Own your ow legal marijuana business
Your guide to making money in the multi-billion dollar marijuana industry
Unravelling An American Dilemma: The Demonization of Marihuana


Chapter One

An Old Path to a New Frontier


Over several millennia humanity and hemp have developed a unique symbiosis.  During the twentieth century, however, certain dominant segments of American culture became avid proponents for the eradication of hemp from the face of this planet.  These protagonists based their campaign on the premise that the cannabis plant posed a dangerous threat to humanity.  Such a brazen assumption clearly contradicted the truth about the ageless symbiosis, that is that humanity benefited from the plant’s peculiar properties. However, because these protagonists have been in a dominant position, they have been able to induce the American public into believing otherwise and, as a result, the truth about the symbiosis between hemp and humanity has become a relic of cultural amnesia.

The long historical relationship between hemp and humanity is readily evident in the etymology of the plant’s names.Around 1000 AD, our English-speaking ancestors began to use the term hanf to designate what is known agriculturally as hemp.Earlier still, our Latin-speaking ancestors of the Roman Empire referred to the plant as cannabis.  This latter term has since become the modern scientific term for the genus of the plant.In the Middle East, the Semitic cultures adapted the Latin cannabis into their own kannab.  The civilizations of the Indian Peninsula named it ganja or bhang.  The “an” and “ang” of these ancient Sanskirt words recur in the names of hemp in all the Indo-European and modern Semitic languages.  Further East, in China the records of hemp date back to 2700 BC, when its name was Ma.  Eventually, by 1000 AD, the Chinese renamed the plant Ta Ma, which meant the “great hemp,” to emphasize the plant’s value to their society.[22]

   As this brief etymology attests, people have cultivated hemp since the dawn of civilization for the many benefits it bestows on humanity.  Specifically, hemp provided people with fiber for textiles and paper; seed as a source of food and oil; and a psychoactive substance, which was used medicinally, religiously, and recreationally.Archaeologists have identified the remains of hemp seeds and fiber among the relics of Neolithic cultures which date back 10,000 years.  The first historical mention of hemp in the Western world occurred in the writings of the Greek historian Herodotus when he stated:

“... I must mention that hemp grows in Scythia, a plant resembling flax, but much coarser and taller.It grows wild as well as under cultivation, and the Thracians make clothes from it very like linen ones - indeed, one must have much experience in these matters to be able to distinguish between the two, and anyone who has never seen a piece of cloth made from hemp, will suppose it to be of linen.”[23]


In the same passage, Herodotus described the funeral rites of the Scythians, a nomadic people from the Russian steppe.According to Herodotus’s account, the Scythians burned hemp seeds as incense.  He noted further that the smoke produced a state of euphoria in those who came into contact with it.[24]

Throughout history, the plant’s psychoactive properties have consistently been incorporated into the rites of mystical religions throughout history.  In Ancient Western Societies, the Mystery Religions of the Great Mother Goddess utilized hemp in their sacred rites.  The use of the hemp’s psychoactive properties persisted in the West as a feature of pagan religions and medicines until the Inquisitions of the twelfth and thirteenth centuries formally outlawed the use of cannabis for religious and medicinal purposes.  A few centuries later, Catholic dogma was firmly established by Pope Innocent VIII, when in 1484, he issued a precedent setting bull which clearly labeled the users of cannabis as heretics and worshippers of Satan.Despite persecution against the religious and medicinal use of the drug, hemp remained an agricultural staple in the West, where it was highly valued as a source of fiber and seed.[25]  Ironically, after it was formally outlawed by the Pope in 1484, hemp took on a new historical importance.

By the sixteenth century, paper had become an integral part of Western civilization and hemp had made it all possible.The actual technique of making paper from hemp was an ancient Chinese secret.  Buddhist documents from the third and fourth centuries AD are the oldest examples of paper.  The ancient Chinese texts were printed on paper made primarily from a mixture of bark and old rags, which were mainly composed of hemp.  With this formula for paper the Chinese became the first culture to mass produce books.  One of the foremost experts on the history of paper making examined samples of the ancient Chinese book paper and found them to be 100 per cent hemp.In the eighth century, the Chinese art of paper making reached Persia and Arabia.  Then, eventually, in 1150, the Moorish culture of Spain established the first paper mill in the West and by the sixteenth century the art of paper making was firmly established in Europe.[26]

During the Renaissance, the prolific French Humanist, François Rabelais (1495-1553), in his classic, The Histories of Gargantua and Pantagruel, proclaimed, “Without it [hemp] how could water be drawn from the well? What would scribes, copyists, secretaries, and writers do without it? Would not official documents and rent-rolls disappear? Would not the noble art of printing perish?”[27]  The truths revealed in Rabelais’ previous statement extend beyond measure.There is no doubt that hemp played an active role in the history of the day.  The great voyagers of the Age of Discovery relied on ropes and sails woven from hemp fibers to rig their ships.  Once used, the sails were recycled and sold as rags to the paper manufacturers.The newspapers and pamphlets made from this paper fueled the democratic revolutions of the sixteenth through eighteenth centuries.  Without hemp these revolutions might never have occurred.  The same conclusions also apply to the evolution of capitalism and the pre-1870 phase of the Industrial Revolution.Both events relied on hemp as a source of canvas and rope for the rigging of trading vessels and as a source of paper for accounting ledgers, business contracts, and routine correspondence.[28]

In America, hemp was an agricultural staple from the very beginning.  The Founding Fathers knew the value of hemp.  Both Thomas Jefferson and George Washington cultivated hemp and wrote about its benefits.  By 1810, hemp was America’s third largest agricultural commodity.  Hemp fiber was in high demand among the producers of ropes and twines, linens and canvases, and even of paper.  This demand led to the development of a strong industry in Kentucky, but like the other cash crops of pre-Civil War America, the Kentucky hemp industry was part of the Southern slave economy.  Following the Civil War, the institution of slavery disappeared and the hemp industry was forced to pay for its labor.  Initially, the new arrangement was feasible, but in time the winds of change forced the hemp industry to the brink of extinction. [29]

The force behind these winds of change was the Industrial Revolution.  As this economic revolution evolved in America, it exerted a powerful influence on the course of the hemp industry.  This influence was set into effect through the introduction of technological improvements.  In particular, the new technology revolutionized the productive capacity of industries.Today this increase in productive capacity is referred to as mass production.  The primary prerequisite for mass production was a cheap and plentiful supply of raw materials.  In order to satisfy this prerequisite, the producers of raw materials invested heavily in the development of mechanical technology.  The innovations of machinery allowed the producers to cut their cost of labor while they increased their output.  Mass production in agriculture led to the establishment of large scale farming operations.  The cultivation of hemp never adapted to the new market conditions of mass production which settled themselves into the fabric of post-Civil War America and, as a consequence, the cultivation of hemp steadily declined to the point where it had virtually disappeared by the close of the 1920s. Only two small business concerns in Wisconsin continued to cultivate hemp for its fiber.These firms survived on the production required by the United States Navy and by the 1930s this business had dwindled to approximately 1000 acres of hemp per year.[30]

From the context of Department of Agriculture reports, the most serious problem confronting the hemp industry as it entered the twentieth century was labor.  Both the harvesting and processing of hemp were extremely labor intensive jobs.  Once slavery was abolished after the Civil War, the cost of hiring labor caused the price of hemp to become uncompetitive in comparison with the lower prices offered for the fiber of other plants.  The use of hemp fiber in clothing was being superseded by cotton and wool, both of which were more easily spun by machinery.  Likewise, the use of hemp on ships had dramatically declined since the introduction of both wire cable ropes, which were stronger and lighter than ropes made from hemp, and by Manila hemp, abaca, which was lighter and more durable in salt water.Furthermore, since ships were no longer powered by the wind, sails composed of hemp canvas were no longer required.Finally, hemp fiber, even though hemp was superior in strength and durability, was also being forced off the market as a material for twines and carpet warps by cheaper jute fiber.[31]

The same cycle of extinction occurred in the manufacturing of paper from recycled hemp rags.  In the 1840s, the Germans developed a process of producing paper from trees.  At the time the new technique was hailed as a breakthrough.  Historically, a short supply of rags had kept the price of paper relatively high.  The German technique offered a cheap formula for converting raw cellulose from a seemingly endless supply of trees into paper.  This new method quickly became established in the northeastern section of the United States, where there was an abundance of trees and water power to supply and operate the paper mills.  Once harnessed, the free power and the abundant supply of trees allowed the paper manufacturers to offer larger quantities of their product at lower prices.[32]

In a relatively short time, the demands of mass production severely depleted naturally occurring supplies of raw material.  Guided by the obvious conclusion, that the supply of trees would eventually be exhausted, scientists began to discuss the possibility of developing alternate sources for the production of paper.  Among the alternate sources, hemp was considered to be a favorable possibility from the outset.  In 1908, the Department of Agriculture published a circular, Papermaking Materials and their Conservation, which suggested the use of hemp as an alternative source.[33]  Two years later, in 1910, the Department of Agriculture published an article, “Utilization of Crop Plants in Paper Making,” in their annual Yearbook.  At the beginning of a specific section titled, “Plants That May Be Grown as Paper Crops,” the author presented the following statement:

“In addition to the waste materials that are available, evidence has been gathered that certain crops can probably be grown at a profit to both the grower and manufacturer, solely for paper-making purposes.One of the most promising of these is hemp.”[34]


The previous suggestion was repeated again in a Department of Agriculture Circular, Crop Plants for Papermaking, which was published in 1911.[35]

Along with this early governmental recognition, hemp also received some attention in technical publications.The earliest study was published in a 1904 edition of the Pulp Paper Magazine of Canada.[36]  The title of this study was “Paper from Refuse Hemp Stalks.”It reported very favorably on the prospects of utilizing hemp.  Two years later the same magazine published another study, “Hemp Waste for Paper,” which reiterated the conclusions of the previous study.[37]  The private research continued and, in 1908, another article was published which stated that hemp was the second best plant material after cotton to use for the production of paper.[38]

Eventually, the Department of Agriculture sanctioned an official inquiry into the economic potential of producing paper made from hemp.  In 1916, the Department of Agriculture issued Bulletin No. 404, Hemp Hurds as a Paper-Making Material, a collection of individually authored scientific articles.[39]  The first study, written by Dr. Lyster H. Dewey, titled, “The Production and Handling of Hemp Hurds,” explained that the hurd was the woody inner portion of the hemp stalk.  Hurds were only produced in a collectable quantity and fashion when the hemp was broken by a machine break.  This new technology had been introduced around 1912, and, since then, it had been used to a limited extent in Kentucky.  Among the processors of hemp it was customary to discard the hurds as waste material and, consequently, large piles of hurds had accumulated.  According to Dr. Dewey’s estimates, 7000 tons were available to be sold in 1916, for which the farmer could receive from $4 to $6 per ton.[40]

The second paper, “The Manufacturing of Paper from Hemp Hurds,” was written by Jason L. Merrill, a Department of Agriculture paper-plant chemist.  He opened his report by stating that his purpose was to investigate the use of hemp hurds for the production of paper.  Given the conditions of the current paper market, Merrill humbly acknowledged that the feasibility of his proposal would be governed by the condition that hemp-based paper could be produced more economically than wood-pulp paper.When Bulletin No. 404 was issued in 1916, hemp was not being extensively grown.  As a result, the supply of hurds was so small that it was uneconomical for the farmers to market them to paper mills.Consequently, Merrill felt that it would be impossible for hemp to gain a foothold in the current paper market.[41]

   At the same time, Merrill also astutely observed the rapidly dwindling supply of timber, and noted that there would be a need for alternative wood sources in the future, especially since the forests were being cut three times as fast as they were growing.  One solution to the problem was reforestation, but based on Merrill’s own research, such a solution would prove to be inadequate.  Over time, the diminishing supply of wood pulp would lead to increased prices and provide an opening for alternative sources on the market.Based on this assumption, Merrill believed that hemp could become a practical alternative if necessary.[42] Continuing, Merrill proceeded to explain that:

“Every tract of 10,000 acres which is devoted to hemp raising year by year is equivalent to a sustained pulp-producing capacity of 40,500 acres of average pulp-wood lands.  In other words, in order to secure additional raw materials for the production of 25 tons of fiber per day there exists the possibility of utilizing the agricultural waste already produced on 10,000 acres of hemp lands instead of securing, holding, reforesting, and protecting 40,500 acres of pulp-wood lands.”[43]


Despite his studies and these promising statistics, Merrill did not openly argue for increasing the cultivation of hemp.Instead, he realistically emphasized the fact that paper manufacturers could only afford to purchase hurds from the hemp industry, which in its current state did not produce enough hurds to make such a venture economical for either party.[44]

   With the future in mind, Merrill still conducted extensive experiments.During his investigations he produced twenty-four different pulps from the hurds which he deemed suitable for the production of paper.With these different pulps he then began to produce paper which eventually led him to the following conclusions:

“After several trials, under conditions of treatment and manufacture which are regarded as favorable in comparison with those used with pulpwood, paper was produced which received very favorable comment both from investigators and from the trade and which according to official tests would be classed a No. 1 machine-finishing paper.”[45]


Certainly, with this statement Merrill effectively suggested that in the future and under different circumstances hemp might be considered a very good raw material source for the production of paper.But, during 1916, he did not believe such a development was possible.[46]

Examining Bulletin No. 404 in retrospect, it does not appear that the report was published with the intention of being promotional.  Aside from scattered abstracts published in five issues of professional journals, Bulletin No. 404 was not accompanied by any sort of general media attention when it was released in 1916.[47]  Furthermore, there was never any serious activity within or outside the hemp industry to develop a market for the hurds after its release.The lack of response should come as no great surprise because the hemp industry was merely a fraction of what it used to be and, in 1916, there was not a problem with the supply of wood pulp.[48]

Despite the prevailing abundance of cheap wood pulp paper, further research was still conducted during the twenties regarding the utilization of alternative sources.Not suprisingly, hemp continued to be considered as a possibility among the research community.  In 1919, the work of two German scientists C. G. Schwalbe and Ernest Becker titled, “The Chemical Composition of Flax and Hemp Chaff,” was published in two prominent technical journals.[49]  According to this study, the chemical composition of hemp chaff, or waste, was suitable for the production of paper.These observations were analyzed further in 1921, when another study was produced by two more German scientists B. Rassow and A. Zschenderlein.This new study was titled, “Nature of Hemp Wood.”[50]  According to an abstract of the study which appeared in the Paper Trade Journal, hemp seemed to possess very favorable characteristics for the production of paper pulp.[51]

The mere fact that this information was available to the public tends to suggest that hemp would have been readily recognized as an experimentally successful type of alternative source for the production of paper among interested parties.  This observation proves to be extremely relevant because by the mid-1920s, research into utilization of farm wastes as an alternate source for the production of paper surfaced as a serious topic on the federal level.The possibility of utilizing hemp for the production of paper was intimately related to the ensuing Congressional debate regarding farm waste as an alternative source.[52]

With respect to the open-ended definition of farm waste, it is interesting to recall that the hurds of hemp were considered to be farm waste in the Department of Agriculture’s Bulletin No. 404.[53]  Furthermore, several technical journals had reported favorably about utilizing hemp waste for the production of paper.  In fact, some of the earliest articles on this topic bore titles such as “Paper from Refuse Hemp Stalks” and “Hemp Waste for Paper.”[54]  Clearly, any definition of farm waste also included hemp.It is extremely doubtful that any party expressing an interest in utilizing farm wastes would have failed to make this connection.To assume otherwise would be to assume that they were uninformed about the finer aspects of their business.

Another possible alternative source which was specifically referred to during the debates and in the majority of the newspaper articles about farm wastes was flax.[55]  These references provide further evidence linking hemp to the alternative source debate.  During the 1920s, a total of sixteen articles were published in technical paper trade journals which investigated the utilization of flax as an alternative source for the production of paper.[56]  In September, 1929, during the 78th meeting of the American Chemical Society in Minneapolis, Minnesota, a study was presented, titled “Physical and Chemical Characteristics of Hemp Stalks and Seed Flax Straw.”[57]  Previously, the authors, E. R. Schafer and F. A. Simmonds, had been studying the utilization of flax for the production of paper.Noting the similarities between hemp and flax, the authors explored the existing literature regarding the production of paper from hemp.Based on their analysis of the existing literature, Schafer and Simmonds concluded that hemp possessed very favorable properties and that further research into the utilization of the plant for the production of paper was warranted.[58]  Given the context of this assessment, it seems safe to assume that individuals with an interest in alternative sources would have recognized the possibility of utilizing hemp whenever flax was mentioned.

   Eventually, the topic of developing farm wastes as an alternative source for the production of paper caught the attention of Washington.  On January 25, 1927, during the second session of the Sixty-Ninth Congress, Representative Cyrenus Cole from Iowa, took the House floor and introduced legislation calling for a $50,000 appropriation for the Bureau of Standards to conduct research into the utilization of farm waste on a commercial basis.  Opening his speech, Representative Cole posed the following set of questions to his audience: “... Can we not make something out of these wastes? Can these vast wastes be utilized? Is there anything that we can make out of them?” Then he answered:

“... I have been studying such problems ever since I have been in Congress.  During all my time here we have had what we know as our farm problems.I have been thinking that we could in part solve some of these problems by making more things out of our products.

To me the farm problem is almost more industrial than agricultural... I believe the farm must be coupled with the factory and the factory with the farm... We must find more uses for our so-called raw products.”[59]


Through his quest to combine agriculture and industry, Representative Cole came into contact with the work being conducted at Iowa College.  According to the Congressman, scientists at the College had successfully converted farm waste into industrial products, ranging from valuable chemicals to print paper and substitutes for lumber.[60]

After consulting with officials from the College about this news, Representative Cole was told that all that was lacking was practical research on a commercial basis.  Apparently, the College did not have the facilities to conduct experimentation of this nature.  Recognizing the need to continue this promising avenue of research, Representative Cole formed the idea of involving the Bureau of Standards.  With this plan in mind he took the initiative and invited Iowa College’s chief engineering chemist, Dr. O. R. Sweeney, and the college president, Herman Knapp, to Washington, and introduced them to Secretary of Commerce Herbert Hoover, who scheduled a meeting for all with Dr. George K. Burgess, the Director of the Bureau of Standards.  At this meeting, Dr. Burgess informed those in attendance that the Bureau was already investigating the utilization of farm wastes for industrial purposes and that he had even discussed such achievements and possibilities in his own annual report of 1926.  Through this conference, Representative Cole was able to impress the importance of developing research on the utilization of farm wastes for industrial purposes and secure the approval of the Bureau of the Budget for an appropriation of $50,000 for the Bureau of Standards to continue its investigations.[61]

On January 25, 1927, Representative Cole presented his $50,000 appropriation bill on the floor of House.According to his data, the production of paper pulp offered the greatest possibility for commercial success with farm wastes.In particular, he argued that the Bureau of Standards possessed the necessary facilities to adequately proceed with commercial experimentation in the production of paper pulp.At the same time, he stressed the fact that the supply of wood pulp was rapidly diminishing and that the United States then imported the majority of its paper from Canada.Given the current situation, he opined it was inevitable that as the natural reserves of wood were depleted the price of paper produced from wood pulp would increase.  The successful research into the utilization of farm wastes, specifically cornstalks, held out a realistic solution to the problem of maintaining a constant supply of raw materials.  If allowed to develop, Representative Cole claimed that markets for farm waste to paper pulp producers could bring the farmers from $4 to $5 per ton for what was presently considered waste material.[62]  This figure was extremely close to the $4 to $6 per ton which Dr. Dewey had estimated in 1916, when he discussed the possibility of developing markets for hemp waste.[63]

   Significantly, Representative Cole introduced this appropriation bill during the midst of an agricultural depression.  After the First World War, European agriculture recovered and recaptured markets which had been assumed by the American farmers.  The loss of markets was coupled with increasing levels of production.The net effect was a decline in agricultural prices.  By the mid-1920s, a serious depression had commenced among the American agricultural community and it was directly linked to overproduction.Representative Cole’s idea was to develop new markets for the farmers in order to relieve them from the pressure of declining prices.This proposal was the first truly logical alternative to the agricultural depression.Specifically he reasoned:

“Our farm problems arise from what I may call an unbalance.For two generations, or ever since the enactment of the homestead laws and the land grant college laws, we have been stressing production.  Under these enactments we have thrown open vast new areas of fertile lands and we have applied every effort to the increase of production.  We now find that we can have overproduction, and overproduction creates the surplus that we are now trying to deal with.

We must now put the stress on the other end.I mean on marketing and consumption.We paid all too little attention to these essential things in the equation of prosperity.  We must find new markets, and new markets may not mean going across the seas with shiploads of our products but in finding new uses for the abundant crops...  The industrialization of agriculture, I repeat, is at the present time the one most important thing lacking and therefore the one most important thing we should be seeking.”[64]


Evidently, the rest of Congress agreed with Representative Cole’s assessment of the situation because they voted for the appropriation.

Before the legislation was finalized, though, the Department of Agriculture caused the appropriation to be stricken from the bill on the grounds that the federal funding was a duplication of investigations already being conducted by the Department of Agriculture’s Bureau of Forestry and Forest Products.  This hostile and uncooperative posture toward the small appropriation of $50,000 seems strange since the Bureau of Forestry did not specifically investigate farm waste.  However, this agency did conduct experiments in search of alternative types of wood to use for the production of paper.  Based on the similarities between the research project proposed by Representative Cole and those already being conducted by the Bureau of Forestry, the Department of Agriculture succeeded in having the appropriation dropped from the record.  Upon discovering this action Secretary Hoover notified President Calvin Coolidge of the dilemma.  Following the advice of Secretary Hoover, the President reinstated the appropriation through an executive order.  By 1927, the Bureau of Standards began to seriously investigate the possibility of utilizing farm wastes for the manufacture of industrial products, such as paper and building materials.[65]

 The following year, during the second session of the Seventieth Congress, Thomas Schall, a blind Republican Senator from Minnesota, introduced new alternative source legislation.  His bill, S. 4834, was a requisition for appropriations to build manufactories in parts of the country where farm wastes could be easily secured, and then, once built, to demonstrate the commercial practicability of making high-grade writing paper, newsprint paper, compo board, insulating board, and wall board.  Among the possible farm wastes cited by the Senator were cornstalks, straw, and sugar cane.According to Senator Schall, it was not unreasonable to help provide the American farmer with the opportunity to use what had previously been considered waste material for the production of industrial goods.  During the course of the debate for S. 4834, Senator Schall printed an article in the Congressional Record which made a direct reference to hemp as a possible alternative source.[66]  Even though this article was the only direct reference to hemp, it still provides solid proof that hemp was recognized as an alternative source.

Senator Schall presented a wealth of information in support of developing markets for alternative sources, but during the second session of the Seventieth Congress his legislation never made it past committee.  Despite this defeat, the Senator continued the fight into the next session of Congress and introduced another bill “authorizing an appropriation to encourage the utilization of farm waste for the production of paper by aiding farmers and local chambers of commerce to develop the manufacturing of paper pulp from waste crops.”[67]  This new bill, S. 561, was essentially the same as S. 4834 which the Senator had introduced during the previous session of Congress.Like its predecessor S. 561 died in committee.

Further alternative source legislation was presented in the first session of the Seventy-First Congress by Senator Daniel Steck from Iowa.  On May 13, 1929, Senator Steck introduced S. 1 as an amendment to the pending farm relief bill.  The Steck amendment was a more elaborate version of S. 561, calling for a government board to make loans to cooperative associations of up to $25,000,000 for the purpose of “assisting the cooperative association in the acquisition by purchase, construction, or otherwise, of facilities and equipment for the preparing, handling, storing, processing, and sale of cornstalks, wheat, oat, and rice straw, cotton stalks, cane stalks, and other like agricultural commodities.”[68]  Despite the Senator’s insistence, the rest of Congress did not feel that there was a need to create a separate amendment.  Instead, an agreement was reached that interested parties could apply for loans through a subsection of the pending farm relief legislation.[69]  Not surprisingly, no action was taken on behalf of developing farm waste industries for the farmer in any of the subsequent Congresses.

At the time of the alternative source debate, hemp never received any serious attention because it was virtually extinct as an agricultural commodity and, therefore, yielded little farm waste.However, the lack of cultivation does not mean that interested parties were not aware of the potential benefits offered by the plant in relation to the on going search for alternative sources.For example, during 1930, the Paper Trade Journal ran an article which recapitulated the previous literature regarding the possibility of utilizing hemp for the manufacturing of paper.  The material of this article also served as a topic of discussion during the 78th meeting of the American Chemical Society held between September 9 and 13, 1929.[70]  Thus, based on these opportunities of awareness, it would be extremely difficult to suggest that parties interested in developing alternative sources were unaware of hemp’s unique paper producing properties.

The previous observation is particularly relevant since the Department of Agriculture’s Bureau of Plant Industry issued a formal warning against the promotion of large-scale hemp cultivation in 1931, with reference to activity which had occurred during the past season of 1930.[71]  Evidently, the promoters cited by the Bureau of Plant Industry were advertising the potential of decorticating machinery to revolutionize the hemp industry.This new technology was critical to developing hemp as an alternative source for the production of cellulose.[72]  Apparently, the promotional efforts continued, because, in 1933, the new hemp industry became an economic reality.The primary force behind the new commercial activity was Frank E. Holton.[73]

According to the Federal Bureau of Narcotics’ records, Holton appeared in Mankato, Minnesota, in 1933, armed with an impressive array of statistics regarding the cultivation of hemp.Prior to his involvement with the commercial hemp industry, Holton had been a cashier at the Northwestern National Bank in Minneapolis.By 1917, he had moved on to “greener pastures,” to become a participant in several speculative ventures during the 1920s.Eventually, during the early 1930s, he came into contact with Harry W. Bellrose, the President of the World Fibre Corporation, which was located in Chicago, Illinois.In addition, to being the president of this company, Bellrose was also the owner of the patent for the new Selvig hemp decorticating machine.[74]  Furthermore, Bellrose was a very active promoter of hemp as a raw material source for the production of paper, as well as other cellulose based industrial products such as artificial textiles, explosives, and plastics.[75]  After their meeting, Holton became interested in the prospects of the commercial hemp industry and purchased the patent rights to the Selvig machine within the state of Minnesota.[76]

From the start, the National Citizens Bank of Mankato was very active in rendering assistance to Holton in his venture.Two members of the Bank’s board of directors invested quite extensively in the new business enterprise.On October 3, 1933, the Northwest Hemp Corporation was organized under the laws of the state of Minnesota.According to the certificate of incorporation, the purpose of the new company was “to encourage and develop the growth of hemp and flax fibre plants, and to enter into contracts with growers for the planting of such products; to engage in the manufacture and distribution of hemp and flax fibre and to own and operate factories to handle and decorticate all such fibre plants, etc.”[77]

In the spring of 1934, farmers planted the first crop of hemp for the new industry.  The growing area was divided among three localities, Blue Earth, Mankato, and Lake Lillian.  Decorticating machines were installed in each of the areas to facilitate the processing of the hemp after the harvest.  When the time came to harvest the first crop, the inexperience of the farmers and organizers became readily apparent.First, Holton failed to supply the farmers with suitable harvesting machinery and second, the hemp was not allowed to ret (to soak to loosen the fiber from the woody hurd) properly before it was decorticated.  Furthermore, the decorticating machines were not working as efficiently as Holton would have liked.[78]  Despite these problems, the company still harvested a total of 6500 acres of hemp.  This figure quadrupled the amount of hemp harvested by all other commercial hemp enterprises in 1934.[79]

Over the winter of 1934-35, Holton was able to keep interest alive in the hemp project.  Farmers in the Blue Earth and Mankato localities still had a surplus of unprocessed hemp left from the previous year, and therefore they declined to grow in 1935.  In their place, Holton was able to convince the farmers in the Lake Lillian area to grow 2000 acres of hemp.  This time, there were no difficulties with the harvest, but again the hemp was not allowed to ret and the decorticating machines were still not working properly.After the harvest in 1935, the Northwest Hemp Corporation had accumulated between 8000 and 10,000 acres of unprocessed hemp.The surplus was left in shocks in the fields.[80]

Stockholders began to grow impatient with the succession of failures in 1935.  The directors of the National Citizens Bank of Mankato started a movement to oust Holton from his position as the company’s president.The endeavor met with failure because Holton retained control of the stock and the principal assets, such as the promissory notes and the lien on the hemp still in the fields.  While the company was in midst of this turmoil, M. J. Connolly, of New York, entered the picture in the fall of 1935.He had been involved in the promotion of fiber companies prior to his arrival upon the scene in Southern Minnesota.Along the way Connolly had acquired several patents for utilizing hemp fiber and its by-products, the hurds, for the production of raw cellulose.[81]  The specific patents possessed by Connolly were not identified in any documents, but they reportedly described processes for deriving raw cellulose from hemp.  Interestingly, there are approximately six American patents and six European patents dating from 1925 to 1935, which deal with the derivation of raw cellulose from hemp.Some of the patents also described the manufacture of paper pulp and plastics.[82]

Before long, Connolly’s schemes to use hemp for the production of raw cellulose attracted the attention of Joseph H. Gunderson, an officer of the Blue Earth State Bank located in Blue Earth, Minnesota, who was one of the original subscribers to the hemp venture, and V. A. Batzner, an officer of the Citizens National Bank of Mankato.More importantly, though, the plans interested Frank Holton.On October 3, 1935, the Northwest Hemp Corporation was restructured as the National Cellulose Corporation.The new company was a joint venture in which Holton controlled the finances and Connolly presided over the operations.[83]

Once the negotiations were completed, Connolly began working on the new project.  His first order of business was to install new machinery.  After this task was completed, he began to process the hemp, turning out tons of pulverized hurds.Shortly thereafter, it became apparent that the operation was an exercise in futility because no one could be found to purchase the processed hurds.  To make matters worse, a government cellulose expert visited the operation and reported that “Connolly had no idea what he was doing.”[84]  After this assessment, Connolly’s venture folded and he left town.The company still existed, but it was forced to change its name to the Hemp Chemical Corporation, because its previous name was already taken by another corporation from the East.[85]

Meanwhile, during 1935, two new commercial concerns had started operations in Nebraska and Illinois.The cultivation in Nebraska was conducted by the Nebraska Fiber Corporation, which was located in the vicinity of Harrington.It was a short-lived operation only lasting until 1936.[86]   The other new area of hemp cultivation was Illinois.During 1934, a fifty-acre tract of land was purchased by the Ball Brothers, mason jar manufacturers from Muncie, Indiana, and the Sloan Brothers, carpet manufacturers from New York City.Together they formed the Amhempco Corporation which was incorporated under the laws of New Jersey.  The buildings on the land purchased by the Amhempco Corporation had been used for the production of paper from cornstalks by a previous venture.Obviously, the former company had not survived, but while it was in operation it had been involved in an effort to adapt alternative sources other than wood for use in the production of paper.[87]  Considering the fact that the Amhempco Corporation purchased the site of the original operation, the new owners undoubtedly had a similar purpose in mind.

The Amhempco Corporation contracted to grow a crop of hemp for the 1935 season.  The total acreage of this crop was 4200 acres.[88]  What happened following the harvest of this crop is not exactly clear, but apparently some of the hemp was processed.  With this processed hemp, the company conducted experiments in an attempt to derive raw cellulose, but they were a failure because the two original investors were unwilling to provide sufficient funds for equipment and experimentation.[89]  The remainder of the hemp grown during 1935 was stored on the premises of the company.[90]

A significant commercial resurgence within the hemp industry occurred during the mid-1930s, primarily because of the economic potential of hemp as an alternate source for the production of paper.After the harvest of the 1935 crop, there was a certain sense of anticipation in the air.The timeless symbiotic relationship shared between hemp and humanity was evolving into the modern age.As if they were following an old path, scientists and entrepreneurs returned to hemp and discovered new frontiers of economic potential.This new frontier became a reality with the new hemp industry.  It was a natural process in the evolution of the human-hemp symbiosis.However, just as this new frontier was being established in 1935, the hemp industry confronted a new problem which led to its eventual demise.  The source of this new problem was the sudden and inexplicable media campaign against the use of marihuana which the Federal Bureau of Narcotics initiated in 1935.

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