Tag: black market

Guess Who’s Getting Purged? How Chinese Citizens Turn Fear Into a Black Market

If you’ve ever wanted to know what Chinese political paranoia looks like in action, congratulations! The CCP just handed us the perfect specimen.

Turns out, Xi Jinping’s ongoing purge of senior officials has gotten so intense, so incomprehensible, and so secretive, that an actual underground market has emerged.

Chinese citizens are now literally paying money to access what appear to be leaked details about which officials are under investigation. Shadowy online groups claim to have insider information on the next wave of purges.

According to Bloomberg, authorities are playing whack-a-mole trying to shut these leaky groups down. But they can’t because the demand is too high. This is the price of the CCP making itself a total black box.

The purge market is just the symptom. The disease is that the CCP created a system with no stability, no clear rules, and no way to know if tomorrow you’ll be promoted or investigated. So citizens and lower-ranking officials are doing the rational thing: trying to buy information to stay ahead of the knife. Or maybe they’re just betting for money, like Polymarket for General Hostility.

This also reveals something much darker about CCP governance. It’s not like these are leaks from innocent whistleblowers. These are just corrupt people trying to navigate a corrupt system. Can they be trusted to predict what’s coming next? Buyers hope so.

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Setting Marijuana Taxes Too High Drives Consumers To The Illegal Market, Federally Funded Study Finds

States that impose high tax rates on regulated marijuana products are driving adult consumers to the illicit market, according to a new federally funded study.

The research, published in the journal Health Economics, looked at past-month cannabis purchasing behavior of 1,525 adults aged 21 and older.

Researchers with Ohio State University found that high cannabis taxes and prices are linked to “lower cannabis consumption and THC intake” from legal purchases, but that the majority of those reductions (89 percent) may be offset by consumers switching to unregulated products from the illegal market.

“If the illegal market is restricted, policymakers can expect increasing cannabis prices using excise taxes to reduce both unit and THC consumption, while generating tax revenues,” the study said. “However, given the sizable illegal market, a large portion of the consumption reduction due to taxes may be offset by switching to illegal products.”

States have worked to strike a balance between pricing marijuana low enough to transition adults to the regulated market but still high enough to generate revenue. The results so far have been mixed, with no firmly established universal price or tax rate.

States that impose high tax rates on regulated marijuana products are driving adult consumers to the illicit market, according to a new federally funded study.

The research, published in the journal Health Economics, looked at past-month cannabis purchasing behavior of 1,525 adults aged 21 and older.

Researchers with Ohio State University found that high cannabis taxes and prices are linked to “lower cannabis consumption and THC intake” from legal purchases, but that the majority of those reductions (89 percent) may be offset by consumers switching to unregulated products from the illegal market.

“If the illegal market is restricted, policymakers can expect increasing cannabis prices using excise taxes to reduce both unit and THC consumption, while generating tax revenues,” the study said. “However, given the sizable illegal market, a large portion of the consumption reduction due to taxes may be offset by switching to illegal products.”

States have worked to strike a balance between pricing marijuana low enough to transition adults to the regulated market but still high enough to generate revenue. The results so far have been mixed, with no firmly established universal price or tax rate.

The study, meanwhile, also demonstrated that legal and illicit cannabis flower are essentially “substitutes for each other.”

Raising the price of legal cannabis flower by 10 percent “results in a 0.9 percent-1 percent increase in illegal flower consumption (units and THC),” and the inverse follows a similar pattern, the researchers found.

“While the cross‐price elasticities for unit demand between legal and illegal flowers are symmetric (not statistically significant), the cross elasticities for THC demand suggest that the increase in THC from illegal flowers in response to higher legal flower prices exceeds the increase from legal flowers in response to higher illegal flower prices.”

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Inside California’s Battle With The Marijuana Black Market

A convoy of sheriff’s deputies heads into a vast network of illegal marijuana grow operations in the foothills of Mount Shasta in California’s Siskiyou County.

They drive into a dusty encampment strewn with garbage and piles of empty plastic fertilizer containers, a blight on the otherwise scenic landscape.

The morning raid is nothing new for Siskiyou County Sheriff Jeremiah LaRue.

Thousands of makeshift greenhouses known as “hoop houses” – each one containing hundreds of illegally grown cannabis plants – are operating in the county at any given time, LaRue told The Epoch Times, as his deputies scoured the Mount Shasta Vista subdivision, a 20-minute drive northeast of Weed, Calif.

The sheriff’s office has counted 2,732 hoop houses using satellite and aerial imagery in the subdivision alone.

By the time he arrived at the scene on June 4, all the occupants had fled.

Spotters at these illegal grow sites – sometimes armed with AK-47s and rifles, according to nearby residents – alert laborers to leave the camp when they see sheriff’s deputies approaching.

Except for a few roosters, an older German shepherd, and a couple of curious pups, the site was abandoned. The occupants had already cleared out when an advance team of investigators approached the camp earlier that morning.

They know the drill.

About 430 flowering marijuana plants were found in each of two 30-by-100 foot hoop houses. Agents from the regional North State Marijuana Investigation Team weighed about 900 pounds of freshly cut marijuana plants that were hanging to dry in another slightly larger greenhouse.

All the marijuana was destroyed. No one was arrested, according to the sheriff’s office.

The team had served a search warrant on the same property last August and arrested the property owner, Haizhou Wang, then 56, who was on-site at the time.

Cannabis industry experts estimate that more than 30 million pounds of illicit marijuana are grown in the United States annually.

Siskiyou County alone produces about 17.8 million pounds of illegal marijuana every year, with a “low-end” estimated local street value of about $3.6 billion based on sales at $200 a pound, according to the sheriff’s office.

A typical pound of processed black-market marijuana may sell for a couple hundred dollars in California, but can sell for $1,500 in Midwest and East Coast markets and much more in other countries, according to both the sheriff’s office and the California Department of Cannabis Control.

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Australia Tried To Tax Smoking Out of Existence. Now 80% of Tobacco Aussies Consume Is From the Black Market.

The Australian government has spent the last decade introducing steep tax hikes to curb smoking, and, as a result, the country has the most expensive cigarettes in the world. The average price of mainstream cigarettes is 54.99 Australian dollars per pack (about $40). But the eyewatering prices have driven people to the black market.

In 2025, an estimated 80 percent of the tobacco consumed in Australia was illegal, up from 12 percent in 2017, according to new analysis from the Australian Bureau of Statistics (ABS). The study, which is the first attempt by the Australian government to estimate the size of the black market, found that “prices for legal tobacco products have almost tripled since December 2016 driven by annual tobacco excise increases, while estimated prices of illicit tobacco products have remained relatively constant.” Since 2020, household spending on legal cigarettes and tobacco has almost halved, but between 2017 and 2025, the amount of nicotine consumed in Australia has risen by almost 40 percent.

Meanwhile, between 2016 and 2025, the price of legal cigarettes nearly tripled while tobacco duty revenue more than halved. As a result, the Australian Treasury has downgraded tobacco excise revenue by $8 billion over the next five years in the latest federal budget.

Lower tax revenue is hardly something to mourn, but Australia’s collapsing legal tobacco market has come with a far darker consequence: a severe wave of gang violence, including firebombings and shootings. Since 2023, organized crime groups linked to Australia’s illicit tobacco and vape market have been tied to “more than 200 firebombings,” “at least 3 homicides,” and “multiple other non-fatal violent attacks,” according to the Australian Intelligence Commission.

“It’s hard to see how it could get any worse,” Rohan Pike, a former Australian Federal Police detective and Border Force member, tells Reason. Pike, who created and led Australia’s Illicit Tobacco Strike Team, says the violence is now an “old-fashioned turf war” and that criminal gangs, attracted by the profits, are fighting to control distribution.

Pike says criminal groups are opening pop-up convenience stores, intimidating legitimate retailers into selling their products, and backing up those threats with “firebombings and other types of violence.” Organized crime syndicates have destroyed hundreds of tobacconists, convenience stores, and hospitality venues, forcing legitimate businesses out. “Every part of the tobacco control policy is uncontrolled at the moment,” says Pike.

Public awareness of the black market rose last year when Katie Tangey, a “completely innocent” 27-year-old woman, was killed in Melbourne in a case of mistaken identity linked to the tobacco wars. “We know it is linked to the illegal tobacco trade. That’s one thing we can say with a high degree of certainty,” Detective Inspector Chris Murray told the Australian Broadcasting Corporation. “This was always our fear, that someone would die as a result of the tobacco wars and unfortunately this has come to fruition.”

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Ukraine Regained Territory After Cutting Russia’s Black Market Starlink Terminals

According to a newly declassified U.S. defense intelligence assessment first reported by Bloomberg, Moscow’s frontline command-and-control structures suffered a catastrophic blackout earlier this year due largely to coordinated crackdown that disabled thousands of black market Russian Starlink terminals.

The Pentagon document highlights just how deeply Russian forces had come to rely on Elon Musk’s commercial satellite terminals to patch over their own spotty military communication systems. For months, Russian units bypassed international sanctions via shadow supply networks to source the hardware.

The Friday Bloomberg report claims that a “Ukrainian offensive against Russia earlier this year retook about 400 square kilometers after thousands of portable Starlink internet terminals operated by Russian forces were deactivated,” citing analysis from the US Defense Intelligence Agency. 

The document, authored jointly by the DIA and US European Command, states that “Russian military capabilities in Ukraine were temporarily yet significantly degraded following Ukrainian officials’ efforts in February to deactivate thousands of Starlink terminals that were illicitly used by Russian forces to coordinate movements and unmanned aircraft strikes in areas where communications were unreliable or easily jammed.”

Ukrainian forces then made their first territorial gains since 2023, after years of steady Russian gains, with Russia military comms now said to be “temporarily yet significantly degraded” due to the loss of the terminals.

The report further describes that Kiev forces working in tandem with SpaceX were able to deploy sweeping geographic restrictions that target-locked and deactivated unauthorized terminals operating inside the combat zone. This resulted in “instant” results.

What also didn’t help is the Kremlin’s own tightening restrictions on the use of Telegram by Russian forces, and so also the recent lack of this favored encrypted messaging platform among military units left frontline commanders totally isolated.

While US intelligence noted that Russia still maintains an overall structural advantage in raw combat functions, and of course manpower and firepower remains on Moscow’s side, the incident demonstrates that communications are still a vital backbone to any modern warfare and command system.

SpaceX has long sought to officially bar Russian consumers from using Starlink, due to long-running sanctions, and to prevent military use against Ukraine.

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Trump’s Killing Spree Isn’t Stopping the Flow of Drugs Into the U.S.

The Pentagon claims that attacks on civilian boats in the Caribbean and Eastern Pacific have severely curtailed the import of illegal drugs to the United States. And President Donald Trump says this has saved more than 1 million American lives. Experts call these assertions laughable and reporting by The Intercept shows that claims by the White House and War Department are baseless, phony, or both.

“The administration has failed to explain the long-term objectives of this mission or provide any evidence of reduced drug flows into the United States,” Sen. Jack Reed of Rhode Island, the top Democrat on the Senate Armed Services Committee said about the campaign on Thursday. “I would ask for a credible answer to this most fundamental question: What is the operation actually meant to accomplish?”

Under Operation Southern Spear, the U.S. military has conducted attacks on 54 so-called drug boats in the Caribbean and Eastern Pacific Ocean, killing more than 185 civilians, since September. The latest strike, on April 26 in the Pacific, killed three people. The Trump administration claims its victims are members of at least one of 24 or more cartels and criminal gangs with whom it claims to be at war but refuses to name.

Experts in the laws of war, as well as members of Congress from both parties, say the strikes are illegal, extrajudicial killings because the military is not permitted to deliberately target civilians — even suspected criminals — who do not pose an imminent threat of violence. These summary killings are a deviation from the standard practice in the long-running U.S. war on drugs, in which law enforcement agencies generally detained suspected drug smugglers and brought them to trial on criminal charges.

“These are extrajudicial executions, or even just murders — something similar to a cop shooting a fleeing suspect in the back when there is no self-defense justification,” said Adam Isacson, the director for defense oversight at Washington Office on Latin America, a human rights group. He called the growing death toll “a gross human rights violation.”

While Trump consistently lies about various aspects of the boat strikes, including the illicit narcotics allegedly on the boats and the number of lives supposedly saved by the attacks, the Pentagon has followed suit, using rhetorical sleight of hand and seemingly disingenuous statistics to bolster the claims of their commander-in-chief.

“I can’t imagine how you could come to some of these conclusions regarding illegal smuggling and drug overdose deaths based on the facts as we know them,” said retired Rear Adm. William Baumgartner, the former commander of the Seventh Coast Guard District, who oversaw drug-interdiction operations in the Southeast U.S. and the Caribbean Basin.

The Pentagon and White House for months failed to respond to detailed questions from The Intercept on the boat strike campaign.

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Too High To Thrive: Excessive Cannabis Taxes Are Undermining Legal Markets

In recent piece, The New York Times editorial board called for a federal tax on cannabis and urged states to raise their own taxes to “dollars per joint, not cents.” That argument assumes cannabis is lightly taxed today—but across the country, the opposite is true.

Taxes on legal cannabis are higher than almost every industry in the United States and have generated nearly $25 billion since adult-use sales commenced in 2014. Despite these rates, efforts to increase cannabis levies are continuing to gain steam.

In 2025 alone, Maryland, Minnesota, Maine, Ohio, Michigan and California attempted to raise or expand cannabis taxes. This year, Colorado and Oklahoma are looking to do the same. Many of those proposals emerged as lawmakers confronted budget shortfalls and the expiration of federal pandemic aid. Cannabis has increasingly been treated as an untapped source of revenue.

In several large markets, cannabis taxes are layered on top of one another. Excise taxes are combined with state sales taxes, wholesale taxes, local taxes and, in some cases, potency-based taxes. In states such as Illinois, Michigan and Washington, the effective burden can exceed 40 percent. This is in addition to the federal tax burden cannabis businesses carry under §280E, which limits their ability to deduct ordinary operating expenses.

These structures are straining the legal market. High tax burdens are contributing to business closures (particularly among smaller operators) and pushing many consumers to the illicit market.

According to publicly available data, several highly taxed states, including California, Colorado, Illinois, and Washington, have experienced year-over-year declines in adult-use sales and industry job losses in recent years. At the same time, the illicit markets across these states remain entrenched. In California, one of the nation’s oldest legal cannabis markets, estimates suggest that roughly 60 percent of sales still occur outside the regulated system.

Higher taxes do not eliminate consumer demand. They simply change where consumers buy their cannabis.

Licensed businesses pay for testing, packaging, compliance systems, labor and sometimes local licensing. Unregulated sellers do not. When the legal price rises too far above the illicit alternative, price-sensitive consumers shift accordingly. That weakens the regulated market that legalization was intended to build. When tax increases take effect, the impact shows up quickly in wholesale pricing pressure, retailer margin compression, and shifts in purchasing behavior.

The cannabis industry is still new, but data tell us that the type of tax matters as much as the rate.

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Owners and CEO of Wholesale Pharmaceutical Company Sentenced for Distributing More Than $92M of Black-Market HIV Drugs

Two owners of a pharmaceutical wholesale company were sentenced Friday to a total of 38 years in prison for orchestrating a complex, nationwide drug diversion scheme that harmed vulnerable HIV-positive patients, placed countless others at risk, and corrupted the supply chain for prescription drugs in the United States.

“Patrick and Charles Boyd did not just commit fraud and cost taxpayers millions of dollars, they preyed upon some of the most vulnerable members of our society: HIV patients who depend on life-saving treatments to manage their disease,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “Fraud schemes like this one undermine the integrity of our supply chain for necessary prescription drugs. These defendants will rightly spend years in prison for their reprehensible conduct, which took advantage of people for illicit profit. This case is another example of how the Criminal Division, our United States Attorney partner in the Southern District of Florida, and law enforcement will pursue and seek convictions of those who defraud our systems, endanger our citizens, and seek to line their pockets with fraud proceeds.”

“These defendants treated life-saving HIV medication like street contraband,” said U.S. Attorney Jason A. Reding Quiñones for the Southern District of Florida. “They bought drugs off the street from black-market suppliers, shipped them in dirty boxes and discarded packaging, falsified paperwork, and pushed those medications back into the legitimate pharmaceutical supply chain. The consequences were real. HIV patients received bottles containing the wrong drugs, and at least one patient lost consciousness after ingesting medication that should never have been in that bottle. As a former military prosecutor, federal prosecutor, and trial judge, I have seen how greed can drive dangerous schemes. When criminals gamble with patient safety for profit, federal prison is the result.”

“Friday’s sentence underscores the extreme danger these defendants created,” said Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General (HHS‑OIG). “They took life‑threatening actions that showed an alarming disregard for human life in service of nothing more than a payday. Their criminal scheme endangered vulnerable patients, put entire communities at risk, and undermined the integrity of Medicare and Medicaid. HHS‑OIG will continue working with our law enforcement partners — and using every tool in our arsenal — to pursue and dismantle illegal black‑market rings that seek to corrupt the nation’s drug supply and exploit taxpayer‑funded health care programs.”

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The Heavy Pot Taxes Favored by The New York Times Would Undermine Legalization

The New York Times embraced legalization of recreational marijuana in 2014, two years after Colorado and Washington became the first states to take that step. By that point, most Americans opposed pot prohibition, and that majority has grown since then.

Although the Times does not regret endorsing legalization, its editorial board now says stricter regulation and heavier taxation are necessary to curtail the costs associated with marijuana abuse. Those recommendations elide two inconvenient facts: Cannabis is still federally prohibited, and states are still struggling to replace unauthorized pot peddlers with government-licensed marijuana merchants.

The Times emphasizes that “occasional marijuana use is no more a problem than drinking a glass of wine with dinner or smoking a celebratory cigar.” But while marijuana “is safer than alcohol and tobacco in some ways,” the Times says, “it is not harmless.”

Frequent cannabis consumption has increased substantially in recent years, the Times notes, and roughly one in 10 marijuana users “develops an addiction.” Even nonaddicted cannabis consumers “can still use it too much,” it says, since “people who are frequently stoned can struggle to hold a job or take care of their families.”

The Times also mentions cannabinoid hyperemesis syndrome, “marijuana-linked paranoia,” and the danger posed by stoned drivers. “Any product that brings both pleasures and problems requires a balancing act,” the Times says, which means “personal freedom” must be curtailed to protect “public health.”

That formulation is inherently paternalistic, since the “public health” burden to which the Times refers is borne mainly by cannabis consumers themselves. And the moral logic of the hefty marijuana taxes that the Times favors is questionable.

Those taxes would add to the difficulties that some heavy consumers face while punishing the occasional use that the paper says is no big deal. Although “adults should have the freedom to use” marijuana, the Times says, they must pay the government for that privilege.

A tax-based “balancing act” also raises practical difficulties. “The first step in a strategy to reduce marijuana abuse should be a federal tax on pot,” the Times says, gliding over the point that Congress cannot impose an excise tax on marijuana products unless it is prepared to legalize them.

The editorial does not explicitly acknowledge the need for that step. To the contrary, it implicitly criticizes President Donald Trump’s decision to reclassify marijuana under federal law, which falls far short of legalization.

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Amid Raging Drug War Trump’s Hemp Ban Will Further Empower Cartels

During his first term, the Trump Administration’s legalization of hemp in the 2018 Farm Bill was seen as a fantastic win in the crusade to legalize cannabis across the country. Thanks to the bill, not only was hemp cultivation legalized for industrial use, but an additional loophole also paved the way for the legalization of a psychoactive cannabinoid known as Delta-8-THC, which has received high praise for its numerous medicinal uses without the accompanying intensity that comes with a typical cannabis high.

According to the National Cancer Institute, delta-8-THC can be defined as:

“An analogue of tetrahydrocannabinol (THC) with antiemetic, anxiolytic, appetite-stimulating, analgesic, and neuroprotective properties. [Delta-8-THC] binds to the cannabinoid G-protein coupled receptor CB1, located in the central nervous system…This agent exhibits a lower psychotropic potency than [delta-9-THC], the primary form of THC found in cannabis.”

Hemp cultivation has a long history in the United States marred by restrictive prohibition at the behest of industrial tycoons of the early 20th century who were threatened by hemp’s capability to replace the petrochemical industry due to its potential to create more effective, cleaner, and safer alternatives for thousands of products; capable of replacing oil, plastic, lumber, paper, and cotton.

The passage of the 2018 bill presented a promising future for the cultivation of hemp in the United States to potentially revolutionize domestic infrastructure, in addition to serving as a victory for advocates of personal freedom. However, new legislation threatens to change all of that.

The recently passed federal spending bill includes a provision intended to close the aforementioned loophole, banning hemp derived THC products in a move that CNBC notes threatens a growing 28 billion dollar industry.

“What this ban is going to do is it’s going to force all those little players right now into the illegal market. Companies have got way too much money invested in this and the demand is still there and growing. They [companies] aren’t just going to go away, they’re just going to go into the illicit market and put more people at risk.” Said Boris Jordan, CEO of cannabis company Curaleaf.

The move, spearheaded by Kentucky senator Mitch McConnell, who led the charge to pass the original 2018 bill and said to be his final major act in Congress before his retirement next year has been sharply criticized by colleagues such as senator Rand Paul, who worked with McConnell on the original legislation.

“This is the most thoughtless, ignorant proposal to an industry that I’ve seen in a long, long time,” Paul said after the ban was passed. 

This move represents the latest ridiculous folly in the failed war on drugs, as Congress attempts to legislate morality over the rights of individuals self ownership, prohibition will only continue to do what it has always done and fuel the growth of illicit market industry.

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