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How an Anti-Gambling Crusade Threatens US Interests

5/23/08 - The New Republic Blog - View Source

By Josh Patashnik

Reason magazine has had some really nice features in the last couple months that are worth your time. The May issue had this piece from Veronique de Rugy on the Bush administration's (and Congress's) unprecedented use of emergency supplemental appropriations bills to hide the real cost of wars in Iraq and Afghanistan, as well as this truly astonishing story from Radley Balko about a Louisiana family that went bankrupt defending itself against bogus, racially tinged drug-trafficking charges that were based on nothing more than fabricated tips from jailhouse informants looking to have their own sentences reduced.

Perhaps even better, though, is Jacob Sullum's article in the latest issue on the federal government's draconian, counterproductive attempt to crack down on online gambling. As Sullum documents, in 2006, a handful of members of Congress (led by Virginia Republican Bob Goodlatte) on an anti-gambling crusade managed to push through the Unlawful Internet Gambling Enforcement Act. It sounds like the bill was mostly written up to be BS election-year campaign fodder, but it actually passed. The result:

“It’s a mess,” says Nelson Rose, a professor at Whittier Law School and a leading expert on gambling law. “Nobody ever read it. There were no debates on it. It’s really a piece of garbage. It doesn’t clarify what’s legal and illegal, so the definition of what is an unlawful Internet gambling transaction depends on other federal or state laws.”

Because American law bans online gambling sites based in other countries while permitting domestic gambling in any number of forms (wouldn't want to anger Sheldon Adelson!), the WTO ruled that it runs afoul of international trade agreements. Instead of fixing the law or paying damages to the countries affected, the Bush administration decided to unilaterally revise American trade commitments to exclude gambling, which sets an awful precedent. Our trading partners are not happy, and as Sullum puts it, "Should China one day decide it no longer wants to respect U.S. copyrights, or should the E.U. decide to exclude U.S. agricultural products, the United States could not reasonably object to such unilateral revision of trade agreements, given the precedent it is setting in the area of gambling."

And the disturbing pattern of behavior by the government extends well beyond that: Proprietors of gaming websites (even those that are completely legal in the countries where they're based and where the bulk of their business is conducted) are being arrested during layovers in U.S. airports and face decades-long jail terms, and the Justice Department is threatening to prosecute media outlets that accept ads for illegal gambling, putting the onus on them to vague gambling laws correctly or face severe consequences.

This certainly isn't close to being on the top-ten list of Bush-era legal follies, but it's still pretty bad. Kudos to Reason for shining some light on it.

Protecting Children
Compulsive Gambling Safeguards
Secure Financial Transactions
New Government Revenues
Regulated and Licensed Environment
International Ramifications
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