The Economics of Hemp
Proponents, including many Hawaii folk, are changing the way we think about industrial hemp.

HONOLULU WEEKLY
October 17, 2001
By Chad Blair

First, the bad news
It came as a major blow to the industrial hemp industry and its many advocates, which include thousands of Americans from Maui to Maine.

"Devastating!" pronounced Hawai'i state Rep. Cynthia Thielen on Hawai'i Public Radio's Talk of the Town program Tuesday, Oct. 9. "Just devastating." "An absolute usurpation of our right to access natural products," chimed in David West, the Wisconsin plant breeder/geneticist who oversees O'ahu's experimental hemp plot, the only place in the entire nation where industrial hemp is grown legally.

What was the bad news? The federal Drug Enforcement Agency earlier that same day issued three rulings that criminalize the possession and manufacture of any edible hemp seed or oil products, effectively stunting the momentum of a nascent hemp movement that seemed on the cusp (again) of mainstream legitimacy. After all, the plant had been in widespread use for 10,000 years, embraced not only by gentlemen farmers George Washington and Thomas Jefferson but by whole civilizations including ancient Persia, Greece, Rome, China and Japan. (Fun hemp factoid No. 1: Betsy Ross reportedly sewed the first U.S. flag with hemp.) Hemp's modern adherents are fond of citing Genesis 1:21, 29-30 — God gave us "every seed-bearing plant on the face of the whole earth and every tree that has fruit with seed in it. They will be yours for food." California hemp authority and author Chris Conrad writes that Hindu, Buddhist and Islamic texts make direct, favorable references to hemp as well. (Hemp factoid No. 2: The first Gutenberg and King James Bibles were printed on hemp paper.) The Mormons built their Utah empire with hemp construction materials. "Hunt out places and soil suitable for flax and hemp, and let them there be grown," commanded Brigham Young.

But the United States, under pressure from corporate self-interests and drug hysteria, abruptly terminated hemp's production in this country with the passage of the 1937 Marijuana Tax Act. Hemp would have a brief resuscitation in 1942, when fiber shortages as a result of World War II necessitated wartime hemp production. Afterward, however, hemp went back underground.

Too bad. If hemp is all that its many proponents say it is —and this reporter could find no evidence to the contrary — legalization could lead to an agricultural revolution in America and, especially, in economically challenged Hawai'i. To accomplish that, however, requires a fundamental governmental paradigm shift, starting with the DEA.

Rep. Thielen, the Kailua/Kane'ohe Bay Drive Republican who co-sponsored (with Big Isle Democrat Rep. Jerry Chang) a bill that established the Hawai'i Industrial Hemp Research Project in Wahiawa in 1999, was a guest on HPR that Tuesday afternoon with Dr. West and Maui hemp consultant Cindy Biggers. Coming off the inspiring Hemp Industries Association (HIA) Eighth Annual Convention, held in Kïhei, Maui, just the weekend before, the DEA's rulings floored Hawai'i industrial hemp supporters.

Even HPR's substitute host, Kayla Rosenfeld, was in disbelief, especially after hearing West detail that the hemp seed, which contains all essential amino and fatty acids, could potentially satisfy a host of humans' nutritional requirements. (Fun hemp factoid No. 3: Prince Siddhartha ate only hemp for six years prior to his enlightenment.) The same shocked reaction was felt on the Mainland.

"These three new rules are vague, and we're still trying to figure out what they mean, but it's fairly clear that the immediate effect is that all hemp food products are now a controlled substance," explained Eric Steenstra, president of Votehemp.com, a Virginia-based nonprofit established a year and a half ago to push for hemp deregulation. "The big question is, Why?"

Hemp is not pot
Why indeed. As hemp proponents will tirelessly tell anyone that asks, hemp won't get you high, although, like its notorious compatriot marijuana, it is cannabis sativa. (Cannabis indica is similar but much shorter in height; its short stem is not suitable as hemp fiber.) The entire hemp plant — roots, stalk, leaves, flowers, seeds, even the aroma — are usable in one form or another. But the psychoactive ingredient of pot — tetrahydrocannabinol, or THC — is not a component of the myriad line of products made from hemp.

The smoke-able part of cannabis, the pakalolo, comes from female plants that are separated from male plants to prevent pollination. Grown to the proper height, the flowers or "buds" are trimmed. Harvested, marijuana sells for $400 to $650 an ounce in the Islands — and higher, post the Sept. 11 terrorist attacks (most pot in Hawai'i comes through the mail from Canada, California and Mexico, and airport and mail security have been intensified). It's also the stuff known as medical marijuana (see the Weekly's related story in the Rear Window, Page 31).

Hemp crops, by contrast, are male and female plants side by side that naturally pollinate. Even if someone were to get a hold of female hemp plants and separate them from males in order to grow pot, it could take several generations to do so, and even then it might not produce tasty buds. Smoking hemp will only get you a headache.

"People are still getting them mixed up, hemp and marijuana," says an indignant Peter Thielen, Cynthia's son and, with wife Sharon, head of Kaua'i-based Island Hemp Wear (see chart on Page 8). "The distortion, the propaganda, the misunderstanding out there about hemp is just unbelievable." Despite pollination, traces of THC can be found in some hemp manufactured products, but it comes in amounts so miniscule that the DEA's fears are ill-founded, if not absurd.

"The ruling formalizes the level of THC permitted in hemp food products, five parts per million or lower in hemp oil, and 1.5 parts per million or lower for the seed," explained an aggravated David Bronner, chair of HIA's food and oil committee.

At the HIA convention, Bronner displayed his product line alongside fellow hemp industry members at the Maui Lu hotel. The Escondidio, California-based Dr. Bronner's Magic Soaps, which generates $7 million in annual revenue, was started by David's grandfather, Emanuel, in 1948. While not directly impacting his business, the DEA's ruling was particularly galling to Bronner, who had helped to spearhead an HIA-led volunteer THC test-pledge program to address the DEA's concerns.

"We're looking at serious damage to our industry," he argued from the Votehemp.com offices Oct. 10. "It's totally inappropriate that the DEA wants to create the impression in consumers' minds that hemp foods are illegal drugs." It's also a blatant double standard, as the DEA has a far more lenient detection level when it comes to measuring the opiate content of poppy seeds on, say, bagels. But that's because, argues Bronner and many others, America's DEA is in the back pocket of the lucrative drug-testing industry.

"We have no documented proof, but it's very clear that there's a connection," said Votehemp.com's Steenstra. Bronner added that it is uncertain whether widespread arrests and confiscation of "contraband" may follow, but, given the state of heightened national security following Sept. 11, anything seems possible. (The DEA also failed, in the view of Votehemp.com, to arrange for a required public notice and comment period about the new rules.) What is certain is that the hemp cookies, granola and energy bars, veggie burgers and salad oils happily ingested by HIA conventioneers on Saturday, Oct. 6, were, in the eyes of the DEA, equivalent only three days later to shooting up heroin or swallowing LSD. According to the Washington, D.C., based National Organization for the Reform of Marijuana Laws (NORML.org), possession of a so-called Schedule I drug is punishable by one year in jail and a minimum fine of $1,000 for first-time offenders.

Hemp's bounty
In spite of the DEA's ruling, hemp is not going away. In fact, though food and drink stuffs are a substantial component of the hemp product line, they are but one part, and a fairly minor part at that. (Fun hemp factoid No. 4: Utne Reader in its March-April 2000 issue reported that a beer titled Hempen Gold, brewed in Maryland, was once served to President Clinton on Air Force One, though a witness said that Clinton "tasted but didn't swallow.") Clothing apparel, purses and bags, shoes, skin-care products, automobile and building composites (hemp fibers are mixed with materials like concrete, wood or plastic), fuel and industrial lubricants are the major uses of hemp, with emphasis by manufacturers and retailers primarily focused on clothing and personal-care products (the DEA ruling exempts — so far — topical application of hemp seed and oil).

In addition to hundreds of small businesses, hemp products are manufactured and distributed by the likes of Crate and Barrel, Ralph Lauren, DaimlerChrysler, The Body Shop and Kimberly Clark, constituting an estimated $50 million domestic market. The problem is, these products are relatively expensive due to import costs. (The figure of 25,000 uses for hemp comes from articles on plastics in the 1930s.) The U.S. is the largest importer of hemp in the world while Canada, China and Europe are the largest exporters. Over 30 countries currently permit and support cultivation and production of industrial hemp and the marketing of products made from same.

One would think that the world's largest, most powerful capitalist country would commandeer the bandwagon. The market is rapidly expanding, after all: Worldwide hemp production has risen nearly 25 percent since the mid-1990s. But American indifference to hemp starts at the top, thanks to aggressive policies in the continuing war on drugs that started with President Reagan in the early 1980s.

Businesses can't grow and harvest an illegal crop, of course, but corporate reluctance to lobby Congress to deregulate hemp laws is based on the assumption that hemp production would cut into existing profits, specifically those for manufacturers of pulp, paper, textiles, commodities, construction, plastic, metals, pharmaceuticals, energy and petroleum, according to author Conrad. (Fun hemp factoids No. 5 & 6: Rembrandt and Van Gogh painted on hemp canvas, while Confucius and Lao Tzu wrote on hemp paper.) While some $14 billion has been spent to prohibit the use of marijuana and hemp since 1990, Conrad conservatively estimates that $500 billion in potential GDP is missed because of our government's "boondoggle." (Conrad says the annual black market figure for hemp is at least $50 billion.)

The frontlines
In spite of the sizable opposition, grassroots hemp activists and small-business persons across the country are intensifying their efforts to legalize hemp. As Maui hemp consultant Biggers remarked following the DEA's rulings, a sizable infrastructure supported by businesses, associations, scholars and lawyers to fight for hemp has been in place since the early 1990s.

"We're not giving up," Biggers promised.

In fact, the fight has only grown more forceful and articulate. Hemp advocates are like a cult of Scientologists — happy, shiny people — except that their philosophy of "saving the planet through hemp" makes good sense. Clear-eyed, informed on the law and knowledgeable about nearly every aspect of their industry, these proponents channel their anger and frustration into constructive activity.

Hemp's popularity and open advocacy in Hawai'i comes from many directions, but it gelled in the late 1980s on the Big Island when Puna residents Aaron Anderson and Roger Christie formed the Hawai'i Hemp Council — "to give us some stature" when dealing with county government officials. The organization, now run by Kris Johnson, is today called the Hawai'ian Hemp Council and operates from O'ahu.

The council advocated for all uses of cannabis on the Big Isle, and Anderson and Christie take a measure of credit for having laid the groundwork that has led to medical marijuana legislation in Hawai'i and to placing boundaries on marijuana eradication on Hawai'i County. Both men have had their share of legal problems over the years: Christie eventually obtained legal permission to run a "cannabis ministry" in Puna, while Anderson has been in and out of various courts — but not jail — on what Anderson says were sometimes trumped-up charges. Anderson has also run several times for elective office, unsuccessfully.

As with nearly everyone, the Sept. 11 attacks have reoriented thinking on hemp, with activists eager to point out how hemp could drastically reduce American dependency on foreign oil.

"I just hope this whole situation will bring people up to the fact that we should stop trading freedom for security," says Anderson. "This is all about the Constitution and civil liberties.

There are several dozen Hawai'i folk actively pushing hemp products in the Islands — and even making a tidy profit from them. (If manufactured properly, hemp clothing feels more like fine linen than rough burlap.) While hemp stores on Maui and the Big Island cater primarily to specialized audiences, companies like Island Hemp Wear, begun in 1995 on Kaua'i, produce hemp aloha shirts that sell for $59 or more in stores such as Natural Attitude, Turbo Surf and Global Village as well as to retailers in Canada, Japan and Puerto Rico. (Fun hemp factoid No. 7: During the sumo ritual of dohyo-iri, a yokozuna ritually cleanses the dohyo, or sumo ring, to exorcise evil wearing a heavy hemp rope around his belly).

"Hemp producers and retailers are true entrepreneurs," says Cynthia Thielen, who acknowledges that her political involvement with hemp together with her son owning a hemp store might be seen as a conflict of interest — except for the significant fact that neither she nor her son makes any money off the Wahiawa plot, and that commercial planting of hemp in Hawai'i is many years off.

"The three biggest problems facing the hemp industry are ignorance, intentional misrepresentation of hemp for political purposes and drug testing," Thielen told HIA members at the Maui convention. It was not easy for Thielen to convince her legislative colleagues to pass hemp legislation, she explained. When she walked through the state Capitol hallways, "people would run and hide." So Thielen plied legislators with hemp shirts, encouraging them to brush off DEA efforts to defeat "for budgetary reasons" her hemp bill. Local legal authorities tried to defeat the bill as well. But the bill narrowly passed, and Governor Cayetano, a supporter, immediately signed it into law.

Thielen also walks what she talks. Currently undergoing pre-cancerous facial treatment, she has been taking two tablespoons of hemp seed oil a day orally (yep — it's now illegal) as well as applying it to her face. "My doctors and dermatologist have been very surprised at the results," she remarks, "and they want to know more." (Fun factoid No. 8: In second-century Rome, Pliny the Elder prescribed hemp seed for constipated farm animals, the herb for earache and hemp root, boiled in water, to ease cramped joints, gout and burns. His contemporary, Galen, wrote that it eliminates excess gas.) It's a treat to watch Thielen, who is internationally acclaimed by hemp folks, address HIA members. The moderate Republican with a background in environmental law, though dressed in a business suit with her hair neatly coifed, is embraced by long-haired hempsters draped in hemp wear and soaked with hemp oils. During her speech, an Adonis-like barefoot man spread fumes of burning hemp throughout the Maui Lu longhouse — aromatherapy. Watching Thielen among this crowd is like watching Laura Bush attend a Dave Matthews concert. But Thielen is at home with these people, and they with her. A standing ovation follows her uplifting talk.

Diversifying ag
Speaking of Sept. 11, Hawai'i's imperative to wean itself from its troubled tourism industry and to diversify its agricultural base to help the local economy is more pressing than ever. As the governor and other officials fall back on tired patterns of begging Japan for more visitors while throwing money at the construction and tourism industries, Thielen contemplates a true vision.

"If we could grow hemp on Kaua'i and Moloka'i, we would no longer have to import building materials," she says. "We can process it here, and also reduce our dependency on fossil fuels." That vision is years away from being actualized, but it is government — voters — that holds all the cards. The statistics for playing those cards, however, are compelling. While diversified crops are a minor component of the state's economy, they are growing, reports the state Department of Agriculture. Total agricultural output directly contributed $500 million to the gross state product in 1999, or about 1.2 percent of the total.

Tourism, by contrast, is estimated to be 25 percent of the state GDP, down slightly from 1990, while the military's overall share has dropped from 15 to less than 10. (Military spending, of course, could change as a result of ... well, you know.) Diversified agriculture — meaning everything but sugar and pineapple: coffee, papaya, macadamia nuts, etc. — was valued in 2000 at $357 million out of a total farm value of $521 million, according to DOA statistics.

That may seem like small potatoes, but hemp supporters see wisdom in literally planting seeds for tomorrow. Punahou graduate Peter Thielen has discussed using abandoned cane fields on Kaua'i now owned by former classmate/AOL-TimeWarner boss Steve Case, although Thielen stresses that the Case family "in no way condones planting an illegal crop." But the potential for a thriving hemp crop here is apparent.

That potential is physically manifested daily in a quarter-acre plot on former plantation land in Wahiawa, near Whitmore Village. Geneticist David West, an agronomic genius to his many admirers who tolerate his sometimes prickly nature, runs the facility (Ralph Nader and Woody Harrelson visited West's garden in May 2000.) A marvelous videotape compilation of West's two-plus years of cultivating hemp here, delineates the step-by-step process of learning how to grow a viable hemp crop.

Though proud of his research, West is impatient with the press, reluctant to divulge how the Wahiawa plot is funded, or where, exactly, it's located. Utne Reader, however, reports that the private monies come from L.A.-based Alterna Applied Research Laboratories, which uses hemp seed oil in its hair-care products. At least $25,000 had to be spent on security for the farm, including a 10-foot-high barbed wire fence and infrared surveillance cameras, according to Utne Reader. For good reason: The plot has been broken into and plants confiscated. West relates how black helicopters — the same kind used in the federal Green Harvest marijuana eradication in the Islands — occasionally circle overhead.

West stays out of the political fray as much as possible, although he has made pointed remarks about it just the same. "It's a crop, you grow it," says West, wearing his ever-present fisherman's vest. "Where does the government get the right to tell you that you can't plant a seed? It's a fundamental right. At what point does the growing of a plant become a criminal act? This country has become Fortress THC." (Fun factoid No. 9: Hemp is naturally resistant to pests, thus requiring very little in the way of pesticides. It also prevents the growth of weeds because it grows quickly and chokes out other plants.) Hemp is also perhaps the most multipurpose crop on Earth.

"How many uses does corn have?" posits West, who begun his career in maize research in Minnesota and Wisconsin.

West's video concludes with heartbreaking scenes of a DEA hemp bust at Pine Ridge Reservation in South Dakota this past July 30, where Native American Alex White Plume helplessly watched his crop cut down and destroyed by federal agents. Another bust occurred a month later. (Go to Nativesunite.org for more on Pine Ridge.) The Wahiawa plot is also used by Dan Paquin, a researcher with the UH College of Tropical Agriculture working under professor Qing Li. Paquin has conducted three experiments at Wahiawa that have supported a long-held assumption about hemp that could prove revolutionary: Hemp naturally cleans contaminated soil.

"It has a fantastic growth rate and is able to produce several crops of protein-rich seeds a year," he says. "Phytoremediation uses hemp to clean polluted soils, sediments and waters. The data is very exciting, because it suggests that industrial hemp could be used to remove EPA-listed, fuel-based contaminants from Hawai'ian soils." When Paquin presented his research at the Maui HIA convention, he was soon surrounded like a rock star by HIA groupies eager to learn more. Given the damage done to Hawai'ian lands after a century and a half of sugar and pineapple farming, phytoremediation may prove to be hemp's greatest gift.

"Here's the deal," says West. "Everybody wants this thing [hemp's potential] to be proved, but the government won't let you do it. It reminds me of the old philosopher's debate, 'How many teeth does the horse have?' While the philosophers debate, the fool comes up and looks in the horse's mouth. That's the situation." (Fun factoid No. 10: Paper made of hemp fiber has a life span of centuries, even millennia — compared to 25 to 80 years for tree pulp paper — and will not harden, crack, yellow, crumble or otherwise deteriorate.)