The study conducted by The Collective-Action Constitution offers several lessons. First, when states disagree about the existence or severity of collective-action problems, such problems do not simply exist or not in a technical, scientific way. Cost-benefit collective-action problems have an objective structure, but their existence and significance require assessing the extent to which states are externalizing costs that are greater than the benefits they are internalizing, and such assessments may require normative judgments in addition to factfinding.

Second, the assessor that matters most is either the Constitution itself or the governmental institution with the most democratic legitimacy to make such judgment calls. This institution is Congress—the first branch of government—where all states and all Americans are represented, in contrast to individual state governments, where only one state and some Americans are represented. In McCulloch v. Maryland (1819), Chief Justice Marshall explained this key difference between the democratic legitimacy of the states and the people collectively in Congress and the democratic legitimacy of states individually outside it. Congress is also more broadly representative of all states and all people than is the presidency, which does not include both political parties at a given time, or balance interests to anywhere near the same extent that Congress does.

Third, if it is acting within its enumerated powers, Congress need only comply with the voting rules set forth in the Constitution; Congress need not first establish that all or most states agree that a collective-action problem exists and is sufficiently serious to warrant federal regulation. In other words, Congress need not poll states apart from establishing sufficient support in the federal legislative process. Because states are represented in Congress—because congressional majorities represent (albeit imperfectly) the constitutionally relevant views of the states collectively—proceeding otherwise would overrepresent the states, effectively letting them vote twice. One main reason that the Constitution is too difficult to amend, Chapter 10 argues, is that Article V essentially lets states vote twice.

Fourth, Congress's central role in deciding whether and how to solve collective-action problems for the states connects constitutional provisions, principles, and ideas that may otherwise seem to have little to do with one another. These include, for example, the Interstate Compacts Clause (see Chapter 3), the Interstate Commerce Clause (Chapter 5), the congressional approval exception to the dormant commerce principle (Chapter 5), Article III's opening clause, which lets Congress decide whether to create lower federal courts (Chapter 7), Article IV's provisions expressly or implicitly authorizing Congress to legislate (Chapter 8), and democratic-process rights and theory (Chapter 9).

Congress's paramount role in the constitutional scheme raises questions (explored in Part III of the book) about the operation of the Constitution's system of separated and  interrelated powers in contemporary times. It is one thing  to argue that the Constitution was originally intended, and designed, to render the federal government operating through (super)majority rule more likely to solve multistate collective-action problems than the states operating through unanimity rule. It is another thing to show that this is generally true in practice. As George Washington implied in his letter accompanying submission of the U.S. Constitution to the Confederation Congress that begins The Collective-Action Constitution, to protect state autonomy and individual liberty, the Framers created a bicameral legislature and a separation-of-powers system, both of which make it more difficult to legislate than in a unicameral legislature and a parliamentary system. But the Framers did not imagine that the availability of veto threats would come to dominate the policymaking process in situations having nothing to do with perceived encroachments on the presidency or bills that the president thinks unconstitutional. Nor were the Framers responsible for modern subconstitutional "veto gates" in Congress, especially the Senate filibuster, which makes it even harder to legislate. Finally, the Framers did not foresee the polarized, antagonistic nature of contemporary American politics.

These developments have meant that bicameralism and the separation (and interrelation) of powers often do not merely qualify Congress's ability to legislate. The horizontal structure and contemporary politics likely make it too hard for Congress to do so, particularly given the magnitude and geographic scope of the problems facing the nation and the extent to which Americans look mainly to the federal government, not the states, to solve them. The Constitution's greatest defect in modern times is probably that Congress often cannot execute its legislative responsibilities in the constitutional scheme. A result has been power shifts from Congress to the executive branch, the federal courts, and the states. The main workaround for congressional gridlock has been more frequent unilateral action by the executive. Other partial and potentially worrisome workarounds include efforts by federal courts to "update" the meaning of federal statutes and greater exercises of state regulatory authority. Sufficient solutions to the problem of gridlock may not exist any time soon given the practical impossibility of amending the Constitution, the unlikelihood that veto practice will become more restrained, and the long periods required for political realignments to occur. Ending the legislative filibuster in the Senate by majority vote would, however, have the likely salutary (but not cost-free) consequence of changing the typical voting threshold in this chamber from a three-fifths supermajority to majority rule.

Given the difficulty of legislating in the current era, it might be thought that The Collective-Action Constitution offers an elegy—an account of how the U.S. constitutional system was supposed to function or used to function but functions no longer. To readers who regard the book as an elegy during an era of presidential administration, judicial supremacy, and assertive state legislation, I offer the words of Richard Hooker, who long ago deemed his own book an elegy and justified writing it anyway: "Though for no other cause, yet for this; that posterity may know we have not loosely through silence permitted things to pass away as in a dream." (My learned colleague, H. Jefferson Powell, furnished this quote.)

In truth, however, The Collective-Action Constitution does not offer an elegy.  The constitutional structure still has much to commend it relative to relying on the states to act collectively outside Congress. When problems are national or international in scope, the relevant comparison is not between Congress's ability to combat a problem and one state's ability to do so, but between the ability of the political branches to act and the ability of the states to act collectively through unanimous agreement. Collective-action problems would almost certainly be more severe if the federal government were dissolved and states had to unanimously agree to protect the environment; regulate interstate and foreign commerce; build interstate infrastructure; conclude international agreements; contribute revenue to a common treasury and troops to a common military (or coordinate separate militaries); disburse funds held in common; respond to economic downturns; provide a minimum safety net; and handle pandemics, among many other problems. Congress still legislates today, and it does so much more frequently than most (let alone all) states form interstate compacts.

As for the executive branch, Presidents lack the ability to legislate in a formal and legitimate fashion, and so they cannot address the above problems and those with a similar structure to anywhere near the same extent that Congress can. Presidential action is less enduring and far reaching than legislation. Normatively, moreover, executive unilateralism poses risks of democratic deficits and backsliding that congressional power does not.

The federal judiciary's most important job is largely (although not entirely) to get out of the way. The Collective-Action Constitution cautions the U.S. Supreme Court and lower federal courts—both of which can be substantially more assertive than the Founders envisioned in reviewing the constitutionality of federal laws (see Chapter 7)—not to significantly restrict federal power in the years ahead, whether through constitutional-law holdings contracting congressional power or administrative-law decisions diminishing agency power. The nation will continue to face pressing problems that spill across state (or national) borders, so federal action will be needed to address them effectively. In general, the federal government has the authority to act. And given the horizontal structure and the era of partisan polarization and animosity in which Americans will continue to live, there are already major impediments to the ability and willingness of members of Congress to overcome their own collective-action problems and legislate. Especially in modern times, legal doctrine should facilitate, not impede, realization of the Constitution's main structural purpose—its commitment to collective action.

The post The Collective-Action Constitution in an Era of Polarization and Animosity: An Elegy? appeared first on Reason.com.

Today the U.S. Court of Appeals for the D.C. Circuit decided a case concerning the allegation of unfair labor practices at Curaleaf Arizona, a medical marijuana dispensary. In Absolute Healthcare v. NLRB, the court granted Curaleaf's petition challenging some NLRB findings that the company had committed unfair labor practices under the National Labor Relations Act.

The fact that Curaleaf is a medical marijuana dispensary makes this an interesting case. While Curaleaf's activities are legal under Arizona law, they are criminal under federal law, so Curaleaf is engaged in a criminal enterprise. This makes it interesting, to say the least, for a federal agency (the NLRB) to police Curaleaf's treatment of its employees. (For an exploration of other curiosities caused by the state-level legalization of the distribution and sale of marijuana, see my book, Marijuana Federalism: Uncle Sam and Mary Jane.)

Judge Millett wrote the panel opinion, granting Curaleaf's petition insofar as it challenged the NLRB's findings. (Some of the NLRB's findings were uncontested.) Senior Judge Ginsburg and Judge Walker joined the opinion. Judge Walker also wrote a separate opinion raising questions about whether the NLRA reaches allegedly unfair labor practices by employers engaged in businesses that remain illegal under federal law.

Congress empowered the National Labor Relations Board to protect the labor rights of certain employees of certain employers that affect interstate commerce. It is an undeniably broad grant of jurisdiction. But it may not be quite as broad as the NLRB assumes.

Consider the facts of this case. The NLRB ordered a criminal enterprise called Curaleaf Gilbert to pay a drug dealer to sell illegal drugs. That is a curious order from the branch of government tasked with faithfully executing federal law.

I can imagine three arguments in favor of the NLRB's jurisdiction over marijuana dispensaries like Curaleaf, but each has flaws.

First, many people believe marijuana should be legal. There are thoughtful people on both sides of that policy debate, and momentum may well be toward legalization. But for now, marijuana remains illegal at the federal level, notwithstanding the Department of Justice's nonenforcement.

Second, Arizona law allows Curaleaf to sell marijuana.6 But federal criminal prohibitions preempt conflicting state law. And those prohibitions cannot be displaced by an agency advisory memo.

Third, the NLRB usually retains jurisdiction even after an employer breaks a law. Indeed, Congress tasked the NLRB with holding employers accountable when they violate federal labor law. But that's when the enterprise is otherwise legitimate — not necessarily when its sole aim is to sell an illegal product or provide an illegal service.

That distinction may be more significant than the NLRB appreciates. After all, rings of bookies and counterfeiters affect interstate commerce, but the NLRB does not seem eager to adjudicate their labor disputes. Ditto for street gangs.

Why does that change when a corner boy calls himself a "budtender" and his crew incorporates under state law?

To me, at least, the answer is hazy.

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President Joe Biden describes the Drug Enforcement Administration's proposal to reclassify marijuana under federal law as "monumental." How so? "It's an important move toward reversing longstanding inequities," Biden claims in a video posted on Thursday. "Today's announcement builds on the work we've already done to pardon a record number of federal offenses for simple possession of marijuana, and it adds to the action we've taken to lift barriers to housing, employment, small business loans, and so much more for tens of thousands of Americans."

Even allowing for 60 days of public comment and review of a final rule by Congress and the Office of Management and Budget, marijuana's rescheduling could be finalized before the presidential election. And even if it does not take effect before then, Biden is hoping the move will help motivate younger voters whose turnout could be crucial to his re-election. But he also had better hope those voters are not paying much attention to the practical consequences of rescheduling marijuana, which are much more modest than his rhetoric implies.

"Look, folks," Biden says in the video, "no one should be in jail merely for using or possessing marijuana. Period. Far too many lives have been upended because of [our] failed approach to marijuana, and I'm committed to righting those wrongs." Yet rescheduling marijuana will not decriminalize marijuana use, even for medical purposes. It will not legalize state-licensed marijuana businesses or resolve the growing conflict between federal prohibition and state laws that authorize those businesses. It will not stop the war on weed or do much to ameliorate the injustice it inflicts.

In accordance with a recommendation that the Department of Health and Human Services (HHS) made last August, the DEA plans to move marijuana from Schedule I of the Controlled Substances Act, a list of completely prohibited drugs, to Schedule III, which includes prescription medications such as ketamine, Tylenol with codeine, and anabolic steroids. Schedule I supposedly is reserved for drugs with a high abuse potential and no accepted medical applications that cannot be used safely even under a doctor's supervision.

When Biden directed HHS to review marijuana's legal status in October 2022, he noted that "we classify marijuana at the same level as heroin" and treat it as "more serious than fentanyl," which "makes no sense." On Thursday, he likewise noted that "marijuana has a higher-level classification than fentanyl and methamphetamine—the two drugs driving America's overdose epidemic."

Biden is right that marijuana's current classification makes no sense, as critics have been pointing out for half a century and as HHS belatedly acknowledged in explaining the rationale for rescheduling. HHS found "credible scientific support" for marijuana's use in the treatment of pain, nausea and vomiting, and "anorexia related to a medical condition." It also noted that "the risks to the public health posed by marijuana are low compared to other drugs of abuse," such as heroin (Schedule I), cocaine (Schedule II), benzodiazepines like Valium and Xanax (Schedule IV), and alcohol (unscheduled).

Although "abuse of marijuana produces clear evidence of harmful consequences, including substance use disorder," HHS said, they are "less common and less harmful" than the negative consequences associated with other drugs. It concluded that "the vast majority of individuals who use marijuana are doing so in a manner that does not lead to dangerous outcomes to themselves or others."

According to the DEA's proposed rule, Attorney General Merrick Garland, who holds the ultimate authority to reschedule drugs under the CSA, "concurs with HHS's conclusion" that marijuana has currently accepted medical uses. Garland also "concurs with" the assessment that "marijuana has a potential for abuse less than the drugs or other substances in schedules I and II." And he agrees that "the abuse of marijuana may lead to moderate or low physical dependence, depending on frequency and degree of marijuana exposure."

Those conclusions are "monumental" in the sense that HHS, the DEA, and the Justice Department are finally acknowledging what most Americans already knew. Abandoning the pretense that marijuana meets the criteria for Schedule I represents progress in that sense, although it comes after decades of legal wrangling in which HHS and the DEA took the opposite position, at a time when 38 states have legalized medical use of marijuana, two dozen have taken the further step of legalizing recreational use, and an overwhelming majority of Americans oppose pot prohibition.

In practical terms, the two main benefits of moving marijuana to Schedule III are fewer regulatory barriers to medical research and a financial boon to state-licensed cannabis suppliers, who will no longer be barred from deducting standard business expenses when they file their federal tax returns. But when Biden calls it "an important move toward reversing longstanding inequities" and links it to "righting [the] wrongs" suffered by cannabis consumers, he is promising more than rescheduling can possibly deliver.

Although Biden promised to "decriminalize the use of cannabis" during his 2020 campaign, rescheduling does not do that. Nor do the pardons he touts. Despite those two moves, low-level marijuana possession will remain a federal offense punishable by a minimum $1,000 fine and up to a year in jail. Only Congress can change that. Biden has invested little, if any, effort in urging it to do so, and he opposes outright federal legalization based on "gateway drug" concerns that pot prohibitionists have been voicing since the 1950s.

Neither rescheduling nor pardons will remove the unfair "barriers" that Biden decries. Although Biden claims he is "expunging thousands of convictions," that is not true, since pardons do not entail expungement. Nor do pardons eliminate the various legal disabilities associated with marijuana convictions, cannabis consumption, or participation in the cannabis industry, which include loss of Second Amendment rights (a policy that Biden defends) and ineligibility for admission, legal residence, and citizenship under immigration law.

As his pardons reflect, Biden's concern about unjust incarceration is curiously limited. Because those pardons did not apply to people convicted of growing or selling marijuana, they did not free a single federal prisoner. Neither will rescheduling.

With marijuana in Schedule III, state-licensed marijuana businesses will remain criminal enterprises under federal law, albeit subject to less draconian penalties. "If marijuana is transferred into schedule III," the DEA notes, "the manufacture, distribution, dispensing, and possession of marijuana would remain subject to the applicable criminal prohibitions of the CSA."

For that reason, rescheduling is unlikely to reassure financial institutions that are leery of serving marijuana businesses because it could expose them to devastating criminal, civil, and regulatory penalties. "Because marijuana would remain a controlled substance under the CSA," the law firm Debevoise & Plimpton notes, "its rescheduling would not immediately impact the potential legal risks to financial institutions (and other parties) considering whether to provide services to marijuana businesses."

If marijuana is listed along with prescription drugs, doesn't that at least mean that it can legally be used as a medicine? No, because doctors can prescribe only specific products that have been approved by the Food and Drug Administration (FDA). Unless and until new cannabis-based medicines pass muster with the FDA, they will not be legal for doctors to prescribe or patients to use.

These points are easily overlooked in the hoopla surrounding the rescheduling announcement. But the limitations of Biden's "monumental" policy shift are clear from the reactions of activists and the cannabis industry.

"This recommendation validates the experiences of tens of millions of Americans, as well as tens of thousands of physicians, who have long recognized that cannabis possesses legitimate medical utility," said Paul Armentano, deputy director of the National Organization for the Reform of Marijuana Laws, which first urged the DEA to reschedule marijuana back in 1972. "But it still falls well short of the changes necessary to bring federal marijuana policy into the 21st century. Specifically, the proposed change fails to harmonize federal marijuana policy with the cannabis laws of most U.S. states, particularly the 24 states that have legalized its use and sale to adults."

The review from the American Civil Liberties Union (ACLU) was similarly mixed. "President Biden's decision to reschedule marijuana is the most significant step any American president has taken to address the harms of the war on marijuana," Cynthia W. Roseberry, director of policy and government affairs at the ACLU's Justice Division, said in an emailed statement. "While it is an incredibly encouraging step in the right direction, the rescheduling does not end criminal penalties for marijuana or help the people currently serving sentences for marijuana offenses."

John Mueller, CEO of the Greenlight dispensary chain, likewise noted what rescheduling will not do. "This is a monumental moment," he said in an emailed press release, "but we still have a long way to go to rectify the injustices of the War on Drugs. The recent strides in cannabis rescheduling mark a significant departure from a failed 50-year prohibition policy. We must continue this momentum by calling on our state and federal leaders to prioritize the release of individuals incarcerated for cannabis-related offenses. This is not just about acknowledging the legitimacy of the cannabis industry, but also about rectifying the disproportionate impact of outdated policies on marginalized communities.…It's time to right the wrongs of the past and embrace progress wholeheartedly."

Aaron Smith, CEO of the National Cannabis Industry Association, had a similar take. "On behalf of thousands of legal businesses operating across the country, we commend President Biden for taking this important first step toward a more rational marijuana policy," he said. "Now it's time for Congress to enact legislation that would protect our industry, uphold public safety, and advance the will of the voters who overwhelmingly support making cannabis legal for adults. Rescheduling alone does not fix our nation's state and federal cannabis policy conflict. Only Congress can enact the legislation needed to fully respect the states and advance the will of the vast majority of voters who support legal cannabis."

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American federalism is struggling. Federal rules are an overwhelming presence in every state government, and some states, due to their size or other leverage, can impose their own policies on much or all of the country. The problem has been made clearer by an under-the-radar plan to phase out diesel locomotives in California. If the federal government provides the state with a helping hand, it would bring nationwide repercussions for a vital, overlooked industry.

Various industry and advocacy groups are lining up against California's costly measure, calling on the U.S. Environmental Protection Agency (EPA) to deny a waiver needed to fully implement it. In the past month, more than 30 leading conservative organizations and individuals, hundreds of state and local chambers of commerce, and the U.S. agricultural sector have pleaded with the EPA to help stop this piece of extremism from escaping one coastal state.

Railroads may not be something most Americans, whose attention is on their own cars and roads, think about often. But rail is the most basic infrastructure of interstate commerce, accounting for around 40 percent of long-distance ton-miles. It's also fairly clean, accounting for less than 1 percent of total U.S. emissions. Private companies, like Union Pacific in the West or CSX in the East, pay for their infrastructure and equipment. These facts haven't stopped the regulatory power grab.

Most importantly, the California Air Resources Board (CARB) regulation would have all freight trains operate in zero-emission configuration by 2035. At the end of the decade, the state is mandating the retirement of diesel locomotives 23 years or older, despite typically useful lives of over 40 years. Starting in 2030, new passenger locomotives must operate with zero emissions, with new engines for long-haul freight trains following by 2035. It limits locomotive idling and increases reporting requirements.

Given the interstate nature of railway operations, California needs the EPA to grant a waiver. If the agency agrees, the policy will inevitably affect the entire continental United States.

The kicker is that no technology exists today to enable railroads to comply with California's diktat, rendering the whole exercise fanciful at best.

The Wall Street Journal's editorial board explained last November that while Wabtec Corp. has introduced a pioneering advance in rail technology with the launch of the world's first battery-powered locomotive, the dream of a freight train fully powered by batteries remains elusive. The challenges of substituting diesel with batteries—primarily due to batteries' substantial weight and volume—make it an impractical solution for long-haul trains. Additionally, the risk of battery overheating and potential explosions, which can emit harmful gases, is a significant safety concern. As the editorial noted, "Even if the technology for zero-emission locomotives eventually arrives, railroads will have to test them over many years to guarantee their safety."

The cost-benefit analysis is woefully unfavorable to the forced displacement of diesel locomotives. To "help" the transition, beginning in 2026, CARB will force all railroads operating in California to deposit dollars into an escrow account managed by the state and frozen for the explicit pursuit of the green agenda. For large railroads, this figure will be a staggering $1.6 billion per year, whereas some smaller railroads will pay up to $5 million.

Many of these smaller companies have signaled that they will simply go out of business. For the large railroads, the requirement will lock up about 20 percent of annual spending, money typically used for maintenance and safety improvements.

Transportation is the largest source of U.S. emissions, yet railroads' contribution amounts to not much more than a rounding error. The industry cites its efficiency improvements over time, allowing railroads today to move a ton of freight more than 500 miles on a single gallon of diesel. Its expensive machines, which last between 30 to 50 years and are retrofitted throughout their life cycles, are about 75 percent more efficient than long-haul trucks that carry a comparative amount of freight.

As Patricia Patnode of the Competitive Enterprise Institute, which signed the aforementioned letter to the EPA, recently remarked, "Rather than abolish diesel trains, CARB should stand in awe of these marvels of energy-efficient transportation."

President Joe Biden talks a lot about trains, but his actions since taking office have consistently punished the private companies we should value far more than state-supported Amtrak. In this case, EPA Administrator Michael Regan and the White House need not think too hard. They should wait for reality to catch up before imposing on the rest of us one state's demands and ambitions.

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The Justice Department yesterday confirmed that the Drug Enforcement Administration  (DEA) plans to move marijuana from Schedule I of the Controlled Substances Act (CSA), a list of completely prohibited drugs, to Schedule III, which includes prescription medications such as ketamine, Tylenol with codeine, and anabolic steroids. The Associated Press notes that the change, which is based on an August 2023 recommendation by the Department of Health and Human Services (HHS) that resulted from a review President Joe Biden ordered in October 2022, "would not legalize marijuana outright for recreational use."

That is by no means the only thing rescheduling marijuana will not do. Biden wants credit for "marijuana reform," which he hopes will help motivate young voters whose turnout could be crucial to his reelection. The announcement of the DEA's decision seems designed to maximize its electoral impact. But voters should not be fooled: Although moving marijuana to Schedule III will facilitate medical research and provide a financial boost to the cannabis industry, it will leave federal pot prohibition essentially untouched.

Rescheduling marijuana will not resolve the conflict between the CSA and the laws of the 38 states that recognize cannabis as a medicine, 24 of which also allow recreational use. State-licensed marijuana businesses will remain criminal enterprises under federal law, exposing them to the risk of prosecution and forfeiture. While an annually renewed spending rider protects medical marijuana suppliers from those risks, prosecutorial discretion is the only thing that protects businesses serving the recreational market.

Even if they have state licenses, marijuana suppliers will be in the same legal position as anyone who sells a Schedule III drug without federal permission. Unauthorized distribution is punishable by up to 10 years in prison for a first offense and up to 20 years for subsequent offenses. That is less severe than the current federal penalties for growing or distributing marijuana, which include five-year, 10-year, and 20-year mandatory minimum sentences, depending on the number of plants or amount of marijuana. But distributing cannabis, with or without state permission, will remain a felony.

That reality suggests that banks will remain leery of providing financial services to state-licensed marijuana suppliers, which entails a risk of potentially devastating criminal, civil, and regulatory penalties. The dearth of financial services has forced many cannabis suppliers to rely heavily on cash, which is cumbersome and exposes them to a heightened risk of robbery. It also makes investment in business expansion difficult.

Although federal arrests for simple marijuana possession are rare, cannabis consumers likewise will still be committing crimes, even if they live in states that have legalized marijuana. Under 21 USC 844, possessing a controlled substance without a prescription is a misdemeanor punishable by a minimum $1,000 fine and up to a year in jail. Moving marijuana to Schedule III will not change that law, which only Congress can do. Nor did President Joe Biden's mass pardons for people convicted of simple marijuana possession under that statute, which apply only retrospectively, "decriminalize the use of cannabis," as he promised to do during his 2020 campaign.

Biden has repeatedly decried the barriers to education, employment, and housing that marijuana convictions create. But contrary to what he claims, his pardons do not entail expungement of criminal records and therefore do not eliminate those barriers. Nor did the pardons address the various legal disabilities associated with marijuana convictions, cannabis consumption, or participation in the cannabis industry, which include loss of Second Amendment rights (a policy that Biden defends) and ineligibility for admission, legal residence, and citizenship under immigration law. Rescheduling marijuana likewise will not remove those barriers and disabilities.

Moving marijuana to Schedule III will not even make it legally available as a medicine, which would require regulatory approval of specific products. Doctors can legally prescribe Marinol (a.k.a. dronabinol), a synthetic version of THC listed in Schedule III, and Epidiolex, a cannabis-derived CBD solution listed in Schedule V. But they will not be able to prescribe marijuana even after it is moved to Schedule III unless the Food and Drug Administration approves additional cannabis-based medications.

The medical "recommendations" that authorize patients to use marijuana for symptom relief under state law are not prescriptions, and they do not make such use compliant with the CSA. So rescheduling marijuana not only will not legalize recreational use; it will not legalize medical use either.

What will rescheduling do? It should make medical research easier by eliminating the regulatory requirements that are specific to Schedule I, and it will provide an important benefit to state-licensed marijuana suppliers by allowing them to deduct standard business expenses when they pay federal income taxes.

Under Section 280E of the Internal Revenue Code, which is aimed at sticking it to drug dealers, taxpayers may not claim a "deduction or credit" for "any amount paid or incurred during the taxable year in carrying on any trade or business" that involves "trafficking" in Schedule I or Schedule II drugs. As that provision has been interpreted by tax courts, marijuana businesses can still deduct the "cost of goods sold," which counterintuitively means they can deduct the expenses associated with obtaining and maintaining an inventory of cannabis products. But they cannot deduct any other business expenses, including rent, utilities, salaries and benefits, office supplies, security, cleaning services, insurance, and legal fees.

That rule results in a crushing financial burden, forcing marijuana retailers to pay an effective tax rate as high as 70 percent or more. But because Section 280E applies only to businesses that sell drugs in Schedule I or Schedule II, moving marijuana to Schedule III will eliminate that disadvantage.

"I cannot emphasize enough that removal of § 280E would change the industry forever," cannabis lawyer Vince Sliwoski writes. "Having worked with cannabis businesses for 13 years, I view taxation as the largest affront to marijuana businesses—more than banking access, intellectual property protection problems, lack of bankruptcy, you name it. This would be HUGE." In addition to making it much easier to turn a profit, Sliwoski says, the tax change would help attract investors and give marijuana businesses "more leverage" in negotiating those deals.

Aside from those practical changes, rescheduling represents a historic federal about-face on the benefits and hazards of marijuana. Schedule I is supposedly reserved for drugs with a high abuse potential and no accepted medical use that cannot be used safely even under a doctor's supervision. Explaining its rationale for recommending marijuana's reclassification, HHS acknowledged that the drug does not meet those criteria—a point that critics had been making for half a century.

HHS cited "credible scientific support" for marijuana's use in the treatment of pain, nausea and vomiting, and "anorexia related to a medical condition." Regarding abuse potential and safety, it noted that marijuana compares favorably to "other drugs of abuse," such as heroin (Schedule I), cocaine (Schedule II), benzodiazepines like Valium and Xanax (Schedule IV), and alcohol (unscheduled). "The vast majority of individuals who use marijuana," HHS said, "are doing so in a manner that does not lead to dangerous outcomes to themselves or others."

In agreeing to follow the HHS recommendation, the DEA likewise is implicitly admitting that the federal government has been lying about marijuana for decades. But that long-overdue reversal falls far short of addressing today's central cannabis issue: the conflict between federal prohibition and state tolerance, which extends to recreational use in jurisdictions that account for most of the U.S. population. Repealing the federal ban—a step that Americans overwhelmingly support—would resolve that conflict. And while Biden cannot do that on his own, he has stubbornly resisted the idea, even as he emphasizes the irrationality and injustice of the war on weed.

The post Rescheduling Marijuana Does Not Address Today's Central Cannabis Issue appeared first on Reason.com.

President Joe Biden's perfunctory reference to marijuana reform during last night's State of the Union address further undermined his campaign's already iffy attempt to motivate young voters, who overwhelmingly oppose pot prohibition. Biden claimed he was "expunging thousands of convictions for the mere possession" of marijuana, which is not true, and declared that "no one should be jailed for simply using" marijuana—a proposition that was on the cutting edge of drug policy half a century ago.

Contrary to what Biden said, his pardons for people convicted of simple possession under federal law do not entail expungement of criminal records because there is no way to accomplish that without new legislation. The distinction matters because Biden has emphasized that "criminal records for marijuana possession" create "needless barriers to employment, housing, and educational opportunities." His pardons do not remove those barriers. The certificates that pardon recipients can obtain might carry weight with landlords or employers, but there is no guarantee of that.

In other words, Biden has not delivered on his campaign promise to "automatically expunge all prior cannabis use convictions." Yet Biden claimed otherwise last night, conflating pardons with expungements that would mean people convicted of simple possession no longer "have it on their record."

What about the idea that people should not be arrested simply for using marijuana? During his 2020 campaign, Biden promised to "decriminalize the use of cannabis." His pardons do not accomplish that goal either. Federal law still treats simple marijuana possession as a misdemeanor punishable by a minimum $1,000 fine and up to a year in jail. In any event, all but a tiny percentage of simple possession cases are prosecuted under state law.

"Biden made two promises on marijuana reform on the 2020 campaign trail—to decriminalize marijuana use and expunge records—and he has failed to deliver either," notes Cat Packer, director of drug markets and legal regulation at the Drug Policy Alliance. "Biden's pardons haven't released anyone from prison or expunged anyone's records."

We might credit Biden for at least having his heart in the right place if he had ventured to say that marijuana use should not be treated as a crime back in the 1970s, when that idea first gained traction. In 1972, the same year that Biden was elected to his first term in the U.S. Senate, the National Commission on Marihuana and Drug Abuse recommended decriminalization of marijuana possession for personal use. It also recommended that "casual distribution of small amounts of marihuana for no remuneration, or insignificant remuneration, no longer be an offense."

Those recommendations were especially striking in light of the commission's composition. Most of its members had been appointed by President Richard Nixon, a law-and-order Republican, and it was chaired by Raymond Shafer, a Republican who had just completed a term as Pennsylvania's governor.

That decade, nearly a dozen states, beginning with Oregon in 1973, took the commission's advice, typically changing low-level possession from a criminal offense to a civil violation punishable by a modest fine. President Jimmy Carter endorsed decriminalization in 1977, when he told Congress that "penalties against possession of a drug should not be more damaging to an individual than the use of the drug itself."

That wave of reform was followed by an anti-drug backlash in which Carter's successor, Ronald Reagan, figured prominently. So did Biden. "We have to hold every drug user accountable," he declared in a 1989 speech that faulted Republicans for not being tough enough on the issue, because "if there were no drug users, there would be no appetite for drugs, and there would be no market for them."

Biden now presents himself as a recovering drug warrior who has seen the error of his ways. During his 2020 campaign, he conceded that the scientifically baseless penal distinction between crack and cocaine powder, which resulted in glaring racial disparities, was "a big mistake." He switched from pushing mandatory minimums to advocating their elimination. And he said the federal government should "leave decisions regarding legalization for recreational use up to the states."

That last promise cannot be fulfilled as long as federal prohibition remains in place. Until marijuana is descheduled, state-licensed marijuana businesses will remain criminal enterprises under federal law, which makes it hard for them to obtain financial services and exposes them to the risk of prosecution and civil forfeiture. For businesses that serve the recreational market, prosecutorial discretion is the only protection against that risk.

Reclassifying marijuana as a Schedule III drug, another move that Biden touted last night, would leave federal prohibition essentially untouched. It would not decriminalize the cannabis industry or remove the various legal disabilities triggered by participation in that industry or by cannabis consumption, such as the loss of Second Amendment rights and ineligibility for admission, legal residence, and citizenship under immigration law. Rescheduling would not even make marijuana legally available as a prescription medicine, which would require approval of specific products by the Food and Drug Administration.

Until marijuana is "removed from the Controlled Substances Act entirely," Packer notes, "federal criminalization will continue to ruin countless lives, create barriers to jobs, housing, food, and education and disproportionately harm Black and Brown communities. If Biden is truly committed to ending the failures of federal marijuana criminalization he should: expand pardons and commutations beyond simple possession cases; end marijuana-based deportations of noncitizens; direct his administration to revise policies related to marijuana, including access to housing and food assistance programs; and call on the DEA and Congress to federally decriminalize marijuana by descheduling it."

Biden has stubbornly resisted federal legalization, saying he is worried that marijuana might be a "gateway" to other, more dangerous drugs—an argument that pot prohibitionists have been deploying since at least the early 1950s. That position flies in the face of public opinion. According to the latest Gallup poll, 70 percent of Americans, including 87 percent of Democrats, favor legalization.

Support for repealing pot prohibition is especially strong among younger voters, whose behavior in November could be crucial to Biden's reelection. It is therefore not surprising that his campaign is trying to boost turnout among those voters by bragging that Biden "changed federal marijuana policy" (which so far is not accurate) because "nobody should have to go to jail just for smoking weed," which almost never happens under current law and won't happen less often as a result of Biden's pardons or rescheduling.

Even if Biden had the power to unilaterally decriminalize low-level marijuana possession, that step would not address today's central cannabis issue, which is the conflict between federal law and the laws of the 38 states that have legalized marijuana for medical use, including two dozen, accounting for most of the U.S. population, that also allow recreational use. Instead of addressing that issue, which is what an overwhelming majority of his supporters would like him to do, Biden is acting as if it is still 1972.

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