Politics

Republican pot bill upends legalization calculus

By Alex Halperin
Nov 15, 2021
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That elephant is crazy high bro!

Cannabis politics just got a lot more interesting. 

Following Senator Majority Leader Chuck Schumer’s (D-N.Y.) bill this summer, Freshman Congresswoman Nancy Mace (R-S.C.) has filed a new bill she’s presenting as “a good middle-of-the-road, pragmatic, common-sense approach” to federal legalization. No matter what it means for the industry, or legalization, it looks like a sharp political move. With Republicans heavily favored in next year’s mid-terms, it co-opts an issue that could have benefitted Democrats next year. 
Business Insider

  • “The Republicans are taking the mantle of legalization away from the Democrats, which makes them not look good in front of their constituents who support cannabis,” Curaleaf Chairman Boris Jordan told Bloomberg
  • The bill seems to have the industry pumped, and pot stocks staged the closest thing to a rally we’ve seen in a long time.
    Highly Objective
  • The industry seems especially excited about the 3% federal excise tax, far lower than what Schumer proposed. 

The bill is probably a long shot before the midterms, though it could make banking reform more likely. It could also give more Republicans cover to publicly endorse reform. 

Mace’s bill, the States Reform Act, could also create friction surrounding cannabis equity. She says the bill contains something for everyone, and that includes equity supporters, though there would be  far less in guaranteed benefits than in Schumer’s bill. 

  • NORML political director Justin Strekal told me, “You’re never going to hear Congresswoman Mace say the words ‘social equity,” but the bill includes a mechanism by which the federal Small Business Administration would support small businesses from the most adversely affected communities.

Bottom Line: The new bill could open the door to a centrist approach.  

Related: An interesting story in Politico explains why the state’s low-tax, low-regulation business climate inflamed the state’s illegal market:

  • “The state’s free-wheeling MED program has proven to be a magnet for bad actors from across the country. And it has brought into conflict two long-standing and important strains of the state’s conservative makeup: a laissez-faire attitude toward business regulation and a history of harsh treatment of drug offenders.”