Blog : The Medical MJ Moment

by Ed Zwirn on June 20th, 2014

Medical marijuana symbolA major legislative breakthrough for the medical MJ industry could occur as soon as today, if he U.S. Senate approves an amendment to the Department of Justice funding bill. This amendment would bar the feds from spending money to go after medical cannabis businesses acting in compliance with state law.

Readers of this marijuana blog may recall the apparent surprise which greeted the passage of a similar measure in the House of Representatives last month. The so-called Rohrabacher-Farr amendment passed the House by a 219-189 vote margin, significantly with the help of 49 conservative Republicans.

"Businesspeople who are licensed and certified to provide doctor-recommended medicine within their own states have seen their businesses locked down, assets seized and customers driven away," said Rep. Dana Rohrabacher, the Republican co-sponsor of the bill, about Drug Enforcement Administration actions.

"Conservatives in this body who regularly call for a decrease in the size and scope of the federal government, but who have historically opposed ceding any ground with the regard to the Controlled Substances Act, ought to seriously consider voting for my amendment," he told his fellow members of Congress."In fact, if you're on the wrong side of Milton Friedman, William F. Buckley and Grover Norquist, you ought to reconsider whether you're position is the conservative one."

Rohrabacher cites these conservative icons as influencing his intention to keep marijuana within the restrictions of the 10th amendment, which gives precedence to state laws on matters not enumerated within the Constitution (What would George Wallace and other bygone states-rights advocates make of this?). But whatever the ideological rationale, it apparently did the trick, or at least gave enough conservatives political cover, and the House vote to keep the feds away from medical MJ constituted an all-too-rare instance of bipartisanship on Capitol Hill.

Catching up with their own success, the MJ lobby, after scrambling for a few weeks, has finally found Senate sponsors for the amendment. Just yesterday afternoon, senators Rand Paul (R-KY) and Cory Booker (D-NJ) introduced their version of the House measure into the Senate. The amendment could come up for a vote as soon as today (Friday).

The odds of passage in the Senate are uncertain. On the one hand, it is usually difficult to get any legislation of consequence past the 60-vote hurdle needed to ensure passage without a blocking filibuster, and bills with all quantities of merit and popular support have been known to die there for that reason.

On the other hands, there are encouraging signs for the medical MJ industry. For one thing, each state gets two votes in the Senate. A total of 22 states and the District of Columbia have already passed medical MJ provisions of varying degrees of leniency. Four more, including New York, where they plan to allow consumption but not smoking, plan to follow up. This would presumably put a majority of senators representing states which would benefit from the measure.

Investors in startup companies in both the medical and recreational marijuana sectors ought to be emboldened by this development, especially if it pans out. The total MJ market in the U.S., both recreational and medical, is said to total around $40 billion. The vast majority of this money is being collected on an underground and therefore untaxed basis.

Taking the DEA and other federal law enforcement agencies out of the medical MJ policing business will not actually legalize the stuff on a federal basis, but removing the threat of federal prosecution will solve a major problem for entrepreneurs selling the medicine in states where it is legal.

NJ Governor Chris Christie, taking a break from managing traffic jams, has recently gone on the radio to complain that medical MJ laws such as NJ's, which he opposes, are "a fallacy" and in fact a "front for legalization." Perish the thought.

Peter LeedsBut whether you are citing Grover Norquist or Chris Christie, the pros and cons of the MJ debate are the rare example of a public policy debate in which the usual ideological and partisan lines have been blurred. Even a political novice can predict how a vote on abortion or Obamacare will turn out, but the Senate outcome is a crapshoot, one that will affect how a great deal of money gets spent in the not-too-distant future.

If you've read this far there's a good chance that you're both a Peter Leeds fan and an MJ aficionado. Participants in the National Cannabis Industry Association's Cannabis Business Summit, to be held June 24-25 in Denver (they don't call it the Mile-High City for nothing) will get to combine both these passions. Peter will be appearing at this gig to discuss Cannabis Penny Stocks. Hey, it's a tough job but somebody's got to do it.


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