Media Speaks Up in Opposition to Online Gambling Ban

LOS ANGELES—He is not the first person to call out the U.S. government for its “absurd” ban on online gambling, but finance writer Michael Hiltzik, in his Oct. 19 Los Angeles Times column titled “Calling America's Bluff on Internet Gambling,” became yet another voice among a growing chorus of members of the media asking why the ban exists in the first place, and when will it be lifted.

“The U.S. approach to Internet gambling, which is legal in much of the rest of the world, is absurd,” wrote Hiltzig. “The activity is unstoppable, so let's regulate it.”

If that comment sounds eerily familiar to advocates of adult entertainment, it is because the arguments surrounding government control of morality also remain eerily the same as those used by most so-called “sin” industries, including adult entertainment, gambling, alcohol and guns, and often involve the legal limits of speech.

“To persuade ourselves that we can keep this particular sin under control, we sequestered casinos in isolated places like Las Vegas and Atlantic City reachable only by superhighways, and isolated them on riverboats where not a single card could be dealt or slot lever pulled until the vessel left the dock,” Hiltzik writes.

In making the case for absurdity, Hiltzik points to the federal statute that controls online gambling.

“That federal law, The Unlawful Internet Gambling Enforcement Act, has numerous flaws,” he claims. “It saddles financial institutions with the duty of enforcement by barring them from ‘knowingly accepting payments’ derived from ‘unlawful Internet gambling.’ But it doesn't define what is unlawful.

“It exempts fantasy sports and ‘skill’ games, for example,” he continues. “But where does that leave the most popular online game, poker? The new regulations seem to outlaw the game, although its aficionados contend that it's a game of skill pitting player against player. They contend it's been swept into the gambling ban by lax regulation-drafting.”

Hittzik supports two pieces of legislation introduced by Rep. Barney Frank (D-Mass.) and Sen. Robert Menendez (D-N.J.) that would lift a federal ban on much online play and clarify the current law. “Their goals include taking a piece of the action for the U.S. Treasury, on the political principle that sins always seem less deadly when there's money to be squeezed from them.”

Time is of the essence, he contends, since “new Federal Reserve and Treasury Department rules requiring banks and other financial institutions to block gambling transfers will go into effect Dec. 1, and the banks are screaming bloody murder about the added regulatory burden.

“It's doubtful that Congress will act in time to put off the new regulations,” he concludes, “especially given the more pressing issues on its plate. But next year isn't too soon for it to relearn the lesson of every attempt to enforce a morality that most people don't share. If you can't eradicate, regulate—and take a big chunk out of the wages of sin while you're at it.”

In August, Mort Zuckerman, an MSNBC political analyst, chairman of Boston Properties, and publisher of the Daily News and U.S. News & World Report, also came out strongly in favor of doing away with the ban on online gambling, arguing in an interview with Forbes, it could help save the country’s newspaper industry.

"A lot of cities are going to exist without newspapers," Zuckerman said. "There is something that can be done, and the federal government ought to do it: allow sports betting on newspaper websites."

Also, The New York Times’ Maureen Dowd penned an Oct. 20 column (“Desperate Times Call for Desperate Measures”), in which she supports Zuckerman’s call for an end to the ban.

“I tracked down Zuckerman in Jerusalem on Tuesday to ask him about it,” she writes. “’Newspapers are so critical for public dialogue and holding public officials responsible,’ he told me. ‘And who’s going to be able to afford original reporting in the next five years? Very, very few.’

“He said some British newspapers make millions on betting games like Bingo. ‘People are spending money on what is basically a social vice anyhow,’ he said. ‘So why not use it to preserve the First Amendment? It’s not a perfect solution, but it is a solution.’”