PROHIBITION 2006- The GOP Assault on Online Gaming

Why Ronald Reagan Must be Rolling Over in His Grave at the Antics of our Republican Congress! 

By Wayne Allyn Root, author of “Millionaire Republican” and “The King of Vegas’ Guide to Gambling” 

My name is Wayne Allyn Root. As America’s gambling guru, the media has dubbed me “The King of Vegas,” and “The Face of Las Vegas Gaming.” I am the Creator, Executive Producer and star of two popular gambling television shows- “King of Vegas” on Spike TV and “Wayne Allyn Root’s WinningEDGE.”  I am the creator of the web site www.WinningEDGE.com. I am the author of numerous books on gambling, including “Root on Risk,” “The Zen of Gambling,” and my new book (released on August 3^rd) “The King of Vegas’ Guide to Gambling- How to Win Big at Poker, Casino Gambling & Life.”   

But I am best known not as a professional gambler, but as a CEO, entrepreneur, business leader and political activist. I am Chairman and CEO of GWIN, Inc., America’s only publicly-traded sports handicapping firm.  I am also a lifelong Republican supporter, voter, contributor, and future GOP candidate.  As the author of the Amazon # 1 Personal Finance Best-Seller “Millionaire Republican,” I am one of the more outspoken Republican guests on television and radio talk shows across America.  I believe I possess a keen understanding of why Republicans control literally every branch of government- Presidency, Senate, Congress, a majority of Governorships and statehouses.  It’s pretty simple- as my Jewish Republican butcher father David Root put it many years ago: “The GOP is not the party of the rich, we are the party of anyone who wants to be rich!” We are the party of hopes and dreams. We are the party of ownership- we support individuals taking control of their own lives. We are the party of the American Dream. We are the party of economic freedom, individual rights, smaller government and lower taxes. (Or, at least that’s what we’ve been until recently).  Those four core values, and the idea of dismantling “Big Brother,” have propelled my beloved GOP to unprecedented levels of political dominance.

I also have a keen understanding of who makes up the core demographic of GOP voters. The most dependable group of Republican supporters and contributors are businessmen like me: male, college educated, high-income, primarily entrepreneurs, small business owners, professionals, and independent contractors (real estate brokers, stockbrokers, mortgage brokers, insurance brokers, etc). This is the core of the GOP and its economic backbone.  In case Republican leaders don’t understand that core group - allow me to enlighten you. They are not just Republicans- they are GAMBLERS.  These are the same macho males that fill Las Vegas and Atlantic City casinos, sportsbooks, poker rooms, racetracks, and tribal casinos. These are the same individuals that make NFL football, Monday Night Football, March Madness and the Super Bowl some of the highest rated shows on television.  Why?  Because they are betting on those sporting events.  Does anyone truly doubt that NFL ratings (and therefore advertising dollars) would drop 30% or more if sports betting could be abolished overnight (which of course it can’t). These same upscale male Republican voters and contributors are the ones who are setting up online gaming accounts in record numbers to bet on poker and sports (because they are the tech-savvy, early-adapters who do everything online). These primarily Republican male voters are the reason that online gaming is now a $15 billion business (and growing fast). They are not criminals- they are role models! These self-made small businessmen and rugged individualists are living proof of “The American Dream.”  Freedom is what fuels this dream. These are grown men with free will. They’ve earned their money the hard way (without help from government) and have the right to do with it what they want. They do not want to be told what they can, or cannot do in the privacy of their own home, office or bedroom; on the privacy of their own computer; with their own money. Any Republican politician who thinks otherwise is heading for grave political danger and electoral disaster.

Enter into the picture a new attempt by our Republican-majority Congress to ban online gaming- to treat ordinary Americans with contempt; to treat adults like idiots incapable of choosing what to do with their own money; to treat this popular form of entertainment (online gaming) as a crime; to trample Ronald Reagan’s legacy of limited government and individual rights. I am shocked and saddened to say that it is Republican political leaders that are leading this misguided “Big Brother” assault on our individual freedoms and rights (individual rights and states rights). This attempt to ban online gaming is nothing more than a 21^st century version of Prohibition. That first attempt to institute Prohibition in the 1920’s was one of the biggest failures in American political history.  It will fail again. What Americans choose to do with our time and our money, on our computers and cell phones, is none of the business of politicians or government. My beloved GOP has strayed far from our own winning message. We are guilty of violating the core values of our party and the legacy of President Ronald Reagan. Instead of fighting “Big Brother” and the expansion of government into our lives and bedrooms, we are guilty of supporting it. My beloved GOP is in danger of becoming the very symbol of “Big Brother!”

Ronald Reagan, my hero (and namesake of my 2 year old son Remington Reagan Root), put it best when he said “The 9 worst words in the English language are: I’m from the government and I’m here to help.” He was right then, and he is still “right on the money” today. No matter how well meaning government bureaucrats and politicians try to be, somehow they ALWAYS foul things up for ordinary Americans.  The biggest foul of all is telling Americans how to live our lives. The American Revolution was fought by our Founding Fathers to protect our ability to live our lives without government interference. Isn’t it ironic that the British government now understands those rights and freedoms, while American politicians are trying to limit them (in England, where online gaming is legal, studies report that 90% of all Brits made a bet last year). Ronald Reagan believed in freedom. He believed in the common sense and wisdom of the American people- and his faith was rewarded with two landslide victories and a legacy as one of our greatest Presidents ever.

MESSAGE TO THE GOP: The American people love to gamble. There is nothing that any politician can or should do to fight the will of the people. Americans prove their love of gambling everyday with their actions, their choices and their wallets. Gambling is booming. Researchers recently reported that more money is spent on gambling by Americans than movies, music, books, videos and DVD's COMBINED! Annual visits to casinos by Americans have doubled from 162 million in 1999 to 319 million in 2004. Today in America, it’s far easier to buy a lottery ticket (185,000+ lottery stores) than a Big Mac (13,000+ McDonalds stores). And then there’s the modern economic miracle called Las Vegas. Only in a gambling-crazed society could the #1 gambling destination grow to become the #1 tourist destination (40 million visitors a year and growing fast). Las Vegas is #1 in America in virtually every category- from fastest growing city for 18 consecutive years, to #1 in housing starts, job growth and small business creation. All this phenomenal growth and success is fueled by gambling and low taxes (which are only possible because of the tax revenues created by gambling).

One particular form of gaming- Poker is one of the hottest and fastest growing forms of recreation in this great country. Tens of millions of Americans are playing poker at casinos across America, playing online, and watching a multitude of hit poker shows like World Poker Tour, Celebrity Poker, World Series of Poker, and my show King of Vegas. How big is poker? Just one publicly-traded online poker company Party Gaming (traded on the AIM stock exchange in London because of America’s ignorant attitude towards online gaming) handled $45 Billion dollars of bets last year, producing revenues of $977 million, and profits of $293 million. No government can stop a business that big and that popular- but what they should be doing (if they had a brain) is look to regulate and tax it!

Gambling is not a sin or a blight on our society- it is now America’s favorite form of entertainment. The fact is- it always was! Back in 1746, Benjamin Franklin organized one of our first lotteries. At various times, all 13 colonies established lotteries to aid in the founding of America. One of the biggest supporters of gambling in those days? George Washington himself, who actually won cash prizes and land in several lotteries! That Americans love to gamble should come as no surprise. After all, most Americans are descended from the biggest gamblers ever- immigrants who traveled thousands of miles, under dangerous and often deadly conditions, to claim a new life in a strange new land called America. Gambling online or in a casino is downright tame by the standards of our ancestors. We are truly a nation of gamblers- those who were afraid of risk, stayed home in Italy, Ireland, Eastern Europe, Russia, India, China, etc. Those willing to gamble to improve their lives, literally chose to risk everything (including death) to travel to America. These brave risk-takers became the immigrants, explorers, adventurers, and pioneers that won the American Revolution, tamed the Wild West, and today continue to conquer new worlds- like the Internet.  It is the gamblers and romantic risk-takers that have made America the greatest nation in the history of civilization.  Gambling is literally in our blood. It is for this same reason that America leads the world in entrepreneurship (small business creation) and stock market investment. America (and our capitalist system) values and rewards risk!

Yes, gambling can have negative consequences. But, so does betting on Google, IBM or Microsoft at the wrong time.  So does investing your life savings in a small business (70% of which fail).  Millions of American gamble on stocks online with their E*Trade or Charles Schwab account. Millions more gamble by buying products on eBay that they will attempt to resell at a profit online. Some will win, some will lose. That’s called capitalism- risk and reward is at the very core of our American way of life. As I write this very commentary, the headline in today’s USA Today business section is: “Best bet this quarter? Bet against the stock market.” Who wants to debate me on the idea that investing in Wall Street isn’t a bet? All investing - whether making a bet on the Dallas Cowboys online, or an online bet on the direction of Google, MGM Mirage, gold, or oil with your E*Trade or Charles Schwab account, involves gambling. Investing- like gambling- produces winners and losers. Gambling is at the very core of capitalism and the business world.

Yes gambling addiction is a serious problem. But I’d argue that equally damaging to the average American is a lack of willingness to risk or gamble. Those afraid to risk (intolerant of gambling), often wind up trapped in dead-end jobs their whole lives, working for others, never participating in the ownership society so valued by leading GOP political leaders. Risking (or gambling) your money on an investment or business idea is essential to achieving success and wealth in the 21^st century. Those afraid of risk, uncomfortable with it, or intolerant of it, are destined to fail in a free market capitalist society that values and rewards daring risk-takers.

It is only natural that as Americans become literate on their computers, they choose to do their gambling online. Why not? They do virtually everything else online- shop, play, date, buy stocks, cars, clothes, music, jewelry, even homes. The Internet is where Americans of the 21^st century go to work, entertain and live! It is against this backdrop, that online gaming has exploded. About $15 Billion dollars will be bet online this year. Experts estimate that there are over 15 million global gamblers online. The U.S. Congress estimated a few years back that sports gambling revenues topped $380 billion annually- making it bigger than the U.S. auto industry. Online Poker now rivals sports gambling. Ironically, between 60% and 70% of all online bets are made by United States citizens- this despite the fact that America is one of the only countries in the world that considers online gaming to be illegal. 80 countries and counting have legalized some form of online gaming- but not America. Do our “Big Brother” politicians think they know better than our citizens (and the rest of the world)? What arrogance! GOP political leaders who support a ban on online gaming are literally laughing in Ronald Reagan’s face and trampling his legacy of freedom, individual rights, states rights, and limited government. These misguided politicians are sadly trying to criminalize everyday choices made in the bedrooms, offices and on the laptops of tens of millions of Americans. Ironically, they don’t even realize that the vast majority of these online gamblers are GOP voters and contributors. Talk about biting the hand that feeds you!

While our best friends in the world, and our only loyal partners in the war on terror, England and Australia, both have legalized, regulated and taxed online gaming, out of touch American politicians rush to pass bills to ban and criminalize it. I say “out of touch” because online gaming is already over a decade old and has grown to epic proportions. The genie is out of the bottle. It cannot be stopped or slowed. Ban or no ban, Americans will continue to gamble online- but because of our ignorance, the profits will go to foreign companies and the taxes to foreign countries. How short-sighted. At a time where our national deficits grow unabated, where under-funded public schools miserably fail our children, where we clearly do not have the resources to properly fund homeland security, online gaming presents an unlimited new source of tax revenues. Online gaming is tailor-made to fill government coffers with billions in new taxes. Yet misguided Congressional leaders (I’m sickened to report most are my fellow Republicans) insist on sticking their heads in the sand, ignoring the will of the American people, and telling us what we can do with our own money (what’s left of it AFTER paying taxes), on our own computers, in our own homes. What a gross betrayal of Ronald Reagan’s legacy.

To ban and criminalize online gambling is just sticking our heads in the sand and ignoring the facts of life. Gambling will not stop because we don’t like it, or even ban it. Just like Prohibition in the 1920's, it will continue unabated offshore and the U.S. government will continue to lose billions in tax revenues. Just as in the days of misguided Prohibition, organized crime will flourish and profit, while honest American businessmen will be cut out of the deal. (Why would any self respecting Congressman or Senator vote to support the mafia? Why would any politician support the growth of the underground economy? But that is EXACTLY what they are doing with a vote to ban online gaming. Perhaps they are getting contributions from the Gambino Crime Family?) American businessmen, investors and government taxing agencies will lose billions because of this ban. What misguided politicians are saying in effect is that only foreign companies and non-American entrepreneurs (along with the mafia) are allowed to profit from the phenomenal growth of online gaming- even though most of the bets and money are being made by American citizens. Brilliant reasoning Sherlock!

There is only one common sense solution: online gaming needs to be legalized, regulated and taxed (just as the SEC regulates Wall Street). These newfound tax revenues can then be used to help reduce the deficit, bolster education and homeland security, lower taxes (the GOP mantra) and fund addiction programs for problem gamblers. Legalization will remove organized crime from the equation (just as it has in Las Vegas). Legalizing it will allow us to more clearly recognize, treat, and fund the problem of gambling addiction.

As America’s most famous professional gambler and sports handicapper, I’ll lay 1000 to 1 odds this is one of the biggest (and most misguided) blunders in the history of American politics. Politicians- as usual- have proven their lack of vision. In 1980, there were only 2 states with legalized gambling- Nevada and New Jersey (Atlantic City). Revenues from legal gaming barely topped $1 billion. Today 48 out of 50 states have legalized gambling. Just the gambling revenues from one state- New York- now top $43 billion! In only a quarter of a century, think of how far we have come in changing our attitudes towards land-based gambling. In another quarter of a century, we will look back at online gaming the exact same way. To try to ban online gaming in today’s Internet-savvy world, is like trying to stop land-based gaming in 1980. To vote for a ban is to endorse Prohibition all over again- one of the greatest failures in U.S. history. Unfortunately the results will be the same - massive non-compliance; ordinary Americans ignoring (and losing respect for) the law; the loss of billions in tax revenues; the continued growth of organized crime thru the underground economy; the rest of the world laughing at our ignorance; and eventually (just like Prohibition) REPEAL. Online gaming will be legalized, regulated and taxed in the United States of America- it is only a matter of time. The question is will it be sooner or later (after we realize the disastrous consequences of Prohibition- all over again).

I don’t plan to ever leave my beloved Republican Party- I will fight from within to save my party. I will continue to fight for what I believe are the core values of the GOP: more economic freedom, more individual rights, smaller government, lower taxes, and most importantly, more common sense. I will fight - like my hero Ronald Reagan- for the rights and freedoms of ordinary Americans, and against intolerance, ignorance and the expansion of “Big Brother.” I know what is best for me. I know that Government does not. That used to be what the GOP stood for, and I hope and pray it will be once again.

For more of Wayne’s political commentaries, please go to www.MillionaireRepublican.com.