Lame-duck Congress Looking to Ban Online Gambling

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With the media attention focused largely on the president-elect’s antics going on in Trump Tower, the lame duck Congress pushes on largely overlooked. Unfortunately that’s when the legislature can be most dangerous.

By:  Tho Bishop

This article first appeared at Mises.org

For example, while the country has spent most of the week debating whether Donald Trump’s deal with Carrier Air Conditioning was either benign or the worst thing to ever happen to American capitalism, Congress is busy moving forward with a proposal that would impose a Federal ban on online gambling.

The bill, called the Restoration of America’s Wire Act, is the latest attempt to prevent American’s from accessing popular games such as online poker. A prior law, the Unlawful Internet Gambling Enforcement Act, made it illegal for financial services companies to process payments used for gambling sites, and led to American online poker players seeing billions of dollars in assets frozen in 2011.

Luckily the UIGEA offered some loopholes. First, it did not explicitly ban gambling for non-sporting events, so in theory Americans could still access online poker sites if they found a way around payment restrictions. Second, since it was a Federal law, it only applied to interstate commerce.

So RAWA not only deprives Americans of the basic freedom of spending their money as they so choose, it’s a blatant violation of the 10th Amendment as three states — New Jersey, Delaware, and Nevada — have expressly legalized online gambling, with seven more showing interest. The fact that it is supported by Senator Mike Lee, who often talks about the importance of the 10th Amendment, is a disappointing reminder that even politicians that talk a good game shouldn’t be trusted with your rights.

While it’s not surprising that Congress is hard at work trying to find new liberties to take away, it’s fair to ask why is online gambling in the crosshairs now. After all, outside of Jeb Bush coming out in favor of cracking down on fantasy football leagues, it was hardly a noteworthy subject during campaign season. So why are legislators such as Lee, Tom Cotton, Jason Chaffetz, and Lindsey Graham trying to do this now?

The answer is simple: paying off campaign debt.

While the country just elected a former casino owner president, a current one, Sheldon Adelson, was busy writing checks to elect Republican senators. During the 2016 campaign Adelson donated $20 million dollars to the Republican Senate Leadership Fund, just the latest in a long history of being a major GOP sugar daddy.  He’s also long waged war against the largest competitor to brick-and-mortar casinos, vowing to “spend whatever it takes” to ban online gambling. Now his investment may finally be paying off.

Though RAWA has been around for a while, it’s recently been resurrected.  Some fear it could be inserted the bill’s language into a larger appropriations bill that is to go up for vote before the end of the year. This is the sort of trick legislators love to play. The Ex-Im bank, the cronyist government institution that largely serves to subsidize Boeing, was similarly revived in 2015 during one of the faux-crises over shutting down the government. For a politician trying to avoid public scrutiny, the only thing better than adding such an obscene measure to a massive spending bill is to do so during the holidays with everyone’s attention directed elsewhere.

Fears that the GOP will tread upon the state sovereignty gains made in recent years are not exclusive to online gambling. The appointment of Jeff Sessions to attorney general, a prominent critic of the Obama administration’s refusal to crack down on state-licensed marijuana dispensaries, has given many drug war opponents renewed concerned about the future of the industry.

Of course the dismissal of states’ rights by a Republican legislature is the ugly mirror to the left’s recent embrace of ideas such as secession and nullification in the face of Trump’s election. One of the reasons political decentralization is an appealing strategy is because it is non-ideological. Unfortunately this is also why it’s often opportunistically embraced by the party in the minority, and promptly ignored by those with political advantage.

Populism is an effective strategy for winning elections, but simply electing populist politicians does not guarantee a defeat for growing government. The ideological diversity of the legislators supporting RAWA is a perfect demonstration that the urge to grow the Federal government doesn’t just transcend party lines, but various ideological coalitions. As long as Washington has the power it has, it will be used to the benefit of the powerful.

The only real solution is to make political decentralization more than simply an easy slogan by the party outside of the White House, but a strategy put in to practice.

This article first appeared at Mises.org