powers in the state.
They're never, never going toget rid of local control.
The other states did.
It is a top down.
Look, we agree.

(56:26):
I just again, I'm just tryingto have it like a, just call it
untaxed weed and we couldfucking talk about it.

Ben Larson (56:32):
It is currently.
It is currently untaxed weed,with the exception of whatever
your normal retail taxes are.

The hemp guys won't say that, right, which is
like, again, when your wholeentire premise and I'm not like
above the hustle or above evengetting involved in, in quotes,
hemp, but when your entirepremise is based on, hey, we
test the plant, when it's likeit's seven weeks and we
manipulate the testing and thenwe call it something that it's

(56:58):
not, like it's very hard toregulate, uh, that that
situation, right, it's a mistakemade by mcconnell who didn't
understand what thca you knowwas.
And even in spite of thatmistake, right, you're, you're,
you're you're still not at a lowenough level that it pencils

(57:20):
out it would be anything butuntaxed cannabis.
But you know, turning to thered states, I think it's been a
great way where, like thegenie's out of the bottle there.
Take Texas, we'll see what theydo.
You know that thing waspolitical.
They were trying to make Abbottveto that because they thought
it would be unpopular.
So I think what's going tohappen in texas because of the
hemp debate, by the way, texashas surpassed california.

(57:41):
It is now a, uh, larger marketthan california.
Their hemp market is largerthan our cannabis market, which,
you know, is kind of hilariousin itself.
But what happened?
Because of hemp, texas wouldn'teven be having the conversation
, they had this super limitedgummy only, whatever weird
medical program.
I'm not super familiar with it,but I have bombed through Texas
looking at the hemp thing, andso now what's happened is

(58:05):
they're going to expand thecannabis program, right, and
eventually stomp out hemp, Ithink.
But they couldn't do that hadhemp not got there in the first
place.
So there's no doubt that it'sbeen, you know, an amazing
trailblazing experiment.

Well, and that's what Texas hemp has shown
.
Like what could Californiacannabis could have been if Prop
64 wasn't so broken?
And I think you've been likevery clear throughout this
discussion about all thedifferent ways that the laws in
California are broken, and so Ithink it's just a challenging
debate as it comes to hemp inCalifornia, because the cannabis

(58:43):
operators are screwed, they'restuck in this system that
doesn't work for anybody, and sotrying to put anything new into
that is pretty irreconcilableoverall.
But what we know is that thefull opportunity is not realized
because of the bad laws,whether it be in health or
cannabis all of it Like there's,there's more, there's more,

(59:04):
there's more out there that isnot coming through dispensaries.

Yeah, that's, that's the black, that's the
black market argument, though,too Right.
I mean, to me it's basicallyjust a black market argument,
which is, like you know, whichis fine, right, but it's just a
black market argument.
Hemp's just a black market,that's all it is Right.
So, and again, like you know,I'm sure Ben runs his company
very responsibly and he's, he'son the drinks, but like that's

(59:30):
not going to be the majority ofthe uh, of who's in hemp and in
so much as I've heard a hempperson ask to be regulated, the
two things I've never heard himsay is we want to actually be
tested the same way cannabis istested, but whoops, there goes
your whole supply chain and wewant to be taxed at an equal
level to cannabis.
Those are two things you'llnever say.
What you're really saying is wewant a license to be outlaws,

(59:51):
right, and not pay any tax,which, honestly, what hemp has
shown is how powerful the freemarket is and how the hemp guys
now have all the dough andthey're all fucking working on
70% margins, having a good oldtime, and we're just
middlemanning for the government, which just shows you, if they
took hands off everything, itwould be great, but if they even
that playing field, this ideathat the hemp guys who the vast

(01:00:12):
majority of them and I'm notsaying Ben, that I know of have
failed in cannabis and they'vereinvented themselves in hemp.
So if the playing field wasequal and they've already failed
in cannabis and they had totake their ball and go home
because they couldn't make it,how would they succeed without a
40 tax advantage and all theheavy regulation?
And the majority of that markethas always been black market,

(01:00:34):
forever guys, which god blessthem, those guys will always
exist, but they just were likeoh, now I can call it hemp has
some plausible deniability.
I got a fucking friendly lab.
I'll test that shit with thefucking stems and the roots and
the soil.
Oh look, it's under 0.3.
But we all know it's coming inaround one percent once it's
cured and it's not somethingthat is hemp, right.

(01:00:56):
So again, define the regulation.
And if you even the playingfield, hemp wouldn't even be a
thing.
Just like if you did a taxholiday, black market weed and
hemp would barely even be athing, right.
If California did full taxholiday right, we don't pay any
taxes to anybody.
The soccer mom would come to us, right, everybody would come to
us.
You know there'd be, instead of30 percent legal market,

(01:01:22):
probably go 20, 25 percent blackmarket.
There always be a niche for theinclusive.
There'll always be a niche forthat.
But I've never heard the hempguys yet say that we want to be
regulated at parity with thecannabis guys.
What they're basically sayingis we want to sell the same
products but we don't like thecurrent regulations and because
we didn't jump in on thecannabis side, or because we
failed on the cannabis side, nowwe want to call it hemp and not

(01:01:43):
and be able to do whatever thehell we want.
Fuck, I wish I could call myshit hemp and I ever have to
deal with the government eitherand make 70, 80 percent margins.
It sounds like fun.
Shift to people's front doors,have a fulfillment center like
yeah, we're about to get intothat shit in some other states.
I'm just saying that we have tobe honest about what it is and
what is the debate really right?

(01:02:03):
You can't even get the premiseof hemp to hemp.
If you put in testing that wasproperly done after the product
was cured, you would havenothing to sell, right, like
that's just what it is.
And then on top of that, butyou're essentially asking the
states is.
We know all these people wentthrough this complicated and
look, we're suckers for doing it.
Like I think that's a fairargument.

(01:02:24):
Like why did you get in bedwith the government?
But, now the hemp guys aresaying, oh, we really want to
get in bed with the government.
We're not really saying is wewant to get into the bed with
the government the same way thatyou guys are.
We want to have all these otherfreedoms that you, that the
cannabis guys don't have, right,and we want to sell the same
product.
So it's like that's theargument.

(01:02:49):
You can make the argument, butif we're being honest about what
the argument is, there's nodoubt that's the argument, which
is we sell weed, it's not hemp.
We want to be taxed differently, we want to be regulated
differently and if we wereforced to test the same way
cannabis was forced to test,we'd have nothing to sell look,
I I, if you if you, I'm all earslook, I I agree with a lot what
you say.

Ben Larson (01:03:08):
I could probably argue certain aspects till the
cows come home, I'm not going to.
I really appreciate, uh, theconversation, ell, elliot, and,
like I said, I have a lot ofempathy for anyone that has
operated through Prop 64 and,frankly, has survived and in
some ways thrived, and you'vebuilt a great brand and I feel

(01:03:31):
like we didn't give you adequatespace and time to really just
promote the brand.

Elliot Lewis (01:03:36):
It doesn't matter.
I'll say this If we could callit all hemp, I'd be on board for
that.
Call it all hemp, get thegovernment out of our.

I'm down with weed for the people man.

No tax, nobody.
Let's all get to work right.
But what would happen is againthey would have guys that go
away pretty fast.
They need a 40% pricingadvantage to even have a have a
you know, a chance and help tocompete, not to mention all the
two gram products and stuff thatyou know we can't sell.

(01:04:09):
But we'll leave that one be,and just you know.
Again, like I said, I don'trule out that we're getting into
it in the red states.
You know where we're hoping toavoid the kind of regulation
that we get here.
But ultimately that is, youknow, hemp in quotes.
Untaxed weed is just freedomWeed is really what it what it
is.
You're asking for freedom WeedRight, which is again, the

(01:04:30):
government is never going toallow for freedom Weed to be
taxed differently than theircurrent existing cannabis
programs.
It's always going to have to belike this two 15 loophole niche
vibe to exist in the currentstate it's in.
As soon as they start bringingin the regulation, the whole

(01:04:51):
thing falls apart because thereis no heck.
It's like there's no heck.

We can uh, we can joint venture on your eventual
uh weed launch and call itFreedom Weed.

AnnaRae Grabstein (01:05:01):
Sounds great.
I love it, elliot.
You know we have so many thingsthat we could have touched on,
and I'm glad that we had whatseemed like a debate, but I
think that there's really morethat we agree on than than that
we disagree and ultimately, wehave to move to our last call,
which is when we turn the micback to you for one last final
message for our listeners Advice, call to action, a closing

(01:05:24):
thought to leave the audiencewith.
So, elliot, what is your lastcall?

My last thought get married, have babies, be of
service, love God.
That's my last thought.

Fucking love it.
Oh man, Elliot, this has beenamazing.
I really do appreciate the openconversation.
I always appreciate the rawnessand what you bring to the
community and thank you foralways speaking your mind and
being a strong voice for thespace.

No, I appreciate you guys.
Lively discussion, I agree,we're more in agreement than
than not.
But you know, just trying to,but just trying to flush out the
broad swaths from which I'veheard the freedom weed arguments
come from.

You got it.

Thanks, buddy .

All right, elliot Lewis from Catalyst Cannabis Not
as volatile as I thought itmight have been.

Yeah, totally Super well overall.

What do you think, folks?
Thank you for engaging andwatching and doing all the
things.
Man, I feel so lucky to haveconversations like this.
It gets my day off on the right, but thank you to our teams at
Virtosa and Wolfmeyer and, ofcourse, our producer, eric
Rossetti.
If you've enjoyed this episode,please like, subscribe, share,

(01:06:41):
do all the things.
Definitely subscribe to us onApple Podcasts or Spotify or
wherever you listen to yourpodcasts.
As always, folks stay curious,stay informed and keep your
spirits high Until next time.
That's the show.

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#106 - Weed for the People—Taxed or Otherwise: Elliot Lewis Unfiltered

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}#106 - Weed for the People—Taxed or Otherwise: Elliot Lewis Unfiltered