Sloe Times

I don't think there's a week that doesn't go by that there isn't either an r.g.p or 2+2 post about S. 627. Most of those posts amount to someone screaming "The sky is falling!" and getting the response, "No it's not." Neither of them being particularly useful posts, I went and did some research of my own to see what all the fuss is about.

The Internet Gambling Funding Prohibition Act (S. 627) is coming up for vote soon (I can't verify exactly when) and in reading it, there's a few interesting points that make me go hmm.

First things first, what is the purpose of the bill?

The bill makes illegal the receipt of funds from the payments system by the operator of an Internet gambling site. Because of the anticipated difficulty in enforcing this prohibition against persons outside a particular jurisdiction, the legislation also authorizes the Attorney General (and appropriate State officials) to seek an injunction against any person to prevent or restrain a violation of the ban, or to prohibit banks and other financial service providers from processing any credit card or other financial transaction with a specified illegal Internet gambling site. The bill also requires the Department of the Treasury, in consultation with the Federal Reserve Board and the Attorney General, to issue rules requiring each designated payment system, and all of its participants, to identify and prevent transactions barred by the bill--that is remittances to the operators of Internet gambling sites--through establishment of policies and procedures reasonably designed to allow identification and blocking of such transactions and to prohibit the use of payment system services for such transactions.

What follows are the reasons for this bill as presented by the committee Report to the 108th Congress (with my commentary):

Internet gambling is especially dangerous, because it can foster or enhance gambling addiction, provides no assurances against rigged games, and offers enhanced opportunities for money laundering. In addition, of course, Internet gambling diverts revenue--and taxes--from lawfully authorized gaming within the United States

Ok, so addicts with access will feed their monkey. How is this different than anything else? Bars don't have some sort of detector to limit drinking by alcoholics. The deterrent comes in the form of the bartender who may or may not decide you've had too much. Most poker rooms also implement a mechanism to prevent the uncontrollable addict from flushing his life away before someone notices by using deposit limits. Granted, this also limits their risk to credit card fraud, but that's a secondary benefit if you ask them.

Hmm, enhanced opportunities for money laundering. I guess I could see this, feed money in via dirty accounts, transfer the money to a 'clean' account and pull it out. I got to wonder though if the folks doing this take advantage of the deposit and reload bonuses. I believe there was also a report (I can not find it at the moment) from the Department of Homeland Security that basically said, operations like this support terrorism. It is unlikely however that you would actually get to play against Osama since Afghanistan has been bomb back into the stone age.

The last two items are the best in my opinion, "diverting revenue and taxes from gaming within the US" and "assurances against rigged games." To me, the solution seems pretty obvious. Legalize and regulate. Kill about a million birds with one stone. Create some jobs in the regulation area, ensure against rigged games through that same regulation, and gain extra tax money that likely isn't being recovered now (I suppose some pros may actually be claiming their winnings).

The next reason for this act is to inhibit gambling among the youth (<18 years of age). Having been a youth and actually battle a gambling addiction of sorts I can relate to this, but is this act really a solution?

In June 2002, the FTC announced the results of an informal survey of websites to determine the access and exposure teens have to online gambling. The FTC visited over 100 popular gambling websites and found that minors can, indeed, access these sites easily. FTC staff found that the gambling sites had inadequate or hard-to-find warnings about underage gambling prohibitions, and that some 20 percent had no warnings at all. The survey also found that these gambling sites had no effective mechanism to block minors from entering.

Are you kidding me with this? I have not come across one site that didn't at least ask me my age as part of the registration process. Granted I could be a twelve year old (my wife accuses me of as much) and lied, but how is that the casino's fault? I could do the same thing to access pornography, and you don't see a bill or act going before congress and the senate to ban banking transactions with those types of sites. In the list of addictions, I believe sexual addiction is up there and online porn feeds that monkey too.

So the NCAA is concerned about online gambling from college students. Perhaps if ethics made up a portion of our pre and post secondary education that might not be an issue. Then again, who am I trying to fool? The only thing online gambling does is provide more options on where college students can wager their money. If it went away tomorrow they wouldn't stop gambling, but the local bookies would be happier.

The Internet is an addiction enabler:

For 15 million Americans with gambling problems, gambling is every bit as addictive as alcohol or illegal drugs can be. Recovering from a gambling problem is a lifelong struggle. Internet access tilts the playing field against the addict, by making gambling easily accessible in the comfort and privacy of the home. And, in so doing, Internet gaming removes the impediment of traveling to a casino or track, and shields the problem gambler from the public stigma that may help the addict to refrain.

So because 15 million people have a problem, we should pander to them and damn everyone else? I certainly appreciate the fact that there are impulses that people can not control without help. But you're promoting victimization (is that a word?) by way of the Internet with this argument. To me, this is like saying gas stations will no longer process ATM or credit cards because the roads enable alcoholics to access the drive-through liquor store from the privacy of their car. Maybe I'm stretching it here, but this is what it seems like to me.

An interesting thing to note is that there were two House bills that had a similar purpose, H.R. 21, and H.R. 2143. One of the provisions there allowed states to sanction and regulate Internet gambling within their own borders. S. 627 removes this provision.

Personally, I think they should save the $9 million they're projecting that enforcing this bill over a 5 year period would cost and introduce a new bill for the legalization and taxation of internet gambling.