5/14/20 By DAN ULLOA
House Democrats led by Speaker Nancy Pelosi (D-CA) unveiled a new stimulus bill this week that includes cannabis banking reform.
The language is similar to the SAFE Act which passed the House last fall by an overwhelming margin. But it has been stalled due to staunch opposition from Senate Banking Chair Mike Crapo (R-ID). Idaho is one of the few states in the nation that doesn’t even allow CBD sold within its borders.
Reform has been blocked despite widespread bipartisan support from the American Banking Association, several state Governors, Attorneys General, and State Treasurers, among others.
Currently, plant-touching businesses have a very difficult time accessing banking services. This includes opening up a bank account, processing debit/credit cards, and securing loans from a bank. Most are forced to operate on a cash business which causes many headaches in our digital age. The lack of proper banking many believe is hindering the growth of the industry.
Banks found doing business with cannabis firms would not be penalized should it pass.
Unemployment hit 14.7 percent last week, a level not seen since the Great Depression due to the Coronavirus prevention measures. Desperate times call for desperate measures.
According to a survey conducted by the National Cannabis Roundtable, one-third of cannabis businesses said they will be forced to close if they do not receive federal relief.
“Cannabis businesses are dealing with the same hardships as other small businesses without the same critical financial tools and reliable banking services,” said Saphira Galoob, executive director of the National Cannabis Roundtable. “Providing access to banking services removes some of the shackles that are holding back the full potential of the fastest-growing sector of the US economy.”
The Politics of a Stimulus Bill
The stimulus bill would spend $3 trillion to reinvigorate the economy.
For reference, in 2009 during former President Barack Obamas first 100 days during the Great Recession, moderate Democrats didn’t want a one trillion dollar stimulus because of conservative worries about the deficit.
The Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act would provide relief to different sectors of the economy. The stimulus bill would give people a second $1200 stimulus check.
The bill has more relief funds that small businesses that are not plant-touching can access. This is due to a specific Small Business Administration (SBA) rule.
Long-time cannabis reform champion Earl Blumenauer (D-OR) wrote a letter signed by 39 other House Members urging the SBA to allow cannabis firms access to relief funds.
“The inclusion of the SAFE Banking Act… is a positive development, but one that’s akin to applying a band-aid to a gaping wound,” said NORML Political Director Justin Strekal. “In the majority of states, these cannabis businesses have been deemed essential during this pandemic. Those small cannabis businesses facing tough economic times are essentially being told by Congress to shutter their doors and fire their employees.”
The previous stimulus bill signed into law also excluded plant-touching businesses.
While there has been great bipartisan work to address the crisis, this bill does not seem to have garnered such a response.
Senate Republicans and the White House have already rejected the bill as a liberal wish list”.
What is it going to take for Mitch McConnell to wake up and see that the American people need help and need it now?” Senate Minority Leader Chuck Schumer (D-NY) said.
Republicans now seem more worried about protecting businesses that have failed to take appropriate safety measures to stop the spread of the pandemic.
“We must think big for the people now because if we don’t it will cost more in lives and livelihood later,” Pelosi said regarding the stimulus bill. “Not acting is the most expensive course.”
Shortly after Franklin D. Roosevelt was inaugurated as president during the Great Depression, prohibition was repealed to stimulate the economy, among other reasons.
Perhaps history will repeat itself.