The U.S. Congress is taking its first major steps to legalizing marijuana.
Although it’s not the outright legalization at the federal level and handing power over to the states, it’s a big step forward.
Politico reports in Bankers' pot push gets boost from blue wave, Sessions ouster that a bill clarifying rules regarding the banking industry and the legal marijuana industry is gaining support.
As usual, the article features plenty of quotes from politicians on both sides of the issue.
We’re not going to review those quotes because they are the usual mix of obvious statements, low on specifics, and, frankly, because the source of them is politicians.
There are two significant changes featured in the report though that are worth noting.
First, the marijuana banking bill proposed by Rep. Ed Perlmutter (D-CO) has 96 public co-sponsors in the House of Representatives.
Of those co-sponsors, 83 are Democrats and 13 are Republicans.
That’s bipartisan and represents almost half the votes needed to pass any bill through the House.
Second, the report notes two banking industry associations -- the Independent Community Bankers of America (ICBA) and the Credit Union National Association (CUNA) – are publicly supportive of the bill.
This is a massive change.
Call it experience or cynicism, but the Seed Investor doesn’t expect any bill to move successfully through Congress without both popular and financial support.
That’s why the backing of these groups is critical.
These are associations with political and financial muscle.
ICBA contributed about $1.6 million to political campaigns in the 2018 election cycle and CUNA spent $3.7 million on lobbying last year according to OpenSecrets.org.
Granted, these aren’t huge numbers for political and lobbying spending.
They’re actually dwarfed by the top political donation financial sector which accounted for $752 over 2017 and 2018.
And they’re not even close to the agribusiness sector and its $86 million in contributions over the last two years.
But they are something and that’s a big change from years past when there was a lot more moral support behind even basic pro-marijuana legislation than there was any significant financial support.
In the end, both factors are positives for the marijuana industry and the bill’s progress is worth watching for marijuana investors.
Banking issues are a major hurdle for the industry and any positive changes to rules and laws governing it would add to the marijuana industry tailwinds in 2019.