Barely a week in, 2018 is already proving to be the most explosive year for US cannabis yet. Adult use is legal in California on the first. Stocks rally on the second. Attorney General Jeff Sessions repeals the Cole Memo then pot-stocks tank on the fourth. Now, Congress is rallying in the name of freedom to use their legislative power to fight back. Many are hoping the cannabillions already made will speak loud for potential sway to finally allow marijuana policy reform from a Federal standpoint.
Money, Money, Money
“Must be funny, it’s a rich man’s world.” So says ABBA. Regardless of gender, anyone lucky enough to be invested in retail or medical cannabis operations is likely rich too. For 20 years now, the average dispensary brings in about $100K-$1Mil in revenue annually. Since the enactment of The Compassionate Use Act in 1996, officially greenlighting medical cannabis sales, gross sales of cannabis are debatably somewhere between $50-$100 Billion. The majority of which comes in the past 4 years, likely with advent of recreational adult use.
A Dank Taxation
Imagine taxing cannabis like alcohol and tobacco. The aforementioned cannabillions would sing to the tune of an additional $10 Billion in tax revenue for our federal government. This would bring a boost to our national GDP without having to burden lowest earning Americans with increased taxes. Not to mention, maybe we could actually afford to be cutting them at the highest rates like we are now.
Cannabucks back in the Bank
Imagine still, if this newly taxed money is now in Federally Insured Banks instead existing predominantly in cash as it is now. This money returns to the central banks, therefore the effectively decreasing the money supply without a massive bond issuance. Thus, allowing interest rates to be increased much sooner than the almost 7 years it took to get them from near zero. All without risking rampant inflation. Steady, increasing rates mean credit is again freed up for first time homebuyers and small businesses. Economic recovery at last.
This is, of course, all theory. As cannabis businesses are still illegal operators for all FDIC establishments. This is not spurring investment. Private equity, public banks, payment solutions, and now cryptocurrency are all avenues owners and operators are using. Solutions aside, the money still remains largely out of circulation. With the cannabucks back in the banks, our currency and economy could be further stabilized and everyone gets on with their new, and very chill lives. So what’s the hold up?
People Power, Power to the People
If the green is not enough, in comes the power of the constituents. The House and Senate now consist of around 60% representatives of states with retail cannabis, either medical or adult use. Coincidentally, this figure is on par with the 64% pro-cannabis public opinion. Seat holders who speak for the disenfranchised and oppressed are using the AG’s recent offensive maneuvers as a chance to show the power of their people. Not stopping with the usual partisanship, there now exists the bipartisan supported Congressional Cannabis Caucus.
Good news, for if there are people, then they need representation in Washington, and the cannabis people are numerous. Monthly cannabis users are around 22 Million, almost 10% of the population and, more impressively, almost 20% of the now historically low voting demographic. Cannabis consumers are no longer a voting block for Washington to turn its nose up at. The electoral college is XX% pro cannabis reps, too. Per Presidential decree, the states are to handle policy themselves, however this may be less so now. Regardless, recent moves have show us what “to form a more perfect Union” really means. We see states coming together in all their legislative glory as the branch of the Federal Government able to write laws and rewrite history.