West Hollywood is painted with rainbow flags. Known as “The Creative City,” this counterculture hub is set in rolling hills, thrumming with thrift stores, vegetarian restaurants, and, since Jan. 1, four dispensaries selling recreational cannabis.

The most populous state in the union, with 39 million people, started allowing legal recreational pot sales three days before the Justice Department threatened to step up enforcement of federal prohibition.

As people waiting in a line outside West Hollywood’s MedMen brush off a rainstorm, Iain McDonald, an actor and Lyft driver from Australia, says he’s puzzled by what he sees as a “war on California.” “When they say state vs. federal – as an outsider – that doesn’t feel right,” he says. “The other countries I know would try to work with their states, not fight them.”

On America’s other coast, at the eastern terminus of historic Route 80, the Tybee Island Lighthouse throws shafts of light into a foggy night as war veterans gather at American Legion Post 154.

The post commander, Chuck Bolen, Jr., a Vietnam War veteran, leads a group of vets mostly living the retired life, who largely voted for President Trump.

But when asked about the American Legion begging Congress to deregulate marijuana to possibly help soldiers in pain, Mr. Bolen shrugs in agreement. In his experience, he says, weed is not a gateway to harsher drugs, but a potential “exit drug” for veterans addicted to opioid pain medications.

To the US attorney general, Jeff Sessions, both the Australian actor and the Georgia veteran are wrong. In 2016, Mr. Sessions, then an Alabama senator, urged Congress to acknowledge that “this drug is dangerous, you cannot play with it, it is not funny, it’s not something to laugh about … and [Congress should] send that message with clarity that good people don’t smoke marijuana.”

The decision by Sessions on Jan. 4 to rescind an Obama-era memo that allowed states to decide for themselves whether to legalize marijuana is in many ways a direct challenge to federalism. It also may hasten a showdown in Congress, which is under growing pressure to allow states alone to either regulate or prohibit the plant.

The X factor is whether the disparate groups pushing for federal marijuana deregulation – from pot growers in Texas to legionnaires on the Georgia coast – can see eye to eye long enough to force Congress’ hand on a prohibition that goes back to the 1930s and was enshrined in the Controlled Substances Act of 1970.

Either way, the heated power struggle represents, law experts say, a monumental moment for states’ rights in America and a major rethink of core values by Republican powerbrokers.

“I’ve seen stories on, ‘Congratulations, Jeff Sessions, you just hastened marijuana legalization,’ ” says University of Denver law professor Sam Kamin, co-author of “Cooperative Federalism and Marijuana Regulation,” a UCLA Law Review article. “That may be wishful thinking. But the conversation is happening now.”

A year after Colorado legalized recreational marijuana in 2012, then-assistant attorney general James Cole formalized the Obama White House position in the so-called “Cole memo,” which offered a semblance of certainty to states rejecting the federal prohibition of the substance. Sessions scrapped that direction, giving broader latitude to enforce federal law back to the 93 US attorneys.

Susan Walsh/AP Then Deputy Attorney General James Cole testifies on Capitol Hill in Washington on Sept. 10, 2013, before the Senate Judiciary Committee hearing entitled; 'Conflicts between State and Federal Marijuana Laws.'

Former US attorney Barbara McQuade notes in a Monitor interview that some US attorneys may go the “extreme” route to target growers, dispensers, and even users. Several US attorneys have signaled they are not likely to interfere with activities that the states are regulating and taxing. But the US attorney in Massachusetts, for example, has refused to signal his intent, which could complicate a summer deadline to allow recreational sales, passed by voter referendum.

Sessions’s move sent stock valuations plummeting in what has, in five years, become a multibillion dollar industry, with markets open or opening from Portland, Ore., to Portland, Maine. Twenty-nine states now regulate legal sales of medical marijuana, eight of which also offer it for recreational use. It is now also legal for Americans to possess – though not buy – recreational marijuana in Washington, D.C.

“Until last week, a venture capital investor could say, ‘Hey, all of the momentum is on the side of more and more [marijuana] markets opening,’ but now their business lawyer has to say, ‘It looks like the federal government is going to muck up the works – rocky times ahead,’ ” says Doug Berman, a constitutional law professor at the Moritz School of Law, at Ohio State University.

Politically and culturally, Mr. Berman adds, the policy shift allows Americans worried about long-term health and societal impacts of state-regulated marijuana to urge caution. “Now that the federal government shows it is committed to enforcing prohibition,” he says, “it is all the more reason [for them] to take a slow approach.”

Kevin Sabet, head of Smart Approaches to Marijuana (SAM), an anti-legalization group, praised the Sessions announcement. “This is a good day for public health,” he said in a statement at the time. “The days of safe harbor for multi-million dollar pot investments are over.” The former Obama Administration drug policy adviser added, “DOJ’s move will slow down the rise of Big Marijuana.... Investor, banker, funder beware.”

States meanwhile, are pushing back. Attorneys general from 20 states wrote to congressional leaders Tuesday seeking an expansion of banking options for businesses in the legal marijuana trade.

‘Evolution of thought’ on both sides of aisle

The Trump administration is also facing pushback from its own party.

Republican congressmen such as California’s Duncan Hunter, Alaska’s Don Young, and Florida’s Matt Gaetz see Sessions’s move as an attack on voting majorities in their states, who voted to legalize.

Sen. Cory Gardner (R) did not support legalization in Colorado in 2012, but is now defending what has grown into a billion dollar a year industry in his state. He emerged from a meeting with Sessions last week saying a congressional showdown on prohibition seems imminent. Sen. Patrick Leahy (D) of Vermont noted that the stance may play into a January deadline to reauthorize a 2014 law that directed the DOJ to not interfere with medical marijuana regulators in the states.

Rep. Tom Garrett, a Virginia Republican, is part of a shift in thought that could move the country fundamentally. He has introduced SR 1227, which would remove marijuana out of the Controlled Substances Act, which would wash Washington’s hands of weed. He predicts it would win an up-or-down vote in the House today, were leadership to allow his bill to the floor.

“The first time I ever heard the term ‘medical marijuana’ I probably laughed,” acknowledges Representative Garrett, a former assistant attorney general in Virginia.

But he says that an “interminable” queue through his office of veterans, parents, and other Americans pleading for deregulation has, for him, helped shape a deeper rethink of the constitutional implications of pot prohibition. It took a constitutional amendment to justify banning alcohol, during the Prohibition era, which lasted for a decade.

He says most Americans have become persuaded that states are able to competently regulate marijuana as they do other potentially hazardous drugs, including alcohol and tobacco.

Noting that he does not care whether marijuana is legal in California or illegal in Alabama, Garrett says, “My problem, especially as a former [assistant attorney general], is that I find nothing in our foundational documentation or in concept that would give the federal government purview over a plant which, if left to its own devices, would grow naturally in all 50 states.”

“We are in a paradigm where people go to federal prison for the same exact activity that would make them a candidate for entrepreneur of the year depending on which state they are in,” he continues. “Justice that is not blind is by definition also not justice. If I was languishing in federal prison on a marijuana charge – and that still happens today – I would be very bitter.”

In that light, he says, he has taken Sessions up on his challenge to fix the law instead of questioning rule-of-law. The ensuing debate “is a great thing from a philosophical standpoint, [signifying an] evolution of thought on both sides of the aisle. That’s good for us as a nation.”

In fact, Gallup reported earlier this month that for the first time just over half of all Republicans, 51 percent, support legalization of recreational marijuana. Ninety-four percent of Americans support medical marijuana as prescribed by a doctor, according to a 2017 Quinnipiac Poll.

In Nevada, state Sen. Tick Segerblom says there would be “riots in the streets” if federal agents began prosecuting a nascent industry that already employs 7,000 people.

“Republicans are running away from [marijuana prohibition] because if you were to run as an anti-marijuana candidate in Nevada today, there’s only one possible outcome: You would lose,” says Mr. Segerblom.

Long-time cultural antipathy for the intoxicant is shifting even in the deepest of red states, observers note.

In Georgia, Republican Gov. Nathan Deal, never a pro-marijuana advocate, signed a law in 2015 that legalized the use of cannabis extracts for a handful of childhood illnesses, including the relief of epileptic seizures. The Alabama legislature in 2016 passed Leni's Law, which decriminalized the drug for limited medical purposes.

And this month, Schulenburg, Texas, the home of the Texas Polka Music Museum, will watch as a newly-licensed farm and dispensary begins selling low-THC compounds to consumers, marking the first entrée of legal marijuana in a state defined both by its social conservatism and its staunch defense of states’ rights.

In part, says Mike Maharrey of the Tenth Amendment Center, that marijuana legalization is taking root even in red state America is an acknowledgement that federal prohibition evokes “no sense of liberty, no sense of what the people want.”

‘We’re neck deep in this’

For Mr. Bolen, the Tybee Island legionnaire, a few joints smoked in the 1970s constitutes the extent of his personal experience. But classifying marijuana as a substance with no medical benefits runs counter to his assessment of the needs of a new generation of Afghan and Iraq war veterans struggling with opioid addiction, suicidal thoughts, chronic pain, and post-traumatic stress disorder.

That sense of American veterans being denied a treatment is why “what Sessions is doing, well, I don’t like it," Bolen says. This week, the United States Department of Veterans once again said, given the federal prohibition, it cannot research any potential medical benefits.

But momentum toward legalization may be difficult to reverse, even for the federal government, says Daniel Yi, communications chief for West Hollywood’s MedMen.

“I mean, think about this: You can travel the whole western United States now and buy pot,” says Mr. Yi. “And by this summer you can do that all the way to Vancouver because Canada is going to legalize marijuana under federal law. We are not knee deep in this – we’re neck deep in this.”