Government Needs Gambling…and Vice Versa

There were TWO recent events that prompted these comments.  The first, obviously, is the recent Daily Fantasy Sports clusterfuck (tossed from Nevada, being investigated in NY and FL, and other shenanigans).  The other was a random post on a poker website where the postee made the standard complaint about the lack of online action, “We don’t need no government to let us play poker!”

Well, actually, we do, and just as much as they need us.  Hear me out.

Government needs gambling now more than ever.  It started a long time ago – 1963 to be exact – when New Hampshire decided to finally try a lottery as a way to increase funding for education (the idea had been debated for a decade).  Taxes is a four-letter word there, as they have property taxes but no sales or income tax.  Anyway, the lottery was a hit, New York got one in 1967, and, as the saying goes, TIDAL WAVE!  Today almost every state in the union has SOME form of legalized gambling, be it lottery, horse racing, casinos, etc. 

The things that ALL of these forms of gambling have in common? 

• Authorization
• Regulation, and most important for the state,
• Part of the action (percent of the amount wagered, or fees from operators, or sometimes both).

As you have read in your history books, the online poker boom of the last decade didn’t have any of these things.  You know what happened soon enough.  And apparently, the folks running FanDuel, DraftKings, and all the other DFS sites missed that lesson.  It’s painfully obvious that in the very near future the DFS industry will undergo an evolution of sorts.  How fast and in what capacity that evolution occurs is up in the air right now.

There are many options – outright ban (as in Nevada), regulation (as in Massachusetts),  or…something else?  It’s clear to me that whatever the outcome, it will be up to the states, not the Feds (unless another version of UIGEA or RAWA or some other Sheldon Adelson-funded-prohibition bill finds its way through Washington’s sewers).

Remember, (state) government needs gambling.  Legislators are loath to raise taxes, and the money has to come from somewhere.  Gambling revenues are here to stay.

And gambling needs government.  It’s a business after all.  Name a business that doesn’t operate without SOME form of government oversight.  Even Mom & Pop stores have to have business licenses, and if they have employees there are taxes and payroll forms and perhaps more. 

In my own industry (food) we have business licensing, restaurant licensing, health inspections, plus the above.  In addition, we’re an S Corporation, so that another level of licensing.  All of this regulation is important – it provides structure and it ensures that we provide a safe and healthy environment in which to serve the public.

There are many in our industry who grumble about “excess regulation.”  The problem, as I see it, is “uneven regulation.”  Businesses cheat because they need to (make a profit) or want to (make a profit).  The problem is that no one operates in a vacuum, and if Bob’s Ice Cream Store finds a way to get around regulations and save some bucks in the process (the usual M.O.), that puts Bob’s competitors (like me) at a disadvantage.  Bob can use the money he saves by skirting the rules to advertise more, or to sell his ice cream at a lower price, or maybe Bob pockets the excess.  Either way, it’s advantage = Bob, disadvantage = me.

In some cases, ironically, it’s because of less government involvement.  In our county we only have 1.5 food inspectors to cover the entire county.  Restaurants are supposed to be inspected twice a year, and I can tell you that the inspectors here are wayyyyy behind – our last inspection was in 2013.  There are several places in our county I refuse to eat at because I know they’re not keeping a clean kitchen (and I’ve known of cases where it seemed customers suffered mild food poisoning from eating there).  Lack of inspections (caused by shortage of staff) allows some to cut corners and we all suffer.  Some (barf) more than others.

The need for regulation is important.  Don’t think so?  Would you really want to eat unregulated meat or dairy products?  Gambling (or gaming) is already one of the most heavily regulated industries in the world (I. Nelson Rose says so).  And given the potential for “problems” in the gaming industry (we’re looking at YOU, UltimateBet), regulation is essential for players and the industry.

In the case of online poker and online gambling, it’s the ONLY way it’s gonna happen.  Suck it up and push for safe, legal, and regulated online gambling.

And DFS?  Well, watch and learn.

DFS Needs a History Lesson

First, let me say that I give few rat’s asses about Fantasy Sports.  Most likely it’s my age showing, but I don’t get the thrill.  No matter, I’ve been all over the recent kerfuffle that DraftKings/FanDuel and the whole DFS industry has been going through the last couple of weeks, and I would offer to them some advice in the form of a history lesson, and that lesson would be in the form of “those who can’t remember history are doomed…etc.”

So travel in time with me to a period of, oh, let’s set our way-back watches for a decade ago.  Here’s a new online industry that’s sweeping the country.  Extremely popular and, although there are several players involved, there are two mega-stars who get the lion’s share of the business.  It’s gambling, of course, but it’s a skill-based game, and folks can’t seem to get enough.  There’s advertising galore and folks seem to enjoying the access and the industry, despite the lack of regulation, is growing by leaps and bounds.

But there are signs of trouble…some players have complained that the playing field isn’t level.  Sure, there are “sharks” and “fish,” but some games seemed rigged.  The industry hasn’t escaped the notice of legislators…some want to ban it, others want to “get their fair share” (as they do with horse racing and lotteries).  It seems as if the industry got too big too fast, and then, just when no one expected it…

UIGEA. 

Now I am not going to argue whether UIGEA and the eventual fallout on the online poker industry was right and fair (hint: no way, José).  I do want to point out that the history lesson is clear – we have a lot of mentally deficient elected officials who can pass legislation at a whim and ruin entire industries with the flick of the President’s pen.

Get my drift here?  The parallels of DFS and online poker are frightfully similar, and we are just now starting to see DFS go through the gauntlet that poker went through ten years ago. 

The outcome?  Well, that’s where I see a different vision.  That’s because there are THREE major differences between DFS and online poker.

1. The history of online poker.  Seems obvious, but the fact that we’ve been down this road before means the potential for someone to sneak in a bill outlawing DFS is very small indeed (despite the fact that the “father of UIGEA” now says the DFS runs on “chutzpah” to operate under that bill’s carveout).
2. Partners.  DFS is being fueled by some heavy hitters.  Major funding for DFS comes from venture capitalists, sports networks like ESPN and Fox Sports, and many of the major leagues themselves.  Poker never had that.
3. Sheldon Adelson.  The less we talk about this blight of near-human garbage the better, but he’ll be part of the debate whether we like it or not (Hint: we don’t).

In my opinion, the idea of Daily Fantasy Sports is akin to poker in the fact that both are “skill-based” games that involve money being pro-offered in exchange for prizes (which usually are also monetary).  I am hopeful that DFS is finally seen for what it really is – online gambling – and as it goes, so goes online poker.

Obviously, although I never play DFS, I hope it lives on and prospers.  And ergo, online poker, too.  And I think it will, eventually.  Here’s why:

1. History.  This time the “legality” of DFS will HAVE to be debated in the open in the federal and state halls of government.  What is it, how does it work, and, most importantly, “can we get a piece of the action?”  Remember, the major carveouts of UIGEA were forms of gambling ALREADY approved by states (and heavily taxed…I mean, regulated).
2. Partners.  The NFL, MLB, NHL, Major League Soccer, and all the rest will not go gentle into that good night.  People want to bet on sports, and sadly, this country isn’t quite ready to join the rest of the world and allow its citizens to put down a fiver on the local franchise’s upcoming match.  DFS allows “sports fans” to get more involved with the action AND make a bet and everyone wins, kind of.
3. Sheldon Adelson.  I admit he’s the wildcard in all of this.  His RAWA bill made no mention of DFS, yet it did initially target the online lotteries.  It’s going nowhere in its current state, but the rumors of RAWA-lite and it’s “moratorium” could also mean that DFS could get nixed at both the state and federal level.  The “study” part of RAWA-lite might be helpful to our cause IF it was done in a fair and balanced process.  Do I think it would be?  Two words:  Jason Chaffetz (he of the unbalanced witness list and misleading charts).  Do not make me laugh.

During the next few weeks and months, we slog through more Presidential primaries and search for a Speaker of the House and vote in November 3 elections.  DFS’s fate might not be decided in that short of time, but eventually something’s gonna happen.  And eventually that SOB Adelson is gonna weigh in.

So be diligent, people.  Be diligent.

I Write Words, and That’s Not Enough

As you can see, the “Wanna Bet?” Blog is back in operation, and the truth is that I really don’t want to write this one.  We finished our ice cream season last week and spent much of this week cleaning up.  While I was cleaning, I was considering what the first blog post would be about. 

So much has transpired since I last wrote…I could write about Sheldon Adelson, of course, my #1 topic.  He’s been kinda quiet on the RAWA front, but the rumor mill has him (and his seven bands of lobbyists) working behind the scenes to deploy a “new and improved” RAWA that purports to stop online gambling and preserve his billions family safety, and of course, it does neither.  I could write about other poker topics like the return of PokerStars to America, or the upcoming “November Nine.”  I could veer off a bit and discuss Kim Davis, the Pope, Donald Trump or the GOP race.  I could even get personal and talk about this year’s crazy ice cream season or how I spent part of yesterday in the hospital because I forgot that I left my hammer on the top of the ladder at work (4 stitches and a big bruise plus a bigger bruised ego is all).

Nope.  Gotta talk a bit about gun violence.  Actually, to be more precise, our reaction(s) to it.

I’ve never written about gun violence before.  Not because I’m not opinionated about the subject – I most certainly am.  But I’ve never written about it before.  Why now?  We’ve had other mass shootings, of course, and even though this occurred in my home state, we’ve had them here before, too.  And folks have been riled up before, calling for change in the wake of Sandy Hook and Columbine and Columbia and all the others.

This feels different.  It’s like the one-too-many dessert that makes you want to go on a diet, or the one-too-many traffic accident that prompts a new road design.

Yeah, we take action when folks die at a not-safe intersection or a dimly lit highway or a corner turnout with poor visibility.  When innocent students are shot and killed in schools…well, I’ll get to that in a moment.

Let me first fully disclose that I have never owned a gun and have no plans to ever do so.  I can’t sight a rifle (birth defect in right eye) and I have no desire to pursue any sports involving guns, archery, etc.  I don’t even fish, and I have been a vegetarian for more than a dozen years.

But let me also disclose I am a strong supporter of the Second Amendment (and the 10^th, and the 14^th, and all the others).  I have friends who own guns.  Friends who hunt.  Friends who are members of the NRA even.  No, really, I do…not just Facebook “friends” but real flesh-and-blood buddies.  They own guns.  Plural, usually.  And I find nothing wrong with owning a gun.  I just don’t want to.

And all of that has nothing to do with gun violence.

Gun violence is the act of using a gun to its ultimate purpose.  Weapons are like that.  Weapons.  A knife can also kill as can a screwdriver (or a hammer), but these tools are often used for a different purpose than as weaponry.  Guns are weapons.

Definition: “a thing designed or used for inflicting bodily harm or physical damage.”

Yup.  That’s what they do.

So when they’re used as intended, and folks get killed, some people get all indignant and call for stricter regulations and more help for the mentally ill and better support for ATF and a bunch of other ideas.  See here, here, here, here. 

And when these folks (and I’m one of them) get all indignant, other folks get even more so and tell us why NONE of that will do ANY good WHATSOEVER.  PERIOD.  Some even say more guns are the answer.  Some say that it’s not a good time to discuss gun violence (though they usually say it’s not a good time to discuss gun control, as if the two are synonymous).

And did you know that we have little way in knowing if we’re right or if they’re right, because there is little in the way of unbiased research on the subject?  Each side can point to studies or anecdotal events to bolster their claims.  Hell, the government can’t even do research on the subject. 

When the CDC began studying gun violence in the early 1990s, the Washington gun lobby launched a serious campaign to persuade Congress to block its funding. In 1996, the effort culminated in an amendment backed by the National Rifle Association (NRA) that explicitly forbade the agency from research that could be used to “advocate or promote gun control.”  In the years since, CDC funding for firearm injury prevention has fallen 96 percent. (from http://everytownresearch.org/reports/access-denied/)

That’s where we are now.  More than 87,000 gun-related deaths since Sandy Hook, and we can’t research it.  It’s a topic that’s off limits, and we’re not supposed to discuss it.  When we do discuss it, we can’t agree.  And that’s why we react like we do and gun supporters react like they do AND NOTHING CHANGES AND MORE PEOPLE ARE SHOT AND HURT AND KILLED.

Seriously?

We’ve wasted enough ink and digital space talking about it.  I spent two wasted hours liking some posts and arguing against some others, and in that short time there’s been a shooting in Baltimore and a lockdown because of a reported gunman at an El Paso community college.

Seriously.  DO.  SOMETHING.  NOW.