Catch the Smoke: July 31, 2023
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Mastercard shuts door on cannabis
A loophole that allowed debit card users to purchase recreational cannabis with their debit cards has been shut down by Mastercard. This highlights yet again one of the industries biggest struggles: lack of access to capital and handling of massive amounts of cash which leave businesses open to robbery. Which brings us to the SAFE Banking Act:
SAFE Banking still floating
Barely. Congress left for August recess last week with not movement again on the SAFE Banking act which is supposed to address the Cannabis industry’s banking problems. Two more senators signed on to cosponsor the bill last week, Rep. Strickland, Marilyn [D-WA] and Rep. Smith, Adam [D-WA],for a grand total of 66. Senate Majority Leader Chuck Schumer (D-NY) trumpeted “good progress” at a press conference last Thursday and promised it as a priority for the fall session.But it’s safe to say we’ve heard empty promises from him that despite good intentions fizzle out in political reality.
Moving out
As predicted, due to Virginia’s new more stringent CBD and hemp laws, businesses are closing and moving out of the state. Old Manchester Hemp Co. is the most recent to close on June 30. Owner Anthony Mijares said he plans to move his business to D.C.
Maryland congressman teams up with Republican
Congressman Jamie Raskin (MD-08) and Congresswoman Nancy Mace (SC-01) introduced the Cannabis Users Restoration of Eligibility (CURE) Act, legislation to prevent prior or current marijuana use from becoming grounds for failing to receive security clearance or for being found unsuitable for federal employment. The bill would allow someone previously denied security clearance or a federal job opportunity based on marijuana use to have the denial reviewed. Maryland’s state laws are still up in the air despite adult use legalization this summer.
Hemp industry strikes back
As we covered last week, the new cannabis market in Maryland is smothering the old hemp and CBD market. The hemp industry sued the state last week for allegedly creating a monopoly and cutting them out of the new adult-use market. These businesses unsuccessfully lobbied for changes during the legislative session. Their suit claims the new recreational industry is “a classic prohibited monopoly, with the state as a willing profiteer in the system.”
East Coast Round Up
NY continuing the crack down too far
New York State Senator George Borrello has proposed legislation to ban the use of cannabis in public places unless local municipalities say otherwise. NYS Senator Jeremy Cooney and other industry professionals disagree with the bill, saying it is a step in the wrong direction and would recriminalize populations that were disproportionately impacted by the failed war on drugs. The illicit market continues to thrive in the state as regulations continue to hobble the legal market despite some reform.
The king of unlicensed NY cannabis is war ready
New York department of tax and finance agents raided Empire Cannabis in July, causing a standoff and the arrest of Jonathan Elfand and his sister, Lenore, the co-founder of the company. The pair are taking New York to court now to prove their legality. The raid on their shops marked a turn off the tide for the state’s gray market which has flourished under a lumbering legal market rollout. Despite only 19 open licensed stores in the states (though more licenses have been issued in the last few months), regulators have made shutting down gray market stores a primary focus of their attempts to right a dangerously off-tilt market. This enforcement is a change from their previously light enforcement.
Culture Corner
Playing for weed
Kevin Durant lobbied NBA commissioner Adam Silver to drop the league’s marijuana ban. The NBA and its players union agreed to remove marijuana from the league’s banned substances list as part of their new collective bargaining agreement.
Cannabis addiction, though rare is real
Cannabis’s risks were inflated for decades as the war on drugs raged. But now, people who legitimately have dependency use disorder with cannabis are finding it difficult to access treatment or be taken seriously. The Increase in potency of flower and weed products has also created more dependency.
Overdoses of cannabis rise with legalization, according to a new study
As marijuana has been legalized in more states, cases of cannabis poisoning have increased. This is especially true for children, who are more likely to ingest too much marijuana and experience symptoms such as sleepiness, dizziness, and a fast heart rate. The link is likely just connected to an increase in usage with legalization.
Decrease in weed charges
There were just over 60,000 cases of drug trafficking reported to the U.S. Sentencing Commission in 2022. Almost 31% of these cases involved drug trafficking and 4.1% of those cases involved cannabis. Marijuana trafficking charges have dropped by over 60% since FY 2018.
From the Swamp
- A key House committee cleared some marijuana and psychedelics amendments to receive floor votes while blocking others. The measures focus on allowing VA doctors to recommend medical cannabis to veterans and promoting research into substances like psilocybin and MDMA.
- The VA and Department of Defense oppose the use of medical marijuana for PTSD, citing a lack of well-designed studies and serious side effects. However, they take a neutral position on psychedelics, saying that more research is needed.
- A former drug advisor to Barack Obama, George W. Bush and Bill Clinton said that cannabis legalization is linked to a rise in mental health issues on Fox News. He did not cite research and founded one of the biggest lobbying opponents of legalization.
- Four republican senators who do not support cannabis legalization admitted that legalization does interrupt illicit cannabis trafficking by cartels.
This week, don't miss
The Common Good Conference: The Common Good hosts a full-day, immersive conference combining the business and culture of cannabis in Washington, DC. at Eaton Hotel. (Sept. 29; $55-150)