Attorney General Jeff Sessions takes on the battle against the ever growing driving force in support of legalizing dope.
What Jeff Sessions thinks about smoking weed was clear even in 2015: “Good people don’t smoke marijuana,” said Donald Trump’s current attorney general during a congressional hearing. Now the conservative hard-liner who once called marijuana “only slightly less awful than heroin,” is taking on the battle against the already powerful movement to legalize weed.
On Thursday, Sessions ordered his federal prosecutors to enforce the federal ban on this drug going forward. This is how Trump’s “law man” is breaking from the policy of Trump’s predecessor, Barack Obama, who gave states the freedom to regulate marijuana. This is a matter of “restoration of the rule of law,” Sessions said, attempting to justify his directive and pointing out the 1970 federal law which prohibits the cultivation, possession and trade of this drug.
By taking this action, Trump’s administration intervened in the market just when it reported a serious boom following California’s legalization of marijuana at the beginning of the week, with California becoming the largest U.S market to fully allow the use of marijuana. Thanks to legalization, local authorities recorded heightened high tax revenue, and so far, there has been no serious reproach from Washington. Some 29 states allow the use of marijuana in general or for medical purposes, according to an analysis by the Drug Policy Alliance.
Cannabis products have generated billions of dollars in business in the U.S for a long time. The sale of classic weed is now only part of this business. Under the common label of “edibles,” there is a range of different products for sale involving this drug — from electronic cigarettes with marijuana, beverages and cookies, to pills and ointments, sedatives or other appetite enhancers. In many places, this is all totally legal.
For the time being, sales are thriving. An analysis by the Arcview Group, a marketing company, shows that the market share in North America in 2017 surged by 33 percent on an annual basis to nearly $10 billion. This result is due to the fact that major markets are opening their doors. In addition to California legalizing marijuana, Canada has followed suit, and by 2021, the market share is expected to increase to $24 billion.
Legalized cannabis trade is expected to create jobs for more than 400,000 people by 2021 in the United States alone, according to Arcview’s research. If direct consumer purchases are included — purchases which researchers believe will total $20.8 billion over the next three years — as well as indirect revenue that retailers would provide to producers and the various subcontractors, the amount could jump to $40 billion. The new forecast would soar by 150 percent in relation to the revenue recorded in 2017 ($16 billion). According to Arcview, “this type of business is experiencing a real boom, and it could add $4 billion in tax revenue to state treasuries within the next three years.”
Can Trump’s Government actions hinder the flourishing industry? “One thing is certain, this will not impact cannabis sales or market growth numbers,” says the chief executive of Arcview, Troy Dayton. “No matter what the Trump administration does, there’s going to be a long line of people willing to take the licenses that the states are giving out, and then there will be a long line of people lined up outside each of those places to purchase cannabis,” Dayton continues. “Consumer demand will not diminish, regardless of what actions the government is taking,” he says.
Dayton stated that from a legal point of view, Sessions’ directive is simply prosecutorial saber-rattling. “In spite of this, Session’s actions leave a bitter taste,” Dayton ultimately admits. Because even if this wouldn’t lead to any additional obstacles, the status quo is not ideal for this young industry.
In fact, the industry has always been hopeful that the federal law against use of cannabis would be repealed one day, as it complicates the business in a number of ways. This is the reason why banks, insurance companies and financial institutions have so far kept their distance from the industry. It is difficult for entrepreneurs to obtain loans, and it is often impossible for some companies that conduct marijuana-related activities to even open a bank account.
This is why the legal marijuana trade in the United States has been almost entirely a cash business to date, and why nearly all transactions are conducted with cash. This is a major shortcoming, as demonstrated by the recent fire which burned through the counties known as Emerald Triangle, destroying not only a large quantity of the weed harvest, but also a large amount of uninsured cash.
Many companies simply accumulate cash. This hinders daily activities and requires costly expenses to provide security, such as vaults or cash collection services. And if the federal ban on marijuana is lifted, the financial sector will no longer have to fear transactions with companies from the industry or investigation for money laundering, for example. And the industry itself would not need to mastermind plans and open their own credit firms or cryptocurrencies. But at least for now, Sessions has destroyed these hopes.