States Eye Online Gambling while Freezing-Out the Private Sector

Today, July 17, the Senate Subcommittee on Consumer Protection, Product Safety and Insurance held a hearing on online gambling entitled, “The Expansion of Internet Gambling: Assessing Consumer Protection Concerns.” In advance of the hearing, Americans for Tax Reform sent a letter to the subcommittee highlighting the problems with government-run, intrastate gambling sites and lotteries, as well as the advantages of their free market alternatives.

Government gambling programs exist solely to generate revenue while imposing strict restrictions, and sometimes even prohibiting, free-market online gambling. Today’s government lotteries also have far less consumer protection and dramatically lower prizes-to-sales ratios as those of licensed and regulated free-market enterprises. 

The letter states:

“It seems clear that the government-run enterprises that sought the ruling were motivated by a thirst for more revenue, which was necessitated by a refusal to undertake structural reforms. These states found a sympathetic ear in an Obama administration all to willing to grant powers to state enterprises prohibited to the free market. Unfortunately, Congress has as of yet done almost nothing to reassert the Constitutional role of the legislative branch in crafting legislation.  Meanwhile, these state entities continue to expand unchecked, allowing these state governments continue to spend without undertaking the structural reforms they need.   This temporary salve risks permanently planting a government enterprise in a sphere that is simply inappropriate for government. Taxpayers deserve to have this growth of state power and revenue evaluated and addressed.”

Read the full letter here.