Don't be Fooled by Barney Frank Internet Gambling Bill
Few bills pass in their original state and when we are talking about laws pertaining to Internet gambling, there is certainly not likely to be an exception to the rule. When we review Barney Frank's proposed piece of legislation the Congressman unveiled yesterday, there is room for improvement but history tells us that even the Unlawful Internet Gambling Enforcement Act (passed in October) has metamorphosed over nearly a ten year period.
Looking back at 1998 when Senator Jon Kyl of Arizona first introduced a bill to ban online gambling, he did not foresee apprehension from various special interest groups such as the powerful horse racing lobbyists, not to mention the Christian Coalition. Over the years he re-tooled his master work and found just the right atmosphere in which to finally get the bill passed.
Frank has admitted his proposal will endure a rough road up ahead. Like Kyl's previous bills, Frank's will be reworked, probably numerous times. The chances of it passing in its present state are very slim, though not impossible.
Ironically, Kyl's attachment of his anti-online gambling legislation to an unrelated and pivotal port security bill rubbed most Democrats - and we dare say a few Republicans - the wrong way regardless of their stance on Internet gambling. Those who were indifferent to the activity may now view anti-online gambling legislation among the flaws of the current administration. Throw in the fact that this is a billion dollar industry without ever being a part of the US landscape, where there is money to be made, this than becomes a bipartisan issue.
Frank's proposal as it stands today is likely to invite more powerful lobbying efforts from big business. Today's announcement that Yahoo! UK has entered into the online poker market in Great Britain can leave a lot to the imagination for big business and already established brand names looking to do the same in the US.
OGPaper.com contemplates how the current proposed bill would present a quagmire of sorts for individual states.
"If a state has a law prohibiting casino gambling at that state, online casinos cannot operate in that particular state, even with a license. And in the United States, there are only 11 states which have private casinos (except Indian tribal gambling, which is treated separately). So in the other 40 states, where casino gambling is illegal - online casinos cannot operate. And when those 11 states already have laws or are working on laws to explicitly prohibit online gambling - there are no states left where a licensee could operate - thus banning online gambling on a state level."
Republican Representative Jim Kasper of North Dakota has already told Gambling911.com he will be proposing new legislation to make online poker legal in his state for 2008, perhaps sooner now that Barney Frank has stepped forward with yesterday's proposed legislation.
OGPaper.com makes a valid point about Indian casinos.
"According to the Internet gambling bill, Indian casinos has the option to opt-in or opt-out for Internet gambling. This means that the Indian tribes which already have casinos in 27 states, could run online casinos in their states, as well."
One can only speculate the rationale here but it is no secret that the Indian Casinos have some of the most powerful lobbyists in Washington. The John Wayne black and white films of yesteryear would have us believing that Indians are headdress-wearing-bow-and-arrow-carrying-teepee-living-depraved-and-uncivilized-natives whose sole purpose it is to taunt and ultimately get wiped out by a bunch of cowboys.
Guess who just bought the $1.7 billion valued Hard Rock International this past December? The Seminoles. Hollywood got it wrong.
According to James Allen, CEO of Seminole Gaming, the two current owned Seminole casino resorts in South Florida are two of the most successful casinos in the world. Allen actually alluded that the properties – which do not have table games – surpasses every other U.S. based casino in profits. Revenue at the properties is about $1 million a day, Allen said.
“We competed against the biggest investment companies in the world. We looked at all the options and realized this is the step to go out in the real world and play with the big boys.”
Indian Gaming is about a $22 billion a year business in the U.S. To put that into perspective, the Las Vegas Strip brings in about $5.8 billion in revenue a year.
Getting the Indian casino lobbyists on Barney Frank's side is an important and crucial first step.
There is more work to be done but the online gambling industry should refrain from looking too deep into Barney Frank's current proposal and assume this bill will pass as is. We see much room for improvement and there are bound to be accommodations made for a much broader group of individuals.
Likewise, unless there are some underlying ulterior motives we are unaware of, the idea that British owned online gambling establishments cannot get a piece of the pie makes very little sense. Why wouldn't the US government want tax money derived from US based customers of Ladbrokes, the UK's biggest Internet gambling firm? And contrary to those old cowboy and Indian films, the Indian casino industry has already demonstrated they work very well with others. A marriage between the Seminoles and PartyGaming? What seemed far-fetched just yesterday may not be any longer if Barney Frank has his way.
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Christopher Costigan, Gambling911.com
Originally published April 27, 2007.
