All 435 seats in the U.S. House of Representatives are up for grabs, along with one third of U.S. senators either up for re-election or planning to leave office. Because of this, many marijuana investors are left wondering what will happen to the cannabis industry following a congressional shakeup.
According to a recent report from Cowen, there are three potential outcomes, and each one paints a very different picture of what we can expect when the new 116th United States Congress convenes next year.
In order of most likely to least likely, here are the three possible outcomes and what they’d mean for the marijuana industry:
- “House Goes Democratic; Senate Stays Republican” – Essentially, under this outcome, “the House will fall to the Democrats.” Since the average Democratic candidate is far more marijuana-friendly than the average Republican candidate, this means that it would be “more likely that cannabis legislation will get to the floor of the House.” With the Senate staying Republican under this outcome, the House will have to pass marijuana-related bills to “put pressure on the Senate to act.” For those who doubt that a GOP Senate couldn’t advance a marijuana bill, think again. Thanks to a “preference by many Senate Republicans to respect state’s rights,” it is more possible than ever. If this scenario were to play out, we could see some progress on legislation to provide banking to marijuana-related businesses and more.
- “Congress Stays Republican” – As it pertains to the cannabis industry, a continuation of the last four years with another Republican-controlled Congress would be the worst of the three options. Despite this, a Republican-controlled Congress is the second most likely outcome according to Cowen. Regardless, if this outcome were to happen, “the new GOP controlled Congress will not be the same as the last two GOP controlled Congresses,” due to “key retirements and committee changes” such as those taking place in the House Rules Committee, House Financial Services Committee, House Judiciary Committee, House Ways and Means Committee, Senate Banking Committee, and the Senate Judiciary Committee. While each committee matters for different reasons, the change-ups could bring about a “path in the House to advance narrow bills” such as the SAFE Act and more.
- “Democrats Sweep House, Senate” – While polling data says a Democratic sweep is least likely to come to fruition, it is still a possibility worth considering. After all, polls can be very wrong sometimes. It goes without saying that if this scenario were to play out, it “would remove traditional GOP roadblocks on both sides of Capitol Hill.” This could lead to the rescheduling of cannabis under the Controlled Substances Act and more.
We’ll be watching things closely tomorrow to see how things play out. No matter what, November 6th, 2018 is sure to make marijuana history.
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