Art, Industry, and Finance
By Prof Tim
Legal cannabis has created entirely new types of money problems: Cannabis businesses generate mountains of cash that banks are unwilling to accept. Yes, you read that correctly. The dissonance between state and federal cannabis laws could not be more stark. In many states, cannabis has resumed its pre-prohibition economic vigor, but at the federal level cannabis remains strictly illegal. During the Obama Administration, the federal government took its first baby steps toward cannabis legalization (Kamin, 2014). However, during the Trump administration, Jeff Sessions has done his best to roll back Obama-era progress (Young, 2017). This state of uncertainty has created a variety of practical problems for fledgling cannabis businesses, especially in the realm of banking.
In her chapter, “Cannabis Banking and Finance,” Sundie Seefried discusses the challenges of banking cannabis businesses during an era of enduring federal prohibition. Because cannabis remains federally illegal, most banks will not allow cannabis businesses to create accounts. This means that most cannabis businesses must handle all transactions in cash. In a world that is increasingly driven by electronic monetary transactions, it is extremely difficult for any business to operate in a cash-only environment. As CEO of Partner Colorado Credit Union, Sundie Seefried is committed to the credit union banking philosophy, “banking the unbankable.” Out of concern for public safety, Seefried has created a special banking institution, Safe Harbor, that is specifically designed to create banking opportunities for legal cannabis business during a time of federal prohibition.
In any environment, where there are large quantities of cash transactions, black market activities are sure to flourish. In their chapter, “Black, White and Green,” Jim Parco and his collaborators examine the state of black market influences on the legal cannabis environment in Colorado. Parco and collaborators have identified intriguing alterations to Colorado’s black market since the legalization of cannabis. Legal cannabis has dealt the black market a number of setbacks, but, like many criminal organizations, the black market has found a way to thrive in the gray areas created by Colorado’s new normal.
Through the eyes of an artist, Anne Scott explores new art and industry possibilities in her chapter, “Hemp as a Sustainable Approach to Fashion.” Scott’s purpose is to discuss industrial hemp as a fascinating new/old textile for the fashion industry. Scott views fashion has a way of enhancing culture and identity all over the globe. However, Scott believes that the fashion industry’s success has created a sustainability crisis: Scott notes that the fashion industry is famous for being the world’s second-largest polluter. Scott is convinced that, with the help of hemp, the fashion industry can help create a much better and more sustainable tomorrow.
According to Ari Eyal, the medical cannabis industry is transforming rapidly. In his chapter, “Medical Cannabis Manufacturing Plant of the Future,” Eyal discusses the stresses and challenges that this new, highly-successful industry is going to experience. In addition to gearing up for rapid transformation, Eyal believes that the medical cannabis industry is going to face drastically increasing capacity demands, introduction of new indications, tougher regulation, and a need for lowering production cost. Eyal believes that the best way to forge ahead toward the future of the medicinal cannabis industry will create a new breed of manufacturing-specializing firms that will bridge divides that more traditional industries don’t have to contend with.
In his chapter, “Best Practices in the Cannabis Industry,” Fred Krissman argues that “best practices” in the agriculture sector have been anything but appealing. Krissman asserts that America’s agricultural sector has embraced practices—such as slave, convict, and undocumented labor—that are no longer tenable. Krissman also points out that industrial agriculture has been very hard on the environment, which has only worsened since the post-WWII shift from family farms to corporate agribusiness. Provocatively, Krissman contends that a new set of “cannabis culture” best practices emerged during the past half-century that is being undermined by cannabis legalization.
References
Kamin, Sam. "Cooperative Federalism and State Marijuana Regulation." University of Colorado Law Review. 85 (2014): 1105.
Young, David. "USA drug policy in the early days of Trump." Matters of Substance 28.1 (2017): 24.
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