Across the United States, success stories surrounding marijuana legalization are becoming increasingly common. When all is said and done, however, it may be the banks and not the individual test cases which provide the extra push advocates need to effect change at the federal level.
On Tuesday, Federal Reserve Chairman (and regular White House punching bag) Jerome Powell told the US Senate that the Fed is in a tight spot when it comes to weed laws around the country. For all the rumors circulating about marijuana legalization at the federal level, Powell’s testimony is perhaps the most important signal that change is on the horizon.
Even as states begin to legalize recreational marijuana, weed is still very much illegal at the federal level. As a result, banks are unsure about the legality of doing business with the cannabis industry. As a result, dispensaries are having a tough time finding banks who will even let them open an account.
To date, most cannabis businesses have found various ways of skirting the federal bugaboo; however, as more states jump on the marijuana legalization bandwagon, the dollars are adding up. In 2018, the Oregon weed industry raked in $777 million. Colorado’s weed sellers tallied $1.5 billion. California cleared $2.75 billion. Those are some massive numbers, enough to raise the collective eyebrow of the pack of crooks who run America’s financial institutions.
But hurdles remain. As Powell explained, the opposing regulations put “financial institutions in a very difficult place and [put] the supervisors in a difficult place, too. It would be nice to have clarity on that supervisory relationship.”
Translation: state-level weed is big business, and federal banks want to wet their beaks.
That said, corporate greed may just be a boon for marijuana advocates around the nation. But before banks can get behind recreational marijuana on a state level, they’ll have to make sure they won’t get in (too much) trouble.
There’s every reason to consider Powell’s plea good news for marijuana legalization. In asking the Senate to give weed some thought, he’s addressing the concerns of the overall financial industry, which is just waiting for the day they can dip their feet in a multi-billion-dollar pool. By representing the interests of the banks (and not Snoop Dogg), Powell is bringing the weed argument to the Senate using means even a politician can understand: the kind that impacts their bank account.