U.S. Representative Jason Chaffetz (R-Utah) is inexplicably on a mission to insert the federal government into state policies regarding gaming within state borders. Rep. Chaffetz’s stealthily titled bill, the “Restoration of America’s Wire Act,” would prohibit states from allowing online gaming. This is a move that could also negatively impact state lottery programs, reversing the decades-long trend of allowing states to self-determine gaming policies. Instead, it prioritizes another Congressional tradition: corporate welfare and crony capitalism.
The movement behind the legislation is being funded by billionaire casino magnate Sheldon Adelson. In fact, there are some reports that Adelson is doing more than funding the effort – his lobbyist literally wrote the bill. If it sounds strange that a casino owner is pushing a bill to outlaw a form of gaming, it shouldn’t. In 2014, the brick-and-mortar business worked out well for him; he raked in $3.8 billion in profits.
The problem with banning online gaming is that it already exists, but it is just relegated to the shadows. A quick Internet search reveals that anyone with a credit card can start betting on any number of shady operators overseas. In any potential legalized U.S. gaming system, there would be an eight-point verification process, including Social Security number verification. This would be more than enough to catch fraud and ensure consumer protections.
In the three states that currently operate online gaming, there have been no allegations of underage or out-of-state betting. The same cannot be said for brick-and-mortar casinos. Since 2009, Adelson’s Sands Casinos in Bethlehem, Penn., have been fined more than $220,000 for allowing underage gambling on more than 20 occasions. In recent cases, two 17-year-olds were able to place bets before casino security finally asked for identification.
If there was any another reason to doubt this legislation, they should look no further than the numerous exemptions that the proposed legislation carves out. Rep. Chaffetz felt it necessary to exempt online fantasy sports betting, online horse betting (likely to help the bill’s prospects in the Senate), and even closed-circuit gambling that is offered at Las Vegas casinos, including Adelson’s Venetian.
Yet, despite those exemptions, Rep. Chaffetz’s bill could restrict state lotteries’ online games that many states use to fund important priorities, like education. Without those funds, citizens might see taxes increase in other areas. When that issue was raised in a conference call with state lottery officials earlier this year, Chaffetz “brazenly” suggested that state officials try to pass their own federal bill instead of trying to amend his bill.
There was a surprising revelation from a March 25th hearing when the loudest voice in favor of states’ rights came from an improbable source: Representative John Conyers (D-Mich.). Conyers argued that “the better option is to allow states to permit online gaming as they see fit, subject to regulation and monitoring.”
That is the tone that folks are accustomed to hearing from conservative Republicans, like House Judiciary Committee Chairman Bob Goodlatte (R-Va.). Rep. Goodlatte, a reliable conservative voice, and other conservative committee members, need to champion states’ rights even if they personally don’t approve of the policy in question.
Two traditions are in conflict over the “Restoration of America’s Wire Act” legislation; states’ rights and crony capitalism. That should be a no-brainer for members of Congress who consider themselves to be conservative.