Poker Laws Again: The Feds, The States, and the Outside Looking In

As promised, we're returning to the topic of recent anti-online gaming legislation, if just for a short bit. Reaction from Washington-based players about to be impacted by that state's lobby-compromised legislators --- if one believes the tales --- is about what one would expect: the word of the day seems to be "disgust." On a similar note, national legislators continue to perform one of the biggest head-in-the-sand routines in recent memory, defying the rulings of the World Trade Organization [WTO], and proving again to the world that we do have our fair share of imperialistic idiots.

In fact, Sen. Bob Goodlatte (R-VA) served up one of the most incredulous comments in recent history when he uttered the following: "Virtual betting parlors have attempted to avoid the application of United States law by locating themselves offshore and out of our jurisdictional reach." Last time I checked, something like 95% of the world's population resides outside the U.S. borders, yet Goodlatte and his ilk somehow maintain the belief that all other countries must be subservient to U.S. special interests, and that all "offshore" companies dealing with the U.S. are really just American ex-patriots on the dodge from American law. Which makes three possible categories of "foreigners" now extant, along with international terrorists/drug dealers and all those starving babies in the UNICEF and Christian Children's Fund commercials.

No wonder people hate us.

I needed a good quote for this piece, so my first thought was to give a call to a Congressman I know, one Rep. James Nussle, a Republican from Iowa who's also now running for governor of that fine state. (That really is a Nussle photo to the right... with appropriate embelleshments.) There are some interesting issues regarding the differences in the approaches that state and federal legislative bides are pursuing as they seek to tax regulate online gaming, and someone who's moving from one venue to the other would be a wonderful source. How and why I know Jim is a matter for another tale --- if not part of a book --- but let's just say that Jim comes from the same cut-o'-the-cloth as Goodlatte and others. Nussle, for his part, is the original Newt Gingrich "paper bag" Republican, and even introduced a comely young intern to Gingrich who at a later point became Mrs. Gingrich. The intern, along with Nussle and yours truly, are all graduates of the same small Midwestern school.

I bring it up because I would swear on a stack of bibles to this: At one time, James Nussle was an unrepentant poker player of the first order. This is first-person knowledge, not hearsay. Therefore, the logic goes, were a pol such as Nussle to align himself with the Goodlatte bloc, it would mean that he subscribes to politics as usual --- that being the normal "Golden Rule" cash-driven politics that mark modern America.

Ahh, but Jimmy's the consummate pol... and he never disappoints my expectations. He would know that I know that his past (at least on this specific matter) doesn't jive well with the legislative morality that often defines his modern right. Therefore, as expected, his office declined to comment.

I'm such a dirt digger.

But left unresolved was a measure of the immediacy of all these legislative actions: Which is the greater threat to the online game, the federal or the state efforts? So I called one of the best and most knowledgable sources of all, poker author Lou Krieger, who's been at the forefront of the reporting and editorializing on these topics on the national scene. That Lou is also a frequent reader of this site is greatly appreciated.

While my gut reaction is to fear the state efforts to a greater degree, Lou was able to show why I was mixing my metaphorical apples and oranges on the topic. It's a macro-vs.-micro thing, it seems. As Lou put it, "When it comes to the business, capital formation, the creation of jobs, growth in equities and stock valuations and the like, then the federal efforts are the greater issue." And on the flip side, "As to laws being harmful to people playing [online] poker, to Joe Individual on the micro level, then the state actions can be important, particularly when state and local authorities go after individual online gamblers to make examples of them."

Well summarized, Lou... and thanks for the impromptu quote. It clarifies for me how the perception of the issue changes depending on the point of view, and it highlights just how nonsensical Goodlatte's crusade is, upon deeper examination. While he may rally the tax-grab crowd to his "cause," the fact is that Goodlatte's view of a proper Internet resembles that tried by Mainland China a few years back.

That Goodlatte's law would screw the American economy out of billions at a time we really need it is, simply, not a factor to be considered. As Lou pointed out, "Goodlatte's legislation will vaporize any revenues that may have come from a well-regulated program of online gaming. Moreover, Goodlatte is himself disingenuous because his legislation carves out exemptions for wagering on horseracing and in fantasy sports leagues."

I couldn't agree more. Wait... isn't Virginia a big horse-racing state? They have only one track, but it's definitely a hotbed of breeders and countrified estates, along with being the polo headquarters of America. Given that, I'd hate to think that partisan politics are sullying the high morals of --- *sigh* --- yet another Congressman.

Moving right along to some other views on the topic.

One of my favorite off-the-beaten-track poker blogs, mentioned here once before, is British blogger David John's White Belt Poker. John's blog captures and adds commentary to much of the British "news" on poker and gambling, much as Dave Schwartz's excellent Die is Cast: Thoughts on a World of Chance does on happenings here in the States. White Belt Poker highlighted a recent article from Great Britian's The Register, which often features gambling-related news. Recently, John served up a link to this dilly, entitled "Illegal Internet Gambling Soars in the US."

The Register article is an exceptional example of lazy journalism, merely rehashing another section of the oft-quoted release from the American Gaming Association reporting on the house-sponsored survey conducted on the AGA's behalf by Peter D. Hart Research Associates. The very first sentence of the Register report tells you where this one is going: "Just 19 per cent of US internet gamblers realise – or are willing to admit – that the activity is currently illegal..."

Well, that sentence is taken verbatim from the AGA release, but its regurgitation by the Register overlooks the obvious: The AGA is the newsy mouthpiece of the brick-and-mortar industry here in the States. As such, the AGA can hardly be expected to take up the banner of offshore poker sites, despite the fact that it recently called for a one-year study of online gaming in general.

I have issues with judging a person or a group guilty before all the facts are in, and I have even greater issues with so-called "journalists" that are too damn lazy to check their sources' motivations. If you haven't read Allyn Jaffrey Shulman's excellent, legally strong analysis of the issue for Card Player Magazine, then please take the time. What you will discover is that the legality of online poker is very much a grey area at the present time --- "the willing to admit [] that the activity is currently illegal" line as spouted by the AGA is at its best debatable, at its worst a deep and sticky pile o' poo.

But I don't fault the AGA for their predictable spin attempt, which falls into the "Demonize the Opposition" category. I fault the Register for being the dolts that they are and running this one without checking the facts. Even funnier is that as a UK-based enterprise, the Register should have a vested interest in UK-based online gaming companies... in this instance, the exact opposite of the purpose served by the piece that they ran.

Maybe they were paid off to run the piece, but that's unlikely. One of the variants of Hanlon's Razor is this: "Never attribute to malice that which can be adequately explained by stupidity." That seems a Register-sized pigeonhole, if there ever was one.

Concerning the AGA, online interests would be well-served to mind another famous line, and whether it comes from the historical (Sun-Tzu in The Art of War) or modern (Michael Corleone in "The Godfather"), its meaning is clear: "Keep your friends close, but keep your enemies closer." Online gaming interests trusting to the support and good intents of the AGA are likely to be disappointed if they need support from that organization at a crucial future point.

If they don't, they may end up looking as vacuous and lazy as the Register.