By
Dan |
Published
Jun 25 2008, 02:16 PM
On Wednesday, the House Financial Services Committee, chaired by Congressman Barney Frank (D-MA), defeated legislation that would revamp the regulations of the Unlawful Internet Gambling Enforcement Act. HR 5767 was brought to the Committee by Frank. Two votes were taken. The first was on an amendment by Congressman Peter King (R-NY) that would have called for the U.S. Treasury and Federal Reserve to work hand in hand with the Department of Justice to ascertain what identify what kinds of online gambling are legal and what kinds are not. It was defeated after a 32-32 roll call vote, with many of the calls for defeat coming from Republican members of the Committee. HR 5767 was then voted on without the amendment and was defeated by an oral vote, with the Nays outnumbering the Yays by a sizeable margin.
The discussion within the House Financial Services Committee surrounded comments by Congressman Spencer Bachus (R-AL), who is the ranking Republican on the Committee. He opened the hearing and commented, “A national study several years ago said that problem gambling doubles within 10 miles of a gambling facility. The closer you get to a casino, the more problem gamblers you have. The internet puts that facility right in the middle of the home, in dorm rooms, and in the bedrooms of teenagers or college students.” Bachus claimed there is overwhelming support for banning internet gambling across the country, though organizations like the Poker Players Alliance have cried that the majority of Americans favor legalization and regulation.
Bachus expounds upon who is supporting the Unlawful Internet Gambling Enforcement Act’s regulations: “We had 49 Attorney Generals write us and they urged us to pass the legislation in 2006. They now have said to speed up these regulations. Why did the American Psychological Association appear before us and asking us to pass the legislation we passed back in 2006? 47 state universities have sent letters to this committee urging us to keep this ban. It’s the effect on our youth. That’s what it’s all about: our youth. It’s about those studies that say that the younger one begins to gamble, the worse the problem is.” He spoke to the proponents of internet gambling in the audience and claimed, “You represent a criminal enterprise. I will tell you that the internet sites which are attempting to reverse this ban are criminal enterprises.”
King then spoke on the specifics of his proposed amendment, which focuses on providing the financial services industry with a considerable amount of direction: “The banking industry is enforcing and defining what the law is. My amendment withdraws the existing regulations and calls for the Treasury and Federal Reserve to work together with the Department of Justice to determine proper regulations. I am calling to have the current regulations rescinded. The amendment requires the Treasury to compile and maintain a list of unlawful internet gambling businesses. This isn’t about whether or not you believe in internet gambling; this is about imposing unenforceable regulations on the banking industry.” Supporters of King’s amendment included the Chamber of Commerce of the United States, the Financial Services Roundtable, and the National Association of Credit Unions.
Paul then spoke about his concerns with the UIGEA, which are themselves different from other members’ concerns: “I agree with everything about the dangers of gambling, but the issue to me is how we regulate moral behavior. The internet happens to be very important. It’s important to everybody. When you regulate the internet, you open up the door for all kinds of regulations. I believe individuals have a right to spend their money the way that they want to. Some people spend their money unwisely. If you can regulate how people spend money on the internet, it opens a can of worms because everyone is going to have a different item they want to regulate. There are special interests involved. People who like casinos don’t like internet gambling. The real issue is what the role of government ought to be.”
Congressman Mel Watt (D-NC) claimed that the discussion of whether Committee members were in favor of internet gambling was irrelevant: “It is unfair to banks to place this responsibility on them to decide what’s legal and illegal without very clear rules and regulations and that’s exactly what Mr. King’s amendment is proposing. I think my position on whether people ought to be allowed to gamble or not is not the underlying issue. My position abut whether people ought to supervise their children better is not the issue.”
Bachus had one of the final comments prior to adjournment before the vote and responded to Congressman Paul’s claim that the government should not get into the business of regulating the internet: “All 50 states have said we don’t want to have this go on; it’s illegal. The states have said, ‘Don’t operate illegal gambling sites through the internet.’ We already regulate the internet. It’s illegal to send child pornography over the internet today. We regulate that. We have determined that we are going to try to stop child pornography and illegal gambling over the internet. We don’t want those in our young people’s bedrooms and in their dorm rooms. We don’t want that addiction at an early age.”
The Committee adjourned, returning at 4:00pm ET for a vote. King’s amendment was defeated by a 32-32 margin. HR 5767, without the additional amendment, was voted on and defeated by a verbal call for votes. Poker Players Alliance Executive Director John Pappas will appear on the PocketFives.com Podcast this week to explain the organization’s next move.