For far more than 200 years, the federal government has let the states decide what their public policy toward gambling will be. If Utah wants complete prohibition and Nevada wants commercial casinos, the federal government’s role has been to either step aside, or, if asked, to assist the states in enforcing their laws.

That relationship changed on October 13, 2006. On that date, Pres. George W. Bush signed the SAFE Ports Act, which had the Unlawful Internet Gambling Enforcement Act tacked on by an unethical politician, Bill Frist (R.-TN.), then Majority Leader of the U.S. Senate.

The impact of the UIGEA is well known. Now the question is, when will it be changed?

The answer depends in part on presidential politics.

The Republicans have little interest in liberalizing Internet gambling, especially in an election year, when they are pandering to the religious far right. Even if the Democrats could squeeze a legalization bill through Congress, Pres. Bush would never sign it.

When the Democrats took control of the Senate, Harry Reid, senator from Nevada, became Majority Leader. In April 2005, the American Gaming Association, the lobbying group for land-based casinos, changed its position. It no longer opposes Internet gambling; now it wants a study.

Although it didn’t say so, it wants the study to conclude that online gaming can be conducted safely, and should be limited to operators who are already licensed. For example, land-based casinos.

Sen. Reid could make that happen, if the President is also a Democrat.

But, if John McCain wins, Republicans will take over the Senate, so nothing will change.

Insiders know that if Hillary Clinton is the nominee, Democrats will lose the Senate, even if she wins the presidency by carrying large, industrial states. Although she is admired by many, Hillary is the most hated woman in America. She is so despised, that it is hard to think of any woman who would be in second place.

As John A. Millin, chair of the Wyoming state Democratic Party put it: “It has become the dirty little secret in the Democratic Party. For reasons I don’t agree with and don’t completely understand, most voters in Wyoming seem to hate Hillary Clinton.”

It has been said that she is the only person who can unify the Republican Party. Many conservatives will sit out the election if it is Barack Obama versus McCain. But they will be energized, if they can vote against Hillary. In the process they will also vote against Democratic candidates for Congress. It will be massive number of Democrats who won’t vote, if the Clintons are seen as stealing the nomination from Obama, or sending him to the back of the bus as Vice President. There will then be four years of deadlock.

Assuming Obama is nominated and wins, the Democrats will keep control of Congress and there will be a change in federal law. It might come as early as 2009. More likely, it won’t be until 2010, or even later.

For political cover, there could be an objective, scientific study done first, that proves that internet gambling can be kept safe from hackers, protecting the “vulnerables” (children and compulsive gamblers), and that states that don’t want to allow gambling can prevent their residents from making bets.

I expect the federal law will eventually be changed to allow a state to opt-in, exactly the system that exists for horseracing today. But that change won’t happen for many years, unless Obama is elected President and the Democrats keep control of Congress. (E-03.27.08)


I. NELSON ROSE

© Copyright 2008. Professor I Nelson Rose is recognized as one of the world’s leading experts on gambling law. His latest books, Internet Gaming Law and Gaming Law: Cases and Materials, are available through his website, www.GamblingAndTheLaw.com.