Proponents say gambling can’t be stopped and government should cash in by taxing it.

The House Ways and Means Committee held a hearing Wednesday to consider legalizing Internet gambling.  The discussions centered on the idea that the government can’t keep people from gambling, so it should be getting in on the action by taxing the industry, an argument family advocates ignores the costs to society. 

Rep. Barney Frank, D-Mass., has introduced H.R. 2267, which seeks to overturn the Unlawful Internet Gambling Enforcement Act (UIGEA) and would also gut several other federal and state laws that limit gambling activity.  UIGEA is set to take effect June 1. 

“We do not believe that this is a case where prohibition works,” Frank told the committee.  “We’re not talking about an activity that harms others.  We are talking about a decision, by adults, to do what they want to do with their own money.” 

Frank argued that prohibition, in his opinion, hasn’t worked in the past and won’t work now. 

“We do know that gambling will go on in America because the people who are doing it are doing it voluntarily and they’re not going to report themselves to the police,” he said.  “So the question is, should we give those who gamble total immunity from taxation?” 

The lone opponent to testify was Rep. Bob Goodlatte, R-Va., the author of UIGEA. 

“People sometimes resort to drastic things when they’re strapped for cash,” Goodlatte said in his testimony before the committee, “although it’s unfathomable for Congress to consider legalizing a currently illegal activity that poses harm to the most vulnerable members of our society just to raise money for more big federal government spending.” 

CitizenLink has compiled data showing the social costs that would be incurred by various groups should UIGEA be overturned. 

The estimated costs of Internet problem and pathological gambling addictions among adults each year in the U.S. would be $18 billion.  It would total $7 billion for those under age 18. 

“Gambling is not a victimless activity,” Goodlatte said.  “The anonymity of the Internet makes it much easier for minors to gamble online.” 

Updated data for the estimates on problem and pathological addictions comes from economics research in the field of gambling and a federal report on gambling.  

Chad Hills, gambling analyst with CitizenLink, said H.R. 2267 would put the government in the business of hurting its citizens. 

“Isn’t Big Government already getting enough taxpayer money,” he asked, “without bilking citizens for more cash by invading our homes with thousands of predatory, online casinos?” 

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Learn more about the social costs of gambling.

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