GARRETT I. HALYDIER
RESEARCH
Journal Articles
States increasingly implement “social equity” programs as an element of new cannabis regulations; however, these programs routinely fail to achieve their goals and frequently exacerbate the inequities they purport to solve, leaving inequitable industries, high incarceration rates, and broken communities in their wake. This ineffectiveness is due to the industry’s fundamental confusion of the modern, individualized concept of “equity” with the historical, society-level concept of “social equity.” In this paper, I develop a new theory of “cannabis social equity” to integrate these concepts, and I apply that theory, first, to diagnose why current policies fall short and, second, to propose a new approach to social equity that can remedy the inequities in both the emerging industry and in the populations most adversely affected by the War on Drugs.
Through a historiography of the definition of social equity in the cannabis industry, I show how legislators, regulators, advocates, and scholars built the modern definition of social equity by replacing the rich, process-based theories of racial, social, and restorative justice with a narrow set of policies crafted more for narrative resonance than effectiveness. As I argue in a companion article published in the Fall 2023 issue of the University of Massachusetts Law Review, these policies will continue to fail to improve equity in the new industry, bring equitable justice to the previously incarcerated, redistribute resources to inequitably impacted communities, and provide equitable access to cannabis.
In contrast, the field of public administration developed the original theory of social equity in the 1970s to provide a philosophical foundation and process for using the mechanisms of program administration and public participation to address societal inequities, not just those inequities created explicitly or implicitly through policy implementation. I extend the traditional theory to include a legislative component that broadens potential solutions by centering the development of cohesive regulatory schema rather than individual policies. I apply the new theory to produce a novel solution that uses the level of legalization as an organizing principle for legislation inpursuit of both implementation equity in the new industry and societal justice for the victims of the War on Drugs. For if all we ask for is equity, there will never be justice.
Current approaches to social equity in the cannabis industry continue to fail to promote racial equity while simultaneously exacerbating gender, environmental, and other inequities. To better understand the structural dynamics underlying this phenomenon, I first present a multi-disciplinary recounting of not only the racial inequities, but also the stigma, business, research, energy, sex and gender, hemp, and international inequities of the War on Drugs. This serves as the foundation for a compilation of the structural and theoretical reasons for how current social equity policies, whether targeting the cannabis industry, community reinvestment, social justice, or access equity, will only continue to fail to address the inequities they target.
In short, state licensing processes, managed market dynamics, and natural characteristics of the industry conspire to undercut states’ attempts to address social inequity solely by reserving limited numbers of “social equity licenses.” State community investment programs to address inequities are funded by taxes on the populations they are intended to help, and industry-led initiatives are treated as marketing campaigns. Retroactive pardons and expungement are routinely underfunded, hobbled by technical issues, unused by beneficiaries, and insufficiently comprehensive to provide effective resentencing solutions, all while states maintain arbitrary criminalization limits that continue to exacerbate inequity. Finally, direct cannabis regulations remain only tangentially associated with the employment, child custody, housing, insurance, bankruptcy, environmental, and medical research issues presented by the ongoing criminality of cannabis, and the associated inequities remain unaddressed by cannabis regulatory regimes to the ongoing detriment of those most negatively impacted by the War on Drugs.
Abstract: This paper combines insights from law and economics to create a hybrid model that examines the U-shaped relationship between the strength of a country’s IPR protections and its level of economic development over time. This hybrid model is used to analyze whether implementing different levels of IPR protections at varying stages of economic development has the potential to enhance or stagnate economic growth in LDC and developing countries. The paper analyzes the pharmaceutical industries in India, Brazil, Indonesia, and Vietnam to show that implementing an improper level of IPR protections during certain phases of economic development can stagnate economic growth in LDC and developing countries. India successfully resisted decades of international pressure to implement a stronger IPR regime and emerged as a world-leading supplier of affordable generic drugs. Brazil and Indonesia bowed to international pressure to implement stronger IPR protections, and both countries continue to struggle to maintain once promising domestic pharmaceutical industries. Vietnam currently stands on the cusp of rapid economic transition. This paper provides recommendations for the creation of an IPR regime in Vietnam that will foster a nascent, domestic pharmaceutical industry.
Cannabis Publications
Abstract: This publication applies my previous work on the U-shaped relationship between regulatory strength and industry growth to argue for a specific cannabis regulatory regime by providing a roadmap for adult use cannabis legalization legislation in Hawaii. This publication builds on previous summaries of data and diagnosis of Hawaii’s current cannabis industry to recommend specific policy proscriptions for a future adult-use legal regime. The publication addresses: the national, federal, international, and non-profit landscape, Hawaii’s local political and popular climate, updated economic projections, tools for advocacy, and the need for a comprehensive framework.
2017 Economic Impacts of Legalization, Cannabis Insider, Nov/Dec Edition (31 pgs.)
Abstract: This publication surveys the eight adult-use legalization regimes in force in 2017 to determine the regulatory conditions that foster the success of a nascent cannabis industry. The paper reviews the regulatory framework, managing authority, implementation process, legislative support, economic and demographic statistics, and state-specific variations of cannabis regulation of all eight states.
2017 Hawaii’s Cannabis Oligopoly, Cannabis Insider, Sept/Oct Edition (11 pgs.)
Abstract: Through comparison to New York’s cannabis regulations, this publication argues that Hawaii’s Medical Cannabis Program failed to serve patients and to meet the legislature’s goal of creating a functioning new industry. As predicted by the U-shaped curve of regulation vs. industry development – overregulation, vertical integration, and a lack of administrative direction created a state-sponsored oligopoly controlled by out-of-state interests–rather than a robust, local industry. The publication recommends a switch to a horizontal licensing system and the introduction of new licenses to foster a domestic medical cannabis industry.
Abstract: This publication provides a detailed economic analysis of the potential size and scope of Hawaii’s medical cannabis industry. The projections are sensitive to the strength of future industry regulations. The publication uses this data to make recommendations for future regulatory changes to foster the growth of a vibrant domestic cannabis industry. The publication was featured in the Honolulu Star-Advertiser, Hawaii News Now, and Hawaii Business Magazine.
2016 Hawaii’s Medical Cannabis Economy: A Roadmap for the Future, White Paper (34 pgs.)
Abstract: Written prior to the creation of Hawaii’s medical cannabis industry, this white paper applies a general theory of the U-shaped relationship between regulatory regime strength and industry development to predict the potential futures of the industry. Conducting a detailed, comparative analysis of the regulatory conditions that fostered a successful medical cannabis industry in Israel, this paper predicts the future outcomes for Hawaii’s cannabis industry based on how far the relative regulatory regime strength of Hawaii’s cannabis regulations diverge from or conform to the level of regulatory strength recommended by the U-shaped curve. The paper provides specific predictions for the potential outcomes of the industry as well as prescriptions for regulatory change that would facilitate the growth of a vibrant, growing domestic medical cannabis industry.
2015 Real Estate, Property Law, and Medical Cannabis Dispensaries in Hawai‘i, Cannabis Insider, Oct. 2015-Feb. 2016 Editions (29 pgs.)
Abstract: This compilation of a series of publications addresses the real property legal issues faced by cannabis businesses across the country, with specific recommendations for Hawaii cannabis businesses. The publication addresses landlord-tenant relationships, real estate and banking, and real estate and community relations. The publication also provides an in-depth statutory analysis of all real property rules and regulations governing the cannabis industry in Hawaii.
Works in Progress
State Cannabis Programs Should be Leary of the 5th Amendment (work-in-progress). The Court in U.S. v. Leary struck down the Marijuana Tax Act of 1937 in its entirety for violating the 5th Amendment by requiring people to register with the federal government, thereby certifying their participation in activities that were illegal under state law. Current state programs require business owners and individuals to do the same, certifying their violation of federal law. These registration provisions are inherent in the structure of a state’s regulatory program, and any alternative will necessitate either recriminalization, decriminalization, or outright legalization. I have completed the research survey of all state programs and begun drafting the paper now.
It Is High Time to Expunge the Past: Evaluating Best Practices for Cannabis Resentencing and Record Clearance Programs (work-in-progress). States that decriminalize or legalize cannabis possession consider retroactive clemency, executive pardons, resentencing, and expungement programs an essential element of social equity. However, these structures and their implementations vary greatly, and best practices need to be developed to inform future state and federal programs. I am working on this project as an outgrowth of my current advocacy work for pardons and expungement in Hawai’i, and my research is still ongoing.
Future Research Questions
First, Leaf(v)ing the Industry: Current State Approaches to Cannabis Industry Insolvencies. Cannabis illegality at the state and federal level inhibits cannabis industry access to both banking and bankruptcy systems. State specific alternatives have seen some success and should inform federal bankruptcy approaches once cannabis is federally legal. I have addressed this issue in several classroom and professional lectures and will continue to expand on those ideas.
Second, the current regulatory ambiguity of Web3 activities and assets, whether they are securities or currency, raises questions about the application, redefinition, and expansion of UCC Article 9. This is an arena where my interests in how to regulate new industries to facilitate industry success can provide insight into the effects of regulatory ambiguity, rather than the strength of a regulatory regime, on the development of new industries.
Third, regulatory approaches to new AI technologies need investigation and standardization to foster the growth of the industry and maintain the United States’ technological leadership. Intellectual property protection of both the AI model, its inputs, and its outputs remains in dispute, and the solutions imagined will either foster or stifle the industry at its inception. This project builds on my previous work on the relationship between intellectual property protections and new industry development as well as work I completed this summer while consulting for an AI medical technology startup.
Fourth, I am expanding the work from my first paper by investigating the impact of regulatory regime strength on the creation of nascent pharmaceutical cannabis industries in developed, rather than developing countries. This project will use a post-hoc evaluation of a 2016 quantitative and qualitative pre-analysis of Hawaii’s cannabis industry development to analyze the accuracy of those predictions and apply lessons learned to new markets.