Marijuana reform is emerging as a midterm elections issue on both sides of the aisle — CNBC

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Marijuana has had a history of highs and lows in the U.S. over the past century — legally, politically and culturally — teetering between vilification and acceptance. Since 1996, 40 states and the District of Columbia have legalized either medical or recreational adult-use marijuana. Yet cannabis, the leafy plant from which marijuana is derived, is still a federally illegal Schedule I drug as defined by the 1970 Controlled Substances Act.

With November's pivotal midterm elections fast approaching, cannabis reform is emerging as an important issue. Two states, Massachusetts and Idaho, will vote on ballot initiatives regarding legalization, and in several others, including Kansas and Iowa, gubernatorial candidates are debating cannabis matters.

Marijuana may not be as critical to voters as the economy, immigration, the war with Iran and the build-out of AI data centers . But it will likely be on the minds of Democrats and Republicans over the next few months.

"It's certainly a very popular issue among voters," said Morgan Fox, political director for NORML, a non-profit group that advocates for cannabis legalization. "It's possible that it could become a more important issue as we get closer to the midterms, particularly if Republicans are worried about losing one or both chambers."

President Donald Trump shined a political grow light on the issue last December when he urged the Justice Department to expedite the reclassification of marijuana from Schedule I to Schedule III, a category that includes Tylenol with codeine, ketamine and testosterone.

The timing of Trump's announcement — coupled with his administration's recent order to fast-track approval of psychedelic drugs , as well the president's slumping approval rating — could be seen as a tactic to boost Republican voters who support loosening drug restrictions. It also steals thunder from Democrats, who had failed to reschedule cannabis during Biden's tenure .

Trump's switch came to fruition, at least partially, in April. Acting Attorney General Todd Blanche signed an order to reschedule state-licensed medical marijuana to Schedule III, thereby easing research restraints and federal tax burdens on companies operating in the $30-billion legal cannabis industry. In a probable nod to voters, outgoing White House press secretary Karoline Leavitt said that rescheduling is "overwhelmingly popular with the vast majority of Americans."

Sixty-four percent of U.S. adults think the use of marijuana should be legal, according to a November Gallup poll.

But that popularity may not translate directly into votes, according to Kevin Sabet, CEO of Smart Approaches to Marijuana, a non-profit that opposes marijuana legalization and commercialization. He believes that cannabis reform will be a low-priority issue come November. "It's traditionally let down the politicians who thought they were going to be scoring some cheap votes," he said, "most recently, the president."

The Gallup data shows public support has declined from 70% in 2023, a trend that can be interpreted as politically motivated. Support for legalization among Republicans has fallen 13 points over the past year, to 40% from 53% — despite Trump's warming relationship with the industry — while it's been consistent among Democrats (85%) and independents (66%) in recent years.

At the federal level, "cannabis will still be illegal," Fox said of the rescheduling efforts. "The most concrete benefit of moving to Schedule III is 280E tax relief for cannabis businesses," he said, referring to the IRS code that prohibits legal cannabis companies from deducting otherwise established business expenses, such as payroll, rent and utilities, from gross income.

"280E has always been one of those things that you just have to operate around," said Matthew Melander, president of Sun Theory, a vertically integrated company that cultivates cannabis and operates dispensaries and markets branded edibles. "We know that if [it] does go away, that inherently makes the industry more profitable."

Sabet concedes that the industry would benefit from the removal of 280E. "I just don't think it's a good thing," he said. "The last thing pot companies need are tax breaks."

In fact, the prospect of rescheduling stoked Trump supporters in the industry who have lobbied the administration for federal and state reforms to onerous cannabis regulations. Most prominent among them is Kim Rivers, CEO of Trulieve , one of the largest U.S. cannabis companies, who donated $750,000 to the president's inauguration last year and attended a private $1 million-per-plate fundraiser at Trump's New Jersey golf club, where she urged the president to follow through on marijuana rescheduling and expand medical-cannabis research , according to the Wall Street Journal .

To date, Trulieve and other industry leaders, including Curaleaf , Green Thumb Industries and Verano Holdings , have contributed roughly $11.5 million into the Trump-aligned super PAC America First Agriculture Action Inc. ahead of the midterms, according to filings with the Federal Election Commission.

Nonetheless, many Republican lawmakers oppose cannabis reforms. More than 20 GOP senators and several House members signed letters urging the White House to halt reclassification. In August 2025, Rep. Paul Gosar (R-AZ) wrote, "Marijuana rescheduling will … not be the boon to the Republicans' midterm chances like Big Weed claims. In fact, reclassifying marijuana as a Schedule III drug would be a self-own for the Republican Party in 2026."

Across the aisle, Congressional Democrats tepidly endorsed the order, labelling it a partial solution that fell short of full legalization, a policy that many in the party favor. Last month, 17 Senate Democrats, led by Cory Booker (NJ), Chuck Schumer (NY) and Ron Wyden (OR), reintroduced the Cannabis Administration and Opportunity Act, for the second time. If it pa...

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