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The New American Poker Law

By now, nearly every poker player on the planet is aware that the US has passed a federal law on internet gambling. This law didn’t make it illegal for the US player to gamble on the internet, although such an activity is illegal in many states already. What it did is make it illegal for companies based outside the US to offer gambling to US customers in any location where such an activity was illegal. Someone who was part of an organization that did so could be arrested if that person set foot on US soil. Financial institutions in the US could be punished for conducting a money transaction with a gambling site that was listed by the government as such, or a company that was an intermediary in such a transaction. The bill was signed into law on Friday the 13th of October by President Bush, and requires the government to come up with a list of banned sites within 270 days.

I am writing this article right after the US November 7, 2006, midterm election, where the Democrats have just won a sweeping victory to take control of both houses of Congress. The US Republican Party base is composed of three main groups. These are conservatives, the relatively well to do, and the religious right. It’s this third group that is the one pushing moral values the strongest, which puts it in conflict with gambling activity. So the Democratic victory is helpful to poker players. Even so, one should not overestimate its importance. For example, the worst state law on internet gambling was passed by the otherwise fairly sane state of Washington, where four Democrats and one Republican got a bill passed that, among other things, made playing poker on the internet a felony offense that could get you up to five years in jail. The attitude of a legislator toward gambling is not just shaped by who supports him, but by the way he was brought up and how much experience he has with gaming.

The new US law snuck through the Senate by being inserted into a bill on Port Safety that few legislators could vote against in an election year. (The anti-gambling part had already passed the House.) Yet one cannot be sure the true feelings of the legislators about this rider. Internet gambling is one of those subjects that most legislators would prefer to not take a stand on either way, for fear of alienating somebody.

I am sure that many hope the new anti-gambling law will be repealed, now that the Democrats have had a big victory. I would rate the chance of that happening as being extremely remote. There is some possibility of giving poker an exception by changing the law. After all, poker is a lot less socially objectionable here than casino gambling or sports betting. However, internet poker has one big problem to overcome before it could once again be legalized. Poker has been accused of being a magnet for teenagers, and one that could push them into becoming problem gamblers as adults. The former is clearly true; the number of teenage poker players gambling on the internet is an immense figure. How many will become problem gamblers is, of course, open to question, but is at least a debatable topic. So my opinion is the US legalization of internet poker is dependent on the ability to enforce a minimum age of 21 to play. In fact, this age limit is set by the new bill even for playing on the internet in states where it would be legal, and I can hardly see this provision being dropped from the regulations.

One thing that is not going to go away is the ardor of Americans to play poker. We invented it and we love it. Many hardcore players will no doubt find a way to circumvent the banking requirements. However, the US players who you and I would like to gamble with will probably be less adept at finding a way to play online poker.

A large part of this new law is actually quite compatible with an individual state putting up its own internet poker site that services only its own residents. When you’re thinking about going into business, the climate improves when the federal government outlaws all your competition. So look for the first state to put up its own internet poker website around 2009 or 2010. Of course, as soon as the first state does this and starts pocketing the tax money, other states will be doing the same thing. Once this happens, no legislator is going to be pushing for a change in the law to allow foreign competition.

The bottom line is you will still see Americans playing online poker, but in substantially smaller numbers and increased average skill. Even though the internet gaming law was passed under a political subterfuge, the chance of undoing the law is slim, even with a Democratic US Congress. President Bush is a sure bet to veto any proposed change, and the votes to override his veto are not likely to be found. By the time he leaves office at the end of 2008, several states will already have plans for their own internet sites, and the political will to alter the law will be gone. So the new US internet gambling law, I think, is here to stay.
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