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Until a decade ago, marijuana was considered a taboo subject. Politicians have evaded the question if ever questioned, and Americans have mostly avoided talking about what was largely an illicit drug across the United States.
But many things have changed in a decade. Today, two-thirds of the country has given the green light to marijuana for medical purposes and Illinois has recently become the eleventh state to accept OK marijuana for adult use. Recreational sales will begin in Lincoln Country on January 1, 2020. We also witnessed open discussion among a number of politicians and perhaps even a marijuana reform at the federal level.
So if so much has changed, at least in the population and at the state level, why has the government not changed its stance on marijuana at the federal level? A recent CBS News survey reveals key information that is holding back the industry.
Source of the image: Getty Images.
Support for legalization reaches a record in this annual survey
In April, just before 4/20 (April 20th), a holiday in the cannabis community, CBS News released its now annual survey, which describes how the public perceives marijuana. When asked if respondents were supportive of the idea of legal marijuana use, an absolute record was 65%, which represents a 6 percentage point increase over April 2018 and 20 percentage points compared to April 2013. This result corresponds more or less to a national pollster The results of Gallup, which showed a 66% support to legalization in its investigation of October 2018.
Among the results, CBS News found that, for the first time in its survey, a majority of Republicans supported legalization (56%). However, as has been the case for some time now, people aged 65 and over were still on the legalization barrier, with only 49% of people favoring such an idea. In comparison, 72% of young adults aged 18 to 34 were in favor of legalization, and 72% of Democrats reported.
One of the main reasons for the growing popularity of marijuana is that most Americans view it as a positive element for the local economy. Just over half of respondents (52%) suggested that cannabis could have a positive economic impact, compared to only 15% who considered it a negative factor for the local economy. Others surveyed had little or no economic effect.
In addition, exactly half of respondents believe that the legalization of marijuana use would not "have much effect" on the number of violent crimes committed. By comparison, 20% predicted a decrease, while 26% predicted an increase in violent crime with increased cannabis use.
Source of the image: Getty Images.
Marijuana is not perceived as a political game changer
Each of these data points would appear to be a selling point for federal reform. Americans are mostly in favor of legalization, think it helps their local economies, and do not think cannabis use will lead to more violent crime. And yet, it remains an illicit substance at the federal level.
The reason? According to a CBS News survey, 56 percent of Americans polled said their presidential candidate's support for legal marijuana would not change their vote. At the same time, 21% said they were more likely to vote for a candidate in favor of legalizing the grass, 21% less likely to vote for a candidate in favor of legalization of the pot. Put in another context, the majority of the public may wonder whether cannabis should be legalized or not, but the attitude of its candidate will not be enough to influence his vote.
A survey conducted in 2018 by the Quinnipiac Independent University resulted in a very similar result. Quinnipiac asked the following question to his respondents:
"If you agree with a political candidate on other issues, but not on the legalization of marijuana, do you think you can still vote for that candidate or not?"
Only 13% of respondents said they would not vote for such a candidate, but 82% said they would still vote. Marijuana simply does not have enough political weight on Capitol Hill to lose elected seats. This means that lawmakers are in no hurry to support the legalization movement, even though the public trend has drastically changed in favor of legalization in recent years.
Source of the image: Getty Images.
Cannabis could remain illegal at the federal level for years
Even if voters will not make marijuana a problem for an elector, it will not reduce the importance of the 2020 election. In addition to the many states that are expected to vote on cannabis for recreation, the federal government could to see the upheavals in the Congress and the Presidency. Since Republicans have a historically more opposite view of cannabis than Democrats, attaching to the Senate and / or the Oval Office could condemn at least two more years without federal reform. In short, a lot depends on the elections next year.
While there are many ways for marijuana investors to hedge in the United States via the hemp and cannabidiol markets, a lack of progress on the federal cannabis front could certainly wipe out investor expectations in the near term.
For example, last quarter we saw a multi-state cannabis operator Surface Fund (NASDAQOTH: ACRGF) falling 20%, making it one of the 25 worst-performing cannabis stocks. Acreage, which has retail stores, growing operations and processing sites in more states (20) than any other vertically integrated US pot stock, has agreed to be acquired by Cover growth (NYSE: CGC), the world's largest stock of marijuana by market capitalization, in April.
The $ 3.4 billion cash transaction was concluded on a contingency basis. Canopy Growth paid out $ 300 million in cash and sold $ 3.1 billion in shares to legalize marijuana at the federal state level. Although the agreement is expected to last about 90 months, the Republicans' victory in the Senate or Oval Office next year could eventually nullify any possibility of reform for at least 24 months. Canopy Growth may appear to have easy access to the thriving pot market in the United States, but there is no guarantee that any rights associated with the Acreage deal will be respected at any time, if ever.
As long as marijuana will no longer become a problem for a single voter, there is little chance of true federal reform in the United States.
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