Here’s a belated trick or treat. These three related events
occurred during the just-past Halloween. Each one features a plant that is
grown in the Golden State.
A tree grows in
Hughson, not just Brooklyn.
This is an all too rare, whole-hearted good
news story about caring people and an almond tree planted near Hughson, a small
town in California.
Last year, the millions and millions of California almond
trees that cover about 800,000 acres of Central Valley farmland, produced total
cash receipts of $5.16
billion (B). California almonds represent the entire US almond crop and 82% of
the global crop. That’s a lot of almonds.
But here I’m talking about a single, unique almond tree,
shown in the pictures below. The Modesto
Bee discovered this tree’s marvelous story.
This particular almond tree stands in the corner of an
orchard near Hughson. It’s decorated each year on Halloween, Christmas and
Valentine’s Day in commemoration of Danielle Genzoli, who died in a car accident
12 years ago when she was 16.
The tree had failed to thrive, and David Genzoli, Danielle’s
father, planned to rip it out. But Danielle objected. “She was a nature girl
and just loved the trees,” Kimber Genzoli, Danielle’s mother, said. “So it
became their project to save this little tree. Before her death Danielle and
her dad started the tradition by hanging a single bulb on the tree during the
holidays.
The year Danielle died, David Genzoli didn’t have the heart
to continue the tradition. But one day, when he and Kimber went by the tree they
found that someone had hung homemade ornaments on it. They never found out who
did it, but suspect it might have been a neighbor. “And it kind of morphed from
there; people coming by just started adding to her tree,” Kimber Genzoli said.
“It’s became a community project, and we are grateful for the people who
contribute to this tree.”
Kimber Genzoli said Halloween was Danielle’s favorite
holiday, so a few years later she hung some small pumpkins from the tree. This
also was adopted by the community, with people stopping by regularly to add
decorations.
From a single bulb, the tree at Christmas is now covered in ornaments
and lights and even has a star at its top, as you can see above in the
right-side picture.
Friends and strangers alike add ornaments, some personalized
with pictures or their family name and the year.
People have left letters to the Genzoli family about
Danielle’s kind heart and how she affected them, like one from a fellow student
at Hughson High School who said Danielle one day sang “Don’t Worry Be Happy” to
her when she saw her crying at school.
One year, Danielle’s first-grade teacher had her students
make paper Valentines that hung from the tree in February. The tradition, too,
has continued with Valentines from a new class each year, as shown in the
left-side picture.
After Halloween and Christmas, the Genzolis take down the
decorations and store them until the following year, and every year the
collection grows. Danielle’s wonder-filled tree and its spirit is one more
reason I enjoy eating almonds.
Lutheran Hops. This Oct. 31st marked the 500th anniversary
of Martin Luther’s protest to the Catholic Church. That’s because Oct. 31st
isn’t only Halloween, it’s also Reformation Day, which celebrates Luther’s nailing
his 95 Theses to the door of the Wittenberg Castle church in Germany on Oct.
31, 1517. His theses challenged the authority of the Catholic Church, and inspired
the historic split in Christianity known as the Protestant Reformation. Apparently, historians now question
whether Luther actually nailed his theses to that door. They think he might
have merely mailed them to the archbishop. But beyond quibbling about whether
they were mailed or nailed, it started something momentous.
That something wasn’t limited to changes in religious
precepts. Nope, it also had to do with changes in beer production.
Every trendy craft brewery today touting hoppy beers should
tip a brew towards Luther and thank him and his followers for stimulating the
use of hops. Luther did it as an act of insurrection against the Catholic
Church. He and his disciples provided a reformation in the production of beer.
For the record, California grows a tiny amount of hops; much of our domestic
hops come from Washington State, Oregon and Idaho. Here’s the story
of Lutheran hops.
In the 16th century, the Catholic Church had a near headlock
on beer production. History is repeating itself. My previous blog,
“Wither My Craft IPA,” mentioned the heady concerns I have about today’s beer
market where a very small number of producers (e.g., two) now dominate almost
40% of global beer making and distribution.
But let’s get back to the 16th century. The church’s control
of the beer market came from its monopoly on the herbs and spices (e.g., sweet
gale, mug wort, heather, rosemary, juniper berries, ginger and cinnamon) used
to flavor and most importantly preserve the beer. The church taxed these needed
beer ingredients.
In an age when you risked your health by drinking plain
water, beer was drunk by everyone. This widespread use of much safer fermented
beverages was the norm in Germany and beyond for centuries. In the New World,
beer and hard apple cider, whether it was made by Johnny Appleseed or not, was consumed
by virtually everyone for the same reason. Treatment of public water wasn’t
common until the late 19th century. Paisley Scotland seems to be the first
Western European city to filter its water in 1832.
Fortuitously for Luther and other early German beer-makers,
hops were not taxed by the Church. The Church’s priestly brewers considered
hops unworthy, nasty weeds. In addition, Middle-Ages folklore which the
Catholic Church adopted held that hops might not be healthy or good for you. Little
did the Church know.
Hops flowers
Beyond its being untaxed, hops were a far better
preservative than herbs. Hopped beer thus contributed to local public health.
It also contributed to regional and international business as hops’
preservative qualities allowed hopped beer to be safely sold further away from
its brewery. This is why high-hopped beers like what came to be known as India Pale Ale could be transported
across several oceans without problems. So, if you were an early Protestant
brewer and also wanted to scorn the Church, you used hops instead of herbs. Such
brewers changed the world of beer.
These Protestant brewers included Luther’s wife, Katerina.
She opened a successful brewery that produced large amounts of hopped beer.
Luther was delighted. Lord Katie, as he kindly called her, had assured him a
steady supply of his favorite drink. We should thank Martin Luther for his
bravery in pushing hops into beer. I’ll drink to that.
Some folks consider Luther’s strong promotion of hopped beer
his second Reformation, and perhaps the most important one that many benefit
from every day, not just Sundays.
Greedy Weed Bureaucrats. This tale is a coda to my blog
last month, “The High Price of Getting High,” about marijuana, which California
grows plenty of. One knowledgeable policy analyst said that high marijuana tax
rates "will prevent the minimization of the black market,” a clear policy
goal of marijuana legalization. More information about the California marijuana taxes became available on Halloween.
The expected price of California’s recreational marijuana
sold legally after January 1st keeps growing. Why? In large part because
marijuana is California’s single biggest cash crop. Cannibas’ production value
is roughly 50% greater
than that of grapes, the state’s second most lucrative crop. Thus, local
authorities see legalization as a big new revenue-enhancement opportunity. They
are proposing multiple large taxes on marijuana consumers, distributors and growers.
Revenue-hungry municipal and state agencies will, in effect, feed the black market
by increasing the tax-inclusive price of legal, recreational marijuana. The
price of getting high in the Golden State is getting higher.
The fundamental economic relationship that tax authorities
may have forgotten is this: high prices of legal marijuana will reduce its
sales and will allow California’s existing, large black market weed to prosper.
This is in spite of the relatively price inelastic nature of the demand
for cannibas.
A new study issued by Fitch Ratings and reported by CNN
on Halloween notes the breadth and height of these expected taxes on California recreational marijuana. They are shown in the table below.
California’s Proposed Taxes and Costs for
Recreational Marijuana
Tax Type
|
Tax Rate or Level
|
Consumer sales tax
|
22.25% to 24.25% (includes 15%
state excise tax)
|
Local business/distributor tax
|
1% to 20% of gross receipts or
$1 to $50 per square foot of plants
|
Grower’s tax
|
$9.25/oz. flowers and $2.75/oz.
leaves
|
Grower’s cost for registration
and environmental compliance
|
$100,000 (est.)
|
Source: Fitch Ratings and CNN
These proposed consumer and distributor tax rates may total
45%. Notice also the hefty potential costs of growers registering and complying
with the state’s environmental regulations. Such substantial “entrance fees”
for the thousands of California’s illegal growers will act as a large
disincentive for them to enter the legal market.
These sizable tax rates have a familiar ring to them. My
experience with public authorities in several states’ municipalities is few
have any systematic sense about how consumers or businesses may respond to their
tax increases. They seem to believe that if for example they increase a tax by
10%, then tax revenues will also increase by 10%. This is a naïve expectation,
especially when there is a substitute good not subject to the tax, like Emerald
Triangle cannibas.
The authorities appear to believe businesses and consumers
have virtually no sensitivity to high taxes; they will supply and buy the same
amount of marijuana regardless of the taxes’ rate. This is a mistaken belief.
The tax-induced high prices of legal recreational marijuana
in California will be good news for growers of black market weed. There will
certainly be new buyers of marijuana after the New Year who will pay the high
legal price because it’s legal and a less risky transaction. However, it’s also
likely that other consumers (including many existing buyers of Emerald Triangle
marijuana) or price-sensitive shoppers will buy from black-market suppliers and
doubtlessly enjoy lower prices, just like happened in Washington State.
California’s marijuana policy-makers should learn about and/or
remember Washington State’s, Oregon’s and Colorado’s early legalization experiences
that forced these states to lower their initial,-uncompetitive, high tax rates.
Given their fiscal greediness, I’m not sanguine that California’s marijuana tax
authorities will remember basic economics and other states’ experiences. Time
will tell as January 1st approaches.
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