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Month: September 2022

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The Hold on the Trillion-Dollar Crypto Trade Leaves It Vulnerable

Throughout the cascading cryptocurrency collapses and bankruptcies this summer, one name rose to the top: Sam Bankman-Fried, also known as SBF.

The Bahamas-based American billionaire entrepreneur heads FTX, the world’s second-largest cryptocurrency exchange. This year, he’s become a primary protagonist in the folding of crypto platforms and hedge funds like Celsius Network, Voyager and Three Arrows Capital, deploying a proverbial $1 billion parachute to scoop up failing firms, prop up those facing insolvency and flirt with acquisitions worth hundreds of millions.

He’s also become a primary player in American domestic politics, revealing he’s willing to spend up to $1 billionto fund the Democratic Party’s 2024 efforts. That will prove influential if significant cryptocurrency regulation makes its way through Congress, especially in the context of the 2022 “crypto winter.”

In 2022 alone, his companies acquired two crypto platforms, Canada-based Bitvo and the Japanese platform Liquid, bought a 30 percent stake in Anthony Scaramucci’s SkyBridge Capital, 7.6 percent of the trading platform Robinhood, and lent a whopping $400 million to BlockFi with an option to buy it outright by October 2023.

His relationship with Voyager Digital — an exchange that filed for bankruptcy in July — is a complicated one. His private equity fund, Alameda Research, is a creditor, investor and borrower. Bankruptcy documents show Alameda initially owed Voyager $370 million, but the company lent it more than $500 million in crypto in late June to cover client accounts. Later documents show Alameda likely borrowed up to $1.6 billion from Voyager in the end.

In the same period, Alameda Research also lent $12.8 million to Celsius Network, a crypto lending platform that filed for bankruptcy in July.

Celsius’ single-largest creditor, as revealed in bankruptcy filings, was Pharos USD Fund. This Cayman Islands-based investment firm was owed $81.1 million. That fund is managed and owned by Lantern Ventures, whose CEO, Tara Mac Aulay, is a co-founder of Alameda Research and a close associate and former colleague of Bankman-Fried at the Centre for Effective Altruism.

While a complete forensic account would be impossible to tabulate, we are left with a scenario where one individual — thanks to his controlling shares at multiple companies and connections to investors, debtors and creditors — has a major stake in a significant part of the broader cryptocurrency trading industry.

The various loans, swaps and leveraged trading are typical for financial institutions. Still, they represent an entirely new level of risk in the world of digital money based on open blockchains.

Owing to his newfound relationship with lawmakers and political campaigns — especially as President Biden’s biggest donor— he’ll also have significant weight in shaping the future of Democratic Party politics.

There is no doubt that SBF is one of the most successful investors of our time. But does his significant position constitute a risk for a new innovative sector of our economy?

For those of us with a significant interest in Bitcoin and other cryptocurrencies — protocols designed to be decentralized — to see so much capital and control vested in one person is a warning sign.

With so much crypto value tied up on exchanges and lending platforms rather than people’s private wallets, there are hundreds of billions of dollars at risk for consumers. As we saw with the collapse of TerraUSD, an algorithm stablecoin, it only takes one bankruptcy to send shockwaves. Can a trillion-dollar industry continue to rely on a single investor’s altruism and business acumen?

Politicians in Washington will soon set the rules for how the government classifies cryptocurrencies. They will invoke financial risk, uncertain investments and consumer protection. Bankman-Fried will inevitably have an influence on whatever the outcome will be.

It would benefit us all if future rules help bring regulatory clarity, keep shady actors at bay and provide financial transparency. The whims of a single person, however successful they may be, cannot be the guiding light for the future of decentralized digital money.

Originally published here

US Smoking Rates Rise As a Result of Lobbying Against Safer Alternatives

For the first in two decades, US smoking rates have risen amid the persistent lobbying against safer nicotine alternatives such as vaping products.

In a blog post on the Consumer Choice Center’s (CCC) website, the group’s deputy director Yaël Ossowski said he believes the incessant crusade against safer nicotine alternatives is behind the recent rise in smoking rates. “Nothing has been more egregious and harmful in our current age than the public health lobby’s persistent denialism of the harm reduction value of nicotine vaping products and other alternatives to cigarettes.”

The Federal Trade Commission’s 2020 Cigarette Report indicated that cigarette sales in the US are the highest they have ever been in two decades. The total number of cigarettes sold by major manufacturers rose 0.4 percent in 2020 to 203.7 billion units from 2019. “This is the the first increase in cigarette sales reported in the last 20 years. Smoking is up for the first time in a generation. The public health lobby is to blame,” said Ossowski.

Read the full article here

Pentingnya Menjadikan Kekayaan Intelektual untuk Jaminan Kredit

Perlindungan hak kekayaan intelektual merupakan salah satu instrumen yang penting untuk meningkatkan inovasi dan juga industri kreatif. Melalui perlindungan hak kekayaan intelektual yang kuat, maka para inovator dan pelaku industri kreatif memiliki jaminan untuk mendapatkan manfaat ekonomi dari karya dan inovasi yang dibuatnya.

Berinovasi dan membuat karya orisinil yang diminati oleh konsumen dan bisa dijual kepada masyarakat bukanlah sesuatu yang mudah. Untuk itu, adanya insentif bagi para inovator dan pekerja di industri kreatif bahwa mereka akan bisa mendapatkan manfaat ekonomi dari hasil karya yang mereka buat merupakan sesuatu yang penting.

Tanpa adanya insentif bagi para inovator dan pekerja kreatif untuk berinovasi, maka tentunya akan membawa dampak yang negatif terhadap perkembangan inovasi di negara tersebut. Dengan demikian, akan sangat sulit bagi sektor usaha untuk berkembang, dan tentunya lapangan kerja yang dibuka kepada masyarakat juga akan semakin sedikit.

Itulah mengapa, perlindungan hak kekayaan intelektual yang kuat merupakan sesuatu yang sangat penting. Tanpa adanya perlindungan hak kekayaan intelektual yang kuat, maka orang-orang yang tidak bertanggung jawab bisa dengan mudah mencuri ide dan hasil karya orang lain. Dengan demikian, para inovator dan mereka yang membuat karya tersebut tidak bisa mendapatkan manfaat dari karya yang telah dibuatnya.

Aspek penegakan hukum untuk menindak para kriminal yang mencuri hasil karya dan inovasi merupakan hal yang sangat penting untuk dalam rangka kebijakan untuk melindungi hak kekayaan intelektual. Tetapi, penegakan hukum dalam bentuk penindakan tentu bukan sesuatu yang cukup untuk memberi insentif bagi para inovator untuk berkarya dan berinovasi.

Setelah hak kekayaan intelektual yang dimiliki oleh seorang inovator tersebut dilindungi, maka adanya ekosistem yang mendukung pemanfaatan kekayaan intelektual tersebut secara optimal juga harus dihadirkan. Kita harus bisa memastikan, bahwa para inovator dan pekerja kreatif bisa mendapatkan manfaat ekonomi dari karya yang dibuatnya secara optimal, untuk mendorong semakin banyak inovator dan pekerja kreatif untuk berkarya dan berinovasi (wipo.int, Maret 2021).

Salah satu hal yang paling jelas misalnya adalah, para pemilik kekayaan intelektual tarsebut harus bisa untuk menjual karya yang dimilikinya dalam berbagai bentuk barang atau jasa kepada konsumen, sebagai salah satu cara untuk mendapatkan manfaat ekonomi dari karya yang dibuatnya. Kegiatan ekonomi jual dan beli ini juga harus dilakukan di dalam ekosistem yang bebas, seperti kompetisi yang adil dan terbuka, serta lain sebagainya.

Namun, ada cara pemanfataan yang lain lagi, yang juga tidak kalah pentingnya dibandingkan dengan pemanfaatan dalam bentuk jual beli. Salah satunya adalah, menjadikan kekayaan inetelektual yang dimiliki tersebut sebagai jaminan untuk mendapatkan kredit dari lembaga keuangan.

Menjadikan aset sebagai jaminan kredit merupakan skema yang sangat umum yang dilakukan oleh berbagai pemilik usaha, baik untuk membuka usahanya, ataupun untuk memperluas pangsa pasar yang dimiliki. Saat ini, khususnya di Indonesia, aset-aset yang umumnya kerap dijadikan sebagai jaminan antara lain adalah apa yang dikenal dengan tangible asset atau aset nyata, seperti properti misalnya.

Adanya ekosistem yang memungkinkan para pemilik properti untuk menggunakan asetnya sebagai jaminan pinjaman tentu merupakan hal yang sangat bermanfaat bagi para pemilik properti tersebut. Dengan demikian mereka bisa memiliki modal untuk berbagai hal, seperti membuka usaha baru, atau mengembangkan usaha yang sudah dimilikinya.

Hal ini pula yang sangat penting untuk didorong, agar para pemilik hak kekayaan intelektual bsia menggunakan kekayaan intelektual yang dimilikinya sebagai jaminan untuk pengajuan kredit. Bila hal ini bisa dilakukan, maka insentif seseorang untuk berkarya dan berinovasi juga akan semakin besar, karena kesempatan mereka untuk mendapatkan manfaat ekonomi dari karya yang dibuatnya juga semakin luas.

Meskipun demikian, memang harus diakui bahwa, ada beberapa tantangan yang harus diatasi untuk mewujudkan hal tersebut. Otoritas Jasa Keuangan (OJK) misalnya, yang memiliki wewenang selaku lembaga regulator, mengatakan bahwa hak kekayaan intelektual memiliki fluktuasi nilai yang tinggi. Selain itu, industri Usaha Mikro, Kecil, dan Menengah (UMKM) yang berbasis hak kekayaan intelektual juga mengalami persaingan yang sangat kompetitif, sehingga berpotensi dapat mengalami kesulitan memasuki pasar (money.kompas.com, 01/09/2022).

Pemerintah sendiri belum lama ini sudah mengeluarkan aturan yang memperbolehkan lembaga keuangan seperti bank untuk menjadikan hak kekayaan intelektual sebagai jaminan untuk kredit, melalui Peraturan Pemerintah (PP) No. 24 Tahun 2022. Salah satu persyaratan yang dibutuhkan adalah, kekayaan intelektual tersebut sudah didaftarkan, dan pemilik kekayaan intelektual tersebut sudah memiliki sertifikat resmi dari pemerintah (money.kompas.com, 25/7/2022).

Hal ini tentu merupakan sesuatu yang sangat positif. DIharapkan, melalui adanya peraturan pemerintah tersebut, industri kreatif di Indonesia dapat semakin berkembanga, dan para inovator dan pekerja kreatif memiliki insentif yang lebih besar untuk berkarya dan berinovasi, yang nantinya tentunya akan membawa dampak yang positif terhadap perekonomian.

Sebagai penutup, perlindungan kekayaan inetelektual yang kuat merupakan hal yang sangat penting untuk meningkatkan insentif bagi para inovator dan pelaku industri kreatif untuk berkarya dan berinovasi. Namun, pelindungan yang kuat saja tidak cukup. Hal tersebut harus juga dibarengi dengan membangun ekosistem agar para pelaku industri kreatif bisa memanfaatkan kekayaan intelektual yang dimilikinya secara optimal. Dengan demikian, semoga inovasi dan industri kreatif di Indonesia dapat semakin meningkat dari tahun ke tahun di masa yang akan datang.

Originally published here

Amy Klobuchar’s Journalism Bill Wants Bad Media Cartels

People will share this article on social media channels, which will drive traffic to the Newsmax website. More traffic on a website means more users likely to click on and consume content on that same website, driving ad revenue.

In this sense, Facebook or Twitter act as multipliers of exposure to media companies. But that is not how Sen. Amy Klobuchar sees it.

Her Journalism Competition and Preservation Act of 2021 (JCPA) claims to protect local media outlets by allowing broadcasters to band together to negotiate terms on content distribution. In essence, it would allow media firms to fix prices on something they benefit from: social media companies allowing links to be shared.

The bill exempts media companies from antitrust laws for four years, even though social media companies would continue to be affected by those laws. According to Klobuchar, this would divert profits of social media giants to those media companies that have struggled in recent decades — not least because of their inability to adapt to the online model.

Klobuchar’s bill doesn’t go quite as far as some rule-makers in Europe have been willing to go. In 2018, the European Commission (the executive arm of the EU) put forward new copyright legislation that would impose a link tax. This would require social media platforms to either pay the publisher for the use of snippets (thumbnail and short excerpt text) or not allow the link to be posted at all.

This proposal sparked wide-scale protests across Europe, arguing that it would reduce access to information, limit freedom of expression, and boost fake news. In the end, the EU watered down the proposal, and to this date, many EU member countries are dragging their feet on implementing aspects of the copyright reform.

The JCPA is a less refined argument than Europe’s copyright approach. To Amy Klobuchar and her bipartisan co-sponsors, it is simply about redistributing financial means from one economic player to another, not by means of taxation but through the creation of cartels. This would create a myriad of problems.

Exempting one economic sector from antitrust rules creates a precedent that other sectors will lobby to access. After all, if media companies can band together to fight Meta and Twitter, why can’t hotel conglomerates collude to limit the availability of Airbnb?

The government picking winners and losers never has a good ending and exposes lawmakers to undue influence. Ultimately the question may very well be: Doesn’t Amy Klobuchar seek to benefit from positive media coverage through this bill and its effects?

Those concerned about market concentration in the media realm should see this bill very critically. While some may benefit from cartels, citizens and consumers never do.

Klobuchar’s bill would also be unlikely to effectively help struggling media companies. Many platforms generate a majority of their website traffic, and so their revenue through social media clicks — thus, a link tax would need to be prohibitively high to yield results.

This could lead social media companies to simply block the sharing of links to news sites, which happened in Australia when it implemented similar rules. When Spain attempted link taxation, Google News shut down its services in the country (and only recently reopened after the EU watered down the local legislation).

The underlying premises of Klobuchar’s bill are twofold. On the one hand, she assumes the plight of companies is due to social media giants like Meta or Twitter. The fact that Facebook shut down news link sharing in Australia last year proves that the platform does not need news content to survive; media outlets need Facebook far more than Facebook needs them.

The other assumption is that the economy is static. Facebook and Twitter, unless they innovate, are unlikely to remain the most prominent players in the social media realm. They know better than anyone to what extent they can become redundant in the eyes of their users: think MySpace.

While this is something we accept for social media companies, we don’t apply the same thinking to the media space. Why shouldn’t newspapers and broadcasters be expected to adapt to the digital space in a financially sustainable way without intervention from the government?

Originally published here

GEG Will Impact Fundamental Rights of Consumers

The highest law in Malaysia is the Federal Constitution, which recognizes the fundamental rights of all Malaysians. If we do not focus on this matter, the validity of the law will be questioned, says R. Paneir Selvam

The Consumer Choice Center (CCC) recently organized an online webinar titled Ending Generation Endgame, Rules of Law and the Constitution.

The aim of this webinar was to examine and evaluate the Federal Constitution’s rule of law regarding the essence of the generation endgame.

According to the representative of the Malaysian Consumer Choice Center, Tarmizi Anuwar, individual freedom for consumers in the Federal Constitution was not given serious attention in the implementation of this generation endgame.

“Very little was discussed about fundamental rights or individual freedom in this matter. Until recently, Tun Zaki, the former Chief Justice, also touched on the issue of individual freedom in his statement. We can have many laws enacted, but what is more important is whether the law aims to achieve the goal of justice and equality”, he said.

The main panel for this webinar was R. Paneir Selvam, the principal consultant for the think tank Arunachala Research & Consultancy Sdn. Bhd. (ARRESCON).

In the discussion, Paneir said that the validity of the law could be questioned if the drafting of the law does not take into account the basic rights of consumers.

Read the full text here

Generation End Game policy will impact fundamental rights of consumers

THE validity of the law can be questioned if the drafting of the law does not take into account the basic rights of consumers.

A case in point is the Tobacco and Smoking Products Control Bill 2022 which culminated in the Generation End Game (GEG) has somehow curtailed the right of consumers to choose with the state apparently controlled consumer choices and actions.

“(If this happens), it is not impossible that the way we cut our hair and wear it will also be controlled in the future. This is a dangerous precedent and a wrong move by the Government,” opined Arunachala Research & Consultancy Sdn Bhd’s principal consultant R. Paneir Selvam.

“The highest law in Malaysia is the Federal Constitution which recognises the fundamental rights of all Malaysians. If we do not focus on this matter, the validity of the law will be questioned.”

According to the think tank founder who was the main panellist at the online webinar entitled Ending Generation End Game, Rules of Law and the Constitution organised by the Consumer Choice Centre (CCC) Malaysian chapter, the law enacted must uphold the principle of equality and consumer rights must be prioritised.

Read the full text here

President Biden Must Waive the Jones Act Immediately to Help Hurricane Victims

In the aftermath of the devastating Hurricane Fiona in Puerto Rico, a ship containing 300,000 barrels of desperately-needed diesel fuel is waiting offshore until it can secure an exemption to the 1920 Jones Act, mandating only US ships can ship goods between US ports, among other protectionist restrictions.

Puerto Rico Governor Pedro Pierlusi has called on the federal government to grant the waiver immediately.

The Consumer Choice Center calls the Biden Administration’s indecision a “crippling example of the harms of restricting trade and commerce for nationalistic and political gain, and why the Jones Act must be immediately waived and then repealed.”

“President Biden’s Administration can immediately waive the Jones Act to speed rescue and recovery operations in Puerto Rico and along America’s coasts. The fact that desperate people, in the wake of hurricanes and natural disasters, must continuously ask the federal government to temporarily waive this law demonstrates it is no longer fit for purpose and should be repealed altogether,” said Yaël Ossowski, deputy director of the Consumer Choice Center, a global consumer advocacy group.

“For too long, the Jones Act has acted as a protectionist racket, benefiting shipbuilding union leaders at the expense of American consumers and entrepreneurs. The OECD estimates that a repeal of the Jones Act would benefit the American economy by up to $64 billion, lowering prices for consumers and offering new opportunities for investment and innovation.

“The fact that we are in a time of economic uncertainty, high gas prices, and rising inflation, and the Biden Administration and its agencies are more focused on protecting their labor union constituents, rather than citizens in need, is a crippling example of the harms of restricting trade and commerce for nationalistic and political gain, and why the Jones Act must be immediately waived and then repealed,” said Ossowski.

“The Consumer Choice Center supports the efforts of Sen. Mike Lee (R-UT) and Rep. Tom McClintock (R-CA) to do just that with the Open America’s Water Act. Congress can do its part to support these bills and give people relief today and going forward. “Consumers and citizens deserve better,” added Ossowski.

On our syndicated radio program Consumer Choice Radio, we interviewed Colin Grabow, a policy analyst at the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies, on how the Jones Act is making people poorer. WATCH HERE.

The trouble with King Charles’ unorthodox views on modern farming

During his long tenure as the successor to the throne, then-Prince Charles was a defender of the environment. The Prince of Wales website underlinesthe use of “his unique position to champion action for a sustainable future.”He testifies to having made changes in his own lifestyle that made him more eco-friendly: running his Aston Martin luxury car on surplus white wine, not eating meat or fish two days of the week and forgoing dairy products one day a week. When the monarch was in charge of Highgrove farm in southwest England, all production was only organic farming.

King Charles didn’t discover his penchant for sustainability all by himself. After Charles met the Indian anti-globalization activist and environmental advocate Vandana Shiva, his focus shifted from raising awareness about climate change to advocacy for more extreme measures. Shiva has repeatedly come under fire for her unorthodox claims and methods, most recently when over 50 biotechnology experts wrote an open letter to the University of Missouri Kansas City regarding an upcoming lecture. The letter attacks her support for hand-weeding — a labor-intensive farming practice used in developing countries because of a lack of pesticides; banned in the state of California — her claim that fertilizers should never be allowed in agriculture, or a tweet in which she likened the use of genetically engineered crops to rape.

Shiva also regards GMOs as “patriarchal” and “anthropocentric,” a view seconded by Charles who referred to them in 2008 as a big environmental disaster. The fact that the royal takes advice that translates to his own ideas became apparent when he published his book “Harmony: A New Way of Looking at Our World” in 2011. In it, he bemoans that the industrialized world has turned its back on God and the harmony of things — that we divorced from the “sacred geometry” by implementing global capitalism at the expense of the environment.

One review of the book states, “He regards opposing views as cynicism or blindness. He likes to overlook complexity.”

Whether or not Charles used to run an organic farm that practiced hand-weeding ought not to matter in British politics, except that it does. The new king, despite being a constitutional monarch, is influential in all nations where he serves as a sovereign, and does have the ability to lobby for his views. 

Just last year, the British press revealed the extent to which Queen Elizabeth had been able to use opaque back channels of legislative procedure to influence laws. Publicly expressed political views are also on the table. When a Canadian radio broadcaster tricked the Queen into a prank call with a pretend Jean Chrétien, then prime minister of Canada, it became apparent to what extent the sovereign was willing to go to publicly announce her opposition to Québec’s attempt at gaining independence.

The policies that Charles supports would fundamentally change the global farming system, causing significant disruptions. Despite innovation in the field of organic agriculture, the practice yields less food than conventional methods, an average 43 percent to 72 percent less. When researchers modeled a 100 percent adoption scenario of organic practices in England and Wales, and they found that it would actually increase carbon dioxide emissions because more natural resources are required to produce the same amount of goods.

Charles’ views on farming stand in contrast with the UK Parliament’s priorities. The House of Commons is considering a bill that would allow genetic engineering in crops. Such a move would be one of the more notable breaks from EU policy, in which legislation prevents the use of modern gene-editing technology. The UK has also shied away from more radical agriculture reforms the EU is embracing: while the EU “Farm to Fork” strategy plans for a considerable reduction in farmland use, the UK government promises plans that help British farmers become more productive. The fact that the “Farm to Fork” legislative packages now face delays in Brussels over concerns of food shortages further underlines the point that Charles’ preferred model of sustainability could lead to disaster.

Whatever your views on the royal family, it’s clear that we excuse irrational policy prescriptions from Buckingham Palace. It’s high time the monarch abandon his advisers and unfounded views on modern agriculture. 

Originally published here

Free up the cannabis market

Removing CBD products from the Cannabis Act would have several immediate benefits for consumers

Last week Ottawa announced that the Cannabis Act, passed in 2018, will finally get its long-overdue mandatory review, which was supposed to take place in October 2021.

Regulators will have to answer some tough questions regarding Canada’s legalization experiment. As Liberal MP Nathanial Erskine-Smith conceded: “We didn’t get it perfect, or exactly right the first time, and this is an opportunity to make sure we get it right going forward.” One of the core priorities of the expert panel reviewing the act is better understanding how the legal market can stamp out the illegal market, which is still prominent.

According to the Ontario Cannabis Store’s own report, the legal market has made significant gains since 2018 but still only accounts for 59 per cent of all cannabis consumed. So what can be changed in the Cannabis Act to target the 41 per cent of cannabis that continues to be supplied by the illicit market?

First, CBD products, those containing cannabidiol but either no or very little THC, which is what produces the high, should be removed from the cannabis act altogether. Products that are not intoxicating and have a significantly lower risk profile shouldn’t be treated the same as cannabis products that include THC.

Removing CBD products from the Cannabis Act would have several immediate benefits for consumers. The first is that it would exempt CBD products from the heavy-handed marketing, branding and plain packaging restrictions set out in the Cannabis Act. Regulating cannabis the same way as tobacco is regulated was a mistake, given the important differences in risks among the various cannabis products. But regulating CBD products like tobacco is downright comical. To end the joke, we should treat any CBD product with a THC concentration of less than 0.3 per cent (the U.S. legal standard) as a natural health product and exempt it from the rules and regulations of the Cannabis Act.

On the producer side, removing CBD products from the Cannabis Act would help licensed producers make use of the glut of cannabis that ends up being destroyed as a result of oversupply — an oversupply that fails to lower prices because excise taxes create an artificially high price floor, while the excise tax stamp regime landlocks finished product within provincial boundaries. Fully 26 per cent of the legal cannabis produced in Canada in 2021, 426 million grams, ended up being destroyed because of oversupply. If CBD were removed from the act, this excess cannabis could be used to create CBD products, which could be sold at other retail outlets, not just licensed cannabis stores, thus significantly expanding buying opportunities for consumers.

On marketing and branding, the rules should be re-written to mirror what Canadians accept for alcohol. Cannabis is no more and arguably much less dangerous than alcohol, so its sale to adults shouldn’t be more strictly regulated. This wouldn’t just be for consistency’s sake, either. People who buy their cannabis in the illicit market need to be aggressively marketed to if the government wants to keep growing the legal market. Marketing and branding rules that are far less paternalistic than those currently in place would be a huge step forward in allowing retailers and producers to reach consumers still buying outside the legal regime.

Regarding product and price, some simple steps would go a long way. First, the 30-gram limits on both purchase and possession in public should be scrapped. There are no such purchase restrictions for alcohol: an adult of legal age can walk into a liquor store, more often than not owned by the government, and buy as many bottles of liquor as they please. If consumers can buy more than a lethal dosage of alcohol from a government store, they should be able to buy more than 30 grams of cannabis from legal retailers.

Regarding edibles and beverages, the act should either remove the 10mg THC restriction or significantly increase it. This restriction gives a leg-up to the illegal market, where edibles are often 10 to 20 times more potent. If legal edibles are to compete, they have to be comparable products.

Finally, as far as price regulation goes, the legal market needs to be much more competitive. Significantly simplifying and lowering the excise tax would help cannabis to be produced at lower costs and sold at lower prices, thus making it more attractive for those still buying illegally. Replacing the $1/gram minimum tax with a flat percentage would give a significant competitive boost to the legal market.

It is worth celebrating that 59 per cent of the cannabis market is now legal but serious changes are needed to crack down on the remaining 41 per cent. If the Cannabis Act is not amended to make the legal market more consumer-friendly, efforts to grow the legal market may fail.

Originally published here

Temperance makes a comeback

Dramatic shift in alcohol consumption guidelines could undermine the ultimate goal of harm reduction

More than 100 years ago temperance organizations promoting total abstention from alcohol and ultimately prohibition were a force to be reckoned with in Canada. Luckily for Canadians, sanity ultimately won out and alcohol was legalized in all provinces in the 1920s. Temperance societies may now seem like a thing of the past but there is a growing movement of lobby groups carrying the same banner under a different name.

Take, for example, the Canadian Centre for Substance use and Addiction (CCSA). Just this month it released a new report on alcohol that concluded that consuming more than two alcoholic beverages per week could seriously jeopardize your health. Yes, according to the CCSA, anything more than two beers in a seven-day period is cause for concern.

The CCSA’s new proposed alcohol guidelines are a radical departure from existing guidelines, which state that adults can consume upwards of 15 drinks per week for men and 10 drinks per week for women without serious danger to their health. Based on pre-pandemic data, upwards of 85 per cent of Canadian drinkers consume responsibly, according to these guidelines. Fifteen per cent of drinkers do not, however, and their problem drinking is obviously cause for concern.

The CCSA’s drastically lower guidelines for alcohol consumption will target many more than the 15 per cent of drinkers who regularly exceed the current standards. In terms of realistic public outcomes, it would be far better to focus on the relatively small number of people who struggle with serious alcohol abuse rather than to shift the goalposts so much that virtually all alcohol consumers in Canada become problem drinkers overnight.

In fact, shifting the standard so dramatically could undermine the ultimate goal of harm reduction: guidelines so divorced from the everyday experience of Canadians likely will be ignored by alcohol consumers across the country.

Another CCSA suggestion is a new “standard drink” label for alcohol. Different types of alcoholic beverage would carry labeling indicating how many such standard drinks were in each container. At first glance, this may seem to make sense, especially if the pandemic has warped many consumers’ views of what qualifies as one drink.

On the other hand, a drink’s impact will vary from person to person and situation to situation. Even for the same individual, alcohol’s impact can vary depending on how tired they are, their hydration or whether they have eaten recently. A standardized drink metric might well provide many drinkers with a false sense of security, especially regarding impaired driving. Consumers might believe that consuming two drinks at a bar leaves them able to drive when in fact the impact of those two drinks varies significantly depending on circumstances. Moreover, alcohol sold in Canada already indicates the volume and percentage of alcohol, which are clearly defined scientific metrics, on the bottle.

Beyond the merits of CCSA’s recommendations, there are obvious problems with the policy model in which government funds organizations whose purpose is to lobby government for policy changes. The CCSA is almost entirely funded by the federal government. How strange it is, in this post-Prohibition age, that the government funds a group whose mission is to discourage even moderate alcohol consumption. As Professor Sylvain Charlebois has pointed out, it’s like giving vegan organization PETA money to do a report on beef consumption in Canada. There’s not much suspense regarding what the report will say.

We know that the pandemic — specifically being home-bound for the better part of two years — shifted Canadians’ patterns of alcohol consumption. But the response to a 100-year pandemic is hardly justification for caving in to the new temperance lobby. Expanding the nanny state and infantilizing responsible drinkers is not the answer to any problem.

Originally published here

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