How might marijuana legalization in California affect the nation?

The question in the title of this post comes from this Forbes article examining how passage of Proposition 64 — California’s marijuana legalization initiative — on Tuesday could change marijuana policy nationwide. The article begins:

California’s Proposition 64 to legalize recreational marijuana is going to have a big influence on the rest of the United States.

 

It is highly likely the measure will pass Tuesday. On Oct, 16, a SurveyUSA poll showed 51% in favor and 40% against. More recently, a USC Dornsife/Los Angeles Times poll showed 58% for and 34% against the ballot measure.

 

Jessica Rabe, research associate Convergex, a global brokerage company based in New York, said that the great size of the California economy — sixth largest in the world if it were a standalone country, with GDP of $2.5 trillion in 2015 — will “put pressure on the government to reclassify or deschedule the drug to help ‘cannabusinesses’ better conduct their operations with more access to banking services.”

 

According to cannabis investment company MedMen, passage of Proposition 64 could add $8.38 billion in annual sales to an already robust medical market worth an estimated $2.83 billion. CEO Adam Bierman said that the California vote is one of the major milestones in the institutionalization of the marijuana industry. “I have a meeting on Tuesday in San Francisco with half a dozen of what some people would refer to as the illuminati of Silicon Valley,” said Bierman. “That meeting doesn’t happen six months ago. That meeting doesn’t happen two months ago. It’s happening now.”

 

Sarah Trumble of Third Way, a think tank based in Washington, D.C., sounds a cautionary note. “I’ve heard that saying, if California goes then this inevitable that all states will go, but that’s not necessarily true,” she said.  “California didn’t do a very good job with its medical marijuana industry and its lack of regulation. If they screw up recreational, it will hurt the overall effort.”

 

Trumble believes that if the analysts are right in their sales estimates and the industry becomes a multi-billion dollar one, then the big banks will reluctantly begin working with these customers. She noted that the amounts of money are so large that it wouldn’t be feasible to work only in cash and the smaller banks and credit unions could be overwhelmed. It could be the tipping point for major financial institutions.

 

“The exponential increase in mainstream venture capital interest will attract talent from the established industries that the state has long supported from tech to aerospace and agriculture, which will be a boon for innovation and job creation across the diverse spectrum of cannabis companies,” said Mike Bologna, Chief Executive Officer of Green Lion Partners. “The potential economic impact of Prop 64 cannot be understated, and we hope that a victory in California will inspire other state governments to reconsider their archaic and destructive stance on cannabis.”…

 

In addition to the financial and cultural aspects, there is also the feeling it will benefit the medical community. Rob Hunt, President of Teewinot Life Sciences said, “California is the epicenter of biotechnology and there are many scientists that are desperate to study the efficacious nature of cannabinoids,” He went on to say, “Legalizing cannabis provides a great deal of insulation to these people and provides them comfort in conducting trials that will ultimately lead to breakthroughs in medicine. It is ironic that the passage of adult use may drive cannabinoid based science far more than a medicinal law ever did.”…