While the nation focuses on who won the 2020 presidential election, cannabis growers and pot smokers are happy with the results. That is because four more states have approved marijuana for recreational use. Unlike with the presidential election, no one is contesting these results. This brings the total to fifteen states where pot is legal. The new states that allow recreational use of marijuana are Arizona, South Dakota, New Jersey, and Michigan. Unlike many elections in many states, the results of marijuana use were not even close to losing.
Which States Are Next?
While both Arizona and New Jersey are expected to be markets worth a billion dollars each for cannabis, New Jersey is probably more significant. Experts expect New York and Pennsylvania to follow New Jersey into the recreational cannabis fold and other states in the Northeast are likely to follow. In fact, a recent Gallop poll shows that the percentage of Americans who support legalizing marijuana on a national level has gone up 68%. The percentage who wanted to legalize cannabis back in the late 1960s was only 12% and by 2000 it was finally over 30%. As more and more people support the idea of legalizing marijuana we can expect legislators in more and more states to pass legislation.
How about Federal Marijuana Laws?
As more and more states approve recreational use of cannabis, there is still a problem with pot being illegal under Federal law. In this case, the election of Joe Biden may be significant. Biden is in favor of legalizing pot on a national level. We will need to wait for election results to be certified and for the Electoral College to elect the next president, but should Biden prevail, the likelihood of Federal laws about pot changing will have improved.
Help for Marijuana Businesses
While state approval of recreational use of marijuana creates markets, producers still have problems getting financing. 1980s tax laws originally targeted at drug dealers make bank loans and other normal means of financing difficult. And, if there is a natural disaster, marijuana-based businesses do not qualify for Federal disaster aid. Insurance is also a problem making it risky to invest in a business and have no protection against theft, fires, or other things that damage a business.
Parallels to the End of Prohibition
The Covid-19 pandemic has hurt the economy. Marijuana businesses could be part of a general recovery. Looking back to Prohibition, it ended when it became clear that drinking just went underground and all of the profits went to organized crime. But, in addition, legalizing alcohol was seen as a way to bring back legal jobs in industries that paid their taxes. With a weak economy today, legalizing marijuana under Federal law might be seen as a way to help bring on a recovery.
A major roadblock to passage of Federal laws legalizing recreational marijuana is the US Senate. Biden and the Democrats will have the presidency and the House of Representatives but the Senate will likely remain (barely) in Republican hands. To get the Senate to go along with necessary legislation, proponents will need to lean heavily on the economic argument.