Federal enforcement of the Controlled Substance Act has eased in recent years, thanks to Federal Memos allowing Medical Cannabis markets to operate with relative autonomy.
As States have the authority to implement enforcement procedures under the CSA, last weeks comments by Press Secretary Sean Spicer indicating "greater enforcement" in Recreational Cannabis markets, underlines the inherent misunderstanding by the White House of the status of the Cannabis Industry. Mora Mota Group will examine three reasons why this move would hurt our Economy:
1. American-made Cannabis hurts Drug Cartels and helps the U.S. Economy.
The intent for implementing the CSA was to categorize and regulate various drugs based on their medical value and potential for abuse. As a result, the Federal Government has enabled a perpetual "War on Drugs" that incarcerates more citizens for nonviolent drug offenses per capita than any other industrialized nation, lining the pockets of the source of these substances: Drug Cartels.
Heroin, Cannabis and Cocaine have not been traditionally grown in the United States, nonetheless, their influence has made a profound effect in our society. Until the last two decades, no significant gains have been made towards improving our position on drug policy in the U.S. until California voted to legalize Medical Cannabis in 1996.
As of today, more than half our States have implemented Medical Cannabis laws to allow access to Medical Cannabis for patients suffering debilitating medical conditions, while eight States have passed Recreational Cannabis laws. The result of these States’ actions has boosted their local economy and significantly cutting into the profits made by Drug Cartels. The few States with Recreational Cannabis have also generated millions in tax revenue in a few short years.
Along with plant touching companies boosting our Economy, Ancillary Businesses servicing this Industry, such as lighting and construction companies, feel the growth in business as States implement new Cannabis laws. Ignoring this reality flies in the face of the will of the people and gives credence to the problems created by the Drug Cartels and criminals. As the Department of Justice solidifies its position on Recreational markets, Businesses and Investors should head caution in the near future as the DOJ adopts "reasonable policies" in the coming months.
2. Tighter Enforcement may push businesses toward other markets, including the Black Market.
Despite the White House indicating “greater enforcement” by the Department of Justice, this doesn’t signal the imminent end of the Recreational Industry. Since 2011, Governors and Senators in Recreational Cannabis States have worked with the DOJ to develop their State-specific frameworks in order to protect the will of the people, public safety, and respect the interest of those States without Recreational Cannabis laws. However, a major concern regarding the Recreational Industry involves the divergence of Cannabis outside of those legal markets and across State lines, into the hands of criminals and the Black Market.
This has already begun as competition increases in these legal markets, and Cultivators and Retailers seek to make larger profits by moving their products into States without Medical or Recreational Cannabis. Attorney Generals for Nebraska and Oklahoma have already attempted to end this scenario by filing suit against the State of Colorado, although the Supreme Court denied to hear their request last year. Would-be Entrepreneurs considering whether to invest in legal Cannabis may be changing their short-term plans in order to make a move into the Medical Cannabis Industry.
The White House also made it clear that Medical Cannabis markets would remain untouched, giving respect to the Ogden and Cole Memos established during the Obama Administration, as well as the Omnibus Spending Amendment passed in 2014 prohibiting the Department of Justice from spending funds on enforcement in Medical Cannabis States. The Cannabis Industry at large cannot afford to perpetuate the entanglement between Federal Scheduling issues and States Rights, and Congress needs to implement legislation to settle this as more and more States legalize Cannabis in some form.
3. Communities have directly benefited from States implementing reformed Cannabis laws.
Disregarding the economic benefit derived from taxing and regulating Recreational Cannabis, there is the societal benefit in from reforming Cannabis laws. The "sky has not fallen" in States that have implemented Medical Cannabis laws, as these States have seen a dramatic drop in Opiate use, addiction, and death from overdose as patients. Data emerging from Recreational Markets such as Colorado and Washington have witnessed a slight decrease in Automobile accidents and fatalities, while the teen use rate has either remained constant or declined in subsequent years.
An overarching social justice issue being addressed States involves the reduction of incarcerated individuals for nonviolent drug offenses in States with Recreational Cannabis laws. As law enforcement adopts a new strategy far eliminating other dangerous forces in our communities, instead of focusing on Cannabis-related arrests, this will help to ease the implicit bias between law enforcement and disproportionately impacted communities in the Criminal Justice system.
While Cannabis legalization may not be the panacea to solve the litany of issues involved with Prohibition, we need to continue conversation related to Cannabis, whether for Medical or Recreational use, to help progress society's understanding of this plant. This effort requires continuous involvement from the Cannabis Industry to educate our Communities, Legislators, and this New Administration on the benefits that sensible drug policy can have in our Country.