Fact-Checking the Arguments For and Against Online Gambling

June 13, 2014

Both advocates and opponents of online gambling expansion have been employing what I’ll call the kitchen sink approach when they try to make their case. Both sides are more than happy to riff on the many advantages or ills of the industry and segue from one argument to another faster than a comedian doing their set at the White House Correspondent’s Dinner.

Sometimes this is done because they have a very strong case and have a lot of good talking points to get to, but other times this riffing is more strategic; meant to confuse, overwhelm, and misdirect the audience, and forcing their opponent to have to defend against a litany of attacks – and doing the defending takes far longer and requires far more nuance than doing the accusing.

In this article I’ll take a look at the most often used arguments from both sides and see if they pass the smell test – and yes, I basically ripped off the true-false scale from Politifact.com.

The arguments FOR legal online gambling

It’s a Revenue Generator

Somewhat true.

Online gambling will certainly bring money into a state’s coffers. As we have seen however, the amount of money the industry is going to contribute is negligible; we’re talking fractions of a percent of states’ total budgets here.

The potential revenue is a quaint argument for online gambling, and one that can provide the average Joe with a tangible figure of the industry’s net worth, but it’s certainly not an argument that should be central to the debate, and it’s turning into a harder and harder sell to wary lawmakers who are now armed with real-world data thanks to NJ, Nevada, and Delaware.

It Provides Strong Consumer Protections

Licensed and regulated online poker isn’t going to stop cheating, or prevent every single underage player from hopping on an online gambling site, but it will do a hell of a lot more than the current unregulated market is doing on this front.

This is one argument that every online gambling advocate should know inside and out, as it resonates with just about everyone.

Poker is a game of skill

Half true.

First of all, this is a poker-only argument and therefore doesn’t fit into the larger storyline that online gambling should be legalized – if your argument is poker should be legal because it’s a game of skill than you’re also saying other forms of gambling are not skillful and should be banned.

Poker is certainly a skill game, but making the case for poker as a skill game requires a lot of patience. The winner of any given hand is based entirely on random luck, and it isn’t until you start approaching a significant number of hands that skill takes over. So poker is a game of skill… depending on how much poker we are talking about.

Furthermore, if you’re not a good player it is indeed luck when relying on lucky cards to beat superior opponents. For these people, poker is most certainly a luck-based game and offers among the worst odds in the house.

The arguments AGAINST legal online gambling

It will increase the number of problem gamblers

This is a powerful argument because it makes sense that new, readily available gambling options would increase the number of problem gamblers – after all, how could more equal less?

That being said, the data simply doesn’t back this up at this point, one way or the other.

It’s unclear if online gambling creates problem gamblers or if some problem gamblers are simply drawn to the Internet, as of now the jury is still out.

Then there is the not so small elephant in the room that iGaming critics gloss over; online gambling has already been around for 15 years in the form of unregulated sites.

Despite what the Andy Abboud’s and Sheldon Adelson’s of the world would have you believe, adding regulated online gambling sites to the mix isn’t really an addition to the gambling pantheon.

It Will Increase the Amount of Underage Gambling

Regulated online gambling will not eliminate underage gambling, but it will make it much harder for children to get online and start gambling. Right now, at unregulated sites, the only safeguard in place is a box asking you if you are over 18.

The technology doesn’t exist to enforce regulations

Mostly false.

The technology certainly isn’t perfect, but by anyone’s measure the geolocation and Know Your Customer (KYC) technology is working extremely well.

What makes this argument all the more misleading is the fact that online gambling opponents are essentially saying that the technology for online banking or credit cards doesn’t exist either, because it’s the same technology.

It will cannibalize land-based casinos

Mostly false.

I would have given this argument the full “pants on fire” treatment but we simply don’t have enough data at this time to say with absolute certainty that online gambling doesn’t cannibalize live gaming.

We do have quite a bit of evidence though: here, here, and here.

We can ban offshore online sites

This is a new line of attack that has been used by Andy Abboud recently, as the Las Vegas Sands point-man for online gaming opposition has held up lists of the illegal providers and used anecdotal evidence to show that if the government wanted to it could “easily” shutdown these operators.

Whether this is true or not (or what the cost would be to do so) is unknown at this point, and while it makes for a nice talking point it doesn’t seem like a feasible option to those of us living in a little place called reality.

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