Another anti-gambling editorial

Another week, another smug, alarmist anti-online gambling editorial, this time from the Christian Science Monitor:

Fresh from fixing Wall Street’s casinolike ways in high finance, Congress begins work Tuesday on a bill to overturn a 2006 law banning Internet gambling in the US. The measure is being rushed through the House Financial Services Committee on a promise that it would create 30,000 jobs and billions in tax revenue.

via Bill to legalize Internet gambling: No dice –

I dare you to click through and read the whole thing–it’s short and really all over the place. Let me point out a few of what I believe are misconceptions or exaggerations

1. “a promise that it would create 30,000 jobs and billions in tax revenue”
I’ve said before that most of the projections I’ve seen seem to be to be way too optimistic. I’d really like to see the math behind these numbers, because to me it doesn’t make sense.

2. “Any parent who’s puzzled or despaired over their child’s trancelike playing of video games during the past 20 years can readily see why Internet gambling operators are drooling over the chance…”
In other words, adults shouldn’t be allowed to choose whether to gamble online or not, because children are incapable of not playing video games. So does that mean we’re all children when it comes to gambling, or just gambling on computers?

3. “It’s ‘click the mouse, lose your house.’”
Great, Professor Kindt came up with a rhyming catch-phrase to go up there with “If it doesn’t fit, you must acquit.” But does this make sense? Is it inevitable that everyone who gambles online will lose their house? A few thousand online poker players would say no.

Here’s the general problem with the editorial: it assumes that the worst will definitely happen. It doesn’t take much thought to reduce this to the absurdity that it is. Over a hundred people will probably lose their lives in auto accidents across the United States today (source here). Does that mean we should all stop driving? Someone returning to the United States from abroad will smuggle drugs into the country today–should we close our borders and ban all travel to prevent this? Again, most people would say no. In short, you can’t make rules for society that assume that the worst will always happen. Otherwise, you’ll end up with the most repressive regime the world has ever known.

Now, that’s not to say that the editorial doesn’t made some good points. Which leads toP:

4. I have no idea how the government could squeeze $42 billion in tax revenue out of online gaming. Right now, Americans only gamble about $90 billion a year. Let’s say that online gaming increases the total national wager by 10%, or $9 billion. What do you think the tax rate should be? Even if it was 50%, you’d only be getting $4.5 billion a year, which is a lot of money for most of us, but not much where the federal budget is concerned; I’d guess that much of that would be split with the states as well.

5. We also should take a serious look at state versus federal regulation of gambling. I’m not sure a federal solution would ultimately be in the best interests of any of us, from taxpayers to gamblers to the industry. Interstate horse-race simulcasting provides one model of states cooperating to split gambling revenues, and this approach should be given more consideration.

It’s possible, however, to debate the merits and mechanics of expanding legal gambling without resorting to “click your mouse, lose your house” reductionism and blatant scare-mongering.

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