Cutting The Wire: Gaming Prohibition And The Internet

5. A Money Jungle From Sea to Sea

5฀ A฀Money฀Jungle฀From฀Sea฀to฀Sea In฀a฀generation,฀the฀United฀States฀becomes฀a฀nation฀dedicated฀to฀public฀gaming฀ for฀the฀public฀interest,฀reversing฀decades฀of฀anti-gaming฀sentiment. Forty฀years฀ago,฀approval฀of฀gaming฀was฀not฀so฀strong.฀This฀began฀to฀change,฀however,฀as฀ state฀governments฀in฀the฀1960s฀began฀to฀sponsor฀lotteries฀and฀corporations฀took฀over฀casinos,฀ bringing฀these฀entities฀under฀the฀strictest฀of฀regulatory฀controls.฀.฀.฀.฀These฀factors฀combined฀to฀ make฀legalized฀gaming฀both฀more฀familiar฀and฀more฀trustworthy฀to฀a฀broader฀cross-section฀of฀ Americans. But฀within฀that฀broad฀cross-section฀of฀Americans฀is฀a฀generation฀gap.฀.฀.฀.฀In฀the฀aga’s฀Annual฀poll฀ conducted฀in฀2003฀.฀.฀.฀adults฀over฀50฀indicated฀generally฀favorable฀opinions฀about฀casinos,฀but฀ the฀opinions฀of฀adults฀ages฀21฀to฀39฀were฀consistently฀more฀positive. This฀much฀is฀clear:฀While฀older฀Americans฀have฀come฀to฀like฀us,฀younger฀adults฀love฀us. ฀฀—฀฀State฀of฀the฀States฀2003:฀The฀aga฀Survey฀of฀Casino฀Entertainment speaking at his february 1950 Conference on Organized Crime, Attorney General Howard McGrath proclaimed plainly that opposition to gaming was the reigning cumulative law of the United States: “Throughout the United States there is, and has existed for many years, a public policy that condemns organized gambling and makes its activities criminal.”1 Given that half the states in the Union regulated and taxed pari-mutuel betting at the time, and a clutch of others were experimenting with various legalized machine gaming schemes, this may not have been the literal truth, but he said it and no newspapers printed editorial retractions; no representatives seized the rostrum in Congress and protested. To that extent, McGrath’s assertion was true: The official policy of the United States, federal, state, and local, dictated that gaming, with a few exceptions, was illegal. Half a century later, one could say with equal fairness that support of gaming, particularly for revenue enhancement and regional economic development , was the public policy of the United States. Forty-eight of the fifty states, plus the District of Columbia, had some kind of legal gaming. The federal government, through legislative acts, executive decrees, and judicial decisions, sanctioned and even encouraged the development of casi141 05.indd 1 6/6/05 11:58:08 PM 142 cutting฀the฀wire nos on Indian lands.2 As of 2001, the federal government itself, through the armed forces, operated eight thousand slot machines in ninety-four locations , garnering an annual profit of more than $127 million; small potatoes, when compared to the $72 billion Americans annually spend on gaming, but a sizable piece of change nevertheless, particularly for a government that is ostensibly gaming-neutral.3 America is now a nation nearly united in the pursuit of gaming. This did not happen as the result of a single referendum or white paper. Rather, the country’s embrace of gaming at nearly all levels has been the product of a series of individual choices made by citizens, public officials, and businesses. The culmination of these choices was an unwritten and even unspoken reversal of the McGrath doctrine of American opposition to gaming . These choices collectively changed the landscape of American culture and law. The United States is now a nation that aggressively promotes gaming , whether we want to admit it or not. States฀Buy฀In:฀The฀Origins฀of฀Public-Interest฀Gaming The twentieth century of gaming expansion began humbly with the permission of pari-mutuel wagering in the 1920s and 1930s, endured setbacks during the 1940s and 1950s with the anti-gaming movement, and regained its vigor in the 1960s, with the legalization of state-run or state-endorsed lottery monopolies. There are many similarities between lotteries and pari-mutuel betting, particularly in their uses by states for revenue, that make a joint consideration of their evolution appropriate. Although horse racing—and betting on it—has been part of American life and culture since at least the time of the first British settlements, the system of race wagering that is now popular originated in the 1920s. Partly an adaptation in the face of political and economic pressures, partly the result of new technologies, pari-mutuel wagering offered several plums to several groups. For those involved in the business of breeding and racing horses, legal wagering permitted larger purses and a subsidy for the agribusiness of horse breeding and training. Public officials found a painless, entirely voluntary source of revenue that could obviate the need for higher taxes. The betting public gained...