The Covid-19 epidemic, and the effect of business shutdowns on the Indigenous Economy

Tim Barnhart, the owner of Legacy 420 in Tyendinaga, provides his thoughts on the implications of the Covid-19 shutdown on Indigenous territories.

The following text is transcribed from an interview with Tim Barnhart that Real People’s Media conducted in March 2020. The text has been edited for clarity and length. For more information about Legacy 420, visit their website.

My name is Tim Barnhart, I am the owner and CEO of Legacy 420 and also the founder of the National Indigenous Medical Cannabis Association, a national advocacy group. We’ve been in business approximately five years, and have established a very unique brand of products. Our emphasis is on pushing a Red Economy across Canada. Unfortunately, Covid-19 has thrown a wrench into a lot of those opportunities. I’m just here to tell people that you can have a small business and you can maintain this business during this Covid-19 crisis.

At Legacy we have taken the Covid pandemic very seriously. We’ve installed sanitizing machines all throughout the building. We have 8 in the dispensary, and two outside the building so that when folks get out of their car they can clean their hands right away before they even enter. We’ve got people going around every 15 minutes wiping all the countertops, doorknobs, door handles with alcohol. This morning we’re having a shield installed all the way around the front counter. That will prevent any spittle from reaching our staff. It’s a plexiglass design that wraps around the whole counter. Wal-Mart and Canadian Tire have taken those steps and so we’re taking it too. We think that keeping our staff and the public safe is paramount in these times.

I think that Indigenous people who are in small business should really think about the long and short term ramifications of closing their store. During the time they’re closed, a lot of customers are going to find other places to buy their stuff, whether it be from other nations or other stores outside the community. We’re going to lose our market is what’s going to happen. There is a lot of fear in the community with regard to that.

My lonely voice in this situation is probably not being heard very well. Cannabis stores are an essential service, so we take that very seriously, but some people don’t take that very seriously and others have taken it to the extreme and closed their doors. In Tyendinaga it’s up to the individual business and how they want to handle that. We’ve taken the proactive move to stay open during Covid-19.

We take cannabis as a medicine very seriously. Our main products that we sell are not synthesized drugs, but compounds of the plant, so it’s very unique what we’re doing here. From these compounds we’ve been able to create various lines of natural products. We’re more in the field of medicine than we are in having a good time. We’ve built quite a brand, there are now some 250 product SKU’s that we now manufacture and about 5000 products available through our wholesale program. It’s expanding and we’re in the medical market, which is where I’ve always wanted to be and we’re now making it a reality. 

A lot of people are doing online sales, not just on reserve but off reserve. As of last week the government and the RCMP have doubled their efforts to close those methods of purchase down. Weedmaps was recently served with a search warrant so a lot of these people will be taken down. So this isn’t really an option for us. What I am worried about is that our people will start to trade and sell through these mainstream websites and then become shut down and arrested due to the system. I don’t think that we should do that because we don’t have any protection, and as far as banking goes we’ve been shut right out of the system. Insurance as well, so the insurance industry, the banking industry, and now you’ve got bank machines which are primarily what First Nations rely on; they’re making moves to come after those as well.

I really think this is an all-out race for taxation on First Nations, I’ve always thought that, I think the Cannabis Act was a design and designed in a way to trick us into signing on that line and imposing taxation on gasoline, tobacco and cannabis.

Getting back to your question on “What are we to do?”: I don’t think going online is the right way. I think that once we’re out in the world selling our product we’re opening ourselves up for a tax issue. I think there are people on this reserve who’ve taken different levels of business in that same direction and have been pounded by the Federal government and are now in the courts trying to save their companies and their names. I think our safety is on the territories and it always has been and always will be and if that means moving people here as safely as we can then we’ve got no other alternative.

Band Councils can’t collect any government money unless you go into a state of emergency. That’s the unfortunate part and that’s why you’ve got provinces and municipalities all calling these. You get no funding unless you do. That’s an interesting position for our people to be in; we’re really fucked. It gets back to my original point – we shouldn’t be closing our businesses. We should be doing everything in our power to make commerce safe. Manufacturing hasn’t shut down in Canada, I don’t know how many industries are still operating out there but I know the people who have been deemed essential, they haven’t given a number on how many people that is.

I think if we were to shut commerce down entirely I think you know what happens. We’re going to have a revisit of 2008 all over again, probably much worse because during the 2008 crash there wasn’t a complete fall-out of the economy. You still had economies up and running in states around the US. Canada, we did pretty good that time, we skated through that, but it’s not gonna happen this time. When this economy goes down, it’s gonna be down for months maybe even years, maybe in the US it was 18 months. The Great Recession, the situation is much worse this time, it could be longer, it could be two years we don’t know. Central banks are throwing everything including cash registers and refrigerators at the situation to no avail. The markets are still uneasy. 

That’s what I am afraid of. Covid-19 is just the dressing on what’s to come; and that’s the financial fallout. There’s where the damage to our people is going to come. How do we get these businesses up and running again once they’re down? We’re being told it’s two weeks, then it stretches into four weeks, then four months. Then what do we do after four months? We don’t have the resources to get industry back up and going, we’re dead in the water and we’re back on the dole again. We’re back to Ontario Works (welfare) and taking handouts from the federal government. 

I guess I am an animal of the markets. I follow what’s going on closely around the world every morning. It all depends on if there is a run on the banks. If there is a run on the banks the first thing that will happen is they will limit how much you can get. They’re going to use Covid as an excuse for you not to withdraw your money. 

Then you’re on plastic like they were in Europe for months, even years and I don’t know if Europe’s even reverted back to cash the way it once was. Another good situation to add to this is the whole artificial intelligence issue and how fast this is coming on. Workers lost their jobs in the last three recessions and they didn’t get them back. Each time there’s a recession or fallout in the economy, people get displaced and unemployed. They never get to go back to those jobs. New jobs are created and they’re at a lower level pay and that’s what those folks are being forced to take. That’s happening at a faster rate so governments around the world are ponying up money for manufacturers to do this basically for nothing, so there are low interest or interest free loans available throughout the world and Canada that you can access to start artificial intelligence, to modernize the manufacturing industry. 

That’s another huge concern for our people, as this is happening we’re sitting at home twiddling our thumbs waiting for this all to end. Hypothetically let’s say the Covid epidemic does end: what about the economic fallout after that? Will we then be forced to stay home because of the economic fallout? Will Covid go on as a guise until they get the financial system straightened out? There’s so many unanswered questions, for our people and people in general about the direction the world governments are taking with Covid and the financial system. 

It’s all paramount on gaining control of our own economies. It’s pretty simple, and this is what I don’t understand, is you tell the province “No”, just tell them “No” and we’re going to do it our way. For the life of me I don’t understand why we are signing away our rights every time we sign up to a provincial program. Is it that difficult to create a program of our own? I remember being 24 or 25 and that my job at the band office was to create programs. That’s what I did, and now we’ve given it all away. We’re going along with the province and we’re calling people in to take care of us basically. I see the new doctors office here is being manufactured and made off the reserve for us; that’s not self-sufficiency. 

I know the band councils have a hard time juggling the situation. Maybe because they are in crisis at this time. I am not sure, but we can do better. All we have to do is create our own economy. It’s already here, just look around, we’ve created this economy ourselves and it’s an economy that is renewable. It’s a resource that just keeps giving and giving and giving. All the band councils have to do is say “You know what? We believe in ourselves, we believe in our people and we’re going to regulate this ourselves and we’re going to do things ourselves” not “We’re going to hand it over to the province or the feds.” (but) “We’re going to do this ourselves.” I don’t know what is so complex that we’re still not even there. 

Here we are, five years later, and we’re still with no acknowledgement from Council. We’ve created what I think is probably a $100 million cannabis business on this reserve and it seems our Council doesn’t seem to recognize the good that’s come from that. You’ve got guys who are growing, you’ve got guys who are processing, you’ve got guys that are manufacturing. The spinoffs from this are huge. With all these processes comes employment and dollars that can easily replace the provincial coffers and what they’re sending us each year. 

If we were to just focus on an industry, if the Councils would allow First Nations to focus on an industry and work with us, and not just on this Cannabis industry but all industries: tobacco industry, construction industry. I mean they always want to give it away. We do have some good people in this Council now that are listening to our concerns. Mind you we are right there every step of the way to make sure that this business and this industry isn’t stolen from us. Look at what’s happened: we created this and the next phase is food sovereignty and energy sovereignty. 

Geothermal, solar panels, this is stuff that our Councils are doing right now; they’re sending money off reserve to partner with other groups, other provinces, other industry players to build these solar parks off the reserve. It just boggles my mind why we’re not building it on our reserve and keeping that energy for ourselves. Right now it’s $0.14 per KWh so you won’t even be able to grow your own food.

The Cannabis industry has opened up opportunities that would have never ordinarily been here. If you are a grower and you have, say for instance, six or ten or twelve greenhouses, two of those should be mandated to grow vegetables for the Nation that they live on. Right now we can’t even build a greenhouse because we can’t get the funding that we need to do that. So we’re frozen even out of that system. We have to do it all from within and that is a costly thing. I have close to $1 million spent already on the greenhouse that we have here yet we still haven’t got it up and running. 

What you have going on right now is the Covid epidemic which has slowed commerce down so our businesses can’t go to mainstream banks and borrow so we’re left to take our money and save it and do all our billing ourselves. That’s taken us time and it’s unfortunate, the longer we sit on the sidelines; the more market share goes to the LPs. That’s also a huge problem. 

We don’t even know if we are going to farm this year because of the price, the prices are falling steadily and fast and there’s other issues with regards to products that we need to make our products. Alcohol and ethanol prices are now being jacked up and they are being squeezed. Alcohol and ethanol processors now require an LP licence, so it’s freezing all First Nations out of the industry. Now we have to either build our own ethanol plant and start it ourselves or build our own alcohol stills. There is no other option; that’s probably the next thing we are going to have to do is invest in that. 

Energy, if it’s ethanol that works for us. We’ve got a lot of obstacles in the way we’ve been trying to get around: we’re frozen out of the LP system so lab supplies are hard to get. We’re frozen out of the insurance industry; so it’s hard to get insurance for all of our products, if someone is injured here it’s hard to get insurance. We’re frozen out of the banking industry so there is no banking available for First Nations people who are running cannabis dispensaries legally on their reserve. So, what are we to do? 

It’s an unfortunate scenario.