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  • GOP Mega Donor Sheldon Adelson Trying To Ban Internet Gambling

    I just recently signed up for an online gaming site called “Draft Kings.” I love it. I set up a baseball lineup and am rewarded with cash if I bet correctly on player performances. The hosts of the site take a cut, much like a casino takes a cut of the proceeds from poker tournaments.

    Las Vegas billionaire Sheldon Adelson is asking his friends in government to outlaw online poker, yet not fantasy games. States are allowing certain types of gaming online, yet some in Washington want to explicitly ban some forms of adult entertainment and strip the state of the power to regulate it, yet oddly allow me to play fantasy sports for money.  I worry that online fantasy sports may be Adelson’s next target, if Congress passes his bill.

    Fundamentally, Adelson’s plan stomps on the Tenth Amendment by outlawing the ability of states to legalize Internet gambling. He is concerned that competition legalized gambling will take away potential customers from his brick and mortar casino empire.

    Members of Congress in Adelson’s pocket are demanding action and by denouncing the spread of Internet gambling. Their focus group driven warning is that every phone, iPad and computer could turn your home into a casino.

    But there is a dirty little secret. Millions of American in almost every state, not just those who have legalized online gaming, participate in Internet gambling every day. It is perfectly legal and growing by the day.

    Even the politicians that are doing the billionaire’s bidding don’t have the guts to do anything about fantasy sports betting or one day fantasy leagues. I bet many of them play it too.

    When Congress passed a law in 2006 that was intended to quash Internet gambling it actually it led to its current exponential growth rate. The law, known as the Unlawful Internet Gambling Enforcement Act, sought to prohibit the use of credit cards to play poker and other games online.

    However, the bill contained a provision exempting fantasy sports from the definition of “bets or wagers.” This legal protection created a multi-billion dollar gambling enterprise that is so mainstream that Disney recently announced it would invest a quarter of a billion dollars into the space.

    Since 2006, daily fantasy sports games have grown from 12.6 million U.S. participants in 2005 to nearly 35 million in 2014. The number is growing, thanks in part to new partnership arrangements with major sports leagues like the National Basketball Association and the National Hockey League. In fact, people betting on one-day fantasy sports vastly outnumbers those who participate in the feared and hated online gambling sites that Adelson wants to outlaw.

    So what is the difference between betting on sports and playing one-day fantasy? Not much. In a typical sports bet, a person would pick a team to win to win. In fantasy sports, the bettor picks the players and the outcome is determined on how players perform individually. The money is the same. The sites like FanDuel.com and DraftKings.com take a percentage of the bet to cover their costs and profit.

    Supporters of fantasy sports argue the difference it huge and their expertise is based on skill and not chance. Let’s not quibble. Poker is a skill. Blackjack is a skill. In fact, for many experts, sport betting is a skill, too. One-day fantasy sports betting is gambling, or a form of it, and it is legal. In short, the horse is out of the barn and there is nothing that Congress and the opponents of Internet gambling can or will do about it. The numbers of players are so large, efforts to outlaw one day sports betting would be met with a grassroots revolt.

    The grass-tops group created by Adelson called the Coalition to Stop Internet Gambling’s website contains scary images of children surfing the web to place bets on poker or roulette but makes absolutely no mention of the billions of dollars wagered everyday in fantasy sports. Even those Members of Congress who are carrying Adelson’s water have yet to raise a peep about the growth of one-day sports leagues.

    The whole attempt to outlaw state legalized online gaming is a farce. It is an effort by a billionaire to get his crony friends to outlaw competition. The growth of online sports gaming represented by one day fantasy leagues is proof that Adelson is chasing a white whale. Americans are spending hundreds of millions of dollars everyday betting online and as Vegas still exists. In fact, so does Adleson’s Sands casino. That begs the question: What is the point of this whole exercise?

    I love my Draft Kings and will play until the government outlaws this source of entertainment for me and millions of Americans.  If Adelson is allowed to ban online poker, online fantasy sports will not be far behind.


    Cloakroom Confidential

    Cloakroom Confidential

    Cloakroom Confidential was a longtime Capitol Hill staffer and insider who has contacts in the House and Senate at the highest levels.

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