Congress gives online gambling the royal flush

Around midnight on Sept. 29, 2006, Congress passed the Safe Port Act, a law to help ensure the security of our country against potential terrorist action on our ports . oh, and to ban all online gambling. Uh, except horse racing. And fantasy sports.

The legislation, titled the Unlawful Internet Gambling Enforcement Act, was attached to the unrelated security bill by a small group of congressmen led by Senate Majority Leader Bill Frist (R-Tenn.).

Once it was added to the security bill, it was guaranteed to pass immediately since the primary security focus of the bill could not reasonably be opposed. Not exactly the most equitable way of passing legislation, but hey, apparently that’s how things work here.

The motivation for the Internet gambling ban is unclear. Several completely baseless justifications have been thrown around, such as asserting that online gambling sites are unregulated (actually, they are all monitored and regulated in other respectable countries including the United Kingdom and Canada); that they can’t stop children from playing (actually, every major site has an identity verification process that prevents underage players from creating accounts); that they allow money laundering (actually, every site has highly comprehensive monitoring systems for suspicious exchanges of money); or even that online gambling supports terrorists (yes, supporters of this legislation actually claimed this without any evidence).

Many supporters of the ban are acting on uninformed moral judgments about “gambling” as a whole, judgments which have no place being legally imposed on the rational members of our country.

Even if the idea “all gambling is bad” was somehow accepted as universally true, there are at least a dozen problems with this bill. Most significantly, this goes against explicit demands by the World Trade Organization forcing the United States to allow its citizens to participate in the international online gambling industry.

The enforcement part of the bill asks U.S. banks to monitor all transactions to ensure none go towards “unlawful Internet gambling” – a costly and unreasonable system against which several banking groups have spoken out. Furthermore, those players who are most addicted to gambling will find alternative ways of funding their online accounts, ensuring that this bill does very little to protect the few that actually need protecting. This effort bears more than a few similarities to the fruitless Prohibition that our country tried out about a century ago. The notable difference, of course, is that alcohol adversely impacts a much, much higher percentage of its users than online gambling does.

Possibly the most outrageous part of the bill is that, while placing a blanket ban on all forms of Internet gambling, it unabashedly calls for several exceptions. Off-track horse betting and fantasy sports remain legal under this legislation, purely for disgusting political reasons. These activities flow money directly to the government by being state-operated.

So then why isn’t our country legalizing, regulating and taxing online gambling as so many other countries have chosen to do? Analysts have concluded that this move would increase U.S. tax revenue by about $3 billion, and the increased regulation would allow the government to more closely monitor and help addicted gamblers.

A further unconscionable aspect of the bill is that poker, a highly strategic and widely popular game with deep roots in American history and culture, was not given an exception in this legislation, surely due to grievous misconception of the game on the part of our government.

Unlike house-edge games such as roulette or blackjack, poker is a game played between players rather than against the house. As such, poker is a game in which the best players have an edge, guaranteeing them to win in the long term against less skilled players, just as a roulette player is guaranteed to go broke over time.

Due to the strategic nature of poker, a player is far less likely to develop an unhealthy gambling addiction than a player of noncompetitive house-edge games such as the legalized and heavily advertised state lotteries. Online poker is much more similar to online stock trading (a form of gambling that is still legal under this law, by the way, since it doesn’t “look like” traditional gambling) than online slot machines, yet Congress has made no effort to make this distinction.

Various polls have shown that over 70 percent of Americans oppose a ban on online poker while only about 3 to 5 percent support it, but the way this legislation was passed helped keep it from receiving due consideration from a reasonable representative sample of the people. Millions of Americans who enjoy playing online poker have just been deprived of their constitutional right to do so for no good reason.

This is an issue which will only impact 2 to 3 percent of Americans, but even for those that don’t care about online gambling, the hypocrisy, economic fallacy, general restriction of rights and “legislating morality” of this issue should be cause for concern.

This law is a terrifying precedent for future governmental control over activities that adults freely choose to do in the privacy of their own homes on the Internet.

Banning activities for all adults because some people hurt themselves as a result of them or because some people don’t like them is not rational and has never been a precedent for effective laws in our great country. It probably won’t start being one now.

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