Why Supporters of the UIGEA Are Full Of It

I recently posted an letter that Focus on the Family sent out to members. Unfortunately it was so full of complete crap that in an attempt to replay to each and every issue I was not very thorough in my responses. Here are their talking points. We should make my responses the official PPA talking points. 🙂

Internet gambling sites took approximately $6 billion out of the U.S. economy in 2005 and may have funded foreign terrorist groups or criminal organizations.

Organizations like Focus on the Family make outrageous, highly inflammatory, and completely unsubstantiated claims like this without any even the faintest bit of evidence.

First off, the FBI has never filed a single indictment involving the use of online gambling proceeds to fund terrorism. Anti-gambling proponents throw in the accusation as a way to make their cause seem pro-American and demonize anybody who supports the freedom of American citizens to decide how they spend their money despite the fact that not a single shred of evidence supports their claims.

The claim that $6 billion was taken out of the US economy is also a highly unsubstantiated claim. The faulty assumption is that every dollar made in profit by an online gaming company is money that has forever left the US economy. Online gaming companies have poured hundreds of millions in profits back into advertising and marketing efforts in the US. Online gaming companies also pay millions of dollars a year to US based affiliates who refer players to them.

Online poker, in conjunction with the massive popularity of televised poker, has resulted in millions of dollars in revenue to publishers who offer poker related books, magazines, poker chips, and other products and services. Thousands of jobs have been created in the US as an indirect result of the popularity of online poker.

While it is true that he general area of online gaming can be proven to benefit criminal organizations what isn’t being fully articulated is the fact that this is almost entirely confined to online sports betting. All this means is that bookies have been able to better lay off their bets. Since sports betting has been around as long as there have been sporting events to bet on it seems illogical to say that completely unrelated aspects of online gaming like poker have any relevance in this debate.

More than 2,500 foreign online virtual casinos were soliciting more than 230 million U.S. Internet users, without effective age verification, validation of payment sources and no financial accountability.

This is a typical catch-22 argument. In order to have an effective means of age verification, validation of payment sources and financial accountability one would need to be able to legally contract with US companies and government entities that could facilitate all of the previously mentioned. If Congress were to simply define acceptable standards in all of the three areas then online gaming companies would be able to meet those criteria. Countries like England have implemented very stringent standards that online gaming operators need to adhere to in order to legally offer their products there. There is absolutely no reason why similar standards could not be required of companies offering services in the US.

As long as the US government takes a prohibitionary stance on the topic it guarantees that only those companies willing to violate US laws are the only options available to US residents. If anything the fact that companies like PartyGaming were willing to walk away from hundreds of millions of dollars in revenue after the passage of the UIGEA proves that gaming companies are willing to comply with any reasonable oversight and regulation the US may wish to impose.

Another ridiculous argument often put forward is that there is no age verification technique that has 100% accuracy. Well, I used to buy alcohol when I was 18 using a fake ID. Does that mean that since offline verification techniques are not 100% accurate we should ban all activities that have an age restriction? Before you answer please keep in mind that you have to be 18 to vote, 21 to drink alcohol, and 65 to collect retirement benefits. Just because all of those systems can be scammed should we do away with them?

Internet gambling holds catastrophic potential for organized crime, funding terrorists and laundering money.

Again this is a completely illegitimate argument. The entire basis for this argument rests on the shoulders of the word “potential.” The US stock markets have a potential for organized crime, funding terrorists and laundering money. Services like Western Union have a potential for organized crime, funding terrorists and laundering money. Since there are more proven cases of organized crime involvement in labor unions than there are in online gaming should we also conclude that labor unions should be made illegal as well?

The other major flaw in this argument is a direct result of proponent’s attempts at turning this into an emotional plea rather than a logical decision. There is not a single case on the books of the FBI or DOJ uncovering a connection between online gaming and terrorism. And even if there were, what would prevent both the funder and the fundee from moving to Canada, England or any of the other countries where online gaming is legal? Making it illegal to play online poker would serve absolutely no anti-terrorism purpose.

Betting on sports is illegal in the United States, with the exception of Nevada and Oregon (Montana and Delaware chose not to wager on sports). Online sports-betting sites were – and still are – making a mockery of U.S. legislation by violating federal Internet gambling laws daily.

This is a highly deceptive argument. It is perfectly legal for me to go to Hollywood Park in Los Angeles and place a sports wager on a horse racing event. In fact it’s perfectly legal for me to place horse race bets in many, many states. The only thing being made a mockery of is the US Constitution which was intended to limit the powers of the federal government just so it couldn’t poke it’s nose into issues just like this.

The integrity of amateur and professional sports is compromised by the growing number of online sports-gambling sites (i.e. point shaving, player payoffs, corrupting coaches, etc).

The integrity of professional sports is being compromised by 21 year olds making $20 million a year. Sports betting is the least of the sporting world’s problems.

The other thing that makes this argument such a farce is that people already bet on sports. There’s a thriving illegal sports betting industry that the US hasn’t been able to stop in over 100 years of trying. Players, coaches, and sports journalists regularly quote the Vegas line on games. Sports betting is so integrated into the fabric of the sporting world that to say that allowing online sports books to do what people are already doing either displays a naive understanding of the situation or intentionally deceptive.

The American Psychological Association found high school and college-aged populations to be at an increased risk for Internet gambling addiction. [APA Advisory on Internet Gambling, March 17, 2002] See Advisory …

First off, high school aged children are not allowed to play on any mainstream online gaming site. Even with their limited ability to do age verification of US citizens onling gaming sites have set a hard line at 18 and if online gaming were to become legal and regulated in the US the legal age to participate in wagering could be set at 21.

Machines cannot verify your age, and children are at extreme risk for exploitation and addiction. Already, gambling addiction with adolescents and on college campuses is at epidemic proportions.

Machines can, with a high degree of certainty, verify who you are and various details about you (like age). Again, we go to the “save the children” emotional appeal because the logical, empirical case doesn’t stand on its own. Gambling has been a problem on college campuses before the internet. If the real concern is gambling addiction wouldn’t we be much better off if part of the gaming fees licensed online gaming sites paid was put towards providing help to addicted gamblers?

The National Gambling Impact Study Commission (NGISC) calculated that approximately 7.9 million adolescents have a problem or pathological gambling addiction. Imagine filling 113 NFL football stadiums to capacity; that’s how many under-aged teens and children have gambling problems. Read more of the NGISC Report …

According to Wikipedia:

According to the Illinois Institute for Addiction Recovery Recent evidence indicates that pathological gambling is an addiction similar to chemical addiction. It has been seen that some pathological gamblers have lower levels of norepinephrine than normal gamblers.

According to a study conducted by Alec Roy, M.D. formerly at the National Institute on Alcohol Abuse and Alcoholism, norepinephrine is secreted under stress, arousal, or thrill, so pathological gamblers gamble to make up for their underdosage.

Further to this, according to a report from the Harvard Medical School Division on Addictions there was an experiment constructed where test subjects were presented with situations where they could win, lose or break even in a casino-like environment. Subjects’ reactions were measured using a fMRI, a neuro-imaging device very similar to a MRI. And according to Hans Breiter, MD, co-director of the motivation and Emotion Neuroscience Centre at the Massachusetts General Hospital, “Monetary reward in a gambling-like experiment produces brain activation very similar to that observed in a cocaine addict receiving an infusion of cocaine.”

Deficiencies in serotonin might also contribute to complusive behavior, including a gambling addiction.

So, if problem gambling is an illness or biological defect, as suggested by researchers, to some degree the argument that offering gambling creates problem gamblers doesn’t seem to hold water. These people have a defect that causes them to crave gambling as a way to compensate for a chemical deficiency. In other words, they’re problem gamblers before they’ve wagered their first dollar.

This is further evidenced by the Illinois Institute for Addiction Recovery’s discussion of different types of gaming as they relate to problem gaming.

Video poker and slot machines have been referred to as the “crack cocaine of gambling.” Because of their immediate and effective reinforcement schedules, problem gamblers who regularly play these machines appear to progress into pathological gambling much faster than problem gamblers who only gamble at horse races, or other games that do not have such an immediate rate of gratification.

Just as crack cocaine ­ referred to as the “great precipitator” ­ shortened the length of time between first use of cocaine and chronic addiction, so too have video poker and slot machines apparently reduced the length of time between first wager and pathological gambling. In the past, a gambler would experience 15 to 25 years of “sick” gambling at the horse track before he or she reached the desperation phase. Today, it is not uncommon for a gambler addicted to slot or video-poker machines to progress into the desperation phase in two or three years.

So, my read on this is that online gaming doesn’t create new problem gamblers. These people are already problem gamblers.

I guess my real point is that online gaming is not the cause of the problem. In fact, offline gaming isn’t the cause either. A certain percentage of people (estimated to be 2% – 3%) have this problem regardless of the availability of gambling. Obviously providing an avenue to gamble is going to give the illness an opportunity to manifest itself but as I said earlier, wouldn’t society be much better off if a percentage of tax and licensing revenues from online gaming were to fund treatment?

Doesn’t it seem illogical to say that 97% – 98% of the population can enjoy gambling in a responsible manner and help fund treatment programs for the other 2% – 3% but we would rather ban all forms of gambling and force the 2% – 3% into underground gambling while providing minimal funding for treatment?

Four out of five students under the age of 18 say that going online is a vital part of their schoolwork. One in five adults says their children spend too much time on the Internet. This age group is extremely vulnerable to online solicitation and subsequent gambling addictions. [USC Annenberg School, 2005] Read more …

I want to meet that fifth student because he’s probably failing out of school. The internet is a way of life. In the coming years it will impossible for anyone of any age not to interact with the internet in some way.

One in five adults can say a lot of things. Opinions change constantly. I’m sure one in five adults thought Rock n Roll was devil music at one time.

Of course, all of this tangential information is to attempt to make a connection between kids and online gaming. It’s one more try and tugging at the heartstrings rather than appealing to logic.

Availability and accessibility are key components in creating addiction to gambling. The Internet is available and accessible 24/7 with no accountability. Addicted gamblers can remain anonymous and feed their addiction in secret. Pathological gambling addiction doubles within 10 to 50 miles of a casino – one can only imagine the addiction rates for 2,500 or more casinos within the reach of a mouse click. Read more …

No they are not! Availability and accessibility facilitate problem gambling. The creation of problem gambling, the disease, is biological.

But again, the facts are being played with to arrive at illogical conclusions. If you tell me that pathological gambling addiction doubles within 10 to 50 miles of a casino I would say that to be an obvious outcome. Pathological gamblers are going to move closer to casinos than people who want nothing to do with gambling. Allowing online gambling isn’t going to create problem gamblers (despite the causality suggested by the talking point) it will simply provide an outlet for existing problem gamblers.

And they can’t feed their addiction anonymously. If online gambling was licensed and regulated an even more effective system to help problem gamblers could be developed than is available in offline casinos and racetracks. A licensing requirement could be that whenever a casino either identifies a problem gamber or a gambler identifies himself to the casino as being a problem gambler (self-reported) his name could go into an industry shared database which would deny him access to all online gaming sites. And because a licensed and regulated online gaming industry could require a social security number (for tax filing purposes) from all players, there would be no anonymity.

Video gambling is the most addictive form of gambling in history. Research finds that addiction can occur in about one year, compared with gambling addictions to traditional slots and card games occurring in three to four years. Read more …

As has been pointed out several times previously the problem gambling illness already exists. Notice how they say video gambling when the actual research said video poker and slots? Anyway, the real issue is identifying these problem gamblers and blocking access while pointing them towards treatment. Something that can ONLY be done in a licensed and regulated environment where the casino actually knows their customers.

Taxpayers and the federal government should not be burdened with monitoring thousands of separate, foreign gambling sites for corruption, illegal activities or jeopardizing homeland security.

Actually taxpayers and the federal government should not be burdened with enforcing prohibisionist laws designed to keep 2% – 3% of the population with gambling problems from harming themselves. And as has been stated several times previously, the taxes and licensing fees paid by online casinos would not only pay for monitoring gambling sites for corruption, illegal activities, and the absurd fear of jeopardizing homeland security but would be a net gain for taxpayers as the costs of those activities would pale in comparison. Also, by bringing these operations onto US soil it would create hundreds (if not thousands) of new jobs not only at the casinos but in advertising and other tangential areas.

Effective and strong regulations are necessary to ensure that the online gambling industry does not infiltrate millions of homes, destroy children, ruin families and mock U.S. laws prohibiting Internet gambling.

As their is no proof whatsoever that online gaming will do or has done any of the above it’s a final last ditch appeal to emotion rather than logic with no supporting evidence.