Not everyone was pleased with the rather rushed House vote on HR
4411 as part of the Republicans' "American Values Agenda"
this week, and we collected a few quotable quotes from the vast volumes
of media coverage on the event.
Representative Goodlatte "Online gambling is a scourge on [American]
society.”
"We have been here before," ABN Amro analysts in a research
note. "Leach's proposals passed a vote in Congress in 2002 and
again in 2003 but never reached the Senate."
"The Republican leadership has made the bill a priority in American
values' agenda, and hence it is likely that the bill will pass [in
the House of Representatives]," Morgan Stanley analysts
"This week's debate might prove irrelevant as there are so few
congressional days in which the bill could be heard before U.S. elections
in November. Only about seven or eight weeks of Congress will be left
for the merged House bill to negotiate the various Senate committees.
In our view this is not enough time for the bill to progress, given
the tight end-of-Congress legislation timetable in the Senate,"
said Richard Carter at Numis Securities.
"We continue to believe that full passage into law is very unlikely,
and would look to buy PartyGaming and Sportingbet on any weakness,"
said Morgan Stanley.
"We believe that the bill will have a very difficult time getting
through the Senate, given the constrained legislative calendar for
the balance of 2006, as well as the partisan political climate in
the Senate, which will only get worse as the elections approach. In
the last Congress, a similar bill was received in the Senate in June
of the first session of a two-year Congress and still never became
law. We are currently in July of the second session. No bill has been
introduced in the Senate; there has never been a Senate hearing on
this topic, and it is not on the calendar of any Senate committee."
Washington political analyst.
Representative Barney Frank, a Massachusetts Democrat, said the bill
restricted individual rights. "What kind of social, cultural
authoritarianism are we practicing here? The fundamental principle
of the autonomy of the individual is at stake today.''
Representative Shelley Berkley, a Nevada Democrat, called Goodlatte
a hypocrite because the bill wouldn't block online gambling on horseracing,
which is legal under a separate U.S. statute governing the horseracing
industry. "He made a deal with the horseracing industry to exempt
them from this bill,'' Berkley said. "And why is that? Because
if he didn't, they would fight this tooth and nail.''
House Speaker Dennis Hastert said: "We must be wary of illegal
gambling sites that offer fronts to criminals for money laundering,
drug trafficking and terrorist financing.
"Internet-based companies must abide by US regulations that protect
our children, citizens and the integrity of American business. The
Internet Gambling Prohibition and Enforcement Act will do just that.
It seeks to protect our children from gambling sites at home, keep
our hard-earned money in the bank, and put the criminals that seek
to take advantage of our family earnings in jail."
Representative Bob Goodlatte said the bill could curb the booming
industry of offshore websites accepting bets and wagers from persons
in the United States. "Because these businesses are located offshore,
they usually cannot be reached through state or federal law enforcement,"
Goodlatt said. "Easy access to Internet gambling websites and
lack of law enforcement give the US public a misimpression that Internet
gambling is not illegal."
Representative Barney Frank, a Massachusetts Democrat, who said the
legislation is an "inappropriate attempt" by some in Congress
to regulate what people do on the Internet. "In general, it seems
to me, if people want to do it, we should let them,'' Frank said.
"We are talking about criminalizing people's individual behavior
because some of us disapprove of what they are doing.''
Representative John Conyers, an Illinois Democrat, offered an amendment
that would strip all exemptions out of the bill. "This bill claims
to ban all forms of online gambling, but it specifically exempts online
betting on horseracing and state lotteries,'' Conyers said.
Reuters revealed that income taxes on winnings from Internet poker
alone - which is estimated to have attracted $60 billion in wagers
worldwide in 2005 - could amount to $2.5 billion each year.
Quoting Andrea Lafferty of the Traditional Values Coalition which
supports banning: "If you're going to support legislation that
is supposed to 'prohibit gambling,' you should not have carve-outs."
John Kindt, a business professor at the University of Illinois at
Urbana-Champaign who claims to have studied the issue,"You just
click the mouse and lose your house."
Antigua Finance Minister Errol Cort: "I'm very surprised and
quite disappointed that the U.S. Congress would be pushing full-force
ahead. We will be watching this matter very closely. The passage of
those two [Goodlatte and Leach] bills will aggravate our trade relations
regarding the U.S. with the WTO."
Greg Avioli, chief executive officer of the National Thoroughbred
Racing Association, said the mention of horse racing in the bill is
"a recognition of existing federal law," not a new carve-out.
He said the racing industry has a strong future in the digital age
and acknowledged the bill would send Internet gamblers to racing sites.
"They'd return to the one place they can bet legally," Avioli
said.
The Center for Responsive Politics calculated that a sizable part
of the racing industry has contributed more than $3 million to lawmakers,
presidential candidates and state and federal political action committees
since 2000. Far more than half the total went to Republicans, the
center said.
Kathryn Rexrode, a spokeswoman for Representative Robert W. Goodlatte,
the Republican who is a co-sponsor of the merged bills, said the horse
racing industry contributed when Mr. Goodlatte was not sponsoring
such legislation, but when he was chairman of the Agriculture Committee.
Leach said that "we authorize nothing new for horse racing,"
because it is regulated under the Interstate Horseracing Act. Even
fantasy sports games, he added, would be further restricted under
the bill, with bans on betting on individual teams or players.
Leach pointed to the coalition of supporters for the bills, including
churches that represent many denominations, like Christian fundamentalists,
that tend to have a consensus on little else. "I just think the
stars are in alignment, that Congress knows it has to deal with this
issue," he said.
"Somehow we find ourselves in a situation where Congress has
gotten in the business of cherry-picking types of gambling,"
grumbled Rep. Robert Wexler, who had earlier tried unsuccessfully
to include exemptions for dog racing and jai alai.
The Democratic leader in the Senate, Senator Harry Reid, a former
gambling commissioner in Nevada, "...has serious concerns about
our ability to properly regulate Internet gaming," his spokesman,
Jim Manley, wrote in an e-mail message
David O. Stewart, an analyst and a lawyer who produced a study of
online gambling for the American Gaming Association, a client of his
firm, paraphrased an adage used by the Supreme Court in a campaign
finance case, saying: "Money, like water, will find its way.
And I really think that applies to this. The money will find a way
to get to the offshore sites."
One of the most pungent observations on the selective nature of the
banning attempts came from a Sacramento online gaming lawyer and specialist
who described the legislative position as "basically, a mess."
Quoted in the Seattle press, Martin D. Owens said: "Here's the
country that has Las Vegas, Atlantic City, riverboats up to Iowa and
Indian gambling under every tree. Not to mention state lotteries.
Now you're going to turn around and say Internet casinos are undermining
the moral tone of the United States? It's just plain silly."