By Dalton Rosario
Today our 116th Congress met at the first cannabis hearing of the year to discuss the SAFE Banking Act, which aims to draft legislation that provides banks and credit unions with precautionary provisions for handling legitimate cannabis proceeds from licensed businesses without fear of being flagged by the federal government and IRS for money laundering and dealings with illicit criminal activity. This is a major step in ending federal prohibition, as all legal industries require the services of financial institutions, particularly for cash-heavy sectors like the cannabis industry. Not only does this increase the public safety and wellbeing of these businesses, their employees and our communities, but also it creates the necessary transparency for cannabis markets to be taxed, regulated and held accountable for the proceeds of their daily dealings at the state and federal level. Furthermore, by banks investing in local cannabis companies and providing financial resources and services, the cannabis industry will wholly embrace a previously unattainable level of standardization that has been lacking; making cannabis seem less like a favorable market commodity and more like a potential hazard and financial liability for those congressman, governors and state lawmakers who seek to pass pro-cannabis legislation but lack the infrastructure and support from our federal government to do so.
Local banks require protection in their dealings with cannabis companies, which have been by and large outright denied in their undertakings of standardized services that all other commercial industries have access to across the country. Whether that be in the form of unfavorable cash deposit rates, the inability to request a line of credit or restrictions on filing for annual tax exemptions based on U.S. Code Section 280E. Ending cannabis prohibition is not just administered through statewide legalization, but through policy reformation and legislative provisions impacting all satellite sectors and services surrounding the cash cow commodity that this bustling industry relies on. According to the U.S. Department of Treasury, nearly 500 financial institutions across the country support cannabis businesses. And although this shows a rising support from Corporate America favoring the legitimacy of this estimated $50 Billion cannabis industry in just a few short years, as it stands only one-third of all licensed retailers, distributors and cultivators have reliable dealings with banks and credit unions. - An unheard of statistic with no parallels in our country's commercial marketplace.
By Dalton Rosario
The partial Government shutdown has been in affect for 36 days now and hemp farmers are wondering when the U.S. Bureau of Reclamation’s policies will be updated so that they can access federally controlled water. The U.S. Department of the Interior has been affected by the current impasse of government funding, placing a dead halt on hemp cultivation to begin despite an abundance of farmers ready to work. Senators Michael Bennet (D-CO) and Jon Tester (D-MT) have already reached out to the head of the Bureau of Reclamations (BOR) to update their policies, to no avail. As stated by Sen. Michael Bennet, “After legalizing hemp in the Farm Bill, we should be expanding opportunities for growers. Instead, the ‘Trump shutdown’ has halted implementations and increased uncertainty for the [hemp] Industry.”
There are a number of policy discrepancies between the Justice Department, the Department of Agriculture and the BOR. This causes doubt and mistrust in the newly established hemp industry. Both on part of farmers looking to cultivate and companies willing to invest in the most crucial stage of getting industrial hemp production off the ground. This is terrible timing for the expected market boom of manufacturing and distribution for fibers, papers, biodegradable plastics and derivatives of hemp products including car parts and concrete. The Food and Drug Administration has also been affected acutely by the government shutdown, causing a lag of policy updates relinquishing restrictive policies against CBD derived products.
Democrats have already begun flirting with similar strategies Trump is currently implementing to secure border funding - as a tactical advantage for ending federal prohibition - contingent upon a Democratic nominee winning the 2020 presidential election. But these musings have been proposed as a means of showing what an unreasonable and abrasive misappropriation of negotiation leverage Trump has incurred onto the American people. We should not be held hostage at the mercy of political trifles and contextual semantic disputes. And it will not be long before the executive powers at be learn this lesson.
By Dalton Rosario
As it stands, our continued partial government shutdown is contingent upon a national security threat necessitating a wall spanning our souther border to keep illegal drugs from being smuggled into our country. The problem with this narrative lies in the fact that roughly 90% of all illicit drugs enter our country through legal ports. According to the U.S. Department of Homeland Security (DHS), in 2017 almost 1.6 million pounds of cannabis was seized from our souther border. This sounds like a large amount without proper context; however, licensed cultivators within the state of Oregon alone grew 2.6 million pounds of cannabis that same year. Certainly this does not negate the fact that at least 10% of illegal drugs entering our country comes from our southern border. But the 1.6 million pounds of cannabis confiscated by the DHS in 2017 - although a sizable amount - totals half of illegally imported drugs seized four years prior in 2013.
This denotes progress due to state legislation supporting the cannabis industry and its commercial viability to generate income and tax revenues from medical programs and recreational use. Not from buffing up Border Patrol with an already finite amount of resources at the federal government’s disposal. According to a marijuana supply chain analysis at the Cato Institute, an American Libertarian Think Tank, boarder patrol seizures dropped 78% over a span of five years due to a clear correlation that cannabis was the predominant drug being smuggled into our borders. As Cato analyst David Bier wrote, “State marijuana legalization starting in 2014 did more to reduce marijuana smuggling than the doubling of Border Patrol agents or the construction of hundreds of miles of border fencing did from 2003 to 2009.”
For years now advocates have been calling on state lawmakers to introduce quality control measures into legislation for cannabis to be treated as any other consumer good that is regulated for consistency, potency and purity of product. With this now-pending “state of emergency” comes a sense of urgency to act. Including this excuse for a wall to strengthen our border security - countering illicit drugs smuggled into our country - and the inevitable catalyst of backlash from those who harbor reason within our Congress; leading to the continued stalemate of this governmental shutdown.