In the Cannabis Civil War, Consumers Lose

The battle between hemp and marijuana is usually described as a fight over regulation, licenses, and market share. But the real casualty may be the American consumer.

For several years I have written about the “Cannabis Civil War”, the increasingly bitter conflict between the hemp and marijuana sectors of the cannabis industry.

At one level, the fight is easy to understand. State-licensed marijuana companies operate in extraordinarily expensive and restrictive regulatory systems. Many pay enormous licensing fees and taxes. They are limited in where they can operate, what they can sell, how they can advertise, and often even whom they can obtain financing from. Meanwhile, the 2018 Farm Bill opened a federally lawful hemp market that developed much more like an ordinary consumer-products industry.

From the perspective of a marijuana operator struggling under layers of state regulation, that disparity understandably feels unfair. However unfair that may be, there are two ways to solve an uneven playing field.

One is to reduce unnecessary restrictions on marijuana while imposing reasonable safety regulations on hemp. The other is to destroy the competing hemp market. Increasingly, powerful interests in the marijuana industry have chosen the second approach.

I have written extensively about why I think that second strategy, ie, destroying hemp, is bad for hemp, bad for small businesses, bad for farmers, and ultimately bad for cannabis reform. What has received far less attention, however, is the constituency that has the most to lose from this war and is rarely invited to participate in it, namely, the cannabis consumer. 

And once we look at the Cannabis Civil War from the consumer’s perspective, the policy debate changes dramatically.

The Cannabis Civil War is really a fight over who gets to sell cannabis

Strip away the terminology for a moment. “Hemp” and “marijuana” are not two different plants. They are legal classifications imposed on Cannabis sativa L. The distinction matters enormously under the law, but it means considerably less to the person purchasing a gummy, beverage, tincture, vape, topical, or flower. 

The consumer generally wants a particular product, effect, dosage, price, level of convenience, and degree of confidence that the product is what its label says it is.

The hemp-marijuana divide currently determines who is permitted to satisfy that demand. This is why much of the current political fight is not really about whether adults will consume cannabinoids. (They will.) It is about who will be authorized to sell those cannabinoids, through what channels, at what price, and under whose regulatory control.

A safety regulation asks: How can we make a market safer? A market-control measure asks: Who gets to participate in the market? These questions are routinely conflated in the cannabis debate.

If the identified problem is that minors can purchase cannabis products, the logical response is age restrictions and enforcement. If the problem is contaminated or inaccurately formulated products, the logical response is manufacturing standards and testing. If consumers do not know what they are ingesting, require accurate and uniform labels.

But if the proposed “solution” to each of those problems is that the product may only be sold through a limited universe of incumbent marijuana licensees, policymakers should ask whether they are actually being presented with a consumer-safety proposal or a market-allocation proposal. Regulation should target the dangerous conduct, not simply eliminate the competitor.

Hemp created something marijuana never did: a national cannabis market

One of the most underappreciated consequences of the 2018 Farm Bill is that hemp created the closest thing the United States has ever had to a national cannabis market.

Section 10114 expressly stated that nothing in the Farm Bill prohibited the interstate commerce of federally lawful hemp or hemp products and prohibited states and Indian tribes from blocking the transportation of compliant hemp through their territories. That did not prevent states from regulating retail sales within their borders. But it gave lawful hemp something adult-use marijuana has never had: an expressly recognized federal interstate commerce channel. The practical result was profound.

Consumers gained access to cannabinoid products through specialty hemp stores, grocery stores, bottle shops, wellness retailers, restaurants, e-commerce sites, convenience stores, and other ordinary channels of commerce. A national supply chain developed. Small manufacturers could reach customers in multiple states. Consumers could choose among thousands of brands, product formats, formulations, cannabinoid ratios, and price points.

It was messy and imperfect. Federal regulators largely failed to create the comprehensive product standards that the emerging industry needed. States often filled in regulatory gaps, but often with competing regulations that made it difficult for national businesses to operate compliantly. But it was also an extraordinary experiment in what a post-prohibition cannabis market might look like.

Now we are dismantling it.

The federal law enacted in November 2025 and scheduled to take effect on November 12, 2026, rewrites the definition of hemp, applies a total-THC standard, excludes various cannabinoids, and excludes final hemp-derived cannabinoid products containing more than 0.4 milligrams of combined total THC and similar cannabinoids per container. That is not literally a prohibition on every conceivable hemp product. But for the consumer cannabinoid market, it is close. Arguably, it also offshores the production of all hemp products, including CBD isolate-based products, since there is no exemption for work in progress hemp extract.

A March 2026 preliminary economic assessment by Whitney Economics estimates that the 0.4-milligram standard would render approximately 95% of existing hemp-derived consumer products federally unlawful. Importantly, the report is transparent that its updated national figures are preliminary extrapolations rather than a new nationwide survey. But its earlier 2023 national survey estimated a hemp-derived cannabinoid consumer market of approximately $28.4 billion, supporting about 328,000 jobs and more than $13.1 billion in wages. Its preliminary 2025 extrapolation places the market considerably higher, between $37.5 billion and $50.9 billion under its baseline methodology.

Reasonable people can debate the precise size of the market, but what cannot reasonably be debated is that it is enormous. A market that large represents something more important than businesses and jobs. It represents consumer demand.

Congress can change the legal definition of hemp. It cannot repeal consumer demand by statute.

Where Will consumers go?

This is the one question that seems almost entirely absent from the Cannabis Civil War. Suppose the federal hemp provisions take effect substantially as enacted and most cannabinoid hemp products disappear from lawful commerce. What happens to the people who buy them today? The answer depends heavily on where they live.

An adult consumer in Colorado, California, Michigan, Massachusetts, or another state with a functioning adult-use marijuana system may have a comparatively easy transition. The consumer can go to a licensed dispensary and buy cannabis. But even that consumer loses something.

The range of available sales channels shrinks dramatically. The national hemp market becomes a state-bound marijuana market. Products lawfully purchased within a state do not suddenly become ordinary articles of interstate commerce merely because the consumer bought them legally. A traveler cannot treat adult-use cannabis the way he treats a bottle of wine or an over-the-counter consumer product. Also, prices matter.

It would be inaccurate to claim that legal marijuana is always more expensive than illicit marijuana. A peer-reviewed 2026 study comparing legal and illicit cannabis prices in eight adult-use states found legal products cheaper in Colorado, California, and Michigan, while illicit cannabis was cheaper in Massachusetts, Illinois, Maine, and Connecticut. The authors found that mature markets with more flexible licensing tended to be better positioned to compete with the illicit market.

Another 2026 economic study found that a 10% increase in legal cannabis prices was associated with a 17.8% reduction in legal recreational cannabis sales, while cannabis taxes significantly increased retail prices.

Those findings should be flashing red lights for policymakers.

The illicit market is not merely a problem of insufficient enforcement. It is also the predictable residual market when lawful cannabis is too expensive, too inconvenient, too limited, or simply unavailable.

Now consider the consumer who lives in a medical-only marijuana state. That person may not have a qualifying medical condition, may not want to register with the state, may not have convenient access to a medical dispensary, or may simply prefer a low-dose hemp beverage, gummy, tincture, or other product that does not fit neatly into the state’s medical-marijuana system.

Then consider the consumer in a state with zero marijuana reform, such as my home state of North Carolina. North Carolina’s own Advisory Council on Cannabis reported in April that marijuana remains illegal under state law for both adult and medical use, subject to the important tribal-sovereignty exception on the Qualla Boundary. For those consumers, the disappearance of the lawful hemp market does not mean that they will just have to go to a marijuana dispensary. For those consumers, there is no marijuana dispensary to go to.

So what happens?

Some people may stop consuming cannabis. Some will travel to get it, and of those people some will unlawfully bring the products back to their home state. Some will find substitutes. Some will obtain products from friends. And some, probably most, will return to the illicit market. That is not a public-health victory.

We should take the safety argument seriously

There are real problems in the hemp industry. I say this as someone who has represented hemp companies for over a decade and have consistently advocated for the industry.

There are irresponsible operators. There are poorly formulated products. There are products with inaccurate labels. There have been products marketed in ways that appeal to children. There have been retailers that did not adequately restrict sales to adults. We should not pretend otherwise.

The FDA has documented legitimate concerns involving delta-8 THC, including adverse-event reports, manufacturing and contamination issues, and pediatric exposures. National poison-control centers recorded 2,362 delta-8 exposure cases during the period FDA examined from January 2021 through February 2022; 41% involved patients under 18, and pediatric patients accounted for a large majority of the reported unintentional exposures.

Those are facts, and responsible hemp advocates should address them rather than wave them away. But recognizing a problem does not dictate a particular solution.

Cars cause accidents. We regulate cars. Alcohol can harm minors. We regulate alcohol and prohibit sales to children. Food can be contaminated. We impose manufacturing, inspection, labeling, and adulteration standards. In other words, we do not generally respond to consumer-safety problems by announcing that only a handful of incumbent businesses may sell the entire product category. In fact, that seems a bit insane to even consider if we think about it in the context of just about any other product or industry. 

This is precisely why I have advocated for years for the Three Pillars approach to cannabis regulation: restrict access by minors; establish standardized quality-control and manufacturing requirements; and require uniform, informative labeling so adults know what they are buying and consuming. That is regulation, not prohibition.

If reasonable potency rules are also appropriate for particular product categories, have that debate. If child-resistant packaging is needed, require it. If certain synthetic compounds present unacceptable risks, address them based on evidence. If a retailer knowingly sells an adult cannabinoid product to a fourteen-year-old, impose meaningful penalties.

The important thing is not to confuse regulating a product with restricting who gets to profit from selling it. Those are totally different public policies.

The “unregulated hemp” argument is becoming increasingly difficult to sustain

One of the marijuana industry’s most effective political narratives has been that marijuana businesses are regulated while hemp businesses are “unregulated.” That description has always been an oversimplification. Hemp is regulated by a patchwork of federal and state laws, although that patchwork is unquestionably inconsistent and has serious gaps.

More importantly, the responsible hemp industry has repeatedly supported additional regulation. The bipartisan Lawful Hemp Protection Act, introduced this July by Representatives Andy Barr and Angie Craig, makes the point vividly. The legislation would establish federal rules involving age restrictions, manufacturing, testing, labeling, packaging, marketing, domestic sourcing, cannabinoid limits, and other consumer protections. Major hemp organizations support the legislation.

I have already written that the bill should be improved, particularly because its treatment of total THC would eliminate the lawful THCA flower market. But its existence demolishes the claim that policymakers face only two options: an unregulated hemp free-for-all or prohibition.

There is a third option: regulate the market. The hemp industry has been asking for that option for years.

The marijuana industry’s prohibitionist allies should make it nervous

There is another aspect of this fight that I think the marijuana industry may eventually regret. The campaign against hemp has produced some remarkable political alignments.

Earlier this year, Representative Barr described opposition to his proposed hemp regulatory framework as including what he called “strange bedfellows”: marijuana businesses, sectors of the alcohol industry, and opponents of cannabis legalization.

Whether these groups maintain formal alliances is less important than the obvious fact that they have converged on the same legislative outcome. And marijuana businesses should think carefully about the company they are keeping on this particular issue.

Smart Approaches to Marijuana (“SAM”), for example, is not simply an anti-hemp organization. It is a longstanding opponent of marijuana commercialization. In May, SAM publicly applauded congressional efforts both to enforce the new federal hemp-THC ban and to block marijuana rescheduling. It subsequently participated in the DEA rescheduling proceeding and urged the government to keep marijuana under stricter federal control. That should tell the marijuana industry something:

You do not borrow a prohibitionist’s weapon and get to decide where it will be pointed next.

Consider the arguments now being normalized in the campaign against hemp: cannabinoid products are too potent; broad consumer availability is dangerous; ordinary retail channels cannot be trusted; cannabis companies target children; intoxicating cannabis should be confined to tightly restricted sales systems; increased access creates unacceptable public-health risks. If those propositions become the accepted basis for cannabis policy, why would anyone assume they will stop at the legal definition of “hemp”? They won’t.

The same arguments can be, and already are being, deployed against marijuana concentrates, edibles, high-THC flower, advertising, dispensary density, medical access, adult-use legalization, and marijuana rescheduling. Regulatory arguments are precedents, not one-use coupons. The marijuana industry may succeed in destroying a competitor only to discover that it strengthened the political and rhetorical architecture of its own future restriction.

We are replacing a national market with fifty cannabis islands

There is also a deeper constitutional problem waiting in the background. For years, hemp and marijuana have operated under almost opposite commerce models. Federally lawful hemp developed interstate supply chains. State marijuana systems developed as isolated intrastate markets: cultivation here, manufacturing here, sale here, all behind state borders. Those marijuana islands are already generating constitutional litigation.

In 2022, the First Circuit held that Maine’s marijuana residency requirement violated the dormant Commerce Clause. In 2025, the Second Circuit concluded that traditional dormant Commerce Clause principles applied to New York’s protectionist cannabis-licensing provisions despite marijuana’s federal illegality. Then, in January 2026, the Ninth Circuit went the other way, holding in Peridot Tree that the dormant Commerce Clause does not protect interstate commerce in a marijuana market Congress has declared illegal. We now have a genuine federal circuit split over the constitutional architecture of state cannabis markets.

That litigation has generally been brought by businesses challenging protectionist licensing rules, not consumers claiming some freestanding constitutional right to cannabis. But consumers are affected by the market architecture those cases are testing. I expect considerably more litigation over cannabis access and interstate commerce as the contradiction becomes harder to maintain.

Think about what we are doing. At the very moment the country has developed a large national market for federally lawful cannabinoid products, we are attempting to dismantle it and push consumers toward geographically restricted state marijuana markets whose underlying protectionist structures are already producing conflicting federal appellate decisions. That is regulatory regression.

Cannabis policy needs a consumer test

Policymakers evaluating hemp legislation should start asking questions that have been mostly absent from the debate.

After this proposal is enacted, will an adult consumer have more or fewer lawful choices? Will the products available to that consumer actually be safer? Will minors have less access? Will compliant manufacturers have meaningful incentives to test and label their products accurately? Will prices remain competitive enough to draw consumers away from illicit sellers? Will adults in states without marijuana programs retain a lawful source of cannabinoid products? Will the policy increase competition or merely transfer market share from one regulated industry to another?

Most importantly: What will the consumer actually do the morning after this law takes effect? If the answer is, “Drive farther, pay more, have fewer choices, buy from an illicit seller, or lose access altogether,” perhaps we have not enacted good cannabis policy. Perhaps we have simply picked a winner in an industry turf war.

Cannabis reform should expand lawful access, not recreate prohibition

I have long argued that the hemp-marijuana distinction has outlived much of its usefulness and that the ultimate goal should be a rational, unified system for regulating cannabis. That does not mean a regulatory free-for-all.

Rather, it means acknowledging that cannabis is one plant, that adults use it for many different reasons and in many different forms, and that government should focus primarily on the things government can legitimately improve: protecting minors, ensuring product quality, giving consumers accurate information, punishing fraud, and creating sensible rules for commerce.

The worst possible outcome is to preserve all of marijuana’s burdens while destroying hemp’s advantages. Yet that is precisely where the Cannabis Civil War may be taking us.

The marijuana industry complains, often correctly, that it is overtaxed, overregulated, geographically confined, burdened by artificial license scarcity, and forced to compete with an illicit market. Its solution should not be to impose those same disabilities on everybody else. It should be to remove unnecessary disabilities from itself.

Cannabis reform that reduces lawful access, narrows consumer choice, suppresses competition, increases prices, and redirects existing demand toward illicit sellers is not meaningful reform merely because the resulting products are sold by licensed cannabis companies.

There are bad actors in hemp. Regulate them. There are unsafe products. Establish standards. There are retailers selling to minors. Stop them. There are misleading labels. Punish them. But do not burn down an enormous legal market in the name of fixing problems that ordinary regulation can address. And do not forget the millions of adults who built that market by choosing to participate in it.

Ultimately, the Cannabis Civil War is a struggle over what the post-prohibition cannabis market will look like. Will be open or closed, national or fragmented, competitive or concentrated, consumer-oriented or licensee-oriented?

If marijuana succeeds by eliminating hemp rather than improving cannabis policy, it may discover that it did not actually win the Cannabis Civil War. It merely helped rebuild the walls of prohibition, and consumers will be the first people trapped behind them.

Thanks to my friend and colleague, Amber Lengacher, for her thoughts and insights that sparked my desire to write this article. She has always advocated for the cannabis consumer. 

August 7, 2026