Why Should Poker Players Support Federal Online Poker Legislation?

[TheEngineer]

Some poker players have asked why we want poker legislation passed, noting that they can play okay today. Here's a great post by PokerXanadu on why:

If No Federal Licensing Bill is Passed

The DOJ has demonstrated, with their recent seizure of funds and indictment, that they consider all gambling on the internet (including poker) which is not expressly authorized by a state or federal law to be unlawful. The seizure and indictment was a shot across the bow, warning all payment processors that they will be fair game if they continue to process gambling-related transactions, and warning all financial institutions that the government will be serious about full compliance with the UIGEA. The DOJ will continue to use their policing powers to prosecute anyone who operates or does business with an internet gambling business. This will affect players by:

1. Financial transactions will get much more difficult, both deposits and withdrawals. ACH transactions (echecks) could dry up all together. US players may have to rely solely on check transactions. This may evenutally involve foreign checks - either from the sites or necessary to send deposits - which will incur various fees for processing.

2. The US player base will start to dwindle. With each new publicized DOJ action, and the press coverage that will accompany the full implementation of the UIGEA, there will be a percentage of the current players who will stop playing. Plus, there will be far less new players signing up. And the increasing difficulty of financial transactions will cause even more attrition.

3. Absent any clear federal court victories, after a few large hits by the DOJ, some of the sites that serve us now may withdraw from the US market. The court battles will probably drag on and take years to resolve. The DOJ will no doubt do what they can to drag these out and avoid direct judicial rulings on the issues. Their overall strategy is to force the businesses involved to suffer financial losses and withdraw from the US market. They are not concerned with the letter of the law except to the extent of avoiding a clear cut court interpretation of the law. The PPA, iMEGA, et al can try to force this issue in court, but there is also the risk that the court will deliver a clear cut ruling against us despite the letter of the law.

4. Expect the IRS to get involved on the level of the individual player. There will be some investigation by the IRS of large withdrawals from sites. AFAIK, we haven't yet seen this come out of the DOJ settlements, such as BetOnSports, Netteller, etc. But I wouldn't be surprised at all to see this start. Note how the BetOnSports settlement is being handled - players have to petition the US government for return of funds. Watch to see if anyone is caught in an IRS snare.

5. I expect some states, especially larger ones like California and Florida, to adopt intrastate licensing and regulation legsilation of internet poker. Expect these laws to license only existing b&m casinos/racinos to offer internet poker, and to outright ban anything but intrastate poker.

Why am I so pessimistic about the future in this scenario? As usual, follow the money.

In our system of government, as a whole our federal legislators are more representative of state interests than federal ones. The states have a vested interest in blocking internet gambling. They have a steady revenue stream from taxation of b&m casinos and their state-run numbers games (lotteries).

Would the states raise more by licensing and taxation of internet gambling? Maybe, but probably not. The rates of taxation of their b&m casinos/racinos are far higher than what we are talking about in the Menendez or Frank bills - often on the order of 50% or more of profits. There is no question that the states would earn more revenue overall if internet gambling could be further blocked or diminished to a significant degree, as opposed to licensed and taxed. However, the licensing and taxation of just games of skill (including poker) would probably work to the financial advantage of the states.

What about the revenues for the federal government? This works to our advantage as the federal government would be gaining a new revenue stream. But, legislation has to pass first. And as I say, the legislators as a whole are more likely to vote in favor of what is best for the states than what is best for the federal government. Plus there are the powerful lobbies that are against it, such as the Christian Right, some B&M casino corporations, the sports leagues, etc.

Also, the federal government does have a small revenue stream from the b&m casinos - the excise tax on some forms of gambling. I wouldn't be surprised to see this increased as well as expanded to some table games. Probably without much hoopla as part of some other legislation.

If the Menendez Bill is Passed (as currently written)

It will be about nine months before we see the first license issued. Expect the new US-corporation sites to be licensed first (like Harrahs), as there will probably be more background check issues for the foreign sites. Also, the current state and tribal regulatory bodies will be relied upon by the Secretary of the Treasury for giving the stamp of approval to license applications - so the US casino companies, which already pass muster with these regulatory bodies, will have a big advantage over the foreign sites in getting approved.

These US company sites will enter the market in a big way. They will still have to compete with the existing foreign sites - the Menendez bill allows sites to service US players for up to 2 years while awaiting acceptance or denial of their application for a license. There will be lots of advertising, player incentives, tie-ins to live tournaments and other casino action, etc. The poker industry will go into an immediate boom (after the initial six month period for the Secretary of the Treasury to issue regulations and start accepting applications).

About a dozen states will opt out for one reason or another - probably mostly to protect their in-state casinos. There will be some legal fights over legal requirements for states to opt out, unless this is clarified in the wording of the Menendez bill before it is passed. A few of the opt out states will adopt their own intrastate licensing and regulation (as I described above). After a decade or so, all the opt out states will opt back in, with maybe a few hold outs.

Players located in the opt out states will likely find ways to circumvent the blocking and play on non-US sites (hiding IP addresses, using foreign-based transaction accounts, etc. - there will probably even be some start-up businesses to facilitate this). The biggest risk these players run is in regards to non-payment of fees and taxes to the federal government. I'd recommend a voluntary payment by players of the 50% penalty fee on any deposit you make (if the player liability survives to the final bill), which would be due monthly. It won't be illegal for you to play on unlicensed sites, but it will be illegal for you to not pay the 50% fee.

Expect all the foreign sites to set up separate skins for US players. This will be their easiest option to ensure compliance with US regulations. The US skins will accept accounts only from US residents, and US residents will be required to have their accounts only on the US skin. However, the sites will be able to transfer all your balances, points, statuses, pending bonuses and such. And the player base will be combined with their non-US skins, although there won't be player transfers available between skins. There will, however, likely be a limit on deposit amounts on the order of $10K, as the 10% governement fees on player deposits will make it unprofitable for them to accept large deposits by high stakes players. The high stakes games will still be available for play, but getting the money onto account for these players will be a problem.

The biggest issue of all will be reporting of tax information to the IRS by the sites. The numbers for "gross wins", "gross losses" and "gross wagers" will be so highly skewed, especially for cash game and sng players, that no one will know what it means and it will make tax returns outrageous (and impossible for players in states which disallow gambling losses). But everyone involved, including the IRS and the Secretary of the Treasury, will be well aware of how unrealistic these figures are. I think we will see accomodation in either the licensing regulations or IRS regulations in very short order - well, short order in government terms anyway: a year or two or three.

If the Menendez Bill and the Barney Frank Bill are Combined and Passed

The Menendez bill is far superior to the Barney Frank bill in terms of the details - things like the schedule for implementation, how past operators are affected, implementation of safeguards, changing the wording of the UIGEA laws to coordinate, qualifications of license applicants, protections for players, etc., etc. I think most of the wording of the Menendez bill will survive, and the final bill will distinguish games of skill from gambling, but license both under one program - at least that's my fervent hope.

The outcomes will pretty much be everything I laid out above, except there might be more states opting out and less of them eventually opting back in. Also, don't expect to see a lot of the current big players in the industry of internet casinos to get licensed - most of them offered sports gambling to US customers at one time or another, which will disqualify them from US licensing.

[TheEngineer]

I have some comments as well:

1. Aren't we better off without government involvement? Shouldn't we just stay quiet?

When we followed that strategy, we lost votes in Congress by 317-93 (HR 4411, the bill that became UIGEA) and 90-10 (an earlier Senate vote). Congressmen acted like no one in America supported the right to play. It's likely that they heard from only a few Americans who did. Many poker players feared clear legalization and stayed quiet, hoping things would remain as they were then, IMO.

I have bad news. PokerXanadu is right. Things cannot stay as they are today. If they could, sites wouldn't be funding and lobbying for clear legalization. There is absolutely no way our government will continue to permit offshore sites to offer services in America while barring U.S. based ones from doing the same. Something will give. If offshore sites continue to serve Americans and poker players remain quiet on purpose, IMO either an effective prohibition will be passed or U.S. based interests will be allowed access. The status quo is simply unstable.

The reason we can access these sites today is not due to people staying quiet, hoping things will stay the same. Rather, the status quo exists because a bunch of people stood up for their rights, stopping the banners in their tracks.

I recommend we keep telling Congress that we want our rights. Fighting back has let Congress know that many Americans want their freedom. It has also resulted in greatly improved media coverage.

2. I like things the way they are now. Why change?

Again, the status quo is unstable. The U.S. simply has no incentive to allow offshore sites to offer online poker while prohibiting onshore sites. Something will have to give. Hopefully it will give in our direction.

There's really no way U.S. gaming interests will wish for the status quo to continue. They'll want either a piece of the pie or a real prohibition to stop the competition. If they have to get clear legalization without our help, they may use their tried-and-true model of buying in with excessive taxation. With the grassroots efforts of poker players, we can all fight for this on the basis of Internet freedom, and have tax revenue act as an additional benefit only.

Another concern is the willingness of sites to continue servicing the U.S. market in the event of a real prohibition. The ones that are here do so because they believe they are offering a legal service. I think some would leave rather than break U.S. law.

Regulated, legal online poker beats no (or very limited) online poker, which is what the 317-93 HR 4411 vote and the recent DoJ actions have told us is coming if we don't come up with an alternative. Otherwise, why would a libertarian like Ron Paul cosponsor these bills?

Ron Paul expressed it best when he said regulation is preferable to prohibition. Like Dr. Paul, I prefer no government interference to regulation on general principle, but that's not the world in which we live.

3. Does advocating for our rights actually do anything?

Absolutely. There have been some negative posts regarding writing to Congress. Some players have actually gone out of their way to try to talk others out of writing to Congress. They express their belief that it won't do any good and that we shouldn't waste our time. Yes, one letter won't change the world, but tens of thousands of letters have certainly improved our position, making us stronger. That success has led to other successes, which has led to improved opportunities.

Letters also support the lobbying effort. Lobbyists need to show that they represent many voters. Lobbyists make our letters and other efforts stronger, while we make their lobbying efforts more effective.

We really saw the impact of this in Kentucky when the governor tried to seize the domain names of poker and gaming sites. Had this happened three years ago, there would likely had been little to no press coverage critical of the governor, and it would have been strictly a judicial affair.

Well, we were able to make it a political issue as well. We immediately had over 2,000 letters of opposition in Gov. Beshear's hands. Lots of poker players phoned him, too. This all helped with our media coverage. IMO we actually got evenhanded coverage on the issue, including publication on the day of the first public hearing of an op-ed that I wrote (good timing for us).
Nationally, we went from losing House votes by 317-93 to winning committee votes while stopping gaming opponents in their tracks. Offense has proven to be our best defense.

These successes build on each other. We're now perceived as a stronger lobby (both the PPA and the overall poker rights movement), and get more attention on Capitol Hill. This leads to better national coverage and to other gains.

4. Wasn't UIGEA tacked onto some port security bill at the last minute? Why can't we just get it repealed? Doesn't this show that the US political system is dysfunctional?

HR 4411 passed the House 317-93 as a freestanding bill. It was actually a ban on interstate online gaming and related financial transactions. It was later tacked onto the Port Security Bill (at the last minute), after being weakened to prohibit financial transactions on interstate gaming unlawful under other laws (as UIGEA). It passed the Senate on a voice vote and the House by an almost unanimous vote.

Unfortunately, this seems to prove that the US political system works as intended. Support for our position isn't exactly universal. Prior to UIGEA, many opposed our right to play. Our side, OTOH, in large part failed to speak up. Many players thought clear legalization could only serve to make things worse. So, as one would expect, we lost the UIGEA vote by a wide margin.

Now, our side is mobilized, but we still have strong opposition. Consequently, we are underdogs but are in the fight. Again, it seems this is as one would predict.

IMO, we really need to know our enemy. It's easy to assume that everyone should agree that we should just be left alone, but that's not reality. We were shown this with the passage of UIGEA in 2006, and it seems the DoJ is working to ensure we get the point now.

Some oppose online poker and gaming that is not licensed or regulated by some US jurisdiction for financial reasons. These include state lotteries, sports leagues, and B&M casinos. Lotteries and B&M casinos see this as competition and believe it costs them money. Governments believe this reduced their revenue. Sports leagues claim a need to show integrity in their games that could be reflected in revenue.

Others oppose this because they believe it to be a social ill and a vice. Some in this group see it as a sin that government ought to stop.

Finally, some are concerned that underage youth will participate.

So, our job is to find a majority to move legislation. The bills currently in Congress address the concerns of all but the "poker is a sin that needs to be banned by government" crowd.

[TheEngineer]

From a recent discussion on UIGEA:

Originally Posted by arkkw987

I agree with everyone in this thread who says that the UIGEA will be insignificant.

No one here thinks UIGEA is insignificant. Some think it will have less of an impact than others, but no one thinks it's not a big deal.

Why would you think it's insignificant? Banks think it's their job to stop online poker, and the DoJ thinks Congress told them to ensure that happens. Games are tightening and deposits are getting tougher. Sites are getting around it, but sites do need deposits to operate profitably.

Assumming the UIGEA does not impact the poker landscape I have to ask this question:

Why are we still pushing for regulation?

That's the attitude that got us where we are today.

Part of the reason you can play easily today is from the work of PPA and of your fellow poker players who are standing up for themselves. We got delays in UIGEA and we also made it clear to Congress that we will fight for our rights.

Poker players are great at imagining that nothing can be done to stop online poker. That's why we didn't fight back hard enough prior to UIGEA's passage. If we all fought back in 2005 and 2006, UIGEA would not have passed, and we'd still have much looser games today.

Surely you've noticed that none of the sites are U.S.-based. Do you really think this will last forever? U.S. businesses and other interests will just be cool with the competition? Sorry, but IMO we'll have clear legalization or we'll eventually have a somwhat effective prohibition. We're better off getting the terms we want than letting other drive the ship.

I was a supporter of the PPA b/c I thought the UIGEA was going to be the end all of online poker and playing online poker + paying additional taxes was better then not being able to play online poker at all. But so far it appears that online poker will easily continue but with minor withdrawal/deposting issues - far from the end of the world.

Not sure I can justify any additional support for regulation if things turn out this way on Dec 1. I don't see how anyone can justify it honestly - why pay extra taxes WHEN WE DON'T HAVE TO?

No one is asking YOU to pay extra taxes. Taxes come from sites. In exchange, we'll have advertising, smooth transactions (you really want your bank to close your account?), and U.S.-based sites. Sites will get access to banks and an end to fund seizures.

You should ask yourself why the bigger U.S. facing sites are heavily backing these bills.

[TheEngineer]

From a recent discussion on UIGEA:

Engineer, I hope you dont take my posts personal but I feel you are since you have dedicated alot fo your time in this matter, so I'm sry, nothing personal just my non-expert opinion.

Thanks. I don't take it personally. Likewise, I hope you don't take my comments personally, as they are directed at your arguments and not at you.

I do think your argument is problematic. You don't state your concerns with the specific bills in Congress (and there are some problems with those). Rather, you claim that any bill to make online poker clearly legal in the US would be bad by definition. IMO this is patently false, and the fact that PS and FTP are lobbying hard for such bills ought to show that.

Prohibition is a fine example of this. Would you have opposed its repeal based on federal and state taxes and regulation of alcohol?

As far as you guys being responsible for the status quo being maintained I simply dont have any proof. AFAIK, the only thing I can give credit to you guys for is the delay of the implementation of the UIGEA. Even then there were other lobbying bodies involved.

PPA won several state court cases, organized letter-writing and phone call campaigns, and lobbied federal agencies and Congress. PPA also set up and organized testimony at good Congressional hearings for us. Poker players wrote and called Congress by the hundreds of thousands.

As for horse racing joining us in the petition to Sec. Geithner, I've always found that getting lucky takes a lot of work, as the foundation must be there to take advantage of lucky breaks. I've written a couple of articles about how UIGEA put horse racing at risk, the first one over a year ago. I've been working with my Congressman on this issue for three years now as well. Concurrently, PPA did its part to develop a strong lobby. So, when horse racing found they had problems with financial transactions, we were there with a credible offer for them to join the delay petition, and my congressman was ready to sign a letter to Geithner (along with the entire KY Congressional delegation) requesting it.

What? where did you see me say everything is great?!?!?!? quote me. I'll repeat my rationale for the last time. The status quo is better than if it were to be legalized and taxed up the ass which i have a huge hunch it will be.

Hunches aren't required. Read the bills. They are in Congress right now.

As for taxes, we're being taxed plenty now. The UB scandal was a tax on us. Neteller was a tax. The toughening games -- a tax. The fact that we can't be certain that we'll have games in five years is a tax.

Again, the status quo is anything but guaranteed. US sites won't just sit back and sit out the Internet. Read Why Should Poker Players Support Federal Online Poker Legislation? for more.

Since the Bush Admin there has been many steps to rid online poker and it hasnt work and you cannot say it is because of ppl like you. With all do respect for your hard work, you didnt stop neteller from getting closed, partypoker from being pushed out the U.S., paypal from being shut down, the confiscation of millions of dollars....just what exactly are you claiming responsibility for? I'm not being an attacker just asking an honest question.

PPA and active poker players have prevented laws from being made worse. After UIGEA passed, Rep. Goodlatte promised to finish in 2007 what UIGEA started in 2006. He tried virtually every year to modify the Wire Act to clearly include online poker. Well, we've seen no legislation making things worse since UIGEA. We are clearly on offense, which has been our best defense for the past three years.

Also, your approach allowed guys like Goodlatte to draw out on us for free. They could score points with anti-poker extremists like Focus on the Family while losing nothing. That's why the GOP platform has an anti-poker plank, in fact. Fortunately, we started charging these guys for their draws, and many have quieted down significantly.

Party left on their own, before PPA came on as a force. The PayPal issue predated UIGEA. Thus, both of these happened when too many poker players were doing as you recommend -- staying quiet and hoping the status quo continues.

Neteller created its own problems by taking transactions for sports betting sites...nothing we could do about that.

If this bill gets passed and we get taxed up the ass, we'll know what exactly your responsible for.

lol @ me being naive. That is all; we have to agree to disagree. No pt in repeating myself.

Do you think we should go out and intentionally criminalize things we'd like to have? Too bad the fear of taxes blinds people to fighting for their rights.

I used to receive PMs from people like you all the time. I do think you're one of the last of this dying breed.

[TheEngineer]

I'll take a shot at the questions. While I do sit on the PPA Board of Directors, this is not an official PPA response. Rather, it's my personal answer to the question.

I haven't been shy about my criticism for the Poker Players Alliance (PPA). While I highly support what they're doing in theory, I believe the organization has failed to produce any tangible results, while making lots of mistakes along the way.

I disagree with that. Consider where we started. UIGEA passed the House in 2006 by a vote of 317-93, and it was a free standing bill at that time (it was HR 4411). Politicians openly and proudly opposed us, and they only do that when they think there is ZERO downside to doing so. Anti-online poker folks did a good job of building a coalition against us. The GOP even put a plank in its platform advocating a ban on online gaming.

With this starting point, it was not reasonable to think poker players could turn this around overnight. Rather, we started a process by which we could build support for our position, and that was better than doing nothing (in others words, initiating the fight was the maximum EV option of the choices available to us).

So, what's happened over the past three years. Well, Congress had heard from us loud and clear. We poker players are on offense in Congress, which is our best defense. No bills have been proposed against us since 2006, after years of anti-poker bills (see http://forumserver.twoplustwo.com/15...ker-rights-ppa). This has maintained the status quo. After all, we can still play, and that's a tangible result on its own.

PPA also succeeded in delaying implementation of the UIGEA regulations for six months. This further keeps us on offense, while laying groundwork with Treasury and the Federal Reserve to improve the regulations.

On the media front, coverage used to be completely against us. We now get our opinion mentioned in pretty much every article. I write a regular column for BigGovernment.com myself, at http://biggovernment.com/author/rmuny.

I'm very happy with our progress. Unfortunately, there is a lot of inertia in DC. Politicians still think the big government anti-gaming types enjoy the support they did twenty years ago. We're chipping away at this every single day.

I also have questions regarding their methods of funding and how the money is spent.

If anyone knows the answer to any of the below questions, please post them here. Also, feel free to crosspost this to 2+2, where the questions may be better answered.

Money is spend on lobbying, organizing, public relations/media, etc. Lobbying expenditures are at http://www.opensecrets.org/lobby/cli...ance&year=2009. The contributions of the PPA PAC, PokerPAC, can be found at http://www.opensecrets.org/pacs/look...trID=C00448688.

1) How much money has the PPA received in total donations since its founding? How much of that money is left?

PPA files all necessary tax forms and disclosures. Like most advocacy organizations, care is taken on the level of information released, as it's more beneficial to our opponents than it is to ensure transparency. I can assure you that I've been to the D.C. offices on a few occasions and have watched everything they've done for the past few years. They are no gold-plated lobby. If they were, sites would not contribute to them, and I would have publicly blasted such behavior long ago.

For example, Executive Director John Pappas shares his office with Grassroots Director Drew Lesofski. PPA also saves money by refraining from having its own fancy meeting room, preferring instead to utilize a nice room (one acceptable for meetings with lawmakers and lawyers) shared by other building occupants. They don't need a meeting room 24/7, so why pay for one?

2) What percentage of PPA funding has come from existing poker sites?

It's enough that we players can be comfortable that they're carrying their fair share of the load. After all, we ought not carry their water for them.

3) Are there any members of the PPA who are paid for their work in the organization? If so, who are they, how much have they been paid, and what do they do for the group?

Only employees of PPA receive a paycheck from the organization. I don't get paid, nor do any of the state directors.

4) Have any outside companies or contractors received PPA money? I am not referring to large companies such as airlines, hotels, etc. I am referring to small companies that most of us wouldn't have heard of.

Yes, of course. It's cheaper to contract out public relations and lobbying than is it to hire this in-house (we don't need these services 40 hours a week, every week). We also get better quality this way.

If so, does anyone in PPA management have a relationship (whether professional or personal) with any of these companies or their management?

No.

5) Is there somewhere that the average PPA member can access a spreadsheet detailing all of the PPA's expenditures?

The links above are the best sources.

1) What has the PPA accomplished at the federal level since its inception? Can the PPA point to any legislation that has been enacted due to its influence? Can the PPA point to concrete evidence of non-enacted, poker-hostile legislation that it has prevented? Please exclude state-level matters in this response.

We stopped and reversed the momentum of the anti-poker forces. We delayed the UIGEA regs and had a number of positive hearings for poker. These have provided us with opportunities for positive media, which have in turn helped our lobbying. These have all served to magnify the effectiveness of member letters to Congress.

In getting the UIGEA delay, 21 Republican lawmakers wrote to Treasury Secretary Geithner to back the PPA's request for the delay, vs. only two against. My senator, Senate Minority Leader Mitch McConnell, was among the 21 supporters.

2) What is the PPA's current plan to dismantle the UIGEA? What is it doing differently now that would produce different results from the past 3+ years?

PPA will continue to build its support in Congress by lobbying, media outreach, and by encouraging members to write and call [email blasts to members, easy-to-send letters (that I wrote, FWIW), etc.].

3) The PPA has received money from current online poker rooms. Let's say that the US Government offered a compromise, where domestic companies holding a valid US Gaming license would be allowed to offer online poker to US citizens, but foreign companies such as Pokerstars and Full Tilt would not. Would the PPA endorse such legislature, or would it feel an obligation to its large, foreign contributors to include them, as well?

It would depend on the legislation. If it resulted in high rakes and no competition, the membership could potentially oppose it. That being said, PPA is not obligated in any way to the current sites. For example, the current bills in Congress, especially the Frank bill, are not completely friendly to the current US-facing sites. PPA supports these bills.

4) Can the PPA explain how it feels that petitions sent to the government would be taken seriously, if many of these signed petitions are achieved through bribery? (Example: Anyone who signed a PPA petition last year for President Obama was rewarded with a Pokerstars freeroll ticket.)

PPA has hundreds of thousands of letters to Congress and to Obama to back the petition up. Also, the fact that many signers played online only serves to prove that they really care about the issue.

1) What is the PPA's current position on the AP/UB cheating scandals?

PPA issued a statement condemning the scandals last year.

Does the PPA feel that AP/UB has done their part to make things right with the affected players? Does the PPA feel that AP/UB has done all it could to bring the perpetrators to justice?

No and no.

2) Has the PPA accepted money from Absolute Poker after October, 2007? Has the PPA accepted money from Ultimatebet after January, 2008?

PPA does not take money from any sites. Rather, the IGC contributes to PPA, and AB and UB are not (and never were) members of the IGC. So, PPA has not received any money from UB or AB -- either directly or indirectly -- since the dates you listed (and, to the best of my knowledge, PPA has never received funding from UB or AB). IGC info is at http://www.igcouncil.org.

3) Does the PPA support full licensing and legalization of Absolute Poker/Ultimatebet, even if the company never fully releases hand histories or releases the names of all of the cheaters?

Again, the PPA condemns the actions that led to the scandals and those after. I don't know if we've formalized a position here, but I'd oppose it for sure.

4) Would the PPA find it acceptable if Pokerstars and Full Tilt were granted a license to do business in the US, but AP/UB was not?

That would be more than acceptable. :-)

5) What is the PPA's position regarding the publicizing of these scandals to the general public? Do they feel that these scandals demonstrate the danger of playing in an unregulated environment, or do they feel that we should do our best, as an industry, to keep them quiet, for fear of hurting the legalization effort?

PPA has publicized them and will continue to do so.

5a) If the PPA believes that these scandals demonstrate the danger of playing in an unregulated environment, why has it been virtually silent regarding the AP/UB scandal and how legalization/regulation would have likely prevented it? Why has the PPA avoided using this scandal as ammunition for legalizing online poker?

PPA released the statement of condemnation and has lobbied Congress of this basis. In fact, that's why both bills in Congress have "consumer protection" in their titles.

[TheEngineer]

Government should not tax or otherwise regulate online poker.

Commerce has been taxed in the US since colonial times. The Constitution clearly authorizes this. In fact, George Washington went to war against whiskey makers who chose rebellion over paying federal excise taxes: http://en.wikipedia.org/wiki/Whiskey_Rebellion

I know it sounds great to say "government should leave us alone," but in this case it's actually a disservice to liberty. Every state government has laws, regulations, and taxes on gaming, and the idea that the U.S. will just cede control and leave us alone has been disproved by government actions against us.

[TheEngineer]

Another recent discussion:

Originally Posted by TruePoker CEO

...it is one thing to accept politically that there will inevitably be regulation in some form. It is another matter to pretend that regulation 'provides a better experience for the Internet player"

IMO, the best player experience would likely come from a completely free market. This would include US-based sites, where players would have access to courts to resolve disputes and to enforce implied contracts between players and sites. With this, offshore sites would have to respond with either lower rakes or a with a defined dispute resolution process (or both). This free market would also work to keep the rake down.

Unfortunately, Congress and the DoJ have made it clear that this will not happen, and PPA has to focus on what is achievable. In this environment, I believe the best outcome for the player is one where the US licenses sites with worldwide access. This will create onshore sites while providing a dispute mechanism for problems like what we saw with UB.

I have a whole sticky on this at Why Should Poker Players Support Federal Online Poker Legislation?

I did this reply as an FYP to demonstrate that the evil you see in proposed "state" regulation is the same evil that lies inherently in "federal" regulation. The argument is the same.

Right now, the state models are all intrastate. This "walled garden" approach seems to be for the benefit of the states, rather than for players. In fact, it seems we're being treated like sheep to be sheared by the taxman (who thinks we're stealing from the lottery by playing poker instead of buying lottery tickets).

We're already having problems finding four $30/$60 limit Hold'em games at the same time, and the ones running are frequently fish-free. I can only imagine how the game will be if I'm constrained to the KY market.

PPA has provided states with options to preserve the worldwide market while gaining revenue. I hope they'll consider some of these.

FWIW, "why [the PPA] has invested so much time and so many resources to push the U.S. Congress to enact a sensible federal policy of licensing and regulation" is because the folks who donated the money want that......... The original defensive fight against the UIGEA/federal prohibition efforts is a far different matter than the continued investing donated resources to enact federal, rather than State-level, regulation.

Not necessarily. There are state models that can be supported. Unfortunately, those proposed to date fall short (most notably CA). Let a state propose state compacting, allowing sites like YouBet and Twinspires to offer poker, or let a state propose a plan to license ewallet transactions to specific worldwide sites, and you'll see poker players support such plans with enthusiasm.

I am not against your spending someone else's money to lobby federally, it helps promote action at the State level. Sttates are prompted to act before "Washington" gets its hands on that potential gaming revenue.

States have had 15 years to do something. I'm glad our efforts are pushing states and the federal government to move forward.

IMO, much of this has come from poker players' letters to governors and state lawmakers. The rest has come from a realization that we're strong enough to stop new anti-online poker legislation.

[TheEngineer]

Originally Posted by RainMan77

But our opponents will still be there even after legislation is passed.

Not really. When is the last time you saw anti-lottery protesters at a convenience store, or anti-gaming protesters at a casino? When is the last time you heard a peep against online horse race wagering, for that matter?

Our anti-poker opponents generally fight only NEW gaming (B&M casinos, online poker, new lotteries, etc.). They cry wolf with wild, wholly unsubstantiated predictions of mass addiction and crime that they claim passage of such legislation will bring. As these never come true, these groups never stick around to fight existing gaming. Rather, they move on to fight the next NEW gaming initiative.

The issues our other opponents (those who don't oppose all gaming) may have will be addressed by licensing, so they'll generally go away.

By passing legislation are we protecting ourselves any further?

Absolutely. We'll have a solid, stable system in place that places the games under U.S. law while permitting U.S. based sites to operate. These sites will continue to lobby for their rights, as will PPA. I don't believe our opponents will spend much time fighting that. Rather, they'll focus on preventing other online gaming from getting licensed.

I have a whole thread on this, at Why Should Poker Players Support Federal Online Poker Legislation?

I think we can consider it as we already have favorable legislation as long as we can still play. By putting these Bills through we give them a chance to hurt us.

Right now as long as UIGEA is a fail, we can still deposit and withdraw and play poker. Basically if UIGEA isn't effective, poker players already have it made. We can consider it as like we already have successful legislation.

I don't know how many people posted that statement here in 2005, but it turned out to be flat wrong.

Congress won't sit back and allow offshore sites to access the market while prohibiting onshore sites from doing the same. Until U.S. sites have access, IMO we cannot consider this to be as if we won anything but a temporary reprieve.

Just by getting a new Bill passed that officially "legalizes and regulates, and TAXES" gambling (with poker lumped in), does not improve things much for us(considering UIGEA fails).

But it comes with a significant risk. In fact it just gives our opponents an opportunity to strike back at us, and limit our freedom compared to what it is today. They can do this by passing amendments making the legal sites crappier than PS and FT, or taxing the heck out of it (10% deposit tax is absurd, nevermind 50%). Not to mention state opt outs. So why would we want to help these Bills along anymore, if the risk is so high? The current state of online poker is in fact pretty good and will get better in time IMO once the fish start to realize it is ok to play.

Again, this sounds like it came right from 2005. There's nothing golden about the status quo. The DoJ and Treasury think Congress gave them a mandate to stop online poker. They won't quit. Likewise, our opponents will attack us more without legislation than they ever will if we get legislation passed.

We can't fear victory. Fear of victory got us UIGEA.

We are going to have to fight off future efforts from our opponents whether legislation passes or not.

PPA will remain to fight for our rights as poker players.

Shouldn't we just consider it like we have already won? We can use our much louder voice thanks to the PPA to prevent anything bad from happening in the future, or similar UIGEA crap from getting put through.

Staying on offense has been our best defense. Just sitting there saying "no" will be a total fail. We saw that in 2006 when we just the HR 4411 (the bill that became UIGEA) vote by a 4-1 margin. Even our supporters in Congress don't want a system with only offshore operators.

It just seems that they just wanna tax us for their own benefits, check out this recent article: http://www.usaplayers.com/gambling-n...es-ineffective

They just want to tax us and rake our profits. 50 billion over a few years?? Just in taxes?? Are they serious? This number seems wayyy inflated. People want to advertise these bills as creating so much tax money, then that is what they are going to expect when they finally get passed. Therefore it seems that there is a good chance we are getting screwed if these Bills get passed.

Every other business in the U.S. gets taxed. Not sure why we think we're any different. Sites have not complained about the current proposals, so I assume they believe this to be in their interest. Besides, sites are paying a lot now in money transfers and other costs associated with UIGEA. They'll be happy to relieved of these costs.

Yes that is the difficulty. Also now it seems the UIGEA is going to be a fail. Therefore to be pro-poker, the Bills need to be better for poker players than the status quo. This means any type of deposit tax should go out the window. Plus we have to worry about whatever amendments our opponents will get through.

I don't think the status quo is a realistic baseline, as there's nothing permanent about it. Do you really think it can last 20 or 30 years? As the current U.S. facing sites are lobbying for legislation, and are even willing to compete with Harrah's and MGM, it's obvious where those with the biggest stakes in the game are placing their bets.

I think so too. I think there should be no deposit tax at all, nevermind 50%, wow. Even if its payed by from the sites, the players will feel the hurt from any such tax.

Who's proposing 50%? There won't be a 50% tax.