California Senate Passes Bill In Attempt To Bypass Federal Reserve With A Completely Separate Banking System
Frankly, anything to get away from the money printing scheme of the Federal Reserve is welcome and people are coming up with all sorts of ideas. From blockchain cryptocurrencies to old fashioned bartering, people who want to move out of the system are looking for more and more ways to do it. Now, the state of California is looking to try and also move away from the Federal Reserve, at least to some degree. The California Senate has just passed a revolutionary bill that will nullify the control of the Federal Reserve over the cannabis industry.
How are they going to do it?
They are looking at creating a totally separate banking industry solely for cannabis.
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The Tenth Amendment Center reports:
On Tuesday, the California Senate passed a bill that would establish limited state-chartered banks to serve the cannabis industry. Final passage of this legislation would remove a major federal roadblock in front of the developing industry in the state and further nullify federal prohibition in practice.
Sen. Bob Hertzberg, (D-Van Nuys), along with a bipartisan coalition of eight cosponsors, filed Senate Bill 51 (SB51) on Dec. 4. The legislation would create a self-contained banking system for the cannabis industry in California.
Because marijuana remains illegal under federal law, cannabis businesses in states that have legalized marijuana remain effectively locked out of the banking system. If a federally chartered or insured financial institution touches marijuana money, it takes on significant legal risk. The federal government insures or charters virtually every bank in the U.S. As a result, cannabis businesses have been forced to transact almost exclusively in cash. Passage of SB51 would completely bypass the federal banking system and create a limited banking alternative for the marijuana industry in California.
On May 21, the Senate passed SB51 by a 36-1 vote.
TAC goes on to point out what would happen.
Under the proposed law, the state would license “cannabis limited charter banks and credit unions.” Cannabis businesses would be able to deposit funds in these institutions and write “special purpose checks” on their accounts for limited purposes, including paying state or local fees and taxes, paying rent on property associated with a cannabis business, paying vendors, or buying state or local bonds or warrants. These checks could only be deposited or cashed at the issuing cannabis limited charter bank or credit union, or another cannabis limited charter bank or credit union that agrees to accept the check. This would keep the entire process outside of the federal checking system known as the automatic clearing house (ACH).
Cannabis limited charter banks and credit unions would be allowed to form banking networks, but they could not engage in banking activity with any other bank or credit union. They would also be able to provide accounts to people and entities other than cannabis businesses, pursuant to rules adopted by the commissioner of the Department of Business Oversight.
A similar bill passed the California Senate during the last legislative session, but it died during the Assembly committee process.
“The status quo for our growing legal cannabis industry is unsustainable,” Hertzberg said in a press release last year. “It’s not only impractical from an accounting perspective, but it also presents a tremendous public safety problem. This bill takes a limited approach to provide all parties with a safe and reliable way to move forward on this urgent issue.”
So, why is this important? The issue of cannabis is definitely one that people should step back and think long and hard about a government that believes it has authority to ban a plant. Seriously, it’s the simplest way to demonstrate the tyranny of government.
Whether you agree with the use of cannabis for medical or recreational use or not is actually irrelevant here.
TAC demonstrates how the federal government has used banking laws to stifle businesses.
The Federal government has used banking laws as a weapon in its unconstitutional war on cannabis by making it impossible for marijuana businesses to access the banking system – even in states where marijuana has been legalized. The feds can prosecute bankers for knowingly engaging with cannabis businesses under the Bank Secrecy Act, the USA Patriot Act, and the Racketeer Influenced and Corrupt Organizations (RICO) Act.
The Federal Reserve has gotten into the act, denying its services to state banks chartered to serve the marijuana industry.
Some of those businesses have taken the route of cryptocurrency to circumvent the banking system.
As states begin to flex their rights against unconstitutional federal legislation, it does provide more freedom to the people.
As TAC points out, this is becoming a growing movement.
California is among a growing number of states simply ignoring federal prohibition, and nullifying it in practice.
Colorado, Washington state, Oregon and Alaska were the first states to legalize recreational cannabis, and California, Nevada, Maine and Massachusetts joined them after ballot initiatives in favor of legalization passed in November 2016. In January, Vermont became the first state to legalize marijuana through a legislative act, and Michigan passed a ballot measure legalizing cannabis for general use.
With 33 states allowing marijuana for medical use, the feds find themselves in a position where they simply can’t enforce prohibition anymore.
“The lesson here is pretty straightforward. When enough people say, ‘No!’ to the federal government, and enough states pass laws backing those people up, there’s not much the feds can do to shove their so-called laws, regulations or mandates down our throats,” Boldin said.
Efforts to expand California’s marijuana law demonstrates another important reality. Once a state puts laws in place legalizing marijuana, it tends to eventually expand. As the state tears down some barriers, markets develop and demand expands. That creates pressure to further relax state law. These bills represent more steps forward for patients seeking alternative treatments and further erosion of unconstitutional federal marijuana prohibition.
Up next, SB51 goes to the Assembly for further consideration.
While California definitely has lots of problems as a Socialist state, this is actually one area I think is a good flex of state muscle against the federal tyranny.
Article posted with permission from Freedom Outpost