Weekly Weed Report (04-05-22)
Welcome to my latest video round-up of the week’s major news in the marijuana industry. The article below is a condensed excerpt.
Well, it happened: The U.S House of Representatives voted to legalize marijuana. The bill’s fate is in doubt in the Senate, but the fact is, Democrats in the House, with some Republican support, managed to get landmark legalization legislation across the finish line. Let’s examine what it means for the states and pot investors.
Last Friday, the House voted 220-204 to decriminalize marijuana at the federal level. The Marijuana Opportunity Reinvestment and Expungement Act, aka MORE, faces an uphill battle to secure the 60 votes needed to pass the 50-50 Senate, despite the strong backing of the majority leader, Senator Chuck Schumer (D-NY).
Schumer said last Friday: “The time has come for comprehensive reform of federal cannabis laws. Of course, we will need Republicans to pass a legalization bill in the Senate, and we will be working hard to try and get them.”
MORE’s passage last Friday has lit a fire under marijuana equities, as well as states that still haven’t legalized marijuana. Momentum is important when it comes to investing, and the cannabis industry has the wind at its back.
The MORE act would remove marijuana from the federal government’s list of controlled substances, impose an 8% sales tax on cannabis products, allow certain convictions on cannabis charges to be expunged, and expedite criminal sentencing reviews at the federal and state levels. MORE also would make Small Business Administration loans and services available to cannabis businesses.
For Republicans, part of MORE’s appeal is fiscal. By reducing law enforcement and incarceration costs and implementing new taxation, the bill would save the government hundreds of millions of dollars. The Congressional Budget Office estimated that the MORE Act would lower the federal deficit by nearly $3 billion over the next decade.
The MORE Act was sponsored in the House by Judiciary Committee Chairman Jerrold Nadler (D-NY). A nearly identical version of the MORE Act passed in 2020, but it stalled in the Senate.
House Majority Leader Steny Hoyer (D-MD) asserted that the MORE Act is “what the American people tell us they think is the appropriate thing to do…This bill is a matter of justice and equal opportunity. It’s about addressing systemic inequities and reforming our criminal justice system so that Americans and America can become a better, stronger, more fair and more just America.”
This sales tax provision in the bill that eventually passed in the House was hiked from an original 5% to 8%. Much of the revenue would go toward a Community Reinvestment Grant Program that provides services for “individuals most adversely impacted by the War on Drugs,” including employment training, health education, mentoring, literacy programs, and substance abuse treatment programs.
Marijuana: no longer a pariah…
Supporters of MORE argue that it’s time to stop viewing marijuana as a focal point of the culture wars. Legalizing pot creates jobs, and investment profits, for ordinary Americans.
As the marijuana industry grows, it revitalizes communities and ancillary businesses, by creating more jobs for citizens of varied educational levels and skill sets. The emergence of new legal markets encourages entrepreneurs and spawns new companies, many of which go on to launch initial public offerings. Early investors in the marijuana boom are getting rich.
Marijuana’s job-generating prowess is putting increasing pressure on politicians to embrace legalization. MORE might get stalled in the Senate again, but the House vote last Friday sent a clarion call to lawmakers at the federal and state levels that cannabis is a pariah no more.
The time to invest in pot stocks is now, while the momentum builds. Looking for the best opportunities in the cannabis sector? Click here for our special report.
John Persinos is the editor-in-chief of Marijuana Investing Daily.