Online gambling opponents will have to wait another day for a federal ban on online poker.
The Restoration of America’s Wire Act (RAWA) — which would overturn a US Department of Justice interpretation limiting the scope of the current prohibition under the current version of the Wire Act law to sports betting — is not attached to the omnibus “must pass” spending bill by Congress.
The development is a major victory for the online gambling industry in the United States.
Fears had been circulating for months that a back room deal similar to the one that saw the Unlawful Internet Gambling Enforcement Act (UIGEA) attached to the omnibus bill in 2006 would happen again.
Although the anti-gambling lobby will undoubtedly continue its efforts in 2015, it will now have to do so by slogging its way through the normal legislative process. This promises to make the debate over the future of American online poker much more robust, open, and transparent.
More Money; More Problems
It appears as though the worst kept secret in Washington these days is that the anti-iGaming lobby is being almost entirely bankrolled by one man: Republican super donor Sheldon Adelson.
Normally, money and politics go hand in hand, especially in the United States where campaign finance regulation is weak. Nevertheless, pushback has begun to ferment at the grassroots level against the idea that one man could have so much influence over what is potentially a billion dollar industry.
Conservative groups especially have voiced strong opposition to the perception that Congress could be bought off by Adelson to craft regulation squashing direct competition to his personal, land-based, gambling empire.
Congressman Ron Paul dedicated an entire op-ed piece to his railing against Adelson’s influence on Capitol Hill and what he labeled “crony capitalism” in its most pure and brazen form.
This political climate appears to have given Republican politicians pause that they risk a serious backlash from their base if they are seen as walking in lock-step with the epitome of special interest money.
State Rights Arguments Also Resonate
In addition to disgust at the money being thrown around, Republican politicians are also hearing from voters in their base who are wondering out-loud why the federal government is even getting involved in regulating online gambling at all.
Land-based casino gambling has always been the prerogative of the sovereign state governments, and many conservatives view the idea of a federal ban as an example of encroachment on the principle of state sovereignty.
Grover Norquist — who is the president of Americans for Tax Reform and one of the most influential figures in conservative politics — has also come out strongly against any federal ban on exactly this point.
States’ rights is an important issue for conservative voters, and so this too seems to have scared off support amongst Republican politicians unwilling to be labeled as going against core political values.
The Best Defense is a Good Offense
The defeat of RAWA in this Congress is welcome news. However, it is only one battle in the larger, ongoing war to avoid the proverbial federal ban-hammer.
The iGaming industry has come a long way since 2006. This recent skirmish with big money validates the efforts of industry advocacy groups such as the Poker Players Alliance and the community in general to step out of the shadows and into the mainstream cultural consciousness of the nation.
Players and operators alike clearly do now have a voice in the halls of power.
Even more encouraging is to see that the issue has now been removed from the simple “pro” vs. “anti” gambling dichotomy and is instead being discussed in the language of the broader American political debate. This is a development that cannot be overstated.
It makes it much less likely — though certainly not impossible — that a federal ban will be able to get through Congress.
Although the omnibus bill can be amended at any time, the high-visibility of the issue in recent weeks makes it unlikely that online gambling legislation will be coming out of Congress until at least 2015.
All eyes will now be on California, as well as the possibility of an interstate compact between Nevada and Delaware. Should these happen, they will cement the industry even further and — given the amount of opposition already present to a federal ban — make it almost impossible to dislodge it.
For that reason, the coming year is shaping up to be the biggest one in the history of US iGaming.