Congress Won't Legalize Pot Anytime Soon, but It Could Protect Marijuana Businesses by Passing Banking Reform
Chuck Schumer seems less interested in achieving cannabis reform than in making political hay from his inevitable failure.
State-licensed recreational marijuana sales began today in New Jersey, one of 18 states that have legalized cannabis for adults 21 or older. Those states account for more than two-fifths of the U.S. population, and another 19 have legalized marijuana for medical use, meaning three-quarters of the states have retreated from a blanket ban. According to the latest Gallup poll, more than two-thirds of Americans think marijuana should be legal. Yet the federal government still prohibits marijuana use for any purpose, and it is very unlikely that will change anytime soon.
A big part of the problem is Republican resistance. When the House of Representatives approved legislation that would repeal federal pot prohibition on April 1, just three Republicans voted for the bill. In the Senate, Majority Leader Chuck Schumer (D–N.Y.), a latecomer to marijuana reform, plans to introduce a legalization bill "before the August recess," a year after he unveiled a preliminary draft. But that bill, like the one the House passed, seems doomed to fail in the Senate, where Schumer has made little effort to attract the Republican support he would need to overcome a filibuster.
As Michael Tesler notes at FiveThirtyEight, GOP lawmakers' opposition to legalization is rather puzzling in light of recent polling data, which show that Republican voters are increasingly turning against prohibition. In the Gallup poll, which was conducted last October, 50 percent of Republicans said marijuana should be legal, a bit more than the 49 percent who disagreed. A 2021 Quinnipiac poll put Republican support for legalization at 62 percent.
Polling data from Civiqs, Tesler says, show "it's Republicans [who are] disproportionately driving the most recent uptick in support for legalizing marijuana." According to the Civiqs numbers, "net support" for legalization (the percentage in favor minus the percentage opposed) among Republicans "grew from –15 points at the start of April 2018 to a high of +13 points at the end of March." Tesler adds that Civiqs polling indicates "more Republicans favor legal cannabis than oppose it in almost every state."
Republican members of Congress may be driven by personal conviction rather than their understanding of what their constituents want. "Compared with most Americans," Tesler writes, "congressional Republicans tend to be older and more religious, two demographic groups that are far more averse to legalization than younger and religiously unaffiliated Americans. Indeed, GOP politicians often oppose drug legalization on behalf of conservative principles like morality, order and family values."
But Tesler also suggests that GOP legislators may not realize how dramatically views on legalization have shifted among Republicans in recent years. "Political science research shows that politicians tend to overestimate their constituents' support for conservative policies, with Republican lawmakers driving much of this phenomenon," he writes. "Some congressional Republicans may therefore oppose federal legalization because they mistakenly believe they're representing their own voters' views."
If so, polling data could be an important tool for Democrats trying to build a bipartisan coalition in favor of repealing the federal marijuana ban. Another obvious point of entry is federalism, a "conservative principle" that suggests the federal government should not interfere with state marijuana policies. Since most states have rejected marijuana prohibition, even legislators who take a dim view of pot might be persuaded that Congress should accommodate those choices.
One likely prospect is Sen. Dan Sullivan (R–Alaska), who is cosponsoring the SAFE Banking Act, which would protect financial institutions from federal penalties for serving state-licensed marijuana businesses. Sullivan told MJBizDaily he supports reform not because he likes cannabis but because that is what his constituents want. "My state did this in a statewide referendum, right?" he said. "And so, the people of Alaska spoke, and I'm trying to fulfill their wishes." When it comes to broader reform, Sullivan said, "the big, core, fundamental issue is: Is this going to be kind of state-led, or is it going to be federal on down?"
It has been nearly 10 months since Schumer unveiled his "discussion draft," but so far it seems the discussion has been limited almost entirely to Democrats. "I've reached out already to a few Republicans to see what they want," Schumer said a couple of weeks ago. Last week MJBizDaily found that Schumer had approached just two GOP senators: Sullivan and Lisa Murkowski, Alaska's other senator. "In honesty," Murkowski said, "I'm not as familiar with what Schumer is looking for, so that's why it probably would be good of me to sit down and find out."
Schumer's office told MJBizDaily he picked Sullivan and Murkowski because "they appeared to be the most receptive on the Republican side." But seven other Republican senators—Steve Daines (Mont.), Kevin Cramer (N.D.), Rand Paul (Ky.), Bill Cassidy (La.), Cynthia Lummis (Wyo.), Susan Collins (Maine), and Roy Blunt (Mo.)—joined Sullivan and Murkowski in cosponsoring the SAFE Banking Act, which suggests they are interested in addressing the conflict between state and federal marijuana laws.
Schumer needs every Republican vote he can get. "At least two Democratic senators —Jeanne Shaheen of New Hampshire and Joe Manchin of West Virginia—have expressed skepticism about full legalization," MSNBC columnist Hayes Brown notes. "Given the likelihood of a Republican filibuster, that would require Schumer to get at least 12 GOP votes to move forward any comprehensive bill."
Schumer seems determined to ignore that reality. He has failed to engage in substantial outreach to Republicans, and the draft version of his bill, which runs 163 pages, is chock-full of unnecessarily contentious, burdensome, and prescriptive provisions that are apt to alienate potential allies across the aisle.
While the short-term prospects for federal legalization look dim, the SAFE Banking Act has a much better chance of passing the Senate. In fact, it would already be law, as an amendment to the National Defense Authorization Act that President Joe Biden signed in December, if Schumer had not insisted that it be excised from the final version of the bill. The majority leader, who thought his own yet-to-be-seen bill should take priority, warned that addressing the banking issue would relieve pressure for broader reform.
The Drug Policy Alliance (DPA) echoed that view, telling its supporters in December that "we have less than 72 hours to keep the SAFE Banking Act OUT of this omnibus bill and the only way to stop it is if advocates like you speak up right away." The DPA portrayed the bill as "prioritiz[ing] marijuana profits over people"—a bizarre stance given the burdens and sometimes deadly hazards created by the lack of banking services, which forces marijuana suppliers to rely heavily on cash, making them ripe targets for robbers.
By contrast, Democrats in the House—which has approved marijuana banking reform half a dozen times, only to be frustrated by Senate inaction—were dismayed by Schumer's obstruction. "I don't really quite know what the hell his problem is," House Rules Committee Chairman Jim McGovern (D–Mass.) said. "People are still getting killed and businesses are still getting robbed because of a lack of action from the Senate," said Rep. Ed Perlmutter (D–Colo.), the House sponsor of the SAFE Banking Act.
When the House voted on Perlmutter's bill last April, it passed by a 3–1 margin with support from 106 Republicans. That tally, combined with the nine Republican cosponsors in the Senate, suggests the bill has a real shot this year, assuming Schumer allows a vote on it. "The issue I'm emphasizing with Sen. Schumer, I think, is a unifying issue," Sullivan told MJBizDaily, referring to banking reform. "This is also a safety issue. The way businesses have to carry around tens of thousands of dollars in cash because they can't bank is really dangerous."
The latest vehicle for the SAFE Banking Act is the America COMPETES Act, the House version of which includes Perlmutter's bill. "Unfortunately," the National Organization for the Reform of Marijuana Laws (NORML) noted this week, "the Senate continued to punt on this incremental but important issue by passing a companion bill that removed the SAFE Banking language. The legislation now moves to conference committee where the House and Senate versions will be reconciled, and the Senate is the biggest hurdle to keeping cannabis banking reform in the final compromise bill."
Washington Gov. Jay Inslee and Attorney General Bob Ferguson, both Democrats, reiterated their call for marijuana banking reform in a Tacoma News Tribune op-ed piece published on Tuesday. "More than 50 cannabis stores throughout Washington state have been victimized by robberies so far in 2022," they write. "That's more than 50 robberies in less than three months—many of them by perpetrators with firearms and two of which resulted in people being killed."
Inslee and Ferguson think the solution is clear. "Congress must take action immediately to pass the SAFE Banking Act, which would, at long last, allow cannabis retailers to more easily use common cashless payment options such as credit and debit cards," they say. "This has become a matter of life and death. Congress can act today to pass the SAFE Banking Act. Every day of delay means business owners are incurring extraordinary costs to hire their own armed security. Retail store employees are being traumatized, assaulted and even killed."
In light of the continuing threat posed by the dearth of financial services for the cannabis industry, Schumer's stance on the SAFE Banking Act is hard to fathom. That bill, unlike his, has a good chance of passing, which would immediately help state-licensed marijuana merchants and their employees. As NORML understands but the DPA apparently does not, it is better to have a slice of the pie than no pie at all.
Judging from his actions rather than his rhetoric, Schumer is not really interested in achieving federal marijuana reform. Instead, he wants to take credit for trying and blame Republicans for his inevitable failure. "Democrats would be wise to make congressional Republicans' opposition to marijuana legalization an issue in the upcoming midterm elections," Tesler says. That seems to have been Schumer's plan all along.
