• Background: Nevada was first state to legalize, now many states have some form of legal gambling
• Debate: Economic growth and personal responsibility v. Overstates benefits for legalization and social costs
• Country Comparison: Online gambling legal and regulated in the E.U., Banned in Australia
• Recent Legislation: Online gambling restrictions

Background

• For nearly 50 years casino gaming was only legal in Nevada where legal state-regulated gaming was controlled by organized crime. In the late 1950s, crime in the industry decreased when the state began allowing publicly-held companies to own and operate gaming facilities. Gaming in Nevada became a multi billion-dollar industry, eventually spreading from downtown Las Vegas to Reno and Lake Tahoe. In 1976, New Jersey became the second state to legalize gambling in a statewide referendum. Since then, eight other states have legalized casino or riverboat gambling and most states have legalized some form of highly regulated gambling.
• Native American tribes, as sovereign entities, have used their legal status to open about 400 casinos in 28 states as of January 2007 (source: Nationalpress.org). It is seen as an method of economic development. The number of Native American gambling facilities have grown during the past decade and are expected to multiply.
• Online gaming is a recent development in the gambling industry. Because gaming is illegal in most parts of the U.S., gaming firms based offshore opperate internet sites that do not fall under U.S. jurisdiction. Some U.S. states have outlawed all online gambling or owning an online gaming operation without a license. No states are currently granting online gaming licenses. There have been a number of U.S. court cases challenging participation in online gaming.

Debate

• Arguments for Legalization: Proponents hold that legal and regulated gambling has been a strong provider of jobs, tax revenues and economic development. Gambling outlets offer wages that usually surpass the national average and legalization would reduce crime by eliminating the desire for underground gambling. Gambling addictions only affect a small minority of the population whose compulsions should not affect the millions of responsible gamblers.
• Arguments against legalization: The social costs are significant. Millions of people suffer from gambling addictions and fall pray to crimes related to gambling. This has a direct impact on families and communities. The business-economic impact of gambling have been overstated the strategic costs of legalization to the states the country as a whole are largely ignored by legalization proponents.

Country Comparison

• Most members of the European Union have legal and regulated online gambling industries. Australia banned online gambling in 2001.

Recent Legislation

• In 2002, the United States Court of Appeals for the Fifth Circuit ruled that the Federal Wire Act prohibits electronic transmission of information for sports betting across state lines. However, it upheld a lower court ruling that the act did not prohibit Internet gambling on a game of chance.
• The Unlawful Internet Gambling Enforcement Act of 2006 was aimed at limiting internet gaming by making it illegal for US-based banks and credit card firms to make payments to online gambling sites. The bill was sponsored by Robert Goodlatte (R-VA)