Legal Cannabis Is Powering the US Economy; Washington Needs to Catch Up

This fall, the Drug Enforcement Administration is anticipated to decide whether to reclassify cannabis at the federal level. Nearly 90% of Americans support cannabis legalization, 47 states have legalized it for medical use, and over 20 allow for recreational use. The question is no longer whether the United States should move toward legalization, but why federal law still treats a mainstream industry as a crime.

In 2024, Americans spent just as much on cannabis as they did on beer. The US legal cannabis market is worth more than $35 billion and expanding quickly. Yet, under federal law, cannabis is still a Schedule I drug, grouped alongside heroin and considered to have “no medical use.” It’s a Nixon-era relic that has remained unchanged since 1971—by those outdated standards, cocaine and crystal meth are classified as less harmful Schedule II substances. That classification is not only outdated, but it also creates an untenable mismatch between federal policy and economic reality.

Today, cannabis is one of the fastest-growing industries in America, employing nearly 500,000 people—more than the beverage and tobacco manufacturing industries combined—and generating billions in annual tax revenue. Federal legalization would strengthen an already significant engine of economic growth. The cannabis industry added roughly $115 billion to the US economy in 2024 alone and is expected to reach $45 billion in legal sales by 2025. It is one of the few sectors that is both labor-intensive and domestically produced—every gram sold is grown, tested, packaged, and distributed in the US.

All of this growth has happened without access to the basic tools every other sector relies on: banking, capital markets, credit cards, and institutional investment. Because cannabis remains federally illegal, businesses can’t take out conventional bank loans, list on US stock exchanges, or process credit card payments. Dispensaries operate as cash-only businesses, creating daily security risks for employees and customers. Entrepreneurs cannot access Small Business Administration loans or standard insurance. Even employees, founders and executives in the cannabis industry often struggle to qualify for personal mortgage loans due to the industry they work in.

Rescheduling would not be radical. It would be a recognition of the obvious: Cannabis is already part of American life and the American economy.

The result is a thriving yet hobbled industry, competing on an uneven playing field. Legal operators are forced to navigate a different set of regulations, packaging requirements, and facilities for every state where they conduct business, while the illicit market still accounts for an estimated $50 billion in unregulated sales each year and has no problem selling cannabis to the American youth. The DEA’s forthcoming decision offers an opportunity to modernize this system before it calcifies further.

The cultural and economic shifts are here to stay. Cannabis is mainstream. It’s integral to how Americans relax, socialize, and take care of themselves. It’s in our music, our fashion, our film, and our homes. What’s missing is a legal, regulatory, and financial framework at the federal level that reflects reality.

The public health case is equally clear. Consistent national standards would strengthen consumer safety and transparency, closing the gap between legal and illicit markets. Rescheduling would also remove barriers to research and innovation. The current classification makes it nearly impossible for US scientists to study cannabis at scale, leaving critical medical discoveries to foreign and underfunded research programs.

In a country where millions of adults use cannabis for anxiety, pain, and sleep, and where opioid dependency remains a public health crisis, the restriction is not just outdated, but negligent.

A recent study published by the American Journal of Health Economics found that states with legal cannabis programs reduced opioid prescriptions by up to 22%. The American Medical Association also found that cannabis helps cancer patients reduce opioid use throughout their treatments.

Legalization would also improve public safety. With access to banking, dispensaries could move away from cash-heavy operations that make them frequent targets for robbery. National standards for labeling, potency, and contaminants would protect consumers and build trust. And as we’ve already seen in legal states, underage use declines when cannabis is regulated.

Rescheduling would not be radical. It would be a recognition of the obvious: Cannabis is already part of American life and the American economy. In 2023, the Department of Health and Human Services formally recommended to the DEA that cannabis be rescheduled—a historic acknowledgment that federal law is out of step with science, public opinion, and economic reality. Even the Supreme Court has noted the “contradictory and unstable” relationship between federal and state cannabis laws.

This is one of the few policy issues with broad bipartisan support. Former President Joe Biden campaigned on rescheduling cannabis in 2020. So did President Donald Trump in 2024. With the DEA’s decision imminent, the window for meaningful modernization has never been clearer.

The cultural reality is undeniable. The economic opportunity is massive. The public mandate is clear. The question is no longer whether cannabis belongs in American life—it already does. The question is when federal law will finally catch up.

It’s time for Washington to finish what the majority of states have already started: Bring cannabis policy into alignment with science, economics, and public consensus.