Adelson’s Internet gambling crusade

At first glance, there’s little doubt that most of the people who love to hate Sheldon Adelson are going to assume that he’s in it strictly for the money or to pursue some conservative agenda.

But the more you look at it, the casino mogul’s new cause is not one that seems to directly advance either his financial interests or the political or Jewish causes that are close to his heart. Thus, the news reported first last week by the Washington Post that Adelson is going all in on an effort to ban Internet gambling is puzzling his chorus of detractors as well as some of his usual allies. Indeed, most in the gaming industry oppose his efforts, as do many Republicans like Governor Chris Christie, who might otherwise look to him for support. But Adelson, who is launching the Coalition to Stop Internet Gambling and prepared to back it with his $20-plus billion personal fortune, is convinced that he can change the nation’s mind about the topic. As Forbes notes, Adelson’s initiative comes at a time when:

For the first time most of the U.S gambling interests – from the casinos to the horse track owners, state lotteries and Native American tribes – appear to be starting to coalesce around a pro-online gambling position. Adelson’s effort is likely to rip apart the American Gaming Association, the casino industry’s lobbying group in Washington.

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With online gambling now legal in New Jersey, Nevada, and Delaware, and with 12 states set to consider it in the near future, the odds against Adelson’s initiative are long. But whether he is able to stop or even slow down the race of state governments to cash in on what they believe will be a windfall, the billionaire happens to be in the right. The spread of gambling on personal computers and smart phones will not only harm his industry but cause untold societal damage, especially to the poor.

Internet gambling was deemed illegal by the federal government up until an opinion handed down in 2011 by the Justice Department made it possible. That led most casinos and other potential gambling venues to get behind efforts to get the states to legalize such businesses. Politicians like Christie, eager for more revenue to balance their budgets without having to cut more services or to raise taxes, also look at it as a way to obtain free money. They also think it will help bolster gambling havens like Atlantic City that are suffering from the proliferation of legal casinos around the country. They point out that Internet gambling already exists via offshore sites that attempt to skirt the laws and that there is no reason for states not to cash in and take their share. Adelson’s numerous opponents also point to his own record as a casino owner and his onetime interest in Internet gambling as proof that his moral concerns are hypocritical.

But whether he is tilting against windmills or not, Adelson is right to try and facilitate a debate about the social costs of this trend before it is too late.

Gambling, whether at destination resorts like the ones Adelson owns in Las Vegas and Macao, or via state lotteries, is generally depicted in the media – and in the flood of advertisements perpetually seeking to entice people to gamble – as entertainment with no down sides for society. It is that for many Americans, but we don’t hear enough about how this supposedly harmless vice destroys countless families and lives. Wherever legal gambling flourishes, it generates a lot of work for bankruptcy lawyers and sets off waves of crime as debt-ridden gamblers resort to thievery and embezzlement. Every conceivable social pathology comes in its wake, and though governments profit at one end with their large take of the cut, they pay for it in many other ways that have to do with the damage done to those destroyed by gambling.

The odds of winning in state lotteries are so astronomical that they are in effect a tax on stupidity. They would be considered scams were anyone but the government operating them. But the low cost of tickets makes it harder for gambling addicts to ruin themselves with it. Similarly, however great the toll of suffering due to legal casinos may be, its impact is limited by the fact that going to such a place is not an impulse decision but rather a planned excursion.

But once high-stakes gambling becomes something you can play on your phone, the stakes for society will increase exponentially. Scoff at sermons about the evils of gambling preached by a casino owner all you like. But Adelson’s right that once this spreads across the country, it will sink the nation in a new wave of addiction whose costs will be incalculable.

So far, Adelson’s group, which is being fronted by a bipartisan trio of retired politicians – Republican former New York Governor George Pataki, former Democratic Senator Blanche Lincoln of Arkansas, and former Denver Mayor Wellington Webb – has been met with skepticism, as was evident when the three were grilled by Chuck Todd on his MSNBC program. Trying to convince Americans that more legal gambling is wrong – a proposition that might have appealed to previous generations – may be like trying to put the genie back in the bottle. But unlike casinos and state lotteries, which are off limits for kids, Internet gambling also will likely victimize children who have access to smart phones with little assurance that regulations will make this impossible. As such, Adelson’s group may be right to say that this could be like the “Joe Camel” moment, when the nation turned on cigarette advertising because of the way it exploited children and created lifetime addictions.

Liberals who care about the way gambling singles out the poor ought to be on his side. So, too, should conservatives who claim to care about communal values as well as those who understand that the answer to the question of how to finance big government should be found in lower expenditures, not soaking middle-class and poor gambling addicts.

With many Republicans and most of the gaming industry against him, it’s not clear that all the money in Adelson’s deep pockets will be enough to prevent more states from following New Jersey’s example. Nor are the odds in favor of his attempt to get federal legislation to close the legal Internet gambling sites down. But even if all he’s able to do is to raise awareness of the grievous social costs of this scourge, it will have been worth it.

I doubt that this will improve his image in a mainstream media that despises Adelson for his support for conservatives and deprecates his backing for Israel’s Likud government. But whatever you may think of his politics, Adelson’s stand deserves respect and support.

This column first appeared in Commentary magazine. Reprinted with permission.