00:00killing going on that shouldn't have happened and we appreciate them working a lot of people want to
00:06see it the reclassification because it leads to tremendous amounts of research that can't be done
00:12unless you reclassify so we are looking at that very strongly nobody's seen anything like it
00:17actually so right now marijuana is on schedule one under the controlled substances act which means
00:34that making it selling it even possessing it is illegal under that statute except for research
00:44purposes what the president is proposing to do and actually what the dea and the fda propose to do
00:53under the biden administration is move marijuana from schedule one to schedule three schedule three
01:01drugs are still regulated under the controlled substances act but they're regulated less
01:07strictly you can actually make grow and sell schedule three drugs ketamine is an example of a
01:16schedule three drug
01:17so this this really wouldn't shrink the gap between state and federal law that much and there are really
01:30two reasons for that one is that under this controlled substances act which is where rescheduling fits in
01:39you're only allowed to produce and sell controlled substances for medical purposes so for those states that have
01:49gone a step further and that's about half the states right now they sell this for any use among adults not just
01:58medical uses um the federal government still wouldn't allow that even if you reschedule marijuana even if
02:06you move it from schedule one to schedule three it still wouldn't be an approved drug under the food drug and
02:13cosmetic act and so it would remain unlawful for anyone to sell this even for medical purposes under
02:21that second federal statute
02:38there's also one practical benefit um that would come from this uh and that's that this would be a big tax
02:47break for those companies that are now growing and selling marijuana pursuant to state law right now
02:57because marijuana is a schedule one controlled substance those companies are subject to a weird provision of
03:05the federal tax code it's called section 280e and it basically says if you're selling a schedule one controlled
03:13substance you're not allowed to make a bunch of deductions when you calculate your federal tax liability
03:21that provision would automatically go away if marijuana were moved to schedule three
03:28because section 280e only applies to schedule one and schedule two controlled substances
03:45but until you make it truly lawful under federal law to make and sell this drug banks are going to
03:54continue to be leery of dealing with companies in this industry all their money you know as long as
04:00the sale of marijuana remains illegal which it would even if it's moved to schedule three because
04:07it would be barred under the food drug and cosmetic act so as long as the sale of this drug remains illegal
04:13the proceeds of those sales they're going to continue to be dirty money they'll be the proceeds of
04:18unlawful activity any transaction involving those funds will remain money laundering under federal law
04:26and banks just don't want to touch that dirty money so this change by itself wouldn't remove that obstacle
04:35and they still might have a tough time getting banking services still would have a tough time getting
04:43registered trademarks with the federal government they're still going to face a lot of business hassles
04:48that won't go away simply because this has been rescheduled
05:11the public has made their minds up with respect to whether cannabis ought to be legal
05:18quite some time ago uh the public polling has been overwhelming on this issue now for well over a
05:24decade about nine and ten americans say cannabis ought to be available as a medicine about seven and
05:31ten americans say ought to be legal for anyone over the age of 21. the question americans have been asking
05:39now for years is why their lawmakers particularly federal lawmakers aren't responding to this overwhelming
05:47bipartisan public opinion that says cannabis prohibition has been a failure and that
05:53legalizing and regulating cannabis is a much smarter and a much sounder uh policy than the failed policy of
06:03criminalization
06:18the president does not possess the unilateral authority to reclassify cannabis uh what the president can do
06:27do and what he's hinted at doing is issuing an executive order directing the requisite agencies within his
06:36administration to advance this rescheduling petition forward
06:41so right now the power to reschedule a substance lies with the attorney general
07:00so theoretically trump could direct pam bondi to take the steps necessary to proffer a final rule in the
07:09federal register that says this administration wishes the follow-through with the biden era guidance
07:17and move cannabis from schedule one to schedule three my presumption is it won't change dramatically
07:24in the short term but over time uh banks and credit unions and other financial institutions
07:32will become more comfortable with the fact that this industry is here it's here to stay and that clearly
07:40the federal government itself is also becoming more comfortable with this industry and more accepting of it
07:46it's already been a long road again let's remember this administrative review was initiated by the biden
07:55administration in 2022 it's now 2025 and my guess is that even if the trump administration is to take action
08:06in the ensuing days uh it will still be several months if not longer uh before this issue is finally resolved
08:25so
08:28you
08:30you
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