Imagine, if you will, a bill down there on Capitol Hill.
This bill would have removed onerous federal regulations from a certain industry, regulations that essentially prohibited it from participating in the traditional banking industry. That removal would have helped thousands of small businesses all over the country, making it easier for them to function; shrunk the size of the federal government, and helped expand state sovereignty, all in one go.
Unfortunately, this bill could never overcome its intransigent opponents to become law. Supporters had hoped they could get it in to the end-of-the-year omnibus spending bill, but alas, it was not to be.
Now, you might presume that this particular piece of legislation – since it helped small businesses, reduced federal regulations and expanded state sovereignty – would have a better chance in the new Congress. Those are all things that Republicans claim they support all the time, after all. You might think that with a Republican majority in the House, this bill might have an easier chance of passage.
Unfortunately, you’d be wrong. You see, while Republicans frequently like to say they support individual liberties, reduced regulations, small businesses and small government, when it comes to this particular business, many of them have conveniently set aside those principles.
The business that proponents are trying to help with this bill is the business of marijuana, both recreational and medicinal.
At the moment, the entire industry exists in a legal gray area. Even though marijuana has been legalized to varying degrees by more than three-quarters of the states and the majority of the public supports some form of legalization, it remains firmly illegal at the federal level.
Because banks (along with insurance companies) are heavily regulated by the federal government, they are exceedingly hesitant to allow any marijuana-based business to open accounts with them, including offering them business loans. That makes it extremely difficult for the industry to function like a normal small business would – even if the goods and services they offer are fully legal in their state.
The SAFE Banking Act would have changed much of this legal landscape, preventing federal regulators from penalizing financial institutions for doing business with legal marijuana-related businesses. Essentially, federal financial regulators would have had to stop treating marijuana as an illegal substance, allowing banks to start offering loans and accounts to marijuana-related businesses.
Quite a few Republicans did support the bill, in both the House and the Senate – ranging from conservatives like Kevin Cramer of North Dakota to moderates like Lisa Murkowski of Alaska. Here in Maine, it was co-sponsored by Rep. Chellie Pingree (who, to her credit, has been pushing this issue for years), Sen. Susan Collins and Sen. Angus King – almost the entire delegation. That makes perfect sense, since with its legalization, marijuana has been booming in Maine, despite being unable to bank like ordinary businesses.
The SAFE Banking Act would not have forced any state to legalize marijuana in any way, shape or form; it simply would have allowed it to function more normally as an industry in those states where it was legal. So why enough hesitancy among Republicans to doom its passage?
Republicans like to say that they support small businesses, states’ rights and reducing federal regulations. This bill would have been the perfect opportunity for them to prove it, sticking by those principles even when it comes to an industry of which they may disapprove. Supporting this bill does not necessarily mean supporting legalization of marijuana; a Republican can vote for this bill and still continue to advocate against legalization in both their home state and at the federal level.
This legislation does set the important precedent that bureaucrats down in Washington can’t trample all over the rights of states or small businesses. It ought to be easy for any Republican to see how that particular principle could be applied to other areas – for instance, the right to bear arms. Credit card companies recently adopted a special merchant code for gun stores at the urging of gun control advocates; it’s easy to see that their next step could well be to pressure banks to stop doing business with gun stores entirely.
Let’s nip that in the bud by supporting the SAFER Banking Act. That should make it clear that it’s perfectly acceptable to federal regulators for financial institutions to do business with any legal business. Just as the government shouldn’t be stripping individuals of their civil liberties, they shouldn’t be pressuring banks to do that dirty work for them, either.
Jim Fossel, a conservative activist from Gardiner, worked for Sen. Susan Collins. He can be contacted at:
jwfossel@gmail.com
Twitter: @jimfossel
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