Don't Bet on Online Gambling

 

Headlines aren't supposed to be in the imperative mood, telling readers what to do.  But in this case I think it's appropriate.  Online gambling in many U. S. states has become a multibillion-dollar industry.  While many people can control their gambling, others can't.  And the ones who can't are suffering, along with their families and friends.

 

Full disclosure:  I don't personally gamble, I have little interest in sports, and my state of residence (Texas) does not allow sports gambling, either in person or online.  So mine is definitely an outsider's viewpoint, but perhaps that can make me more objective. 

 

In 1992, the U. S. Congress passed the Professional and Amateur Sports Protection Act (PASPA) which prohibited sports gambling in all U. S. states and territories, with some minor exceptions.  Over the next decade, individual states where gambling was popular, notably New Jersey, mounted legal challenges to the act, and in 2018 the Supreme Court ruled that it was an unconstitutional violation of states' rights, citing the Tenth Amendment to the Constitution. 

 

This opened the door for individual states to allow sports gambling, and so far about half of them have in one form or another. 

 

In the time PASPA was in force, the United Kingdom legalized sports betting and became one of the early hotspots for online gambling with the advent of smart phones.  According to an article in the Financial Times, in recent years a spate of bad publicity and suicides related to gambling addiction has led to a crackdown on online gambling.  Since 2017, UK online gambling organizations have paid fines of about $240 million in fines to that country's gambling regulatory agency.

 

Like any addiction, online gambling is easy to fall into and hard to escape the clutches of.  The Financial Times article tells the story of 22-year-old Dylan, a New Jersey lawyer in training who recently confessed to his family that he had spent over $50,000 in mostly online bets.  He is currently attending Gamblers Anonymous and hopes to free himself from his addiction, but unless he divests himself of his cellphone and stays away from computers, the means to resume it will always be literally at hand.

Ethically speaking, gambling is an activity in which one person—the gambler—risks something of value, and another person or entity, which we will call "the house" profits from the gambler's risks, on average over time.  Gambling is distinguished from stealing because presumably, the gambler receives something of value from the activity.  And unlike armed robbery, whose victims generally have no choice in the matter, nobody is obliged to gamble.  In this regard, a libertarian would in principle oppose any attempts to regulate gambling, saying that unless some third party is harmed by the transaction, the gambler and the house should be left alone.

 

There is also the argument that casinos and other forms of gambling benefit certain communities.  This was the idea behind allowing certain Indian tribes to run casinos in the U. S.  While nobody can deny that such things make money, I can't shake an uneasy feeling that basing a particular cultural group's economic viability on such a foundation is not in the best interests of the group, or their customers either, for that matter.

 

And gambling doesn't take money from all socioeconomic groups equally, either.  Many studies have shown that gambling revenues are regressive, in the sense that most of the money comes from the poorer segments of the population—those who can least afford it, in other words.  The libertarian would come along and say, "Well, if those folks choose to spend their money that way, it's their choice, and who are you to interfere?" 

 

One way to look at an economic activity is to ask what would happen if a whole lot of people tried to make money that way.  I'm not a trained economist, but it's worth a try, anyway.  Clearly, gambling is a parasite on any economy worthy of the name.  If everybody tried to make money by gambling, no one would have any time left to do anything productive.  The economy would devolve into the equivalent of prisoners playing pinochle for toothpicks.  It might pass the time, but it's not going to put food in anyone's mouth or make anything useful.

 

Granted, we are not in imminent danger of turning into a nation of 24-hour gamblers.  But online gambling is particularly pernicious because it produces a complete geographic separation between the gambler and where his or her money ultimately ends up.  In a friendly office football pool, you at least know the people who end up with your money if you lose.  Betting on your football team online may enrich some executives in the Cayman Islands, but it's a net loss to your neighborhood. 

 

Of course, many states (including Texas) run lotteries, which is a sort of gambling monopoly exercised by the state involved.  And because I teach at a state university, some portion of my paycheck could probably be traced to revenues from the state lottery.  I wish it were otherwise, because I disapprove of gambling in general, but not so much that I'm going to quit my job over it.  This is really just an example of how an industry can co-opt government into benefiting from its operations, even if on balance those operations are harmful to the public.

 

It's interesting that Richard Daynard, who is a professor of law at Northeastern University, is now looking into filing a class-action lawsuit against online gambling outfits, claiming that their advertisements are misleading and that they encourage problem gamblers to go deeper into their addiction.  The online betting industry had better pay attention to what Prof. Daynard is doing, because he was one of the prime movers behind the giant settlement with the tobacco industry that took $200 billion out of their collective hides for deceptive advertising.  After that lawsuit, you didn't see any more ads with doctors in white coats saying how healthy X cigarette was for you.  So if you're invested in online gambling, you might try to find some other way to make money—or lose it.

 

Sources:  The Financial Times article "The Dark Side of the U. S. Sports Betting Boom" by Oliver Barnes appeared on Aug. 9, 2023 at https://www.ft.com/content/2e1a235a-8a46-47f3-b040-5ca21a04ebf4.  I also referred to Wikipedia's article on PASPA.

 

Is Twitter a Wholly Owned Subsidiary of the FBI?

 

When Elon Musk took over Twitter last October, he made available to reporters a large number of internal company emails relating to content moderation, deplatforming, and other interventions that the firm has done at the request of, or under the influence of, the U. S. government.  Like most people, I was dimly aware of these revelations, but the news coverage of them was intermittent and depended greatly on the political orientation of the media outlet reporting it.  And I'm sure that remains the case today.

 

But recently I came across one report that summarizes the facts in a chilling and alarming way.  If what this report says is true, we indeed have a major problem that involves not only electronic social media, but the government and fundamental constitutional issues. 

 

In all such cases, one should consider the source.  The source of this report is John Daniel Davidson, a senior editor at The Federalist, a conservative website which Wikipedia says has carried false and misleading information at times.  The particular report I refer to did not appear in that website, but in a newsletter called Imprimis issued by Hillsdale College, a private college that is one of the few serious colleges in the U. S. that refuses to take federal funds on principle.  Adapted from a talk Davidson gave at the college, the report is entitled "The Twitter Files Reveal an Existential Threat."

 

Davidson details three examples of how the FBI, working both on its own behalf and as a liaison between a number of other federal agencies and Twitter, directed the firm to flag, suppress, or suspend numerous accounts such as those of the New York Post, whose offense was to break the news of the Hunter Biden laptop; President Trump, whose suspension after the January 6, 2021 Capitol riot was sui generis in its disregard for internal suspension policies; and during the COVID-19 epidemic, in which Twitter was asked to, and did, squelch information that did not follow the official line on the pandemic that prevailed at the time.

 

The main point of Davidson's article is summed up in these words toward the end of the piece:  ". . . the entire concept of 'content moderation' is a euphemism for censorship by social media companies that falsely claim to be neutral and unbiased."  Davidson presents evidence that in 2017, Twitter publicly announced that all content moderation took place "at [Twitter's] sole discretion," but internally, they would censor anything that "U. S. intelligence identified as a state-sponsored entity conducting cyber-operations," whether the intelligence community was right or not.  As later events proved, the suspected Russian influence on U. S. elections was largely a smokescreen for allowing the federal government to suppress a wide variety of actors, most of which were not sponsored by any state, in direct violation of the First Amendment.

 

Currently, the U. S. Supreme Court is considering two cases that involve Section 230 of the Communications Decency Act.  The basic thrust of the section is to allow social-media companies to claim immunity from prosecution regarding material posted on their sites by third parties—namely, anybody but the company itself.  It also exempts the companies from lawsuits involving content moderation as long as the company can show such moderation was a good-faith effort to remove "objectionable" material. 

 

This law was passed in the very early days of social media, when it was not at all clear that internet-based systems such as Facebook and Twitter would ever make money.  Those days are long gone, and the pipsqueak upstarts of the 1990s have become the 900-pound gorillas of the 2020s. 

 

Far from being a minor sideshow in the ways the public learns what their elected officials and the rest of the government are up to, Twitter is arguably the primary source of breaking news from officialdom, equivalent to the Associated Press wire service of the long-ago day when news really traveled mainly over copper wires to teletype machines.  As publishers, the newspapers, radio, and TV outlets of yore (yore being anytime before about 1980) knew that they were legally responsible for what they printed or broadcast, and made careful distinctions between what was news and what was analysis or opinion.  They had the freedom to print what they wanted to print, courtesy of the First Amendment, which prohibits the federal government from "abridging the freedom of speech, or of the press."  But they also had the responsibility of standing behind what they printed as facts, and so they stressed fact-checking and accuracy, plus an effort to present all the significant news and suppress none of it, no matter how far it strayed from the newspaper's own political position.

 

Granted, this was an ideal that was only approached in practice.  But if you transpose what Twitter has done in the last few years to the register of how news was produced in, say, 1970, the results can be shocking.

 

Suppose the 1970s Watergate break-in, Deep Throat's revelations, and the secretly recorded Nixon White House tapes had been systematically expunged from all newspaper, radio, and TV coverage through the intervention of the FBI, saying that it was all a plot by the Russians?  After Nixon told the news media that they wouldn't have him to kick around anymore following his 1962 loss to Pat Brown in the California governor's race, suppose all the networks agreed to ban him from ever appearing on radio or television again, again at the behest of the federal government? 

 

I am no fan of Richard Nixon.  But my point is that none of these acts of censorship happened back then, because the reigning media companies kept their distance from the government, no matter who was running it.

 

Needless to say, the situation is different now.  Davidson's summary of the Twitter Files is an indictment of the hand-in-glove way that the federal government, using the channel of the FBI, has succeeded in manipulating the media landscape to suit its purposes, and not the best interests of the American people at large.  It is far past time to restore a responsible distance between social media and the government, but doing that will require a well-informed public, and the media we have may not be up to the job.

 

Sources:  John Daniel Davidson's article "The Twitter Files Reveal an Existential Threat" appeared in Vol. 62, No. 1 (Jan. 2023) of Imprimis, a publication of Hillsdale College.  I also referred to a report on the Supreme Court Section 230 cases at https://www.cnbc.com/2023/02/21/supreme-court-justices-in-google-case-hesitate-to-upend-section-230.html and Wikipedia articles on The Federalist and Richard Nixon's November 1962 news conference.