Why Do Legalizers Keep Blocking Pot Banking?

Chuck Schumer claims to favor repealing the federal ban on marijuana. So why did he sink legislation that would have removed federal obstacles to banking services for pot businesses?


Senate Majority Leader Chuck Schumer claims to favor repealing the federal ban on marijuana. The New York Democrat nevertheless helped sink legislation that would have removed federal obstacles to banking services for state-licensed marijuana businesses.

Even stranger, the Drug Policy Alliance (DPA), which has long supported marijuana legalization, joined Schumer in demanding that the Secure and Fair Enforcement (SAFE) Banking Act be excised from the National Defense Authorization Act for fiscal year 2022, which President Joe Biden signed into law on December 27. "We have less than 72 hours to keep the SAFE Banking Act OUT of this omnibus bill," Maritza Perez, the DPA's director of national affairs, warned in a December 3 "urgent action" alert, "and the only way to stop it is if advocates like you speak up right away."

Schumer insisted that a legalization bill he planned to introduce in April take precedence over piecemeal reforms. The DPA likewise worried that passing the SAFE Banking Act would relieve pressure for broader changes. "Don't Let Congress Prioritize Marijuana Profits Over People," it said.

The SAFE Banking Act, which Rep. Ed Perlmutter (D–Colo.) reintroduced in March 2021, would protect financial institutions that serve "cannabis-related legitimate businesses" from criminal prosecution, regulatory penalties, and civil forfeiture. It passed the House in April 2021 by a 3-to-1 margin with support from 106 Republicans. An amendment adding it to the must-pass defense bill was approved by a voice vote in September. But Schumer made sure Perlmutter's legislation was not included in the final version of the bill.

This was the fifth time the House had approved cannabis banking legislation, and its supporters were dismayed at Schumer's obstruction. "I don't really quite know what the hell his problem is," House Rules Committee Chairman Jim McGovern (D–Mass.) said during a committee meeting. McGovern complained that Schumer is "making it very difficult for a lot of small businesses" to "expand and hire more people."

A lack of financial services forces many marijuana businesses to rely heavily on cash, which increases the risk of theft and robbery. "People are still getting killed and businesses are still getting robbed because of a lack of action from the Senate," Perlmutter said in a press release.

Ethan Nadelmann, who founded what became the DPA in 1994 and ran the organization for 23 years, questioned its current strategy in an October interview with Reason's Nick Gillespie. "Holding off on doing the incremental stuff, like safe banking, until we get the broader legalization, when we know broader legalization is not gonna happen for years," Nadelmann warned, "may well not work on Capitol Hill."

NEXT: Brickbat: Testing Their Limits

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  1. Follow the money - or more precisely - look to where the money is not going. Maybe too much of the money is going into the wrong pockets.

    1. Because if they actually solve the problem, they can't continue to receive credit (and more importantly, votes) for "working to fix" the problem.

      1. Schumer knows people want legalization. He also knows they don't want ridiculous taxes. He needs to hold legalization hostage so he can get his 25% tax, because he'll have no leverage for the tax if its legalized in a clean bill

        1. Everyone wants a piece. NM just went recreational and prices rose ~50% after local, state and federal taxes.

          1. Mine didn't... Of course I'm pretty sure that I'm not being charged any of those taxes either... 😉

  2. Provide him with a path to graft from the affected industry and his attitude will swing right around.

    1. "The SAFE Banking and Chuck Schumer Enrichment Act of 2022"

      Just tell the members of Congress that they get to take part in a split of .001% of all nationwide marijuana sales profits if they pass it. Naked bribery always seems to work.

        1. Plus 10% for the Big Guy.

        2. No, no. Schumer claims he wants 25% "for the people". But it's bullshit and we all know that. I'm pretty sure he could be bribed if the money was actually going directly to him.

  3. Pot smoking hippies can’t get out of their own way.


    1. On a scale of 1 to 10

      Accuracy: 0.1
      I think Jewish business types is more appropriate for the DPA and Chuck Schumer than pot smoking hippie, although in fairness I have not had any exposure to the DPA since Nadelmann retired. I think the Fed's/politicians deserve all the credit for not getting out of the way for cannabis legalization.

      Humor: 0.5
      Pot smoking hippie jokes...about 50 years out of date.

    2. Enh, I suspect the DPA have fallen less into the "pot-smoking hippies" trap than the "well, I don't have to worry about going to jail for getting high any more, so there's really far less urgency now". Still, it's a shitty tack to take, when they could actually make some real progress on the issue.

      1. The DPA has become another progressive "social justice" organization (assuming they were ever anything else) so legalization without a massive wealth transfer via hefty taxes is pointless to them

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  5. The comprehensive reforms that Schumer wants wouldn't help much more than the banking bill would at this point. Federal legalization won't help in states that don't want it legal, but in states that do want it legal it's the money that matters.

    I've seen this sort of shit before. Someone wants to posture as a leader for some low-information interest group, so opposes good legislation by trying to fool the people who'd benefit from it into thinking it's bad. "Cannabis profits over people" is a bizarre opposition slogan when it's the profits that the people want. And Schumer's such a troll, he even looks like one.

    1. I suspect schumer only pays lip service to supporting reform. His career does not demonstrate that this would be something he would support. Attempting to create government agencies to more efficiently harass and regulate taxpayers day to day is more his style.

  6. Why Do Legalizers Keep Blocking Pot Banking?

    Um, because "legalizers" is not an accurate way of describing them?

    1. The DPA likewise worried that passing the SAFE Banking Act would relieve pressure for broader changes. "Don't Let Congress Prioritize Marijuana Profits Over People," it said.

      "Because the creatures that operate marijuana dispensaries aren't people." she continued.

  7. I think it's time we stop talking about it as "pot legalization" and start referring to it as "pot re-regulation."

  8. So open a bank account under a business name similar to "Bob's Landscaping and Weed Removal". Deposit money.

    1. "Since production and trade—not violence—were decreed to be crimes, the best men of Europe had no choice but to become criminals. The slave-drivers of those States are kept in power by the handouts from their fellow looters in countries not yet fully drained, such as this country." The looters can't very well allow your freedom and export their coercion, can they?

  9. Schumer never met a bureaucracy he didn't like.

  10. https://www.reuters.com/technology/russian-watchdog-says-google-faces-fines-over-content-youtube-2022-04-14/

    So... if Google pays those fines to the Russian Government, are they then guilty of violating the financial sanctions against Russia?

    1. If we're still trading in uranium with Russia, it's not serious. No war until the Clintons are done getting paid.

  11. I agree with their actions, but not their reasons.
    It should have been blocked because marijuana banking regulations have no place in a defense appropriations bill.

  12. A lack of financial services forces many marijuana businesses to rely heavily on cash, which increases the risk of theft and robbery.

    That's a feature, not a bug.

    People need to be paid off without paper trails, for a variety of reasons -- confiscation by authorities, naturally, being one of the main reason. Cash is difficult to trace. Drug dealers tend not to complain or fight to hard. Nobody in our government wants to eliminate the black market in cash, because that is how things get done that need getting done.

    1. Except they want to eliminate cash, on a parallel track. Though you wouldn't have to work very hard to convince me they just hadn't actually thought it through.

  13. What a silly question.

  14. Did somebody forget to bribe Schumer make a perfectly legal contribution to Schumer's campaign fund?

  15. The looters understand a fact lost on Sullum: The Crash resulted from the sudden removal of liquor and drug money from the securities markets, then from the banking system. The prohibition Party Platform recently quit calling repeal THE "mistake," yet presumes to declare vices crimes and demand coercion, rights be damned. Should it again influence a Republican Herbert Hoover, it doesn't want as sudden and embarrassing a Crash to again pull away the curtain.

  16. Schumer is lying to you about legalization.

  17. My guess is that fat, not too bright & very fond of regulation chucky believes that his constituents are too stupid to notice that he consistently says one thing and does the opposite. As he has for his entire career, so he may be on to something.

  18. More proof that no matter what Politicians say, they don’t care about the average person.

    Also proof that no matter what they do, you can count on Politicians to screw it up.

  19. Al D’Amato was right. Schumer is a Putz.

  20. Jacob....both Schumer, DPA and NORML do Not Want MJ to become legalized at the fed level...they use the issue to raise money and encourage Dem turnout...this policy / POV has been in place since January 2019. SMH from a guy trying to work his way out of a job on the Hill....cowboy

  21. Why Do Legalizers Keep Blocking Pot Banking?

    Because they're gay?*

    *I don't mean "gay" as in "homosexual." I mean "gay" the way we all used to use that term until maybe ten or so years ago, when "that's SO gay" was added to the blacklist.

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