“The war on drugs has been an utter failure. We need to rethink and decriminalize our marijuana laws.”
Take a guess who said that? You might be surprised to hear that it was Barack Obama, way back in 2004.
How many of us would have ever thought we would hear such a provocative sociopolitical commentary by an American president? Of course, that quote is from eight years ago when Obama was running for an Illinois Senate seat. Since then, his attitude towards marijuana and his relationship with our industry has been up and down, to say the least. Most recently, in December, he stated that in light of the legalization of recreational marijuana in Colorado and Washington State, it is now time to have a national conversation about reconciling the conflict between federal and state laws regarding marijuana.
I know many people who view this comment as another political gambit that won’t lead to any real change.
I disagree. I believe that the tide has turned for the marijuana industry and that we are on the brink of substantial and potentially explosive change that will fuel business growth for decades to come.
First, let’s review how the industry got to where it is today. Medical marijuana was first approved in California back in 1996 when Proposition 215 passed with 56% of the vote. Since then, 17 more states plus the District of Columbia have approved medical marijuana, with 11 of them in just the past 10 years.
Prior to Barack Obama’s election in 2008, there were few medical marijuana dispensaries. Raids and enforcement actions by both the DEA and local authorities were frequent, dampening the ability or desire of many to launch legitimate marijuana businesses.
In January 2009, with the release of the Ogden Memo and Barack Obama’s assumption of office, the medical marijuana business boomed. In 2010, there were over 700 dispensaries in Colorado and, according to some reports, thousands in California. Ancillary businesses serving marijuana growers, dispensaries and patients – such as software, banking, insurance and security companies – also boomed.
In 2011, the market began shifting dramatically. Raids and letters to landlords shuttered hundreds of dispensaries in California and other states. Market saturation and the high cost of meeting state compliance regulations reduced the number of Colorado medical marijuana centers by several hundred. Many communities across the country enacted bans on marijuana enterprises. Federal pressure on banking institutions meant that most marijuana businesses were cut off from credit card merchant processing, business bank accounts and access to loans or investment funds. Ancillary businesses also rose and fell with the market tide, with many closing their doors.
But in the last few months of 2012, a more positive shift occurred. The passage of legalization initiatives in Colorado and Washington State, along with a medical marijuana initiative in Massachusetts, is the most obvious bellwether of this shift. But there are signs elsewhere, too. In October 2012, the US Court of Appeals heard a case to remove marijuana from Schedule 1 of the Controlled Substances Act. In Los Angeles, a ban on dispensaries was overturned only three months after it was enacted. And the notable dispensary Harborside Health Center won a major victory in a legal battle against the government, allowing the center to stay in operation while its federal case proceeds.
Medical Marijuana Business Daily recently wrote that there could be 12 more states that pass medical marijuana initiatives in 2013. And as many as 13 states are said to be considering legalization initiatives. Public opinion in the last two years has also shifted to support marijuana legalization, both medically and recreationally. Two recent polls show that 73% of Americans support medical marijuana legislationand 58% support legalization for recreational use.
More and more politicians are jumping on board as well. San Diego’s new mayor, Bob Filner, is a strong proponent for MMJ and has recently directed the San Diego Police to stop all actions targeting dispensaries. In Chicago, Mayor championed and passed a decriminalization measure last year. Others who’ve come out in favor of marijuana law reform include New York Gov. Andrew Cuomo, Massachusetts Sen. Elizabeth Warren, former President Jimmy Carter and even Sara Palin, former governor of Alaska and a vice presidential candidate in 2008.
Some pretty famous and wealthy Americans are joining the cause as well, including actor Morgan Freeman, Christian TV host Pat Robertson and Randi Weingarten, president of the American Federation of Teachers.
Clearly, it has been a bumpy road over the last few years for those of us in the marijuana business. But the political and social landscape has begun to shift dramatically. As states begin to draft medical marijuana rules or consider legalization initiatives, they are doing so with an eye toward clear and enforceable regulation, which is essential for the growth and sustainability of business.
As mainstream media coverage of the many professional and legitimate marijuana businesses increases, we all benefit from greater acceptance in the market. As outside investment begins to flow into our industry, the opportunities expand for businesses, bringing more jobs and tax dollars to our communities.
It’s hard to see the moment when the tide turns. But if you step back and review recent events, it becomes clear that the environment has shifted. We are on a course of positive growth and expansion. As this shift gains momentum, it will also accelerate. There is now more potential than ever before for marijuana businesses to thrive. Success will require that we be quick to assess and adapt to our rapidly changing world.
Amy Poinsett is co-founder and chief executive officer of MJ Freeway Software Solutions, which provides point of sale, inventory, sales and patient validation products.