Legal Pot: Death of the Emerald Triangle?

Aug. 3, 2010 — -- Tucked away in the very northwestern-most corner of California are three relatively small rural counties that are, despite their size and isolation, known around the world in certain circles.

These counties -- Mendocino, Humboldt and Trinity -- have, since the mid-'70s, specialized in the production of a much-sought-after export that was, until relatively recently, completely illegal: marijuana.

The growers there have produced such a high-quality product for so long that the drug has come to define the area, known as the appropriately-colored Emerald Triangle. Mention of the Emerald Triangle among even small-time pot enthusiasts is met with a knowing smile -- and a wildly different reaction from long-frustrated federal authorities.

The drug is the lifeblood of the counties, woven inseparably not just into every aspect of the local economies, but into the everyday lives of thousands of residents. But with the legalization of pot for medical use and potential legalization for recreational use, the Emerald Triangle is facing a daunting threat in the form of a pot price freefall fueled by industry-style mass production.

For a region of California that has for more than three decades defined and lovingly cultivated an entire culture in the shade of marijuana leaves, the legalization of pot signals a seizmic shift that will change the Emerald Triangle forever -- assuming it survives at all.

The Emerald Triangle: Where People Come to 'Grow Their Lives'

Radio talk show host Anna Hamilton came to the Humboldt County 28 years ago but still considers herself in the "second class" of migrants to the Emerald Triangle.

"The senior class came up in the mid-'70s," Hamilton told ABC News. "They paved the way."

It was then that growers, riding the wave of the counterculture movement, made their way to the three counties where the soft soil, fresh country air and an advantageous distance from government authorities provided the perfect combination for high-quality cannibis growing. They've been doing it ever since.

"Here, they've been able to grow their lives -- raise a family, live a decent middle class life," Hamilton said. "This is no different from any other rural culture that's breaking land and building their own. In our own world, everything is very normal. We have a very normalized world and a very normalized economy around marijuana."

Since much of the county's recent economic history was built around an illegal trade, there are no hard numbers on just how dependent it is on pot. Mark Lovelace, Humboldt County supervisor, estimated the drug is directly responsible for a quarter of the local economy and "maybe more.

"It's really hard to know, but we don't have to be able to put a firm number on it to know it's significant," the Lovelace said. "We've had people coming to Humboldt County to make a killing on this industry."

Though it's not listed in the annual crop report for Mendocino County, marijuana is "the major crop" there, according to a county official who spoke on the condition of anonymity.

Mendocino County Supervisor John McCowen said it is the "popular belief" that the drug greatly outpaces the county's next closest legitimate industries, timber and wine.

"There's no question that a fairly significant number of people rely directly or indirectly on the marijuana business," McCowen said.

Combined, the Emerald Triangle is home to more than 200,000 residents and, according to Hamilton, if you're not directly growing pot, then you're working in the stores that cropped up to cater to the growers' needs.

"There is no other economy," Hamilton said. "All of the service economies are totally dependent on marijuana. ... All the businesses in our little town, the richest ones, sell accessories for growing."

Joy Greenfield, 68, is a medical marijuana grower in Mendocino whose collective, Light the Way, has more than 1,000 members.

"It affects all kinds of people you wouldn't even think," she said.

So when the price of pot jumps or dives, the ground shakes in the Emerald Triangle.

Mass Production Changes Face of Market

Ever since California became the first state to legalize marijuana for medicinal use in 1996 (and approve an expansion in 2003), growers in the Emerald Triangle have faced increased competition in the form of hundreds of dispensaries that popped up across the state. Earlier this month, city officials in Oakland, Calif., gave preliminary approval for four large-scale marijuana production factories, paving the way for unprecedented state-approved mass production of pot.

As a consequence of mass-produced pot flowing into the market, Emerald Triangle growers expect the price of pot to drop -- but not nearly as badly as it will if the state votes to legalize the recreational use of marijuana in November.

A study earlier this month by the RAND Drug Policy Research Center concluded that legalization would throw the price of pot into a freefall -- down as much as 80 percent.

As a result, Emerald Triangle growers, business owners and officials have been thrown into a frenzy to come up with ways to meet the devastating effect such a crash would have on their community and have been divided into two camps of thought.

The first is the hope that the Emerald Triangle can survive on the weight of their "superior product" and emerge as the elite, highly specialized "Napa Valley of pot." Legalization would also allow growers to better cooperate with authorities to curtail violent criminal elements that also have made the Emerald Triangle their home.

The second theory is that the counties are doomed.

The only thing that everyone agrees upon is that nothing will be the same.

Survival of the Fittest

Back in March, the idea that pot legalization could destroy her hometown became lodged in Anna Hamilton's mind. Using her gift for words and local popularity, she began organizing meetings with business owners and county officials that were meant to answer one question: How are we going to survive?

At one of the meetings, Hamilton took a quick survey. How many people believe legalization of recreational pot will improve the local economy? Of the 185 community representatives from various industries, a resounding 95 percent said it would be "a disaster."

"The idea that my generation would let this economic world that we have created for ourselves..." Hamilton said before trailing off in thought. "I started the meetings to try and prepare the county for the impacts on the social services" -- social services that she believes will be strapped when "tens of thousands" of people are driven out of work.

Therefore, many in the Emerald Triangle have taken the seemingly contradictory stance of protesting a law that would legalize their cash crop. Though she is not one of them, Hamilton said the detractors of legalization argue that the way the proposal is structured leads to monopolies on marijuana production and distribution -- a thinly veiled nod to Oakland's impending factory production.

It's an argument many have likened to the way in which super stores infamously run smaller "mom and pop" stores out of business across the country.

"Now the city of Oakland is going to end the marijuana business," Hamilton said. "What's going to happen to us?"

She said if her home town can no longer depend on the marijuana market, it will simply "dry up and blow away."

Desley Brooks, an Oakland City Council member and "longtime supporter of cannabis," told ABC News the super store comparison is off the mark.

"I don't see that," Brooks said. "I think that some people have made a significant amount of money and they don't want anyone else to infringe on that money."

Last Hope: Becoming the 'Napa Valley of Marijuana'

But there are others in the Emerald Triangle that welcome legalization as an opportunity.

"They are getting ready big time," a Mendocino county official said, referring to growers who have excitedly brought their scales in to the Agriculture department to make sure they function properly. "A lot of people I've talked to, they're not really worried about it. They're kind of excited about the opportunity to take their expertise and release it."

Humboldt's county supervisor, Mark Lovelace, said he believes his county is up to the challenge posed by mass producers.

"If Oakland decides they want to be the Wal-Mart of marijuana, we can be the Napa Valley of marijuana," he said, "if we want our name synonymous with higher grade, outdoor, quality product.

"If this becomes a legal industry in the free market, the way you're going to proceed is with superior product, superior price and with better distribution," he said.

In fact, Lovelace believes the Emerald Triangle already has a step up on the coming competition.

"You go anywhere in the country -- anywhere in the world -- and you mention you're from Humboldt County, you get a nod. That's name recognition to die for. We've lived with that for 30 or 40 years now, treated it somewhat as an embarrassment ... but if this is going to be a newly legitimate industry, shouldn't we be looking for ways to capture the upside?"

Local journalist and photographer Kym Kemp, 50, has lived in the Emerald Triangle all her life -- long enough fear a repeat of the economic devastation the counties suffered when the logging industry collapsed before marijuana took over.

"Humboldt will survive of course," Kemp told ABC News. "[But] things could get ugly. Unless, and this is big, unless local government and growers work together to create rules to foster [marijuana] tourism. Unless the marijuana industry is brought out of the shadows and welcomed -- then Humboldt will not just survive, but could even thrive."

Mendocino County supervisor John McCowen agreed.

"Personally, I can't wait for economic reality to come to the marijuana business," McCowen said. He said after a period of "transition," legalization would drive out criminal elements and in time attract legitimate businesses that have historically avoided the area due to its reputation.

Hamilton is not convinced.

"You're looking at a Wild West scramble. All these people are up in the air. Nothing can tell you what's going to happen," she said.

The image of a Napa-esque marijuana industry brought a chuckle to a Mendocino County official who asked not to be named.

"Can you imagine? People come in to our little boutique shops to try different varieties of pot? We'd have our wine tasting areas and our pot tasting areas," he said with wonder before a more somber thought took over:

"As far as what's going to happen? I haven't the first clue."