What The 2020 Election Results Mean For The Future Of Cannabis
2020 has been a year of profound change for the U.S., making this year’s election arguably one of the most pivotal in our entire history. With a deeply polarizing social unrest, a battered economy that is yet to recover from the COVID-19 pandemic, and an ongoing public health crisis that has taken the lives of more than 260,000 Americans thus far, the 2020 Election attracted a record turnout of more than 156 million voters who felt strongly about making their voices heard. In addition to the aforementioned issues, Americans resoundingly voted either directly or indirectly on another important, yet less visible, issue: cannabis legalization.
Just 10 years ago, no state in the country had a legal adult recreational use program in place, with only 32% of U.S. adults believing cannabis should be made legal, according to a 2019 study by the Pew Research Center. Fast forward to 2020, and 11 states, including Washington D.C., had legal adult recreational use programs in place prior to Election Day, with nearly 70% of U.S. adults believing cannabis should be made legal.
Consumer sentiment in the U.S. around cannabis legalization is clearly changing and is continuing to evolve into a more accepting stance, as seen by the overwhelming support voters in five states—Arizona, Mississippi, Montana, New Jersey, and South Dakota—displayed on Election Day. Voters in these states emphatically approved either recreational and/or medical cannabis use measures, in what many industry experts dub the “green wave,” further demonstrating how American sentiment regarding cannabis reform is increasingly becoming more positive.
Today, 1 in 3 Americans live in one of the 15 states that have legalized adult recreational cannabis use, and that exposure is likely to grow in the coming months. Following the five states that recently approved cannabis legalization, there is now an increasing pressure on other states to follow suit, given legal cannabis’ long and proven track record of generating significant tax dollars and jobs, which are viewed as a panacea to the growing state budget deficits sweeping across the nation. Specifically, New Jersey’s recent legalization has put in motion what many expect to be a substantial “domino effect” in the Northeast, as large and highly populous bordering states like New York and Pennsylvania, seek to quickly follow suit and legalize and implement their own adult use programs, so as to not lose the millions of dollars of tax revenue and thousands of jobs at stake.
Pennsylvania’s Gov. Tom Wolf (D) has been actively pushing for the legalization of adult use cannabis to boost the state’s economy and deliver “restorative justice,” particularly to the communities that have been significantly affected by the War on Drugs. Meanwhile, New York’s Gov. Andrew Cuomo (D) has now been advocating for cannabis legalization for the past several years, and recently reiterated that the time for new measures is “ripe” given the state’s ballooning budget deficit. Cuomo has indicated that he will further push lawmakers to approve a measure that can offset economic losses incurred from the COVID-19 pandemic. The governors of other Northeast states, such as Connecticut, have also expressed support to legalize cannabis to offset the pandemic’s economic impact. These tailwinds are putting pressure on New Jersey’s neighboring states to put forward a feasible pathway for cannabis legalization in the near future.
At the Presidential level, more than 80 million votes were cast on Election Day to elect Vice President Joe Biden and Sen. Kamala Harris as the new President-elect and Vice President-elect. Both elected officials, particularly Harris, have been outspoken about their increasingly positive views on cannabis. In fact, Vice President-elect Harris recently stated that the new administration “will decriminalize the use of marijuana and automatically expunge all marijuana-use convictions and end incarceration for drug use alone.” She has been an active supporter of cannabis legalization and has co-authored several cannabis reform bills, including the SAFE Banking Act, which if passed, will allow financial institutions to service the legal cannabis industry without recrimination.
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More importantly, the new administration will bring in new appointments to key governmental positions that will influence the future of cannabis—and to an extent, CBD—reform. Specifically, Biden will name a new commissioner for the U.S. Food and Drug Administration (FDA), which may accelerate the regulatory body’s rule-making guidance on how CBD brands can produce, market and sell their products. In addition, there is much anticipation within the industry for a new, and more cannabis-friendly, Attorney General, given rather unaccommodating stances held by former Attorney General Jeff Sessions and outgoing Attorney General William Barr.
Last, but not least, the election results are expected to have a significant effect on how Congress will influence cannabis reform in the next few years. In the near term, the devastating economic impact of COVID-19 will likely drive lawmakers to include some version of the SAFE Banking Act within the next economic stimulus bill. More interestingly, the currently Democratic-controlled House of Representatives is set to vote later this week on the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, which is also sponsored by Vice President-elect Harris and which represents the most progressive and far-reaching cannabis reform bill ever to reach either of the congressional chambers.
If passed, it will deschedule cannabis from the Controlled Substances Act (CSA), end cannabis prohibition, open up a pathway to full federal legalization, expunge cannabis possession criminal records, and institute a 5% federal tax that will be used to fund a variety of social equity initiatives, particularly for those who have been acutely impacted by the War on Drugs.
That being said, the focus of the election now shifts to Georgia, where the Senate runoff elections will determine if the Republicans continue to retain control of the Senate or if the Democrats manage to flip it. Under the former scenario, Sen. Pat Toomey (R) will be the chairman for the Senate Banking Committee. Toomey has openly supported legislation that would allow cannabis businesses access to banking services. However, even if the SAFE Banking Act were to gain traction in some form or another through a Republican-controlled Senate, the MORE Act and other major cannabis reform bills will likely be blocked by Senate Majority Leader Mitch McConnell (R), who has widely made known his opposition of cannabis legalization.
Regardless of the outcome of the runoffs, however, the future of cannabis has never looked any brighter following Election Day. There are more states that have legalized adult recreational and/or medical use cannabis than ever before, with a record number of Americans not only accepting cannabis’ place in our social fabric, but also increasingly becoming consumers in the legal market as well.