Republicans vs. Democrats A Chronology of Online Gambling Decisions Part 2

If regulated gambling is on a list of election issues, many gamblers are still somewhat confused who to vote for. To that end, we will look at the history of gambling bills from the Internet's onset and determine who introduced them and who opposed them.

This is the second part in our series on online gambling bills in the U.S. for part 1, click here.

2008: The Unlawful Internet Gambling Enforcement Clarification and Implementation Act

After the Republican government issued implementation rules for the UIGEA in 2007, many in the government along with the banks were left scratching their heads. The onus was put on the banks to identify illegal transactions but at the same time they were forbidden by penalty from blocking legal gambling transactions. The problem was that there was still confusion as to whether poker was legal. Horse racing, lotteries and fantasy games were given exemptions but poker appeared not to be on the list. Pete Sessions, a Republican Congressman aimed to end the confusion and sponsored the only pro-gambling bill by a Republican. The bill was to make poker legal under the UIGEA and also provide immunity for companies like Party Poker who offered poker prior to the passing of bill. At the same time it asked that all other casino games and sports betting be deemed illegal forever and prosecuted vehemently. Not surprisingly many states opposed Session's bill because there could come a time when they would want legalized online gambling in other forms. As well casino companies like Caesars vehemently opposed the bill. Consequently it died fairly quickly.

2009: Internet Gambling Regulation, Consumer Protection, and Enforcement Act

Upset with a law that he deemed the stupidest law ever; Democratic Congressman Barney Frank introduced HR2267 and HR2268 which were designed to overturn the UIGEA and instead provide a framework for regulated internet gambling and taxation. Frank argued that it's crazy to try and tell people how to spend their own money and the United States was losing out on billions of dollars of potential tax revenue because of the UIGEA. Under his plan, all online gambling except sports (which he reluctantly removed from regulation since he concluded the bill couldn't pass as long as sports betting was in there) would be legalized and regulated by the government. Gambling sites would have to meet strict requirements for a license and would have to pay a fee and keep track of all gambling activity for taxation purposes. Frank argued this was necessary not only to protect consumers but also to protect banks and companies like Western Union who were put in an impossible situation thanks to the inadequate rules for the UIGEA passed by the Bush government before he left office. HR2267 and HR2268 received support from both sides of the House although the vast majority of supporters were Democrats. Republican representative Spencer Bacchus, who would eventually take over from Frank as chair of the House Financing Committee, vehemently opposed Frank's bill and even berated the banking sector for trying to block the UIGEA rules saying it wasn't their place to complain. One proponent from the Republicans and a co-sponsor of the bills was Ron Paul who stated that while he didn't gamble personally and didn't think it was a good way to spend money, nevertheless supported Frank's bill because as Libertarian he didn't believe it was the government's place to tell people how to live their lives. The bill gained support and even passed one reading but it died when Frank announced he was retiring from politics at the end of his term (2012).

2010: Internet Gambling Legislation and Tax Enforcement Act

Riding on the heels of Frank's popularity, Democratic Congressman introduced an upgraded version of HR2268 with HR4976, The Internet Gambling Legislation and Tax Enforcement Act. The bill was aimed at making Frank's bill a bit more enticing to the Republicans by spelling out how tax would be collected. Under his plan, all gambling operators that receive a license from the government would be required to collect 2% over and above all deposits and given to the federal government as a licensing fee and a further 6% on all deposits would be collected and given to states and tribes as a licensing fee. This was in addition to all taxes that would be required to be paid by gambling operators on their profits. Moreover, websites would have to report all consumer winnings to ensure consumers paid taxes as well. To add some additional enticement, 25% of funds raised through HR 4976 was to be given to the Transitional Assistance Trust Fund, which provides educational opportunities and job training for those currently or formerly in foster care and ½ % of funds raised through HR 4976 was to be given to the American Heritage Block Grant Fund, which benefits historic preservation and the arts. Clearly McDermott was trying to win favor with Obama and other Democrats by suggesting the bill would not only benefit all governments but would also help out the arts and those in need as well. The bill never made it to a vote probably because casinos such as Caesars believe charging 8% over and above as a fee to bet online would never fly.

Examining all the above, it's clear that online gambling bills are not bi-partisan. All bills aimed at making online gambling illegal were introduced and mostly supported by Republicans while all bills but one that wanted to legalize and regulate gambling were introduced and supported by Democrats. So given this information, which party is likely best for any chance of legalized online gambling in the U.S.? The answer seems obvious.