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Barfing over sports betting

The headline in the New York Times screamed:

Cash-Hungry States Eye Sports Betting, to Leagues’ Dismay.


The really serious screaming, however, came from the various organizations that run major league sports and, of course, the NCAA. The article discussed recent moves by several states to consider legalizing sports betting to generate much-needed revenue and the predictable and utterly hypocritical hand-wringing and breast-beating from the usual quarters. The NCAA, Major League Baseball, the NFL, NHL and the NBA went into full panic mode stating that such a move would destroy the integrity of sport in America. All, not surprisingly, have already filed suit to stop New Jersey from legalizing sports betting and are geared up for similar actions in other states should they emerge.


Spokespersons for these organizations have been issuing statements that make it seem like the very fabric of the country will be rendered if betting on athletic contests became legal – they sound like Evangelicals fretting over marriage equality. And they’re not making any sense.


First, sports betting is already ubiquitous. There isn’t a city, town, village or hardscrabble hollow in this land where you couldn’t get a couple of coconuts down on the next “big” game. You want to put down a bet? Wander by the local bar, poker room, race track or pool hall and sit down. Order a beer. Start up a conversation with the guy next to you. Talk up the local team. Ask who might be bookin’ games and, so long as they don’t think you’re a cop, you’ll find the local bookie. Hell, it might even be the guy you’re talking to.


If you’re not comfortable with this approach, click here and a rich array of options will pop up on your monitor. Open an account, ship ‘em some money and you’re good to go.


The numbers are stunning. The action in Nevada, where it’s legal, represents but a tiny blip on the screen. According to the American Gaming Association, Nevada’s books take in less than 1% of the total wagers. In 2011 they accepted $2.88 billion in bets which, while substantial, is a mere trickle compared with the tsunami the illegal books and offshore sites are handling. The National Gambling Impact Study Commission estimated that figure at $380 billion!


Second, much of the support for teams comes from wagering on the outcomes of their games. The Knicks are ahead by 6 as the clock winds down. As the buzzer sounds the Cavalier point guard tosses up a shot from half-court just because he can. It goes all-net. The crowd in the Garden groans and goes limp. You might scratch your head and think “WTF?” But if you knew the line on the game was Knicks -4 you understood. That inconsequential shot just made almost everyone in the stands a loser.


March Madness is accompanied by bracket frenzy. Everybody in the country seems to have a couple of bucks on a bracket contest at their place of work, in their bowling league, bridge club. Even President Obama took time out to offer his picks for the event. Games are discussed on sports channels as though they were betting contests in that point-spreads are regularly tossed into the mix. The NCAA is a strange organization with a history of some very odd rulings and positions on athletics but the board is not made up of stupid people. They know that the popularity of their annual extravaganza is dependent on illegal wagering which, according to FBI estimates comes to roughly $2.5 billion every year (legal wagering comes in at a paltry 80 to 90 million).


The athletic organization that succeeded in banning all wagering on its games would not just bite the hand that feeds it; it would likely sign its own death warrant. And, of course, they know this and their posturing is pure hypocrisy.


Third, the notion that “sports betting threatens the integrity of athletic competition” (a line recently used in a complaint filed by the NCAA) is pure bull shit. It’s legal in Nevada and in other countries (notably the UK) largely without incident. Yes, from time to time point shaving scandals are uncovered but they shrink to insignificance compared with the wreckage of Wall Street where, in just the last few years, we’ve seen major insider trading programs, the Madoff Ponzi scheme and HSBC uncovered as the chief money-launderer for drug cartels in Mexico and Columbia. No one but a few progressive journalists (like Matt Taibbi) have argued that “actions of bankers threatens the integrity of financial institutions.”


The major sports organizations have it exactly backward. It is the lack of open, legal and regulated wagering that threatens the integrity of the games. When you make a desired activity  illegal the folks who come in to provide the service are those who don’t give a rat’s ass about legality. Many of the bookies who handle action around the country are “connected” and not always with the nicest of people. The offshore books are beyond the reach of US justice system and regulated in highly variable and largely unknowable ways in locales not always known for integrity.


When an activity is legal, open and above-board it is easier to regulate and patrol. I have no doubt that the incidents of game-fixing and point shaving would diminish if sports betting were legal everywhere. When someone is playing fast and loose with the outcomes of games they leave trails, evidence, patterns of wins with particular players, referees, opponents. These are far more easily detected when the entire enterprise is carried out in the open.


Others worry about the possible increase in problem gambling. This is an issue that is not an issue. It is an issue in that there are studies that show that when the opportunity to gamble increases, incidents of pathological gambling increase. It is not an issue when it is recognized that problem gambling is a classic “co-morbid” disorder. That is, it rarely occurs as a singular psychological problem. It usually emerges along with a host of disorders including drug and alcohol problems, bipolar disorder, borderline personality disorder and others. Legalizing sports betting in many venues might be followed by an increase in problem gambling but it wouldn’t be accompanied by an increase in overall social pathology – merely a redistribution of it.


A gander across the pond at the UK where betting on just about everything is legal, where sports books are as common as green grocers and wagers are taken on just about anything you might wish to bet on, supports this line of thought. Problem gambling in the UK is found in roughly.5% of the population. In the US it’s about 3%, some six times the rate. There are lots of reasons for this disparity but I’m guessing that one of them is that our Puritanical stance with regard to activities like sports betting (and poker and drugs and sex) is a major contributor. When an activity is open, accepted and integrated into the culture it loses much of the allure of the dark side that we have here in America.


So, my mantra: to be chanted twice a day: Legalize, Regulate, Tax!


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