May 20, 2011 – The spring of 2011 has brought tension to the air for everyone involved with cannabis in the United States. Federal authorities have unleashed a coordinated attack on political efforts to tax marijuana and they have made war on medical marijuana programs. This has been matched by additional states changing local laws, putting more skin into the game than ever.

The bets are now in for the biggest cannabis policy showdown in our generation – right in Washington DC. The Schedule I status of marijuana in the federal Controlled Substances Act will either be re-affirmed or changed, likely over the next 24 months.

Marijuana prohibition has become the most refined and serious states’ rights issue of the 21st Century. Millions of Americans are now participating in a multi-billion dollar medical cannabis economy.

States are taking greater pains to regulate this fast-moving industry. Why? To recognize the will of their residents but also to gain badly needed tax dollars. In some cases, they are getting that money.

At the same time, Michele Leonhart has led the Drug Enforcement Administration to conduct a major escalation of raids that bring automatic weapons into peaceful marijuana centers.

If marijuana were moved to Schedule II, III, or IV or even removed from the schedule (that is an option), it would end the conflict of state vs. federal law on all related matters. That means whatever marijuana industry that states decide to authorize (medical, recreational or hemp) could be protected, regulated and taxed.

When the Controlled Substances Act was created in 1970 a blue-ribbon commission was chartered by President Nixon to study marijuana’s proper placement. The recommendation in 1972 was that personal cannabis use should be decriminalized and it should not appear in the scheduling. Obviously Nixon ignored those suggestions.

Forty years later we live in the ‘Just Say Drug War’ era. Still, the status of marijuana has always been overseen by Congress and the President. They have been the quiet players at the poker game thus far. But the increase in aggression by the DEA and US Attorneys has produced an interesting result.

When the Washington state Legislature recently passed a bill to regulate a dispensary system for patients the fed came down like a ton of bricks on the political process. Governor Chris Gregoire (a former US Attorney in her own right) vetoed the bill. But then she turned around to announce plans to bring together the now 16 medical marijuana Governors in a unified lobby for re-scheduling to category II.

Gregoire currently leads the National Governors Association. Having the elected leaders of these states actively seek an end to federal cannabis prohibition could be a significant pressure point on Senators and Representatives in Washington DC.

We are also just beginning to see federal lawsuits filed in Montana by the victims of these DEA raids over illegal search and seizure. Cannabis and money are stolen, bank accounts cleared out; but no one is arrested. Not exactly by-the-books due-process.

The IRS has now appeared at the table as a major player, staked by the Fed against individual entrepreneurs. Financial investigations of successful cannabis business like Harborside Health Services in Oakland are underway.

At the same time the city of San Jose California began raking in $290,000 in monthly taxes from local medical cannabis sales!

The effect of these simultaneous actions has just forced everyone in the game to go all-in. Congress and President Obama are being positioned to make their bets and address the issue…during an election season. And that may be the plan.

However, supporting the move to Schedule II in the CSA is a safe position, politically. Ever growing majorities of American voters, of all parties, support their local medical cannabis laws. So, re-scheduling is backed by tremendous public support, but groups such as the American Medical Association (AMA) have also recommended the change.

Moving to Schedule II is a good quick-fix for the current medical cannabis industry as well as programs like Rhode Island and New Jersey that remain on hold. Even the Internal Revenue Service would be mollified.

Still, there should be a modern congressional commission designated to study full cannabis legalization if re-scheduling is adopted.

A more disturbing outcome is possible. The current Schedule I status could ultimately be upheld by Congress and President Obama. That would likely signal another significant increase in federal aggression towards the existing medical cannabis industry. This sends everyone down a terrible path. Battles will rage in the courts and in the faces of seriously ill patients just trying to follow their state laws.

Would some Governors then mobilize their Attorneys General, their police or even the National Guard to protect their state employees, medical cannabis centers and patients?

We are experiencing the Cuban Missile Crisis in the cold war between the States and the US Federal Government on medical marijuana laws. Moving to Schedule II would pull authorities on both sides back from the brink of violence.

The move would allow everyone to split the pot. Of paramount importance, it would directly help the millions of seriously ill residents who access this proven therapy every day.

Marijuana prohibition has seen windows for reform in the past; none have been open this wide.

Public support must be channeled because taking the game to Congress is also where the marijuana reform movement has traditionally been the weakest.

Just a handful of federal legislators are there to champion this cause: Ron Paul (R-TX), Barney Frank (D-MA), Jared Polis (D-CO), Maurice Hinchey (D-NY) and Dana Rohrabacher (R-CA) to name the most vocal.

However there is one place that the marijuana legalization movement is stronger than everyone else, including the Fed: Online. Within the modern Matrix cannabis reform is Neo.

This could be the end-game. Everyone online is at the table too, so don’t sit this one out.

Marijuana prohibition deserves a peaceful solution, for all Americans. Source.

April 24, 2011 – WASHINGTON — The medical marijuana industry is beginning to show its age.

After humble California beginnings in 1996, 15 states and the District of Columbia now have legalized marijuana use for ill patients who have a doctor’s recommendation.

Medical marijuana has been found to help with chronic pain, nausea and other symptoms of diseases including cancer, muscular dystrophy and AIDS. Nearly 25 million Americans are medically eligible to buy marijuana.

Sales are expected to hit $1.7 billion this year. Just last week, a San Francisco-based outfit, the ArcView Group, formed the industry’s first investment network to link cannabis entrepreneurs to qualified investors with seed money.

“It doesn’t take a rocket scientist to realize that this industry is growing and that there are untold riches to be made here,” said Troy Dayton, chief executive of the ArcView Group.

In coming months, Arizona, New Jersey, Rhode Island and the District of Columbia will launch programs, joining eight states where medical marijuana is sold legally. Those states are California, Colorado, Maine, Michigan, Montana, Oregon, Washington and New Mexico.

But around the country, some law enforcement officials have expressed concern that medical marijuana could be obtained by relatively healthy people who could get a recommendation from a physician by lying or overstating their pain and suffering.

They also worry that some dispensaries could grow more marijuana than their patients could consume, leaving an excess that could make its way to the illegal market.

While legal for medical purposes in many states, marijuana remains an illegal controlled substance under federal law, although since 2009, the Justice Department has said it won’t prosecute medical marijuana use within the bounds of states’ laws.

With more than 1,500 growing operations and dispensaries nationwide, the medical marijuana industry has defied the recession and prospered even as the broader economy stalled.

Regulatory friction

Strong public support has helped fuel the industry’s eastward expansion, but that growth has also brought growing pains.

Industry reps say section 280E of the Internal Revenue Code unfairly bars legal medical marijuana operations from deducting business expenses from their income taxes. Dispensaries nationwide are facing Internal Revenue Service audits over the measure.

Other dispensaries have found that banks won’t maintain their business accounts, fearing federal scrutiny over reporting requirements for ties to businesses that violate federal law.

The National Cannabis Industry Association was formed late last year to help address these concerns. The trade group recently held its first national lobby day, visiting lawmakers on Capitol Hill as part of a push for greater legislative clout.

“These kinds of days are necessary, because it puts a face on the industry,” said Rep. Jared Polis, D-Colo., one of the industry’s staunchest supporters.

While 76 percent of medical marijuana sales nationally are generated in California, Colorado has the nation’s fastest-growing market. More than 131,000 Coloradans are registered marijuana patients, up from 7,000 in 2008.

Colorado Dispensary Services, which operates three dispensaries and three commercial growing operations, has had five different bank accounts in 3 1/2 years, owing to state regulatory friction. Owner Jill Lamoureux said it’s impossible to manage nearly 50 employees and $120,000 in monthly payroll without a bank account. State regulators have taken notice.

“These regulators need to see our bank accounts, and if we do not have access to banking, it makes it impossible for them to regulate,” Lamoureux said. “Frustrating is an understatement to say how difficult it is to run a business” without banking services.

Last year, Polis and seven other Democratic lawmakers wrote a letter asking the U.S. Treasury to declare that it wouldn’t target banks with account holders that operate in compliance with state medical marijuana laws. Federal regulators deferred, arguing that banks must make those calls themselves.

Polis said he’ll introduce legislation soon that clarifies banks’ responsibilities when dealing with marijuana dispensaries. He said support for the issue is bipartisan, citing Republican Reps. Ron Paul of Texas and Dana Rohrabacher of California as sympathetic to the industry’s plight. Source