January 9th, 2018
Contributing writer for Wake Up World
Attorney General Jeff Sessions has begun the new year with an assault against state legalized cannabis, claiming it violates federal law and revoking an Obama-era memo that instructed state prosecutors to focus on illicit activity which specifically causes harm — like selling drugs to minors and criminal gangs involved in the drug trade across state lines — instead of marijuana businesses that were complying with state regulations.
Sessions also has his eye on the Rohrabacher-Farr amendment — which is linked with budgetary bills and forbids the U.S. Department of Justice from interfering with states “implementing their own State laws that authorize the use, distribution, possession, or cultivation of medical marijuana.” When the amendment passes the approval of Congress each year, it means you are not subject to federal charges under the Controlled Substances Act if you’re adhering to your state’s medical marijuana laws. But if Sessions has his way, it will be permanently revoked. He believes it’s “unwise for Congress to restrict the discretion of the department to fund particular prosecutions, particularly in the midst of an historic drug epidemic.” He asked Congress in May 2017 to repeal the amendment, which is currently in effect until January 19, 2018.
Sessions’s action is jeopardizing a multi-billion dollar industry in the U.S., that many have called a modern-day gold rush, which has brought several states back from the edge of financial crisis. In 2016 alone, North American marijuana sales rose by 30% to $6.7 billion — and are expected to reach $20.2 billion by 2021 with a predicted annual growth rate of 25%.
Rarely have we seen this kind of increase — even with the dot.com era, which grew at a scorching pace of 22%. Says Arcview’s editor-in-chief Tom Adams:
“The only consumer industry categories I’ve seen reach $5 billion in annual spending and then post anything like 25% compound annual growth in the next five years are cable television (19%) in the 1990’s and the broadband internet (29%) in the 2000’s.”
Sessions’s stance on legalized marijuana is already sending financial ripples through the market. Blazing into the new year with incredible earnings, marijuana stocks and exchange-traded funds immediately took a sharp nosedive when he announced the retraction of the Cole Memo.
According to Forbes:
“Cannabics Pharmaceuticals, Medical Marijuana, United Cannabis, GreenGro Technologies, MassRoots and mCig crashed 25% to 30% each after flying high the two sessions prior as California’s new marijuana laws went into effect. ETFMG Alternative Harvest ETF plunged 6%. Its Canadian counterpart, Horizons Marijuana Life Sciences Index ETF, dropped 8%. It trades over the counter in the U.S. under the ticker HMLSF.”
In the meantime, Canada plans to fully legalize marijuana by July 2018. Unlike in the U.S., Canadian marijuana companies have a range of legal protections and rights — such as access to crop insurance, bank loans, tax write-offs and licenses to export and expand overseas. In contrast, one of the main issues U.S. state-legal marijuana businesses have come up against is what to do with all the cash they’re generating — since it’s against federal law for them to have business bank accounts.
Sessions’s assault on the state legalized marijuana market poses serious financial consequences for the industry, forcing investors to look toward Canada for safe haven. John Arbuthnot, CEO of Delta 9 Cannabis in Winnipeg, has this to say:
“There is a real fear about investing in U.S.-based cannabis companies at a time when it is possible people connected with those companies could be prosecuted under federal drug laws,” Arbuthnot told Forbes. “There is a demonstrated interest among investors globally to invest in cannabis companies, which is only logical given the rapid growth of this industry.
“Canada is already, without question, the global leader in the legal cannabis industry, and this is due largely to our own federal government’s support of sensible legalization policy,” he points out. “That support is allowing companies to expand both in Canada and now throughout the world, whereas American companies are being held back.”
Not only that, but if Sessions is successful in his crusade, it would mean more tax dollars would be funneled into the persecution of state-legal growers, sellers and customers. We’re already spending more than $7 billion US a year on marijuana law enforcement — that doesn’t work. (Also see: How the War on Drugs Has Caused More Harm Than Good.)
But the crackdown on state legalization of marijuana isn’t just about financial loss — more importantly, it’s threatening the health and well-being of millions of Americans.
Marijuana: A Health-Giving Miracle
Several studies have found that states with medical marijuana laws have about 25% lower rates of opioid-related deaths. And over 100 scientific studies show that cannabis annihilates cancer. Some believe it’s also the most important vegetable on the planet. Dr. William L. Courtney is one such person as he’s witnessed firsthand how marijuana has transformed the health of his patients.
“It [cannabis] has captured these molecules that help our bodies regulatory system be more effective. The bottom line is it’s a dietary essential that helps all 210 cell types function more effectively. I don’t even refer to it as medicine anymore, strictly as a dietary essential,” he says.
What’s more, CBD hemp oil has also been thrown into the Schedule I category — the same as heroin and LSD — regardless that it isn’t psychoactive or addictive, contains almost zero THC and has been shown to be a miracle-worker in cases of cancer, developmental delays, seizures and other disorders that haven’t responded to conventional treatment.
A Ray of Hope
On the upside, Paul Waldman writes in the Washington Post that he believes Sessions’s attack will likely backfire, making federal legalization more probable. The latest Gallup poll found 64% of Americans are in favor of marijuana legalization — including a majority of Republicans. A dozen more states are also primed to vote on some type of legalization this year — either through public ballot initiatives or state legislatures. Overall it’s a politically charged issue, one that may have enormous ramifications for Republicans in the upcoming November 2018 elections.
“So the end result of this policy could well be to accelerate the liberalization of the nation’s marijuana laws. … Don’t be surprised if every Democrat running for president in 2020 favors ending the federal prohibition on marijuana and returning the question to the states. One potential candidate, Sen. Cory Booker, has already introduced a bill to do just that,” says Waldman.
- https://www.justice.gov/iso/opa/resources/3052013829132756857467.pdf [PDF]
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