The Case Against Legalized Sports Gambling

The Case Against Legalized Sports Gambling

The Case Against Legalized Sports Gambling

The Case Against Legalized Sports Gambling

7

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Sep 23, 2024

Sep 23, 2024

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You enjoyed his hit song "ban pot"? You'll love his new single, "ban gambling."

Charles Fain Lehman of the Manhattan Institute is, in your correspondent's estimation, the best crime policy expert living in America today. And we have enjoyed watching him widen his repertoire to "vice" policy, especially since it involves him preaching the gospel in bastions of liberalism such as the New York Times and the Atlantic.

And so we have greatly enjoyed his new article making the case against legalized sports gambling. The way in which a practice which used to be, if not completely illegal, then severely restricted and frowned-upon, has become totally mainstreamed in just a few years, has been striking to watch. As Lehman points out, "The American Gaming Association expects $35 billion in bets to be placed on NFL games in 2024, about one-third more than last year’s total."

Sports gambling used to be largely banned in the US under the Professional and Amateur Sports Protection Act (PASPA) from 1992 to 2018. In 2018 however,, the Supreme Court ruled PASPA unconstitutional, allowing states to legalize sports betting, and now, as of 2024, sports gambling is legal in 38 states and Washington D.C.

Lehman marshalls the numbers to show why this is a bad development. It will be a familiar story to anyone acquainted with vice policy: the vice may be harmless for many consumers, but to some not-so-negligible subset, it will open up a spiral of addiction and self-destructive behavior. And, of course, these victims tend to be disproportionately underprivileged.

Lehman cites research demonstrating that legalization depletes household savings, increases the risk of overdrafting bank accounts and maxing out credit cards, and leads to a 25-30% higher risk of bankruptcy and increased debt delinquency. Sadly and predictably, these effects are particularly pronounced among economically precarious households, especially young men in low-income areas.

Beyond financial impacts, Lehman points to a disturbing correlation between legalized sports betting and domestic violence. Lehman cites a paper finding that "an NFL home team’s upset loss causes a 10 percent increase in reported incidents of men being violent toward their partner." In a followup study, the authors fond "that in states where sports betting is legal, the effect is even bigger" and "estimate that legal sports betting leads to a roughly 9 percent increase in intimate-partner violence." Lehman cites other studies linking gambling addiction to anxiety, depression, "and even suicide."

Another finding will be depressingly familiar: the corporate incentives. In legalized "vice" industries, we find that providers make a disproportionate share of profits from "whales," the minority of consumers who are most deeply and grievously addicted, creating an incentive to create more of these addicts. In some cases, 5% of bettors account for 70% of the money spent on betting. Hard to blame these issues just on lack of personal responsibility when large corporations have such a financial incentive to push people to bet more.

The final nail in the argument: it turns out that gambling tax revenue, which had been the main justification for the move to legalization, has essentially not materialized at all. All 38 legal states combined generate only "about $500 million … a quarter" from taxes on sports gambling.

Hard to disagree with Lehman's conclusion calling for a moderate settlement where Americans can legally bet on sports with one another, but businesses can't profit from their betting. You should read the whole thing.

Policy News You Need To Know

#Healthcare — A lot of people in the policy world are talking about JD Vance's recent comments on health care reform. He has talked both of keeping Obamacare and "building on" it, and keeping existing protections in place, and also of putting people with pre-existing or chronic conditions in separate risk pools, which seems like a contradiction. This sounds like the old Republican idea of "high risk pools"—not exactly the stuff of populist dreams—but a handful of comments in an interview and at a rally do not a policy make so we are waiting for more information. Stay tuned.

#PublicHealth — Of course, a big way to reduce healthcare costs, and one which the US is notoriously bad at relative to its first-world peers, is lifestyle changes and preventative care. A good example is highlighted by this WSJ essay which makes clear what any European pediatrician could have told you: "pediatricians created the nut allergy epidemic." What is true of peanuts is true more generally of weird allergies which seem to be endemic in the US in a way that they are not in other countries, and almost certainly has to do with over-scrupulous medical and pseudo-medical advice. Let your baby eat dirt! He will grow up with fewer allergies and a stronger immune system.

#Polling — This actually looks interesting. "Harvard experts" (no no, keep reading) have created TrueViews, "a new public opinion data tool" whose goal is to "reduce political polarization by educating politicians about what their constituents actually believe." This is a real issue given that politicians' views are so often divorced from those of their constituents—although in many cases this may actually increase, rather than decrease, polarization… Anyway, TrueViews provides estimates of policy preferences for any geographic location within the United States. It covers 32 different policy issues ranging from marijuana decriminalization to universal healthcare to fossil fuel emission limits. It uses survey results from over one million Americans, compiled from 14 years of Cooperative Election Studies (2009-2023) and three years of UCLA/Nationscape Surveys (2019-2021). Users can select a policy issue and a specific jurisdiction (state, county, district, city/town, or zip code) on an interactive map of the United States. TrueViews then generates a color-coded geographic overview and estimates of what percentage of residents support or oppose the selected policy in that area. The tool uses a "multilevel regression and poststratification strategy" to provide projections, along with a "level of confidence" metric that quantifies the probability of accuracy for each projection. Parts of this actually sound promising.

#TheScience — A recurring topic around here has been the way that so much of "the Science," and not just the gender studies stuff that everyone laughs at (even liberals, in private), but the "hard" stuff seems to be shoddily, if not fraudulently in too many cases, put together. Here's another great example: you may have heard of a very famous study on Israeli day care, which supposedly found that when the day care fined parents for being late to pick up their kids, lateness actually went up. That study has been widely cited as an example of how incentives don't work in the real world the way they do in Econ 101 textbooks. Well, it turns out that study is probably wrong. We say probably because the original authors apparently "lost" the relevant data, so we'll never know. Oops.

#Reg — Sen. Rand Paul, along with Sen. Rubio and Rep. Kat Cammack have (re-)introduced the REINS Act, which would rein in the power of the executive in the area of economic regulation and bring it back to Congress in the wake of Loper Bright. It's got a whole package of measures intended to that effect. The bill would require Congressional approval for any regulation with an economic impact of $100 million of more, and require affirmative approval of Congress for major regulation. This version of the bill also includes the LIBERTY Act, which requires congressional approval for agency guidance with a $100 million or greater economic impact. It would also allow people to sue to stop the enforcement of major rules implemented without congressional approval, among other provisions. If you want to rein in the administrative state, it's a good package.

#Immigration — A new group called America 2100 has been doing great on-the-ground reporting on America's refugee crisis. "In just a couple years, thousands of Haitian immigrants have arrived in this small town in Pennsylvania—and nobody seems to know how they got there or where they came from." According to their reporting, vans just show up and drop off migrants. Bizarre. Watch.

#Immigration — Speaking of, you may have heard about President Trump's new proposed plan to end sanctuary cities in the US. He has said he will push for legislation to ban sanctuary cities, but of course the real action is on the executive side, where there is much to do. He has mentioned surging federal law enforcement to cities that fail to cooperate with ICE, and JD Vance has talked in a recent interview of ending subsidies to sanctuary cities.

#SocialIssues Important piece of fact-checking from the Washington Examiner's Tim Carney, on the tragic death of Amber Thurman, who the Harris-Walz campaign has held up as an example of the nefariousness of pro-life legislation. Thurman, who was pregnant with twins, decided to get an abortion. Writes Carney: "When logistical problems derailed her plan of a surgical abortion, Thurman settled on a chemical abortion. An abortion clinic in North Carolina gave her a mifepristone pill and sent her home with a second pill — misoprostol. These pills not only caused fetal demise — which is their purpose — they also killed Thurman. The abortion pills killed Thurman because by killing her twins, they left her with two dead bodies inside her. Her body didn’t expel the entirety of their remains, and the result was sepsis, a common consequence of abortion pills." Thurman then went to the hospital, but the hospital, for unexplained reasons, did not treat her sepsis early enough, and Thurman tragically died as a result. The Harris-Walz campaign and its allies in the media have implied that Georgia's abortion law called this. Writes Carney, correctly: "This is false. It is not up for debate. It’s simply false. There is no way to read Georgia’s law and believe that it bars a life-saving D&C of dead post-abortion human remains." Carney goes on: "Why did the hospital wait 20 hours after she arrived to take her to the operating room? That’s the central question in Thurman’s case. Digging deeper suggests the blame for Thurman’s death lies not with pro-life laws but with pro-choice lies." Specifically, Carney goes on to speculate, pro-abortion groups' propaganda has falsely claimed that pro-life laws ban lots of things that they don't ban, including things that aren't abortion, such as removing the remains of dead fetuses from a woman's uterus. Writes Carney, correctly again: "Abortion bans do not ban miscarriage treatment, but the pro-choice commentators want you to believe that, because they want to repeal these laws and legalize the deliberate taking of preborn life." He goes on to conclude: "Did Thurman or her doctors believe, falsely, that Georgia’s law banned a post-abortion D&C? Did Thurman or her doctors believe that a life-saving D&C was illegal in Georgia? That would explain why they didn’t move Thurman to the OR for 20 hours. If their mistake did cause her demise, then it’s not the fault of the Georgia law, which is unambiguous on these questions. It’s the fault of those who lied about abortion law."

#Privacy — Apparently, the IRS is giving access to sensitive taxpayer data to "researchers and student volunteers," reports ATR. What could go wrong?

#VotingRightsFox News: "Arizona Supreme Court rules 98,000 people whose citizenship is unconfirmed can vote in pivotal election"

Chart of the Day

What counts as a "fair" tax system? Some think of it in terms of what percentage of their income the rich (or rather, high-earners, which is not quite the same thing as "the rich") pay. But another way to look at it is how much "the rich" contribute. And on this score, the tax system is plenty "fair." (Via Heritage's Preston Brashers)

Meme of the Day

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