Myths and Facts About Online Gambling

Myths and Facts About Online Gambling
Web-Gambling Opponents Restore Old Fight With Abramoff Out of the Picture, Defeated Bills Gain Renewed Attention on Capitol Hill By JEANNE CUMMINGS March 7, 2006; Page A6 WASHINGTON — Foes of Internet gambling are experiencing
a renaissance on Capitol Hill. One reason: Lobbyist Jack
Abramoff is now facing prison time instead of working
against them. House members are rushing to co-sponsor a version of the
Internet ban that failed after an Abramoff-led lobbying
blitz in 2000. Another version of the ban will be the
subject of a House Financial Services Committee meeting
this week. In the Senate, a senior Republican plans to
offer companion legislation as an amendment to a
lobbying overhaul measure spawned by the Abramoff
scandal. “This would demonstrate that not only are we changing
the mechanisms [of lobbying], here is one tangible
result,” says Republican Sen. Jon Kyl of Arizona. “Jack
Abramoff is not going to have his way now.” CAST YOUR VOTE Question of the Day: Should Congress ban Internet
gambling? And that isn’t the only issue lawmakers are
using to show things are different following Mr.
Abramoff’s January guilty plea to conspiring to bribe
members of Congress and other charges. Legislation
extending U.S. labor and immigration law to the Northern
Mariana Islands, which Mr. Abramoff had worked to block,
is being dusted off for reintroduction. Another bill he
had opposed — raising taxes on some U.S. companies with
headquarters in overseas tax havens — is up for an
amendment and could gain steam following the lobbyist’s
fall. With a Justice Department influence-peddling
investigation still under way, lawmakers want to “show
some separation between them and him,” says Rep. Bob
Goodlatte (R., Va.), a chief sponsor of the 2000
Internet-gambling ban. In a few weeks, Mr. Goodlatte has
racked up mre than 100 co-sponsors, including onetime
Abramoff ally Rep. Tom DeLay of Texas. Mike Connolly, a DeLay spokesman, said his boss opposed
the 2000 bill because it had too many exemptions, and
the current version will be more effective. Still, Mr.
Abramoff’s former adversaries see this measure and
others more likely to advance than when they squared off
with a lobbyist who arranged luxurious trips for
lawmakers and their staffs, launched campaign-style
advertisements against opponents and boasted
relationships with the likes of White House political
adviser Karl Rove. Rep. George Miller, (D., Calif.) worked for years to
make companies operating in the Northern Mariana
Islands, a U.S. territory, comply with the same labor
and immigration laws as other U.S. companies. But his
efforts have been stymied in the House, where several
members — including Mr. DeLay in 1997 — took trips to
the islands’ resorts paid for by Mr. Abramoff and his
clients. Daniel Weiss, a Miller spokesman, says the
legislation is “already being redrafted.” That doesn’t mean that legislation Mr. Abramoff once
worked against will sail through. On the Northern
Marianas issue, the Senate champion was then Sen. Frank
Murkowski, who is now Alaska’s Republican governor. It
is unclear who may take up the issue in that chamber
today. In the first post-Abramoff legislative rematch,
Internet-gambling companies opposing a ban are readying
for a fight. The Interactive Gaming Council, for now,
still retains Greenberg Traurig LLP, Mr. Abramoff’s old
firm. Sportingbet.com has retained Washington lobbying
heavyweight Patton Boggs LLP. A grass-roots
organization, called the Poker Players Alliance, also is
working against the ban. The industry’s pockets are much deeper than in 2000,
when there were 1,800 Internet gambling Web sites. By
2003, the industry’s gambling revenue was estimated at
$5.7 billion and it is projected to reach nearly $17
billion by 2009, according to a study by Christiansen
Capital Advisors LLC, a Maine firm that analyzes the
gambling industry. Mr. Goodlatte’s bill amends the Wire Act, which makes
gambling over telephone lines illegal, to include
Internet gambling. It includes some exemptions for horse
racing and state lotteries but also broadens the
definition of gambling to go beyond sports events. Mr.
Kyl and Rep. Jim Leach, (R., Iowa), are sponsoring bills
that would ban credit-card and other Internet financial
transactions for betting. Mr. Leach’s measure is
scheduled to be acted upon by the House Financial
Services Committee this week. Opponents say neither measure will work, primarily
because the industry is largely based outside the U.S.
“Our belief is a regulatory and licensing structure
would go a lot further toward protection of the
consumer,” says Keith Furlong, a spokesman for the
Interactive Gaming Council. By recognizing and licensing
the upstart industry, government officials could tax its
revenue, he added. Critics say Internet gambling must be stopped because
minors and addicted gamblers can find ways to the sites
and regulators can’t duplicate the kind of face-to-face
monitoring of gamblers’ habits that casinos and other
traditional gambling outlets can. Mr. Furlong says that lawmakers’ anger at Mr. Abramoff
and the tactics he employed to kill the bill in 2000
could provide momentum for the other side. The Abramoff lobbying effort included hiring former
Christian Coalition director Ralph Reed to stir up
conservative opposition to the bill on grounds that
exemptions for horse racing and a few other forms of
gambling would lead to an increase in gambling, not a
decrease. His team also ran advertisements threatening
to attack Republican incumbents who supported it. Mr. Goodlatte obtained letters from former Moral
Majority head Jerry Falwell and others to demonstrate
its support among religious conservatives. But Mr.
Abramoff’s last-minute tactics caused confusion.
Ultimately, a strategic decision by Mr. Goodlatte to
allow the bill to come to the floor on a special
calendar for noncontroversial items was his undoing.
Items on that special calendar require a two-thirds vote
for passage. Mr. Goodlatte’s bill received 249 favorable
votes, enough to pass with a simple majority but too few
to get over the two-thirds bar. Rep. Rich Boucher, a Virginia Democrat and co-sponsor of
the bill, said he was stunned last year when, as the
Abramoff records emerged, he learned the real reasons
the Internet gambling-ban bill was defeated. He pledged
to work harder to get it passed now, writing a letter to
fellow Democrats and attending a news conference with
his fellow Virginian, Mr. Goodlatte.

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