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June 4, 2014
Viewpoints: Arguments for online poker don't add up

internet_poker.JPG(June 4 - By the Rev. James B. Butler, Special to The Bee)

Before California legalizes online poker - the largest expansion of gambling in the history of our state - some fundamental questions need to be answered.

The first and obvious question to ask policymakers is, "Why legalize Internet poker at all?"

The answers given by legislators and the gambling interests are: (1) it would bring in more revenue for California government without having to raise taxes; (2) it would offer protection for consumers who are already playing online, and (3) the gambling interests want it.

Let's consider each of these justifications.

Revenue: According to the most favorable casino-provided studies, Internet poker revenue could generate up to $845 million over five years (no mention is made about the revenue that would be made by the tribes, card rooms or horse racing, but I imagine it would be a lot more). This averages about $170 million a year in an annual California budget of more than $100 billion - or less than 0.02 percent of state revenue.

In addition, these industry-backed forecasts totally ignore the economic costs that would come from the increase in gambling that would result from legalizing Internet poker. A nonpartisan study by the California State Library's research bureau estimates that as of 2006, we already had more than 1 million adult problem and pathological gamblers, and another 500,000 underage problem and pathological gamblers. Back then, gambling was already costing the state more than $1 billion a year.

As stated by that study, "These costs derive from a number of social and personal problems that correlate with problem gambling including crime, unpaid debts and bankruptcy, mental illness, substance abuse, unemployment and public assistance." That study also cites another study estimating that taxes to compensate for the increase in serious crimes (aggravated assault, rape, murder, robbery, larceny, burglary and auto theft) would "represent about 25-30 percent of casino revenues."

Since legalizing Internet poker would increase the number of gamblers and therefore all of the associated costs of increased gambling, would there really be a net revenue gain for California? And would any windfall offset the negative social impacts that would surely come in the wake of converting every bedroom, living room and dorm room into a virtual poker parlor?

If this were truly about California realizing more revenues, why aren't policymakers willing to consider eliminating the middleman (tribal casinos, card rooms and horse racing tracks)? We do so with the lottery; so why should we not treat online poker sites the same, with the state, not private gambling interests, keeping all the profits?

Consumer protection: Gambling interests argue that a number of people are already playing on illegal sites, and they do not have consumer protections. In essence, they admit that there are Californians illegally wagering on illegal websites, and then cry foul to discover "there is no honor among thieves."

The argument that we should legalize an illegal activity because those participating in it have no consumer protections is a real exercise of logical jujitsu that cannot withstand serious scrutiny. If we really want to protect consumers from illegal gambling sites, state law enforcement should prosecute those sites, as other states and the federal government have done, not roll out the welcome mat to them.

The tribes want it: During the past several years, tribal opposition stopped Internet poker, and now it seems that their united support will pass it. All but one major tribe with a casino announced Tuesday they had reached agreement on an Internet poker bill. It makes one wonder whose "best interest" is the Legislature representing - sovereign tribes or the people of California?

If the state decided to run its own Internet poker sites and eliminate the other gambling interests, would the tribes and other interests think online poker is still a good idea? Would the Legislature approve it if the tribes said "no"? It is a question worth asking.

Californians deserve answers to all these questions before the Legislature implements the largest one-time expansion of gambling in state history, and we all reap the destructive consequences of that dramatic action.

The Rev. James B. Butler is executive director of the California Coalition Against Gambling Expansion.