Federal Government: Pot Still Illegal
I’ve written extensively about the hazy state of pot regulation in this country and how it has virtually paralyzed credit unions and banks that might otherwise be willing to provide services to pot businesses. So I think it is worth noting that sometime today, the DEA will reportedly be rejecting a high-profile petition seeking to remove Cannabis from the Government’s most restrictive drug classification.
New York is one of approximately half the states in the Nation and the District of Columbia that has voted to legalize marijuana to one extent or another. But banks and credit unions have been justifiably reluctant to provide financial services to pot businesses. This is because marijuana remains unequivocally illegal under the federal Controlled Substances Act. In fact, pursuant to the Act, the DEA classifies marijuana as a Schedule I drug, its most restrictive classification. Critics have argued for decades that this restriction makes it almost impossible to perform the type of scientific research that would determine what medical benefit, if any, pot has.
As explained in this analysis by the Brookings Institute, rescheduling would “not suddenly legalize marijuana” or “solve the policy disjunction that exists between states and the federal government on the question of marijuana legality.” Those same researchers noted, however, that a successful rescheduling petition would have effects on drug policy since it would be interpreted as recognition by the federal government of accepted medical uses for marijuana. This is why advocates ranging from U.S. Senators to the National Conference of State Legislatures have endorsed rescheduling.
On a practical level, such a shift may have allayed the fears of regulators who are reluctant to allow financial institutions to enable pot businesses to access the Federal Reserve Banking system. The decision leaves the status quo intact. The next big event in the pot wars will come when the Court of Appeals 10th Circuit rules on an appeal from a state-chartered credit union in Colorado that was denied access to the Federal Reserve System and Share Insurance by the NCUA.
America’s Uneven Housing Recovery
Another issue which I have obsessed about in this blog is the state of America’s housing market and the causes that may lie behind its relatively sluggish rebound during this so-called recovery. Lest you think these are just the concerns of a curmudgeonly blogger with a glass half-empty perspective, you should read the lead story in today’s Wall Street Journal, which explains that the recovery that began in 2012 has “left behind a broad swath of the middle class, threatening to create a generation of permanent renters and sowing economic anxiety and frustration for millions of Americans.” This is not an op-ed penned by Bernie Sanders, but a front page article that is worth a read.
Hanging with the kids tomorrow. See you Monday.