May 4, 2012
Obama's DOJ Gambles with Economic Recovery
President Obama’s Department of Justice placed a bet that online lottery ticket sales are the cure to states’ fiscal challenges when it sidestepped Congress and overturned 50 years of consistent interpretation of a law that forbade Internet gambling.
Through the years, gambling required careful, judicious consideration and planning at the state and federal levels to stop revenue-hungry operators from going all-in on the latest gambling-related quick fix. Released on Christmas Eve, the Obama’ DOJ’s policy change was a gift-wrapped -- but discreet -- reward to powerful political allies. But in placing more emphasis on timing than policy, the DOJ rushed to judgment, setting a dangerous precedent.
Since the early 1960s, the gambling debate was framed within the parameters set by the Wire Act, which the Justice Department has long interpreted as prohibiting most forms of Internet gambling, including online lottery ticket sales.
In 2011, two cash-strapped states (President Obama’s home state of Illinois, and New York) wrote a letter asking the Obama administration to break with precedent and give them the ability to raise the revenue needed to fund bloated state governments by expanding online gambling sales.
How did this administration, the most liberal administration in a generation, handle this request? Naturally, by ignoring constitutional checks and balances and singlehandedly rolling back the longstanding interpretation of the Wire Act. And it did so without input from consumer advocates, small business interests, or any impacted parties other than state bureaucrats looking to keep their paychecks. This change in policy removed legal barriers to online lottery ticket sales and other casino-style games, which are often run by foreign gambling conglomerates.
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