'Misjudgments Affect Society As a Whole'

Jacob Sullum | October 24, 2006

While researching the Unlawful Internet Gambling Enforcement Act (the topic of tomorrow's column), I came across a novel (to me, anyway) justification for legislation in this area. "Some have suggested that there is no call to rein in the activities of individual choice," says Rep. Jim Leach (R-Iowa), one of the bill's main sponsors. "But misjudgments affect society as a whole. There is nothing in Internet gambling that adds to the GDP or makes America more competitive in the world. Indeed, if an individual cannot repay his or her credit card debts, neighbors will be subject to higher interest rates."

Leach seems blithely unaware that he is making a case for regulating everything people buy. But maybe I'm not giving him enough credit (in contrast with Visa and MasterCard, which according to Leach are giving people too much credit). For all I know he could be hard at work on the Unlawful Big-Screen TV Purchase Enforcement Act or the Unnecessarily Luxurious Refrigerator Prevention Act.

Help Reason celebrate its next 40 years. Donate Now!

Try Reason's award-winning print edition today! Your first issue is FREE if you are not completely satisfied.

|10.24.06 @ 7:02PM|#

May I suggest the No Going to Bad Movies Act?

...talk about a gamble.

|10.24.06 @ 7:07PM|#

We the GDP producers of the United States, in Order to form a more internationally competitive Union, establish lower interest rates for our neighbors, insure domestic off-payment of credit card minimums, provide for scrutiny of individual finances, promote the welfare of the Generals, and secure the Blessings of lower interest rates to ourselves and to hell with our posteriors, do ordain and establish this Unlawful Internet Gambling Enforcement Act for the United States of America.

|10.24.06 @ 7:13PM|#

You know, one of the greatest pleasures of life is good credit. Because of good credit my two amigos, Mastercard and Amex, have helped me finance several moves, many, many plane tickets, every present I have bought anyone over the last six years and the re-painting/plastering of my apartment. Thanks, boys!

|10.24.06 @ 7:30PM|#

I don't see how his arguments support regulation of all purchases. Purchasing from American retailers should add to the GDP, thus making America more competitive. Of course, watching the tv doesn't unless you're a Nielson family. A more apt criticism is that he's suggesting that anything you do that doesn't benefit others monetarily should be illegal...

|10.24.06 @ 7:33PM|#

There are Americans who have made small fortunes by playing poker on the internet against players form around the world, that adds to the GDP. There are online satellite tournaments (relatively inexpensive tournaments that allow players to win a seat in a major event) for the World Series of Poker & other high buy-in poker tournaments that have allowed thousands of people to enter these events for a fraction of the $10,000 cash buy-ins, giving them a shot at literally millions of dollars. Not to mention the thrill of the once-in-a-lifetime experience of entering "The Main Event". Internet poker has turned the WSOP into a huge cash cow for Harrah's. Foreign players who win seats in the online tournaments come to America and bring LOTS of GDP enhancing money with them. Leach's comment about higher interest rates for credit card debt is so incredibly stupid he should be subjected to a sanity hearing.

Hell yeah, misjudgment affects society as a whole, the misjudgment of the Iowa voters has allowed this loony-tune to assault a multibillion dollar industry.

I'm looking forward to tommorrows column.

|10.24.06 @ 7:40PM|#

"to hell with our posteriors"?

i thought thats what people say when they
are allowed to buy junk food?
or perhaps you meant posterity?
surely an excusable and hilarious
solecism

|10.24.06 @ 7:42PM|#

What's funny is how often various Republicans are flippantly accused of being fascist, and now we actually have almost a prototype example of the fascist mindset on display here: the priorities of the state above all else.

Looking up the house votes on this bill, only 17 Republicans voted 'nay' on this bill. Amusingly, one of the 'nays' is Mark Foley. Is it too late to ask for the "child predator" back?

Gimme Back My Dog|10.24.06 @ 7:47PM|#

The fact that all of those poker rakes are going to Costa Rica or the Caymans is because it is illegal for those companies to be based in the U.S. If he was really concerned about gamblings affect on the economy, he would support legalization.

Mike Laursen|10.24.06 @ 8:01PM|#

"... misjudgments affect society as a whole"

Especially when imposed on us all at the Federal level.

|10.24.06 @ 8:02PM|#

How do each of these contribute to the GDP: (1) my purchase of a ticket to a Bob Dylan concert, (2) my placement of a $10 bill in the collection basket at the church where Jim Leach worships, (3) my purchase of a state-sponsored Powerball ticket, (4) playing BINGO at the church where Jim Leach worships?

|10.24.06 @ 8:04PM|#

A member of congress lecturing people about the evils of debt.

Pot. Kettle. Black.

D.A. Ridgely|10.24.06 @ 8:07PM|#

Does anyone know offhand when he changed the second "e" in his name for an "a"?

|10.24.06 @ 8:16PM|#

Isn't this what Barney Frank was responding to in this quote

"If an adult in this country, with his or her own money, wants to engage in an activity that harms no one, how dare we prohibit it because it doesn't add to the GDP or it has no macroeconomic benefit. Are we all to take home calculators and, until we have satisfied the gentleman from Iowa that we are being socially useful, we abstain from recreational activities that we choose?... People have said, What is the value of gambling ? Here is the value. Some human beings enjoy doing it. Shouldn't that be our principle? If individuals like doing something and they harm no one, we will allow them to do it, even if other people disapprove of what they do."

Jim Murphy|10.24.06 @ 8:26PM|#

I know a lot of people who are involved in one way or another in the gambling business. Many of them are either moving their web services offshore, or moving offshore themselves just to avoid any potential trouble. So if these thriving businesses are moving out of the country it pretty much refutes the "no addition to the GDP" argument--not that it wasn't obviously "smoke and mirrors" to begin with.

Besides, if the argument that "gambling sucks money out of the more productive economy" were true Las Vegas would be ghost town once you moved away from the casinos. Last time I checked, the broader economy is doing pretty well there. True, the gaming industry is the straw that stirs the drink but without it home builders wouldn't build houses, restaurants and bars wouldn't serve meals and drinks, so on and so forth. The economic ripple effect of Internet gambling may be more diffuse, but as long as Americans are profiting from its existance--and there are plenty that are--Jim Leach's argument is as simple minded as he is...

|10.24.06 @ 8:28PM|#

The only reason why internet gambling does not make America "competitive in the world", is that it's illegal. But who doesn't love a good self-fulfilling prophecy?

I have days, though, where I let myself think this is all babysteps to eventual legalisation. Knock out the white-hat players now (publicly traded UK companies forced out of the market due to the UIGEA) so that when their day comes, the Harrah's and MGM's of the US can have a decent shot at their domestic market.

It's slimey and protectionist, but it gives me some hope.

Disclaimer: I work in the internet gambling industry.

Jim Murphy|10.24.06 @ 9:19PM|#

I've got a friend who's made more money in the stock market than I care to think about. He's been convinced all along that the end game of this "prohibition" will be the Nevada gaming companies becoming the dominant players in the online gambling business....

|10.24.06 @ 9:23PM|#

I didn't even know about my neighborhood bookie before I started gambling on the internet, but from what I can tell now (years into my ugly habit..I'm about $150 in the hole since I won big on Syracuse in the NCAA final four a few years back...I'm sorry, neighbors!!! I'm sorry, Congress! I hang my head in shame and I will report to the town square for jumping jacks and penance every day for a week!)..anyway..from what I can tell now, our gambling black market is thriving pretty damn well, thank you very much, even if it doesn't show up in our GDP.

(Ya know, like drugs don't contribute to our GDP, no matter how many forests of marijuana American growers harvest every year.)

|10.24.06 @ 9:57PM|#

Thank God we have people like Jim Leach to ensure that our GDP is safe by prohibiting online gambling. Sounds like more money for his lottery and horse racing buddies. I don't usually attribute to malice what I can to incompetance, but the hypocracy involved in allowing the ponies and numbers games to stay legal at the expense of something like poker is so apparant in this type of legislation.

If you didn't read his full justification, I'd recommend it...he seriously sites the fact that such a large number of Americans gamble on line as a reason why it *should* be illegal. Score one for democracy I guess.

|10.24.06 @ 11:12PM|#

Prepare, folks. The revolution cometh.

The Wine Commonsewer|10.24.06 @ 11:19PM|#

You never, ever hear anyone say it's a free country isn't it? any more.

Paul|10.24.06 @ 11:21PM|#

"Some have suggested that there is no call to rein in the activities of individual choice," says Rep. Jim Leach (R-Iowa)

Hey, Jimbo! Let's talk about activities resulting from individual voter choice-- especially the choices of Iowa voters. I got some real problems with that...

Paul|10.24.06 @ 11:25PM|#

You never, ever hear anyone say it's a free country isn't it? any more.

Here's one I sing (just audibly enough) to liberals everytime they try to usher in some new prohibitionist legislation or regulation:

Sign, sign, everywhere a sign
Blockin' out the scenery breakin' my mind
Do this, don't do that, can't you read the sign

It has a certain...effect on those ex-hippie liberals that grew up singing that song.

The Wine Commonsewer|10.24.06 @ 11:25PM|#

Will Rogers had good advice:

Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it.

|10.24.06 @ 11:26PM|#

Making something illegal because you cannot prove to someone else that it "benefits" you AND the rest of society is moving dangerously close to "that which is not explicitly permitted is forbidden."

Scary.

The Wine Commonsewer|10.24.06 @ 11:28PM|#

Paul: ain't it the truth.

Ken: ain't it the truth.

If you could get your money back for sitting through a bad movie (like you can for a defective pair of jeans) the movies would get better.

|10.24.06 @ 11:57PM|#

Jim:

When you consider that Frist has received contributions from Harrah's, it's not a stretch to presume "future consideration" has been promised.

The genie is out of the bottle on this one. They just needed to figure out how to get a piece of the pie. Much easier for a corporate betting company to compete for the US market from Nevada than San Jose. But the same couldn't be said against the already-regulated, public UK companies.

It's also interesting that the UK companies are holding on to many of their poker interests, while selling off the sportsbooks and casinos. Makes me think they are expecting the US market to eventually open up for poker, but not sportsbetting.

|10.25.06 @ 12:05AM|#

The Government wants their Cut, plain and simple. Gambling never left the hands of organized crime: it was simply seized by the most powerful gang in the land.

|10.25.06 @ 12:22AM|#

I'd offer 5 to 1 odds that it will be legalized when the people who lobbied for the prohibition are aiming to protect themselves, but that would probably be considered on-line gambling.

|10.25.06 @ 1:44AM|#

You know what's a choice with negative externalities? Growing Iowa corn, that's what. It gets turned into ethanol through a process that makes the resulting fuel an energy loser, not a saver. Putting that crap in your engine can be hell on the hardware, too. You might even void your warranty. Then there are all those trans-fat loaded snack foods made crunchy with corn. I try to avoid the Chee-tos, ghu knows I try! And don't even get me started on High Fructose Corn Syrup, or corn-fed beef, that heart attack on a plate! Even a "healthy" roasted ear of sweet corn is nothing but a delivery device for butter and salt. If I go to a summer festival I have to have at least one ear, probably two. Then there's corn liquor, and corn used as an adjunct in cheap, skunky macrobrewed beer.

You can choose Iowa Corn, or you can choose life - it's up to you.

Kevin

|10.25.06 @ 1:50AM|#

OK, OK, WC:

'Twas a free country, wasn't it?

That's the best I can do nowadays.

|10.25.06 @ 9:01AM|#

But misjudgments affect society as a whole.

Better than affecting society as a hole, like Leach is doing.

|10.25.06 @ 9:22AM|#

Unfortunately, Leach got 60% of the vote in 2004, so there's not much opportunity for a "target and defeat" effort by Libertarians.

|10.25.06 @ 9:25AM|#

Consumerism does affect society as a whole because we're depeleting our natural resources at an increasing rate to manufacture this garbage. Do we REALLY need that 100" plasma screen?

The Unlawful Big-Screen TV Purchase Enforcement Act might be necessary thing.

|10.25.06 @ 10:04AM|#

No, Dan T., we don't. And we probably don't need you wasting time posting on a blog when you could be out volunteering at a soup kitchen, or picking up trash along the road, or any number of things that other people would want you to be doing instead of indulging yourself.

|10.25.06 @ 10:19AM|#

Peter K. - I think number 2 and number 3 in your list are the exact same thing. The state is the church where Leach worships, so long as he is in charge anyway.

Dan T.|10.25.06 @ 10:22AM|#

Beware the phony Dan T...

Anyway, I don't have a strong stance on the legality of gambling, but I can't help to think that we ignore its perils at our own risk.

I sense that gambling as a social taboo developed because societies in the past have had to learn the hard way how harmful it is. It's a vice - an activity that creates short-term pleasure but long-term misery.

dhex|10.25.06 @ 10:33AM|#

gambling was also always a private/grey market affair for a very long time - so there was no cut, as it were, for the government or whatever gang happened to be in power at the time.

people learn long-term planning by hook or by crook, or they don't learn it at all. lots of people seem to be able to gamble small amounts without imperilling themselves or their loved ones, so i have to wonder just how much of a problem it actually is. i imagine casino funded studies show very little, and addiction institute studies show a terrible scourge. beyond that, though...

personally, i've only gambled once, in vegas, and i won a fair amount of money screwing around with slots. if i never gamble again, that's cool. the joint is a little too night of the living dead for my tastes.

|10.25.06 @ 10:36AM|#

It's a vice - an activity that creates short-term pleasure but long-term misery.

So we should all live lives absent short term pleasure? Do you have some support for your implication that short-term pleasrue via gambling causes long term misery? Aren;t there exceptions?

Sounds a bit like you are a sunday sermonizer... gardens and virgins in the afterlife and all that if only you avoid the evils of short term pleasure...

|10.25.06 @ 10:37AM|#

Dan T:
"[Gambling] is a vice - an activity that creates short-term pleasure but long term misery."

Gambling doesn't create long-term misery, losing does.

|10.25.06 @ 10:39AM|#

an activity that creates short-term pleasure but long-term misery.

Like voting?

|10.25.06 @ 10:44AM|#

Just off the top of my head, a few things that contribute no more than gambling to the GDP.

1) Circuses
2) Professional sports
3) Ballet
4) Music
5) Movies
6) Carnivals
7) Baloon rides
8) Etc., etc., etc.

Dan T.|10.25.06 @ 10:49AM|#

So we should all live lives absent short term pleasure?

No, of course not. Not all pleasurable activities are harmful.

Do you have some support for your implication that short-term pleasrue via gambling causes long term misery?

There are plenty of studies that indicate that gambling is a net harm to a community.

Aren;t there exceptions?

Sure...with all vices, some people can handle them, some can't. But the question is more about the net gain or loss for society.

Sounds a bit like you are a sunday sermonizer... gardens and virgins in the afterlife and all that if only you avoid the evils of short term pleasure...

Yes, I'm familiar with the H&R blanket dismissal that anyone who expresses concern about the social costs of pleasure really just doesn't want other people to have fun.

Dan T.|10.25.06 @ 10:52AM|#

Just off the top of my head, a few things that contribute no more than gambling to the GDP.

1) Circuses
2) Professional sports
3) Ballet
4) Music
5) Movies
6) Carnivals
7) Baloon rides
8) Etc., etc., etc.

Of course, nobody is spending their last penny on their ballet habit because they can't quit.

dhex|10.25.06 @ 10:56AM|#

there are plenty of examples in new york city of the extremely wealthy essentially balleting/fine dining/luxuriating themselves into terrible debt.

the question, dan, is how do people learn to be responsible? at least for me, that's the question. if they never learn, which is the answer in some quarters, then the hunt for some kind of blocking force is on.

of course, with the internet, nothing can truly stay illegal for very long.

|10.25.06 @ 11:11AM|#

FYI, this is the real Dan T.

400,000 people a year die prematurely from heart disease, primarily from poor diet and lack of exercise. This results in a huge net loss for society, in terms of higher health insurance premiums, financial impact to remaining family members, etc.

But this problem has a simple and painless remedy: ban junk/fast food, and mandatory calisthenics in the town square. The enormous net gains for society would outweigh any of the so-called benefits of "individual" freedom.

A healthy, happy worker bee = a healthy, happy hive.

|10.25.06 @ 11:29AM|#

The real Dan T:

Your comments are starting to amuse me now that I understand where you're coming from. You ask yourself, "What can I say that will cause the grreatest outrage and indignation?" and then you post a comment about happy worker bees in a healthy hive. At least you're having fun making libertarians jump through your hoops. More power to you.

Dan T.|10.25.06 @ 12:03PM|#

I think the "real Dan T." is Jennifer.

Jennifer|10.25.06 @ 12:25PM|#

No, Jennifer posts as "The Definitive Dan T."

|10.25.06 @ 12:47PM|#

I feel so diluted.

|10.25.06 @ 2:48PM|#

FYI, this is the real Dan T.

LOL! I prefer the fake Dan T. because he at least has to think about what he's posting.

b-psycho|10.25.06 @ 3:47PM|#

Some questions for Dan T:

Who defines what counts as a net gain or net loss for "society"? What criteria did they use, and why? Who picked them? And what are their qualifications?

|10.25.06 @ 4:09PM|#

"Hey, Jimbo! Let's talk about activities resulting from individual voter choice-- especially the choices of Iowa voters. I got some real problems with that..."

Yeah ditto, can't believe I moved here for a job. Iowans have their priorities so mucked up, I'm surprised this state hasn't imploded yet. Guess it's being propped up by all the flake politicians who come to visit and fake the "down home" look for their ad campaigns. :-P

Leach is a disgrace. His Democratic opponent isn't any better though. Ugh. Where's my alternate candidate? Libertarian, Green, Constitution, anything please!

Dan T.|10.25.06 @ 6:49PM|#

It helps if you look at the email/website linked by my name. Then you can see who is Dan T., who isn't Dan T., and who is impersonating Dan T. using the same website. =)

Dan T.|10.25.06 @ 6:53PM|#

It helps if you look at the email/website linked by my name. Then you can see who is Dan T., who isn't Dan T., and who is impersonating Dan T. using the same website. =)

Hey!

|10.25.06 @ 8:52PM|#

Ironically, the very day "the real Dan T." started posting, I had considered starting a habit of posting the first contrarian thing that popped into my head on every thread, under the handle "Dandroid." But someone else beat me to it, aside from the name.

Not to be a prig, but I don't really think the Dan T. parodier should be posting under Dan T.'s name. Cloning like that is kind of against the accepted custom here, and I don't think it's really fair.

On top of that, it confused me. I honestly have real trouble distinguishing the real Dan T.'s comments from those of the inane parody. And I'm obviously not the only one, either.

jlynfPpuaU|10.27.06 @ 1:03AM|#

Reason Magazine

Get Reason E-mail Updates!

Site comments/questions:

Media Inquiries and Reprint Permissions:

Editorial & Production Offices:

advertisements