Activist billionaires Sean Parker and George Soros and companies hoping to profit from legalizing marijuana in California have helped this year’s campaign for Proposition 64 raise close to $16 million, about four times the amount spent on a failed effort in 2010.
With a week left before voters go to the polls, the campaign to legalize recreational marijuana use is leading in surveys and has a massive fundraising lead over the opposition, which has brought in a little more than $1.6 million.
Observers say the outpouring of cash for the initiative is, in part, due to recognition by the national movement against marijuana prohibition that this may be the best chance in years to pass legalization in California, which could spark similar changes in other states.
One reason: The presidential election may draw more younger, liberal voters. In addition, legalization proponents who have differed on approach in the past have come together this year to support Proposition 64.
“We have broad support from a generous coalition of donors who care deeply about social justice because they know you can’t end the failed war on marijuana in America without ending it in California first,” said Jason Kinney, a spokesman for the Proposition 64 campaign.
But money is also flowing to the campaign because legalization in California would generate large profits for the industry, according to Jack Pitney, a professor of politics at Claremont McKenna College.
“Legal marijuana is no longer a pipe dream: It's an investment,” Pitney said. “Public opinion has shifted strongly in favor of legalization, and the smart money is following the people.”
Proposition 64 would allow Californians who are 21 and older to possess, transport and use up to an ounce of cannabis for recreational purposes and allow individuals to grow as many as six plants.
The measure would also impose a 15% tax on retail sales of the drug. Similar legalization measures are on ballots this year in Maine, Massachusetts, Nevada and Arizona.
A web of eight campaign committees, including New Approach PAC and Californians for Responsible Marijuana Reform, has emerged to support Proposition 64, with millions of dollars from out of state moving from one account to another in a way that makes it difficult for voters to track who is bankrolling the effort.
The biggest individual donor, by far, is former Facebook presidentParker, who has contributed $8.5 million to the cause through various committees. Parker has declined interview requests, but Kinney said the tech entrepreneur sees the initiative as a social justice issue and California as a key state in which to end criminalization.
“It’s never been about him — it’s about the thousands of lives ruined and the billions of dollars wasted by the failed war on drugs,” Kinney said.
Parker has “no current nor future interest in the commercial marijuana industry,” the spokesman added.
Another $4 million has been contributed by a nonprofit called the Fund for Policy Reform to a group called Drug Policy Action in support of Proposition 64.
When asked where the money originated, Drug Policy Action confirmed that it came from Soros, the New York hedge fund billionaire. Representatives declined a request for comment from Soros.
“Our marijuana laws are clearly doing more harm than good,” Soros wrote in an op-ed for the Wall Street JournaI in 2010, the last time California considered legalization.
Others opposed to criminalization of marijuana possession and who have contributed to Proposition 64 include Henry van Ameringen, a New York-based heir to fragrance company International Flavors & Fragrance, and Daniel Lewis, a retiree tied to the Progressive insurance company. Each donated $1.25 million to Proposition 64.
Lewis and van Ameringen contributed through a committee called New Approach PAC, which is also active in other states, and have no other investments in the marijuana industry, according to Graham Boyd, head of the political action committee.
“These are philanthropists who have been involved in social justice work for years,” Boyd said. “They come from a place of really believing that regulating and controlling and taxing marijuana is a better policy than arresting and incarcerating people.”
The initiative campaign is also getting large amounts of money from companies that may profit from legalization.
— $1 million from a committee funded by Weedmaps, a website that helps marijuana users find cannabis storefronts, doctors and deals.
— $250,000 from Nicholas Pritzker, who is chairman of Tao Capital Partners, a major investor in MJ Freeway, a firm providing software to help the legal marijuana industry track and report on its product. He is also former CEO of the Hyatt hotels firm.
— $50,000 from Privateer Holdings, a Seattle company that invests in marijuana products and services, including the official Bob Marley brand of cannabis, and Leafly, which provides news articles on the cannabis industry and information on strains and products.
Those donors appear to be investing contributions now in hopes of cashing in on a new industry later, said Andrew Acosta, a spokesman for the campaign against Proposition 64.
“Much of the money coming into Prop. 64 is not about social justice,” Acosta said. “It is a business investment for the industry to crack into the California market.”
Kinney, the spokesman for the initiative campaign, disputed the opposition.
“As the opposition well knows, the vast majority of our funding comes from organizations and individuals who care deeply about social justice and ending the failed war on marijuana and have zero interest whatsoever in the marijuana industry,” Kinney said.
California’s measure has such strong support and is so flush with cash that the campaign here recently transferred $35,000 to the effort to legalize pot in Nevada.
The opposition has largely been funded by a Virginia group called Smart Approaches to Marijuana Action Inc., an anti-legalization group founded by former Rhode Island Rep. Patrick Kennedy and others.
The group has collected $1.3 million so far from Pennsylvania activist Juliet F. Schauer, a retired art professor, to fight drug legalization measures in various states and has spent $971,730 in California so far.
Schauer, whose family made money in the banking industry, declined to be interviewed, but a representative said she is concerned about the effects of strong marijuana and the industry’s resistance to cap its potency in Colorado.
“She certainly is concerned with the harm of marijuana,” said Kevin A. Sabet, president of SAM.
Schauer has said on social media that she believes marijuana is linked to paranoia, psychosis and violence. The National Institute on Drug Abuse says studies have linked marijuana use to “increased risk for psychiatric disorders, including psychosis (schizophrenia), depression, anxiety, and substance use disorders, but whether and to what extent it actually causes these conditions is not always easy to determine.”
Law enforcement groups concerned about the spread of drug use and drugged driving have made up most of the rest of the money for the opposition campaign.
Those giving $25,000 each include the California Assn. of Highway Patrolmen and the Peace Officers Research Assn. of California, while the California Police Chiefs Assn. has contributed $20,000.
Even so, Pitney said it is not surprising the opposition campaign is not getting more financial help from those who oppose marijuana legalization.
“They read the polls, too,” he said.
Follow @mcgreevy99 on Twitter