For years, Americans have tried to predict how the US federal government would respond to the spread of cannabis legalization at the state level. Early on, we wondered if the federal government would preempt early adopter states’ efforts to legalize adult use of cannabis, which did not happen, as a majority of states have now legalized cannabis in some form. As states continued to jump on the adult-use trend, we wondered if the federal government, in an effort not to be outdone by states, would be motivated to federally legalize cannabis. But the opposite happened—what little guidance the Obama-era Justice Department provided was ultimately reversed under the Trump administration.
So here we are in a state vs. federal limbo in the US regarding cannabis. And despite renewed enthusiasm for federal legalization after Democrats won the White House and both houses of Congress, cannabis reform legislation has yet to reach President Biden’s desk.
Now the focus of reform has shifted to the likelihood of slow, federal “semi-legalization” through incremental change in the form of legislation that provides safe harbor for cannabis banks and research, without full legalization. Federal half-measures that recognize existing state legal industries, if you will.
But the importance of adopting a more modern federal policy on cannabis in the United States is more widespread than ever. During this long period of wide-ranging speculation over federal legalization, more than 30 states have enacted medical and/or adult-use cannabis programs, while both Canada and Uruguay have legalized adult-use cannabis at the federal level.
Governments around the world are considering their path toward legalization because of the perception that public health and safety can be better served by public-private regulatory partnerships based on product safety and scientific research. Europe is of particular interest on this front as countries across the continent have adopted medical use policies, with Germany seeking to legalize adult use in the near future.
Why take the time to compare trajectories of federal legalization between e.g. USA and Germany? To begin with, it’s fun, but also because Europe is a big market that lacks a big market presence for cannabis. According to a report by Prohibition Partners, the European market is set to grow from €230.7 million in 2020 to more than €3 billion in 2025, with Germany itself accounting for more than half of this market until 2024.
As Germany is likely to play a central role in the trajectory of the European cannabis model, it is worth examining both the headwinds and headwinds facing legalization in the country and how they compare to the factors influencing federal policy in the United States.
When the “traffic light coalition” was formed between the Social Democratic Party, the Greens and the Free Democratic Party in 2021, it included the legalization of cannabis in its plans for the new German government. That gave them four years to complete legalization, but time is running out to get cannabis legalization over the line.
In the run-up to a formal proposal, Germany held listening sessions with a wide range of stakeholders to get input on what the country’s cannabis market could look like. The nation’s health agency is currently working on official legislation for legalization and is set to roll it out to the public in late 2022 — at which point the four-year timeframe for legalization will already be halfway through.
While the best-case scenario would be to send this legislation through the Bundestag in early 2023, the traffic light coalition government will have to compromise with some powerful opposition parties, such as the Christian Democrats. The legislation must also gain support in the German Bundesrat and must navigate compliance with EU law and in particular the Schengen Agreement, which criminalizes the trade in non-medical cannabis.
But with Germans now showing slightly more support for legalization than continued prohibition – part of a wider trend in favor of legalization across Europe – and aid from countries such as Malta and Luxembourg, these compromises appear to be happening. The question is quickly shifting from “if” Germany will legalize cannabis to “how” it will do it.
Every day that passes before this fall’s midterm elections represents a reduced likelihood of sending any of these bills to President Joe Biden’s desk, but that doesn’t mean conversations won’t take shape for future calendar years.
Republicans are increasingly showing support for decriminalization, and the American public now overwhelmingly supports the legalization of cannabis (a 2021 Pew Research poll found that 91 percent of American adults support at least medical legalization, while fewer than one in 10 were completely against legalization), which means that there could be considerable momentum for legalization.
As with most political issues in Washington, the biggest obstacle to federal cannabis legalization is the hyper-partisanship surrounding this issue and a limited number of session days in the remainder of this Congress. There is still considerable disagreement both within and between the two major parties about what the best way forward should be for hashish legislation broadly speaking.
One thing that is clear is that Congress generally tends to be drawn to incremental cannabis policy changes ahead of full-scale federal reform or deregulation. For example, the SAFE Banking Act, which allows cannabis banking, has passed the House of Representatives with Republican support seven times, but has yet to succeed in the Senate. There are ongoing discussions about expanding the scope of the bill by attaching it to other piecemeal legislation in an effort to garner enough support to pass the Senate. Republicans have appeared to be warming to the concept of cannabis reform via bills that gradually recognize the product.
The question remains: Will Germany or the US legalize cannabis first? For Germany to cross the line first, it must find a way to navigate the complexities of EU law while establishing a pathway for cannabis imports. Beyond that, advocates must also build broader support in Berlin among the Christian Democrats, who are traditionally opposed to legalization.
In contrast, the US will continue to legalize and establish its respective state markets because sweeping legislation at the federal level is less likely to be approved at the same rate.
However, the more realistic scenario for the US is increasingly incremental change at the federal level through cannabis banking and research legislation. In the meantime, de facto legalization can be achieved by states continuing to legalize cannabis individually.
Ultimately, the nod goes to Germany, as full legalization is already on the federal agenda, and there is a better-than-a-coin-flip chance that the country is able to achieve the necessary compromises at home while successfully navigating the dynamics of international law .
