Advocates of regulated online gambling in the United States received good news this week when it was learned Sheldon Adelson and the Las Vegas Sands Corp. have decided to stop supporting a 50-state ban on online gambling. Adelson has spent tens of millions of dollars in supporting "Restoration of America's Wire Act" (RAWA), but has seen the legislation stall on Capital Hill.
Online players should not celebrate too soon, because the new RAWA bill might well be perfectly tooled to cause mischief, if a nativist politician came to power looking to score easy victories over anyone deemed a devious foreigner.
RAWA first was placed before the US Congress in the spring of 2014, when Sen. Lindsey Graham of South Carolina and Rep. Jason Chaffetz of Utah each sponsored the bill in their respective houses of Congress. A bipartisan list of lawmakers signed on to co-sponsor the bill, and there were concerns whether a federal ban on online gambling might happen.
RAWA's Failure in Congress
In the 2014 legislative calendar, RAWA received little support. After months of failure, proponents of RAWA tried to have the legislation placed in the December 2014 omnibus spending bill. Sen. Chuck Grassley declined to put RAWA in the omnibus and it appeared to have died in committee.
In 2015, Restore America's Wire Act seemed to receive added impetus when its congressional proponents gained in status. Rep. Chaffetz became the chairman of the House Oversight Committee, the only committee with the authority to issue subpoenas.
Lindsey Graham launched a bid to be the Republican Party's nominee for the 2016 presidental election. In June 2015, a week before he launched his own bid for the GOP nomination, Sen. Marco Rubio of Florida signed on a co-sponsor of the bill.
GOP Pushback on the Bill
The odds still were long, because several key Republicans were against RAWA, due to its strengthening of federal authority over state's rights. Sen. Rand Paul of Kentucky spoke out against it, while former Rep. Ron Paul of Texas wrote several articles denouncing it.
Also, powerful lobbyist Grover Norquist opposed the legislation, on roughly the same principles. It certainly didn't help that the world richest gaming mogul claimed concern for problem gamblers, while he seemed to be pushing legislation to squelch possible competirors.
Facing charges of "croney capitalism", RAWA supporters in late 2015 changed their tack. They began to support a watered-down version of the bill ("RAWA Lite") which would carve-out an exemption for online poker. After a December 2015 sub-committee hearing became a public disaster for Jason Chaffetz, even RAWA Lite appeared to be dead in the water.
Sheldon Adelson Changes RAWA's Focus
This week, "Gambling Compliance" announced that supporters of Sheldon Adelson have changed the bill's wording again. Now, RAWA would ban all forms of offshore, unlicensed online gambling.
Thus, legal online gambling in New Jersey, Nevada, and Delaware would be recognized as an approved form of gambling at the federal level. Regulations would be put in place at the federal level, assuring the survival of licensed online casinos and poker rooms.
Federal regulations are what Sheldon Adelson has been trying to avoid the last several years, so it looks like his bill has backfired. Given the offshore sites are seen already as extralegal -- and because they exist offshore -- the new Restore America's Wire Act seems to have little meaning whatsoever, except to codify that the federal government approves state-licensed online gambling.
Andy Abboud on Offshore Gaming
Andy Abboud, VP of Government Relations and Community Development for Las Vegas Sands, spun the position change as well as he could. Abboud said, "We haven't backed off of our focus on [RAWA], but we need to find a way … to be able to shut down illegal offshore operators."
Poker Players Alliance Statement
The Poker Players Alliance warned its members to beware of this shift of focus. Comparing Sheldon Adelson's legislative 180 to a "head fake", the PPA suggested that billionaires used to getting their own way do not give up on causes so easily.
Rich Muny, the Vice President of the PPA, said, "RAWA still exists, so this is no victory lap. We all need to keep up the pressure on lawmakers and ensure this does not end up sneaked in later on."
Change of Tactics
Sheldon Adelson's change of tactics might be a response to the changing situation in national politics. The Donald Trump Phenomenon has thrown off all calculations in 2016. When the bill was being discussed in mid-2015, it appeared that Sen. Marco Rubio had a good chance to win the nomination, and Lindsey Graham might be a solid running mate, at the very least.
Then Trump happened, pushing aside everyone Adelson had relied upon. Donald Trump's appeal is based on nativism -- with many of America's troubles explained by the ill will of foreigners, as well as the American politicians willing those foreigners to take advantage of average Americans.
In that light, an online gambling bill which no longer is turned inward, but outward, has a much better likelihood of being signed into law. Sheldon Adelson is no longer protecting Americans from regulated online gambling supported by US states, but from dangerous foreigners who set up offshore websites to prey on normal citizens.
The new RAWA legislation has a much better chance of being passed into law. People might assure it has no teeth, because it cannot be enforced. But the next president of the United States might not follow the standard rules for enforcing US federal laws. And if the president cannot enforce a 45% tariff against China or build a 50 foot wall across 2000 miles of territory, then that president might be looking for easy victories to trumpet in the press.
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