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**** Newsweek article on new law - Good stuff****

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  • **** Newsweek article on new law - Good stuff****

    Prohibition II: Good Grief

    When government restricts Americans' choices, ostensibly for their own good, someone is going to profit from the paternalism.



    Oct. 23, 2006 issue - Perhaps Prohibition II is being launched because Prohibition I worked so well at getting rid of gin. Or maybe the point is to reassure social conservatives that Republicans remain resolved to purify Americans' behavior. Incorrigible cynics will say Prohibition II is being undertaken because someone stands to make money from interfering with other people making money.

    For whatever reason, last Friday the president signed into law Prohibition II. You almost have to admire the government's plucky refusal to heed history's warnings about the probable futility of this adventure. This time the government is prohibiting Internet gambling by making it illegal for banks or credit-card companies to process payments to online gambling operations on a list the government will prepare.

    Last year about 12 million Americans wagered $6 billion online. But after Congress, 32 minutes before adjourning, passed its ban, the stock of the largest online-gambling business, Gibraltar-based PartyGaming, which gets 85 percent of its $1 billion annual revenue from Americans, declined 58 percent in one day, wiping out about $5 billion in market value. The stock of a British company, World Gaming PLC, which gets about 95 percent of its revenue from Americans, plunged 88 percent. The industry, which has some 2,300 Web sites and did half of its business last year with Americans, has lost $8 billion in market value because of the new law. And you thought the 109th Congress did not accomplish anything.

    Supporters of the new law say it merely strengthens enforcement; they claim that Internet gambling is illegal under the Wire Act enacted in 1961, before Al Gore, who was then 13, had invented the Internet. But not all courts agree. Supporters of the new law say online gambling sends billions of dollars overseas. But the way to keep the money here is to decriminalize the activity.

    The number of online American gamblers, although just one sixth the number of Americans who visit real casinos annually, doubled in the last year. This competition alarms the nation's biggest gambling interests—state governments.

    It is an iron law: When government uses laws, tariffs and regulations to restrict the choices of Americans, ostensibly for their own good, someone is going to make money from the paternalism. One of the big winners from the government's action against online gambling will be the state governments that are America's most relentless promoters of gambling. Forty-eight states (all but Hawaii and Utah) have some form of legalized gambling. Forty-two states have lottery monopolies. Thirty-four states rake in part of the take from casino gambling, slot machines or video poker.

    The new law actually legalizes online betting on horse racing, Internet state lotteries and some fantasy sports. The horse- racing industry is a powerful interest. The solidarity of the political class prevents the federal officials from interfering with state officials' lucrative gambling. And woe unto the politicians who get between a sports fan and his fun.

    In the private sector, where realism prevails, casino operators are not hot for criminalizing Internet gambling. This is so for two reasons: It is not in their interest for government to wax censorious. And online gambling might whet the appetites of millions for the real casino experience.

    Granted, some people gamble too much. And some people eat too many cheeseburgers. But who wants to live in a society that protects the weak-willed by criminalizing cheeseburgers? Besides, the problems—frequently exaggerated—of criminal involvement in gambling, and of underage and addictive gamblers, can be best dealt with by legalization and regulation utilizing new software solutions. Furthermore, taxation of online poker and other gambling could generate billions for governments.

    Prohibition I was a porous wall between Americans and their martinis, giving rise to bad gin supplied by bad people. Prohibition II will provoke imaginative evasions as the market supplies what gamblers will demand—payment methods beyond the reach of Congress.

    But governments and sundry busybodies seem affronted by the Internet, as they are by any unregulated sphere of life. The speech police are itching to bring bloggers under campaign-finance laws that control the quantity, content and timing of political discourse. And now, by banning a particular behavior—the entertainment some people choose, using their own money—government has advanced its mother-hen agenda of putting a saddle and bridle on the Internet.

    Gambling is, however, as American as the Gold Rush or, for that matter, Wall Street. George Washington deplored the rampant gambling at Valley Forge, but lotteries helped fund his army as well as Harvard, Princeton and Dartmouth. And Washington endorsed the lottery that helped fund construction of the city that now bears his name, and from which has come a stern—but interestingly selective—disapproval of gambling.

  • #2
    I really appreciate any information you post like this one here. I live in Ohio and we have nothing. I usually have to travel to Detriot or Niagara Falls to find a casino where you can sit down blackjack or a real game and not play video poker all night. They do have a slot machine bill on Ohio's next ballot but that is still only opening the door a little.

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    • #3
      Amazing isn't it? But Newsweek didn't even howl about how what's his name snuck this onto the Port Security bill. That's another story.

      This is so hypocritical. Alcohol and tobacco are far worse vices and lead to astronomical and catastrophic loss of life, money, health and ruined families. Prohibition didn't work there, so why try with online gaming? And only online gaming?

      Education is the only answer to abuse of any of the above.

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      • #4
        Off the subject but did anyone sign the petition I posted. was just curious i was going to bump it but wasnt going to waste my time if you guys were not interested.
        jpehl

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        • #5
          Another good article:
          http://sports.yahoo.com/top/news?slu...yhoo&type=lgns

          Unless you want to go all puritan and ban all games of chance – casinos, horse tracks, lotteries, bingo, 50-50 raffles and so on – there isn't any ground to stand on in this debate.

          Gambling is gambling is gambling, and the people of the United States of America have spoken clearly on the issue – we love it.

          Sports wagering is illegal everywhere except Nevada because the leagues will tell you they fear the games will be corrupted. But if this is such a real concern, why allow it in even one state? And isn't this illogical because gambling experts say the billions wagered with organized crime's street bookies make game fixing both more likely and easier to conceal?

          Trying to curtail online poker isn't about protecting those people or "the children" as politicians love to scream. It is about protecting current legal forms of gambling in the United States. The politicians aren't getting enough (in donations, taxes and old-fashioned bribes) from the online poker people to turn their back on the casinos, the lotteries, the horse tracks and the rest.

          It is a straight payoff and nothing else.

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