Should the US legalise online gambling?

The Nevada desert in the United States of America is the Mecca of worldwide gambling, playing home to the jewel in the crown of the betting industry, Las Vegas. The casinos in the city attract millions of tourists annually and drive the economy of the surrounding area.

A true example if ever one were needed, of the economic benefits of legalised, regulated betting. So naturally, you’d expect the US to be one of the most liberal countries in the world when it comes to the gambling industry.  Yet you would be wrong.

Gambling in the US is legal under federal law, but each individual state is free to place its own regulations on the practice. One of the areas that is widely unavailable to American citizens is online gambling.

Michigan recently became only the fourth US state to legalise online gambling, and in this piece we examine whether the practice should be legalised throughout the country. Taking a look at the views of the critics and the pro legalisation campaigners.

 The critics view

The Coalition to Stop Online Gambling is a large organisation in the US dedicated to keeping the practice illegal in the majority of American states. As with the majority of campaign groups, they believe that online gambling poses a serious risk to the children of America.

 What they believe

Regulation: The group strongly believe that age regulations put in place by betting companies can be easily navigated to illegally allow children to bet. Their pervading argument is that despite age verification tools, it could be all too easy for children to bypass these checks by asking an adult to log-in for them.

Addiction: It’s fair to say that the coalition aren’t just opposed to online gambling, but the whole gambling industry in general. They believe that whilst land-based casinos can attract addicts that their accessibility keeps the numbers relatively low. It is their fear that the widespread legalisation of online gambling will dramatically increase the numbers of new gambling addicts.

Statistics lie: In their facts vs myths fact sheet, the coalition repeatedly rubbish reports and statistics from states and countries that have legalised online gambling. They feel that the practice in the US is in its infancy and therefore disregard those statistics. The coalition also believes that European statistics are still relatively law and cannot be applied to the debate in the US as those countries differ from their own.

Crime: In the aforementioned facts sheet produced by the coalition, the issue of money-laundering is raised repeatedly. Problems with criminals using betting sites to launder money in the UK have recently led to government intervention, and the critics fear this could happen in the US.

The pro-legalisation view

Several politicians including Chuck Canterbury, Mark Dayton and Ron Paul have spoken about their support of online gambling and made moves to legalise the practice. Beneath are some of the key arguments put forward by the pro-legalisation lobby.

Legalisation allows regulation: Currently the laws restricting online gambling are not designed to help consumers. Various penalties are in place for those that break the law and perhaps more worryingly, no support is offered to those with problems. Revenues from online gambling in the UK generated around £4.3 billion in 2017, which has been taxed and used by the government to set up several gambling help organisations targeted at those with gambling problems.

Exposure: Current thinking amongst critics of online gambling is that if the practice is legalised it will lead to a massive spike in problem gamblers. However, evidence from the UK suggests that the widespread legalisation of all forms of gambling in the country has led to a more mature audience, who are more aware of the risks associated with gambling.

Economic boosts: In 2013 New Jersey legalised online gambling and in the first year alone tax revenues were a reported $32 million. Added to that, the legalisation of the industry is expected to bring more jobs to the US and keep American dollars in America rather than exporting them to foreign gambling countries which are readily available to Americans.

Where it works

The United Kingdom: Sports betting, casino games and bingo are all legal and available to British citizens online, but the industry is heavily regulated by the government. Gamble Aware is an organisation that promotes the benefits of gambling responsibly and all adverts and commercials are suffixed with practical advice for gamblers.

The gambling sector provides over 100,000 jobs in the UK, as well as this, the sector has a positive impact on the economy, paying extortionate taxes and helping charitable causes. In particular, the online sector is thriving, there are a huge amount of games available for the population of the UK, meaning there is something for everyone.

The success of the online sector has undoubtedly saved one of Britain’s longest standing traditions, bingo. For years, the game was in decline, with bingo halls shutting up and down the country. However, the revolutionary features of online bingo saw the game rediscover some of its old popularity. A younger audience are now enjoying the fast-paced games and the ability to be able to socialise with one another online. The growth of the online game has even resulted in a resurgence for land-based venues. May 2018 saw a 2% increase in the number of bingo premises in the UK, it appears the old favourite is on its way back.

Can the US mirror the UK’s success?

Opponents to online gambling believe that there is no comparison to be made between the UK and the US in relation to the practice. Primarily, the opponents believe that the UK audience is culturally more mature and that American consumers couldn’t be trusted to gamble as responsibly as their British counterparts.

Fears over money-laundering are real for anti-legalisation campaigners as they have seen the impact they have had in the UK. However the British government have learned from these problems and forced online gambling companies to enforce strict rules to catch money-launderers. US authorities could use the example of the British government to mitigate potential problems with money-laundering from the start.

What next

The movement to legalise online gambling in the US seems to be growing and whilst widespread legalisation feels a long way off, a domino effect of states legalising the practice is expected.

The economic benefits of online gambling seem to be the main focus of pro-campaigners, but it should be remembered that any increased tax revenues should be partially directed towards regulating the industry.

President Trump has extensive links to gambling as do several senior senators. That coupled with the fact that the country benefits so much from the economic boosts of Las Vegas makes the opposition to online gambling seem somewhat ironic.