Cannabis is legal for medicinal usage in 33 US states. It’s legal for recreational purposes in 10 states plus the unstate of the District of Columbia. The industry is one of the most highly regulated. Banks, however, shy away from it because the federal government regards cannabis as a deadly drug. Banks don’t want to leave themselves open to accusations of aiding and abetting a felony. Hence this $10bn industry deals almost entirely in cash.
Using cash puts the public at risk because dispensaries (which other countries term coffee shops), distributors and delivery drivers face a heightened risk of burglary and outright robbery. Ryan Smith is the CEO of Leaflink, which provides tools, such as order management facilities, to cannabis vendors and retailers. He estimated that 12 to 15 percent of costs come from handling cash: “It’s like something out of the early 1900s”.
So what to do?
The answer is to not deal in cash. This is where the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act comes in. Introduced in June 2018, it would mean businesses complying with state laws wouldn’t be breaking federal laws.
Cannabusinesses have begun to employ many lobbyists to make the case for this law. The issue is bipartisan. Democratic presidential hopeful Elizabeth Warren and Republican Senator Cory Gardner presented the STATES Act. In a rare moment when he wasn’t being utterly idiotic, President Trump remarked that he would “probably end up supporting that”. This goes against his own attorney general, Jeff Sessions, who hates cannabis.
Paul Warshaw is the CEO of greenRush, which delivers dope. He estimates that if only people could use their plastic, business would grow by anything from 50 to 100 percent overnight. That’s where there’s a need for many lobbyists. In 2018, Californian medical marijuana delivery company Eaze Solutions Inc lavished $130,000 on veteran lobbyists Holland & Knight. Cannabis-maker WeedMaps works with the lobbying companies Liberty Government Affairs and Nelson Mullins Riley & Scarborough. The Cannabis Trade Federation, a non-profit organisation, hired many lobbyists – 15 to be exact. Billionaire hedge-fund manager George Soros, the chap who broke the Bank of England in 1992, has donated $3 million to legalisation initiatives since the 1900s. Some big-name cannabusinesses formed the New Federalism Fund to change laws. This is expected to have seven digits’ worth of funds.
Who’s the enemy?
That’s the blue corner. In the red corner, we have police unions, private prison companies and pharmaceutical, alcohol and tobacco companies. These make use of many lobbyists. Police unions oppose legalisation of cannabis because an end to the utterly futile War on Drugs would entail less police funding and job security and no more cannabis-related asset forfeiture. Prison companies don’t want fewer people banged up. Cannabis is a cheaper and safer alternative to many pharmaceutical products, whose makers oppose cannabis legalisation. One survey found that 87 percent of respondents ceased to take prescription medications or alcohol in favour of cannabis. Alcohol and tobacco companies don’t want to have something else to which people would devote their spending in their free time.