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The report from the Competitive Enterprise Institute comes a day after a pair of Congressmen asked for hearings on sports betting in the US. And the NCAA and other pro sports leagues that are the plaintiffs in the New Jersey sports betting case filed their brief with SCOTUS as well on Monday.
The CEI report makes the case for the federal government taking action, outside of the NJ case that will take place in the Supreme Court in December.
The Supreme Court case — in which New Jersey has attempted to partially repeal its prohibition on sports betting — hinges on the Professional and Amateur Sports Protection Act. PASPA is a federal law passed in 1992 that prevents single-game wagering outside of Nevada sports betting.
The CEI points out how the law has failed in many respects in the decades since PASPA came to being. More from the report:
Some believed increased gambling on games would increase the likelihood of match-fixing. Yet, over the last 25 years, PASPA has failed to stop the spread of illegal sports gambling, prompted the rise of an enormous gambling black market, increased criminals’ profits, prevented states from raising millions in tax revenue and enacting consumer protections, and made stopping corruption in sports more difficult.
You can read the report here.
The issue before the Supreme Court is being argued as one of the federal government vs. the powers of the states. New Jersey is arguing that PASPA “commandeers” the states into keeping their sports betting prohibitions on the books. The NCAA et al argue that PASPA is well within Congress’ powers.
The libertarian CEI obviously agrees with New Jersey:
While the courts have expanded federal authority by broadly interpreting what constitutes interstate commerce, PASPA’s prohibition against states legalizing intrastate sports betting pushes us toward a future in which the federal government functionally has no limits on its power. …
In addition to forcing law-abiding citizens to engage in unlawful behavior, the prohibition prevents states from enacting consumer protections, thwarts law enforcement from investigating and prosecuting illicit activity, and unlawfully blocks state lawmakers from acting on the will of their own residents.
There are two viable routes to change on US sports betting policy.
The Supreme Court could strike down PASPA in whole or in part. But that outcome is still uncertain, and SCOTUS could very well uphold the constitutionality of PASPA. The CEI also filed a joint amicus brief in the NJ case.
The other route is Congress. The nation’s highest court leaving PASPA in place, either in whole or in part, would leave more need for action from Congress. After all, sports betting via offshore sites will be taking place no matter what SCOTUS rules. Congress could give power to states to regulate sports betting, to capture revenue new revenue streams, and to eat into offshore sites’ marketshare.
That’s what New Jersey, the CEI and many other states would like to see happen — 20 states also backed New Jersey in its case that PASPA commandeers them on the issue of sports betting.
SCOTUS will rule sometime in 2018. In the meantime, Congress would be wise to take up the issue, the CEI and many others believe.