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Border Patrol Union Head Admits Legalizing Marijuana Forces Cartels Out Of The Market

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The head of the labor union that represents U.S. Border Patrol agents acknowledged on Friday that states that legalize marijuana are disrupting cartel activity.

While National Border Patrol Council President Brandon Judd was attempting to downplay the impact of legalization, he seemed to inadvertently make a case for the regulation all illicit drugs by arguing that cartels move away from smuggling cannabis and on to other substances when states legalize.

Judd made the remarks during an appearance on C-SPAN’s Washington Journal, where a caller said that “the states that have legalized marijuana have done more damage to the cartels than the [Drug Enforcement Administration] could ever think about doing.”

“As far as drugs go, all we do is we enforce the laws. We don’t determine what those laws are,” Judd, who is scheduled to meet with President Trump on Friday, replied. “If Congress determines that marijuana is going to be legal, then we’re not going to seize marijuana.”

“But what I will tell you is when he points out that certain states have legalized marijuana, all the cartels do is they just transition to another drug that creates more profit,” he said. “Even if you legalize marijuana, it doesn’t mean that drugs are going to stop. They’re just going to go and start smuggling the opioids, the fentanyl.”

One potential solution that Judd didn’t raise would be to legalize those other drugs to continue to remove the profit motive for cartels. Former presidential candidate Andrew Yang made a similar argument in December.

Federal data on Border Patrol drug seizures seems to substantiate the idea that cannabis legalization at the state level has reduced demand for the product from the illicit market. According to a 2018 report from the Cato Institute, these substantial declines are attributable to state-level cannabis reform efforts, which “has significantly undercut marijuana smuggling.”

Additionally, legalization seems to be helping to reduce federal marijuana trafficking prosecutions, with reports showing decreases of such cases year over year since states regulated markets have come online.

In his annual report last year, Supreme Court Chief Justice John Roberts also noted reduced federal marijuana prosecutions—another indication that the market for illegally sourced marijuana is drying up as more adults consumers are able to buy the product in legal stores.

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GOP Senator Presses Treasury Secretary On Tax Credits For Marijuana Businesses

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A Republican senator recently pressed the head of the Treasury Department on whether marijuana businesses qualify for a federal tax benefit.

During a Senate Finance Committee hearing on Wednesday, Treasury Secretary Steven Mnuchin was asked about the “opportunity zone” tax credit, which is meant to encourage investments in “distressed,” low-income communities through benefits such as deferrals on capital gains taxes.

Sen. James Lankford (R-OK), whose state’s voters approved a medical marijuana ballot measure in 2018, told Mnuchin that businesses that derive more than five percent of their profits from things like alcohol sales are ineligible for the tax credit, but there’s “not a definition dealing with cannabis businesses.”

“Are they within that five percent amount or are they not at all because there’s a federal prohibition on cannabis sales?” the senator asked.

“I’m going to have to get back to you on the specifics,” Mnuchin replied.

“That’d be helpful to get clarity because there are cannabis businesses across the country that, if they fall in opportunity zones, they’ll need clarification on that,” Lankford said. “When you and I have spoken about it before—it’s difficult to give a federal tax benefit to something that’s against federal law.”

 

Lankford, who opposes legalization and appeared in a TV ad against his state’s medical cannabis ballot measure, has raised this issue with the Treasury secretary during at least two prior hearings. When he questioned whether cannabis businesses qualify for the program last year, he clarified that he personally does not believe they should.

While Mnuchin’s department has yet to issue guidance on the issue, he said in response to the earlier questioning that his understanding is that “it is not the intent of the opportunity zones that if there is this conflict [between state and federal marijuana laws] that has not been cleared that, for now, we should not have those businesses in the opportunity zones.”

Mnuchin has also been vocal about the need for Congress to address the lack of financial resources available to state-legal marijuana businesses. Because so many of these companies are forced to operate on a largely cash-only basis, he said the Internal Revenue Service has had to build “cash rooms” to store their tax deposits.

“There is not a Treasury solution to this. There is not a regulator solution to this,” he said during one hearing. “If this is something that Congress wants to look at on a bipartisan basis, I’d encourage you to do this. This is something where there is a conflict between federal and state law that we and the regulators have no way of dealing with.”

Last week’s Finance Committee hearing was centered around President Trump’s Fiscal Year 2021 budget request, which separately includes a provision calling for the elimination of an appropriations rider that prohibits the Justice Department from using its fund to interfere in the implementation of medical cannabis laws as well as a continued block on Washington, D.C. spending its own local tax dollars to legalize marijuana sales.

American Bar Association Wants Protections For Marijuana Banking And Lawyers Working With Cannabis Clients

Photo courtesy of C-SPAN.

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American Bar Association Wants Protections For Marijuana Banking And Lawyers Working With Cannabis Clients

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The American Bar Association (ABA) approved two marijuana-related resolutions during its midyear meeting on Monday.

The group’s House of Delegates voted in favor of proposals endorsing pending federal legislation to protect banks that service cannabis businesses and calling for a clarification of rules to ensure that lawyers will not be penalized for representing clients in cases concerning state-legal marijuana activity.

Under the banking resolution, ABA “urges Congress to enact legislation to clarify and ensure that it shall not constitute a federal crime for banking and financial institutions to provide services to businesses and individuals, including attorneys, who receive compensation from the sale of state-legalized cannabis or who provide services to cannabis-related legitimate business acting in accordance with state, territorial, and tribal laws.”

ABA added that “such legislation should clarify that the proceeds from a transaction involving activities of a legitimate cannabis-related business or service provider shall not be considered proceeds from an unlawful activity solely because the transaction involves proceeds from a legitimate cannabis-related business or service provider, or because the transaction involves proceeds from legitimate cannabis-related activities.”

A bill that would accomplish this goal was approved by the House of Representatives last year, but it’s currently stalled in the Senate, where it awaits action in the Banking Committee. That panel’s chair, Sen. Mike Crapo (R-ID) is under pressure from industry stakeholders to advance the legislation, but he’s also heard from anti-legalization lawmakers who’ve thanked him for delaying the bill.

“Passage of the [Secure and Fair Enforcement] Banking Act or similar legislation will provide security for lawyers and firms acting to advise companies in the industry against having their accounts closed or deposits seized,” a report attached to the ABA resolution states. “This will also foster the rule of law by ensuring that those working in the state-legalized legitimate cannabis industry can seek counsel and help prevent money laundering and other crimes associated with off-the-books cash transactions.”

“Currently, the threat of criminal prosecution prevents most depository institutions from banking clients, including lawyers, who are in the stream of commerce of state-legalized marijuana. This Resolution is necessary to clarify that such provision of legal and other services in compliance with state law should not constitute unlawful activity pursuant to federal law.”

The second marijuana-related resolution ABA adopted on Monday asks Congress to allow attorneys to serve clients in cannabis cases without facing federal punishment.

Text of the measure states that the association “urges Congress to enact legislation to clarify and explicitly ensure that it does not constitute a violation of federal law for lawyers, acting in accord with state, territorial, and tribal ethical rules on lawyers’ professional conduct, to provide legal advice and services to clients regarding matters involving marijuana-related activities that are in compliance with state, territorial, and tribal law.”

Such a change would provide needed clarity for lawyers as more states legalize cannabis for adult use. ABA’s own rules of conduct have been a source of conflict for attorneys, as it stipulates that they “shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent.” Federal law continues to regard marijuana as an illegal, strictly controlled substance.

An ABA report released last year made the case that there’s flexibility within that rule, however, as “it is unreasonable to prohibit a lawyer from providing advice and counsel to clients and to assist clients regarding activities permitted by relevant state or local law, including laws that allow the production, distribution, sale, and use of marijuana for medical or recreational purposes so long as the lawyer also advises the client that some such activities may violate existing federal law.”

A new report attached to the resolution states that “statutory guidance is needed that explicitly ensures that attorneys who adhere to their state ethics rules do not risk federal criminal prosecution simply for providing legal counsel to clients operating marijuana businesses in compliance with their state law.”

“This Resolution accomplishes this elegantly by harmonizing federal criminal liability with States’ ethical rules regarding the provision of advice and legal services relating to marijuana business. If a state has legalized some form of marijuana activity and explicitly permitted lawyers to provide advice and legal services relating to such state-authorized marijuana activity, such provision of advice and legal services shall not be unlawful under the Controlled Substances Act or any other federal law.”

Last year, ABA adopted another cannabis resolution—arguing that states should be allowed to set their own marijuana policies.

Border Patrol Union Head Admits Legalizing Marijuana Forces Cartels Out Of The Market

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Mike Bloomberg Attacks Marijuana Legalization In Controversial Resurfaced Recording

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Before Mike Bloomberg launched his 2020 Democratic presidential bid, he really wasn’t shy about his disdain for marijuana legalization.

The former New York City mayor has been widely criticized this week after a recording surfaced of him defending controversial stop-and-frisk practices and racially disparate marijuana arrests during a 2015 Aspen Institute speech. But while that short clip went viral on social media, the full audio recording from the event also features Bloomberg condemning cannabis legalization efforts at length.

Asked by an audience member about his thoughts on Colorado’s decision to end marijuana prohibition, Bloomberg said, “I think it is just a terrible, terrible idea.”

Some of the remarks from the talk were previously reported by The Aspen Times, such as when Bloomberg asserted that marijuana use is associated with reduced IQ among young people—something President Trump also said in a recently revealed secret recording.

“What are we going to say in 10 years when we see all these kids whose IQs are 5 and 10 points lower than they would have been?” Bloomberg told the Aspen audience. “Kids’ brains are being formed while they are teenagers.

But much of his anti-cannabis commentary from the talk has not been reported until now.

“If you’re my age, of course you smoked a joint in the 60s—but it was very different and just because we did doesn’t make it right,” the former mayor, who has previously acknowledged his own past marijuana consumption, said. “It was not easily accessible compared to today. Today it’s much stronger and potentially much more damaging.”

Listen to Bloomberg’s anti-marijuana remarks below: 

“We are making progress in reducing smoking. We are making progress in reducing obesity and diabetes. We are making progress in reducing automobile deaths and a variety of other things,” he said. But cannabis reform is going in “exactly in the other direction.”

Bloomberg also disparaged the idea that a regulated market can prevent youth from accessing cannabis, stating that “even if you have a law that says we’re not going to sell it to them, let’s get serious: if there’s more of it around, they’re going to get it.”

“I just can’t imagine why society is doing this,” he said. “I couldn’t feel more strongly about it, and my girlfriend says it’s no different than alcohol. It is different than alcohol. This is one of the stupider things that’s happening across our country.”

Erik Altieri, executive director of NORML, told Marijuana Moment that the newly revealed remarks show just how much work Bloomberg has ahead of him if he intends to reform his image as a tough-on-crime, anti-cannabis candidate.

“Bloomberg and his wealthy friends may be able to sit around and joke about how he was able to smoke a joint in the 60’s and be just fine, but that is cold comfort to the over 440,000 Americans who were put in handcuffs for marijuana possession in New York City during his tenure as mayor,” Altieri said. “He is painfully ignorant and out of touch with sound public policy and basic scientific facts.”

“If he expects voters to treat him as anything other than an awful relic of a bygone drug war era he needs to correct himself on marijuana law reform issues immediately and somehow attempt to make amends for the countless lives he had a role in ruining,” he said. “Unfortunately, given the number of other candidates vying for the presidency who are leaps and bounds ahead of him on this, that still might be too little too late for his self-funded presidential aspirations.”

Bloomberg has been sharply rebuked this week over a different clip from the same 2015 recording where he defended the use of stop-and-frisk policing that disproportionately impacted communities of color.

An “unintended consequence” of targeting policing in those communities, he said, is that “people say, ‘oh my god, you are arresting kids for marijuana that are all minorities.’”

“Yes, that’s true. Why? Because we put all the cops in minority neighborhoods,” he said. “Yes, that’s true. Why do we do it? Because that’s where all the crime is.”

Bloomberg has taken steps since launching his campaign to pivot away from his reputation as anti-reform, voicing support for decriminalizing cannabis possession and allowing states to set their own policies.

But he continues to oppose cannabis legalization, and his past comments haven’t been forgotten. A Denver-based reporter brought up the candidate’s 2019 statement that legalization is  “perhaps the stupidest thing anybody has ever done” and asked whether that meant he felt Colorado voters were stupid for approving the policy change.

“Colorado has a right to do what they want to do,” he replied. “I would advise going slowly to any other state because it’s not clear, doctors aren’t sure whether or not it’s doing damage. But if a state wants to do it, and Colorado and Washington were the first two that did it, that’s up to the state.”

“But what I really object to is putting people in jail for marijuana,” he added. “That’s really dumb.”

Bloomberg and former Vice President Joe Biden are the only two Democratic candidates in the 2020 race who oppose federally legalizing cannabis.

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