Just so everyone knows, the early Colonies and states did indeed use state-sponsored lotteries extensively as a way to raise revenue. They did NOT, however, see fit to ban private lotteries or other forms of "gambling" because they feared competition.

I do believe that makes a difference.

Skallagrim

Merchants, vendors, advertisers, municipalities(sales tax) and direct beneficiaries in the budget. These people fund lobbyists, have existing relationships with legislators, and THINK they will lose money from ipoker. Most states get about 25-30% of the tickets. The rest of the hold is divvied up down the ladder. You would be creating a new department displacing revenue from the lottery commissions. And, poaching revenue from the vendors. There is no garuntee who would get the revenue from igaming, either. In these times, the general fund would be probable, creating no winner and a lot of losers. Pay to play, or we keep our day jobs.

If it was just a question of net revenue we would be fine. We are seen as encroaching on someone elses budget and profit.

Yes, most had to ban private lotteries over fraud. Well, at least during Occupation after the war in the south.

OIC. Yes, many of these people are concerned. And there is a reason for this. They are right to a certain extent. All these revenues to be generated by the expansion of gambling to the internet have to be paid for by somebody. And as I am sure you have noticed, it is not like a super duper economic time for the average Joe on the street.

It is funny that you mentioned the vendors and merchants. Here in NY, they are pissed about the state's plan to sell lottery tickets over the internet. They probably haven't even considered i-poker. It is hard to make everyone happy - you said so yourself. So why waste energy?

In states where the commercial casinos are strong (NV, NJ, and hopefully, IA), the casinos will be able to offer i-poker. CA almost has everything in place to make most of it's businesses happy. In states where the lottery is strong (NY, IL, many northeast), either there will be no i-poker, or there will be, but it will be run by the lotteries. Some in CT might want to go this route, but they will have to contend with Foxwoods and Mohegan Sun. Other states will punt for a while, but may join the party later on, granting i-poker to whoever they like the best. States like UT will never legalize i-poker.

Trying to legalize i-poker while cutting out other forms of i-gaming at the federal level is never going to work because the government would wind up picking one industry segment (basically 2 or 3 NV casino giants) at the expense of everyone else. CA reps won't buy it. NY reps will scream if you try to touch their i-lottery plans. It doesn't matter that you have a Democrat and Republican on board - the whole thing smells fishy.

Government always tries to pick winners. How else do you think they finance campaigns? You have to pay to be allowed to do anything, and you have to pay people who fear you may step on their territory. That is why I have always felt 40plus states would opt out. The only way forward is bribery on a massive scale financed by the federal government, paid back by providers, and taken from players.

I think the federal plan will succeed in time. Mostly because lotteries dont spend the way casinos do at the federal level, and they may win onerous optin or optout provisions. Then, you have to wage war state by state. If we pay the lotteries, we will have to pay the horse****ers as well. But I dont see another way to remove their opposition.

In order to offer intrastate poker, NV casinos don't have to bribe their lottery folk - they don't have any! And they have no desire to subsidize NY's school system (and I don't blame them).

You are making a mountain out of a mole hill. You want the casinos to subsidize everyone else (well, almost everyone), and want the players to wind up footing the bill. What for? Doesn't this defeat one of the reasons for having a federal bill in the first place?

DQ,

If a state bans private online gaming and allows only government-run online gaming, that would constitute socialized online gaming. Sorry if you think that's a bad word, but that's what it is.

If states wish to erect trade barriers against providers in other states who otherwise meet the requirements of providers in the home state, that violates in the intent of the commerce clause. I see attacks on our nation's Constitutional principles as "shredding the Constitution."

You love to conflate lotteries offering services in an open market and lotteries granted a monopoly by government, when in fact they are are very different.

A similar situation happened in Florida with emission control inspection stations. Some counties in FL were required by the federal government to check residents' vehicle emissions annually. When the feds ended the requirement, the inspection station company lobbied the FL legislature for continuation of the inspections on the grounds that they had spent a lot on the stations and needed to recoup their costs.

So, they literally argued that the state should make people get the inspection every year -- regardless of vehicle age -- to generate revenue for the company...and they were serious.

I'm trying to get a handle on the definition of socialized gambling. Is not the lottery itself tautologically socialized gambling? How about these scenarios?

1. PA gaming facilities, fueled by a 55% tax rate on slot machine gross revenues, generate the largest amount by state of tax revenue in the US. So the PA government is basically make more than the vendors themselves (who are paying for 100% of the operating expenses). This effectively makes the PA government the majority owner in all ten PA gaming facilities. State owned monopoly?
2. Post 9/11, cash strapped NY quickly expands its gaming operations in a number of ways, including the adoption of video lottery terminals at selected race tracks. Many of these machines look, sound, and smell like slot machines, which are clearly illegal in the state; others look like table games which are only permitted in the tribal gaming facilities by the compact NY state negotiated with the tribes. The NYS Court of Appeals rule that VLTs are not slot machines (clearly the popular choice - not necessarily the rational one). So the state is directly competing with the tribes within the state, and yet is still charging them the 25% cut usually reserved for gaming exclusivity. Is this socialized gambling?

Did they win?

They got some time out of it. It was a big political fight, but Gov. Jeb Bush did away with it in 2000.

TE,

You can't ignore that that lotteries, run by a State for the funding of public goods, were an accepted practice in the original colonies and the United States at the time the Constituion was written. Read the thread in the PPA forum. How is that public funding mechanism "shredding the Constitution" ?

You may not like the prospect of States operating online poker services, but it is nonsense to pretend State-run gambling, something approved by George Washington, nevertheless "shreds the Constituion" just because you want to label it socialist in 2012.

It is also nonsense to pretend that lotteries always get a monopoly where they do enter the online poker market. The lottery experience in Canada directly contradicts that strawman position you assume. Instead of so readily throwing in with casinos in their fight against lottery competition, you might fight FOR competition. Take a stand FOR competition and players.

FWIW, even in Nevada, which has no lottery, the ability to offer gaming is a privilege granted by the State and not a right.

You might also look at Kansas, where the State Lottery itself already owns a non-Indian B&M casino, competing with Indian gaming concerns.
http://www.msnbc.msn.com/id/46467462

DQ,

I don't know how many ways to say it. I have no problem with lotteries competing in a reasonably open market. In fact, I think that would be a good thing for players.

The issue I'm bringing forward is one of a state grating a lottery a monopoly over online poker and other online gaming. BTW, I don't even necessarily oppose that. I simply think players will be better off with more competition, lower site taxes, and greater liquidity.

I hope that's more clear.

Cheers,

Rich

I don't know how to explain it to you. This is like a playground. The lotteries own the ball, and they don't have to let the other kids play with it. Maybe if we give them a GI Joe we can.

The lotteries and the California tribes are keeping the gate shut. Either pay the toll or stand around and yell slogans like DQ...........

There is a price to be paid, and it is not fair, but it doesn't change the fact there is a price.

It is not just a question of money. States want the control. Consider:

• CA wants 10% of the revenues.
• MS only 5%.
• UT wants OUT.

To be fair, NJ and IA want more (although what their looking to get is less than an 8 to 10% tax on deposits).

I just think this argument is hopeless. Whether they plan to tax it to death or just a little, states do not wish to relinquish their traditional role in gambling legislation.