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Lobbyist Gives Weak Argument Against Internet Poker Bill

25 March 2011 by admin

NevadaIn the ongoing fight for online poker regulation in the state of Nevada, both sides are digging in their heels and making a push either for or against the legislation. The stakes are high for those who want to be the first, or one of the first, states to regulate online gambling at an intrastate level and for those who want to prevent the state from offering another form of gambling.

In Nevada, the situation is more complex than many places. The opposition to online poker legislation comes not only from the anti-gambling groups, but from those groups that make money off of gambling, specifically casinos. While some casinos have latched onto the legislation and accepted that they need to move their business into the 21st century, others still see internet gambling as competition.

On Thursday, both sides got to make their case on Nevada’s online poker bill, Assembly Bill 258. The Assembly Judiciary Committee held a hearing on the bill. During the hearing, proponents of the legislation give a testimony lasting nearly two-and-a-half hours. Supporters gave considerable evidence of the benefits of the bill, such as the added jobs and increased revenue. Jeremy Aguero, from financial consultant Applied Analysis, gave two different scenarios. If the poker rooms could accept wagers from people outside of Nevada, it could bring in anywhere from $37.1 million to $65.1 million. If the market was limited to Nevada residents, he predicted tax revenue between $2 million and $3.4 million annually.

If Nevada became the first state to regulate online poker, it could become the major gambling hub for that industry. That would provide a new income stream for the state, as gambling operators move their headquarters to the Silver State.

After all of those arguments and more for the bill, opponents of the legislation barely talked for 30 minutes in defense of their position. The opposition basically came down to a single point: online gambling is illegal in the United States.

To hang their entire argument on that fact is ridiculous, especially since it’s incorrect. Pete Ernaut, a lobbyist representing the Nevada Resort Association, said that because gambling over the Internet is illegal, they shouldn’t pass any legislation until the federal government repeals UIGEA.

The problem with that argument is that UIGEA does not make online gambling illegal. Federal courts have already ruled that UIGEA doesn’t make anything illegal. All it does is require banks to make sure they don’t process transactions relating to “unlawful” Internet gambling. Since the law doesn’t define what is unlawful, it only bans them from blocking transactions relating to gambling that is already banned under another law. The only federal law outlawing any form of gambling is the Professional and Amateur Sports Protection Act, which outlaws sports betting. Therefore, online poker is only illegal in states where that state has a law banning it. Got it? I know it’s pretty simple, but Ernaut doesn’t understand it.

Even if UIGEA did make online poker illegal, which it doesn’t, that wouldn’t affect Nevada if they only allowed the game to be played at an intrastate level. The federal government only has authority over interstate commerce. Any commerce that is confined to the borders of a single state does not fall under the jurisdiction of the feds.

So let’s recap the only major argument the opposition gave for this online poker bill. They said that online gambling is illegal in the United States, which isn’t true, but even if it was, it wouldn’t matter if Nevada only allowed it at an intrastate level. Well, I think they’re going to have to do better than that to convince lawmakers not to pass this bill.

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