Chicago’s Illegal drug market likely to thrive in the wake of marijuana legalization

By Shirin Ali
Medill Reports

Illinois will soon become the 12th state in the country to legalize the sale and possession of recreational marijuana on January 1, 2020, but legalization doesn’t come without significant uncertainty and risk. In particular, the law establishes a high barrier of entry for individuals interested in entering the industry, which could allow the underground drug market to continue to flourish.

Malcom Gray is a 25 year-old native of Chicago’s Austin neighborhood who says he’s been dealing in Chicago’s illegal drug market since he was 10 years old. He is confident that Chicago’s illicit drug market isn’t going to suffer from legalization, because dealers will simply resell marijuana that was purchased legally from a dispensary.  “They’ll most definitely still do it because of the easy access. The price for cannabis on the streets is now going to go up because the access to it is more easy. Anybody can walk into a shop and get the top notch stuff.”

A 32 year-old resident of Hyde Park who conducts business under the name Paris Tokyo intends to continue operating her underground CBD and THC business, specializing in infused cocktails. She doesn’t plan on applying for a marijuana dispensing license, believing that Chicago’s marijuana market will quickly become too saturated. “People who have been selling weed on the street for years are still going to be accessible and around making money. Especially the people who have been doing this before weed was legalized, we’re just going to keep doing what we’ve been doing.”

Some Chicagoans who have been purchasing marijuana illegally are skeptical of the city’s and state’s ability to execute a smooth rollout of recreational dispensaries.  Emma Day, a 29 year-old resident of Wicker Park, debated whether she would consider purchasing marijuana legally versus continuing to purchase illegally. “I think it depends on the quality, the pricing. I think that it will probably take a while for these places to figure their businesses out. I’m not expecting the quality or organization to be there right away,” said Day.

These testimonies will sound familiar to many states that have passed marijuana legalization laws before Illinois. In particular, after California legalized recreational marijuana use in 2017, the state’s Cannabis Advisory Committee announced in its annual report released in January 2019 that “the unlicensed market continues to flourish, due in part to the competitive financial advantage such operations have over legal cannabis businesses,” and that the “lack of enforcement is creating a thriving environment for the unregulated ‘underground market’.”

Whitney Beatty attested to California’s illicit drug market crisis, as owner of Apothecarry Brands, a California based company that sells luxury storage for personal cannabis use. She was part of a panel held in Chicago’s West Side in late November called Blunt Conversations, and explained the risk illicit drug sellers create. “It undercuts safety and that becomes a huge issue because these items are not tested, in a time of big prices and you don’t know what pesticides are in there. That’s the point of legalizing this space, we’re going to have this opportunity to have safe consumption and we’re throwing that all out the window when we don’t have people shopping there.”

Gray also alluded to the safety risk that Chicago’s illicit market could pose to the community after legalization. “But the dangers of that, now the dealers are more so going to start selling to minors. They’ll start going to high schools and junior high schools because those are the clientele who will still want to smoke cannabis but can’t get into dispensaries because they’re not 21,” said Gray.

The federal Drug Enforcement Administration released figures on young adult usage of marijuana in its 2018 National Drug Threat Assessment report, stating that marijuana is the most commonly used illicit drug in the country. It said 6.5% of marijuana users in 2016 were adolescents aged 12 to 17, which equates to approximately 1.5 million adolescents.

The DEA’s final assessment stated marijuana usage will remain high and is likely to increase over time. Due to the fragmented approach of various states developing medical and recreational use laws, the general public and law enforcement are likely to face uncertainty and complexity when it comes to marijuana usage and access.

Most states approached legalization for the revenue opportunity it created, establishing fertile ground for consistent tax revenue. It also frees up local law enforcement from heavy policing on minor infractions and creates an opportunity to establish a productive social equity initiative. However issues like safety, public distrust and the targeting of minors are big factors looming over Illinois’s marijuana legalization rollout.

State rep. Carol Ammons also spoke at the Blunt Conversation’s panel in late November and explained that she voted against the recreational marijuana law. She said to those who participate in selling marijuana illegally, “There are legal avenues for you to enter and I want people to enter those legal markets so that they don’t jeopardize their liberty. People need to understand the nuances of what this legalization means and how it will impact them if they are in the underground market, they will still potentially have legal consequences.”

Illinois is likely to face an uphill battle when it comes to regulating the legal and illegal marijuana markets. The effects on local communities are uncertain, so long as the barriers to entry remain high and marijuana remains a federally illegal substance. Data from states across the country, like California, Oregon, and Colorado, suggest that illicit marijuana markets not only survive, but thrive in the wake of legalization.

Photo at top: An employee of Smokepost CBD in Bucktown prepares CBD product to be sold in store. (Shirin Ali/MEDILL)