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Hartley Henderson
Impact of the 2010 Midterm Elections on Internet Gambling

By Hartley Henderson - exclusvie to OSGA
Oct 26, 2010, 13:02

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While the topic of gambling is being sold as a non-partisan issue in Congress, nothing is further from the truth. Over the last decade pro gambling bills have been voted down overwhelmingly by the Republicans and supported by Democrats. In fact, it’s an issue that has been voted on almost exclusively based on party lines, and the only bill passed relating to gambling (the UIGEA) was ratified predominantly because of Republican support. At the same time sponsors of pro gambling bills such as HR2267 are almost unanimously Democrats. Over the last two years numerous lobbying groups for the industry including the Poker Player’s Alliance have been getting their ducks in order ready to propel a major pro gambling agenda once the Obama administration gained more popularity, but the opposite occurred. In the last 2 years the economy remains shaky, the public still blames Obama for bailing out the banks and car companies and there is dissatisfaction with Obama’s handling of healthcare and foreign affairs. Consequently, the gains that were expected to accrue for the Democrats in the 2010 midterm elections have actually turned into losses and it’s almost certain that control of the House will go overwhelmingly to the Republicans while Senate control can go either way. Current projections of the New York Times show the Republicans winning at least 220 seats in the House (up from 178 in 2010), while the Democrats will fall to below 215 seats (down from 253 in 2010). In the Senate, the hope that Democrats would win more than the magic 60 seats has dissipated and it appears they will barely hang on to control.

The ramifications of an overwhelming victory by the Republicans in the House are clear. The consensus seems to indicate that current House minority leader John Boehner will take over as House majority leader while Eric Cantor will become speaker of the House. Both have voted against all gambling driven bills whenever the issue came before them. Worst of all, Spencer Bachus, who has been as vocal against all pro gambling initiatives as Barney Frank has been in favour of them is in line to resume the roll as Chairman of the House Financial Services Committee. It was under Bachus’ watch that the UIGEA regulations were written and it’s almost certain that Bachus will do everything in his power to ensure that pro gambling bills are sidelined as long as possible. Furthermore in meetings to discuss the hardship on banks of trying to implement the regulations, Bachus indicated little concern and simply wanted online gambling stopped in its tracks.

The consequences of a reduction in the Senate aren’t as concerning provided the Democrats keep control. But, if the Republicans pick up one or two unexpected seats, control of the Senate could go to the Republicans promoting Mitch McConnell of Kentucky to Senate majority leader. McConnell has voted against all gambling legislation in the past and Kentucky has been very unfriendly to offshore gambling. More important if Harry Reid loses his seat or if the Republicans gain control, it would be a drastic shift from Harry Reid, the current Majority leader in the Senate, who has been a staunch supporter of the industry. It should be noted that Reid has opposed online gambling legislation in the past but that objection was to prop up the casino industry in Nevada. If there was indication Nevada casinos could benefit from online gambling his support would almost certainly shift for any expansion of gambling. Reid is also well connected to key gambling interests in the state of Nevada, and by all accounts to major players in the gambling industry as a whole.

The question many gamblers are wondering is who they should vote for to support the industry. In the 2006 midterm elections, online poker received a huge shot in the arm when a campaign by the Poker Player’s Alliance to defeat Jim Leach resulted in his ousting from Congress. It seems that without the PPA’s intervention Leach would have won another term. This time the PPA has not officially campaigned for or against anyone in particular but they did introduce a ratings guide where they graded each candidate on their position for poker. They also listed 70 Congressmen and Senators who they said were “poker friendly”. Not surprising Congressmen like Spencer Bachus and Jon Kyl got F’s while Barney Frank received an A+. The logic behind the ratings is to provide a guide for poker players who want to vote based on a candidate’s position and actions on poker. Of course a candidate can support poker but be against other forms of gambling like sports. In fact one of the candidates the PPA is backing, Pete Sessions, is counter to anyone who supports sports betting or offshore wagering. Sessions tried to pass a skill game bill that would legalize poker but the bill also calls for sports betting to be illegal forever outside of Nevada. Nevertheless, the site at congressionalpoker.org is useful for poker players to peruse to see which candidate best represents their interest.

That said there are several close races and the outcomes could be significant for the industry. The most important race for the industry is for the Senate in Nevada. The incumbent is Harry Reid and the challenger for the Republicans is Sharon Angle. Polls have Angle slightly ahead but it’s imperative that bettors in Nevada vote for Harry Reid if they view online gambling in the state as a prime issue. As mentioned Reid has never actually campaigned for legalized online gambling but his current status and connections make him any gambler’s ally.  Furthermore, he is seen as a swing vote in the house and was instrumental in getting the delay on implementation of the UIGEA back in January. It’s uncertain what Angle’s view on the issue is, but the loss of Reid not only in the state but also as Majority Senate Chairman will speak volumes to the anti-gambling faction who will be looking for a reason to promote further bills to stop or slow the activity.

A second race that is being watched is for California Senator between Barbara Boxer and Carly Fiorina. Neither has ever stated a position on the issue but the California Senate (which Boxer currently holds) voted to support iMEGA’s motion to overturn PASPA and allow sports betting in New Jersey. Moreover, there is every indication that Boxer has been fully supportive of an online poker network in the state. Boxer has voted for freedom of choice in the past and likely would support increased gambling if the public desired it. Fiorina, on the other hand, has a close alliance with the current Republicans and has received strong support from gambling opponents. The Senate race is very close and if Boxer loses it could be significant in deciding which party will have a majority in the Senate.

For the exact same reason, i.e. to keep Senate control in the hands of the Republicans, it’s imperative for gambling supporters to vote for Democratic candidates in close races to ensure they keep control of the Senate. These include voting for Bennett over Buck in Colorado, Sestak over Toomey in Pennsylvania and Schumer over Townsend in New York. The first 2 are extremely close but it appears Schumer has built a commanding lead based on polling. It also should be mentioned that Bennett is a strong ally of the gambling industry.

As well, it’s important for gamblers to show strong support for the industry by voting overwhelmingly for pro gambling Senators and Congressmen. These include but are not limited to Barney Frank, Jim McDermott, Robert Menendez, Shelley Berkley and John Conyers. If someone is a co-sponsor of HR2267 they should generally be viewed as gambling allies.

The one Republican candidate that gamblers should endorse heartily is Ron Paul. If there is one wild card in the whole mix it wrests with the Tea Party movement which was started by Paul. The Tea Party began as an angry Conservative movement to oppose all candidates regardless of party affiliation that they believe have veered from the Republican’s traditional concerns about lower taxes, less government control and fiscal responsibility. In fact many neo conservatives are on the firing line before the Tea Party. Ron Paul has been heralded as a leader of the Tea Party, and while Paul said he doesn’t gamble personally, he was one of the first supporters of Barney Frank’s bill since he suggested it isn’t the government’s place to tell Americans how to spend their own money. Actually, many of his Libertarian ideals are central to the Tea Party movement and anyone with Libertarian ideals is almost certainly supportive of a gambling agenda. Unfortunately some neo-cons have infiltrated the movement but if they are shown to be promoting a morals agenda at the expense of fiscal responsibility such as Spencer Bachus it’s almost certain they will lose Tea Party support in 2012.

This year’s midterm elections are crucial to the industry. It’s unlikely anyone in America will vote for a candidate simply because they are for or against gambling but bettors should be aware that if they allow control of the Senate to be turned over to the Republicans or if pro gambling advocates like Barney Frank aren’t shown overwhelming support, all gains made in the area of gambling the last few years could go out the window.

Read insights from Hartley Henderson every Tuesday here at OSGA!





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