Tag Archives: Senate

David Feldman

Senior Trump Officials Support Congressional Action on Cannabis

In the last week both the US Attorney General and the Treasury Secretary have encouraged Congress to take action towards easing US cannabis prohibition. Yesterday, in testimony before Congress, AG William Barr seemed to support the currently pending Strengthening the Tenth Amendment Through Entrusting States (STATES) Act, while still opposing legalization. He was concerned about the continuing conflict between federal and state laws in the area, saying: “The situation that I think is intolerable and which I’m opposed to is the current situation we’re in, and I would prefer one of two approaches rather than where we are. Personally, I would still favor one uniform federal rule against marijuana but, if there is not sufficient consensus to obtain that, then I think the way to go is to permit a more federal approach so states can make their own decisions within the framework of the federal law and so we’re not just ignoring the enforcement of federal law…I would much rather that approach—the approach taken by the STATES Act—than where we currently are.”

Separately, many have been disappointed by the lack of action by Secretary Steven Mnuchin’s Treasury Department. In February 2018 he said that addressing the challenge of cannabis businesses’ access to commercial banking was at the “top of the list” of his priorities. Since then the Department has taken no action on the issue. On Tuesday of this week, Mnuchin announced in Congressional testimony, essentially, that his hands are tied and he believes he cannot solve the cannabis banking problem administratively. He urged Congress to address the issue with new laws “on a bipartisan basis.” Mnuchin spoke of the need to build “cash rooms” at Treasury to hold taxes that cannabis companies pay in cash. The SAFE Banking Act of 2019, which would effectively eliminate most restrictions on banks taking cannabis companies as customers, has passed the House Financial Services Committee and is expected to pass the full House as well. It’s fate in the US Senate is less clear. The STATES Act also would address the banking issue.

Politically, it appears we are closer than ever to Congressional action in this area. Every Presidential candidate, including all the Democrats, Trump and his current Republican contender Bill Weld, favors some form of legalization or allowing states to decide on the matter. Between the growing public support for legalization, the taxes and jobs pouring into cannabis-legal states and the desire to right the wrongs of the War on Drugs, it is becoming both more politically acceptable and politically expedient to support easing of federal criminal restrictions. The current holdup? The US Senate, where Lindsey Graham and Mitch McConnell continue to appear to desire to stonewall further legalization efforts. Stay tuned.

 

David Feldman

Senate Passes Bill Legalizing Industrial Hemp

The US Senate, by an overwhelming 86-11 vote, last week approved the sweeping Farm Bill containing language which fully legalizes industrial hemp. As we know, hemp, which is derived from cannabis plants, is used to make products from rope to clothing and does not contain THC, the psychoactive part of the plant. In colonial days hemp was so crucial that farmers, like George Washington, were legally required to grow it.

Most believe the House will follow suit. Hemp has not been legal on a federal level since federal criminalization of cannabis in the 1930s. Many believe that occurred in part because of fears of hemp competing with powerful timber interests and DuPont’s then new patent on nylon.  After the 1930s bill was declared unconstitutional in 1968, the Nixon Administration helped orchestrate passing the Controlled Substances Act. That law, still in force, declared all parts of the cannabis plant as Schedule I drugs, as dangerous as heroin and LSD. A top Nixon aide later admitted, “Did we know we were lying about the drugs? Of course we did.” Constitutional challenges thus far have been unsuccessful.

Legalization of hemp could yield a variety of products that previously could only be produced with imported hemp. These could include food, building materials, paper products and many others. Currently, it it believed that China is the largest producer of hemp, since it is legal to do so in a number of Chinese provinces. They started farming it during the Vietnam War to make more breathable uniforms for their soldiers in the intense heat. This Senate vote is indeed a significant step towards relaxation of federal cannabis regulation.