This article appeared on The Hill’s Congress Blog on March 24, 2015.
President Barack Obama’s long-standing willingness to use taxpayer monies to promote favored industries, companies and well-connected political donors has usually been met with opposition from the Republican Party. But for at least a handful of GOP members, their opposition to corporate cronyism appears to be based on partisanship rather than principle. That’s the only conclusion one can draw as hearings begin this week on legislation drafted, pushed and designed to help one of the Republican Party’s most well- heeled political contributors.
When New Jersey, Delaware and Nevada legalized online gaming for their residents, Las Vegas billionaire casino owner Sheldon Adelson promised to “spend whatever it takes” to see those laws overturned. The only gambling he thinks should be legal is that which happens in one of his casinos, and he has amassed an army of lobbyists to see that happens. One of those lobbyists drafted the Restore America’s Wire Act (RAWA), a bill overturning existing state laws legalizing online gaming within their states and prohibiting other states from doing the same. After being delayed earlier this month due to inclement weather, it is scheduled for its first congressional hearing March 25 before the House Judiciary Subcommittee on Crime, Terrorism, Homeland Security, and Investigations.
The Wire Act predates the internet, and so makes no mention anywhere of online gambling. Instead, it prohibits the interstate transmission of gambling-related communications “on any sporting event of contest.” Nevertheless, the Justice Department interpreted the law to prohibit all online gambling until 2011, when they announced from then on that it would only be treated as doing what it actually says – prohibiting transmission of sports wagers and related information.
RAWA’s sponsor, Rep. Jason Chaffetz (R-Utah), argues that the Obama Justice Department overreached in when it reversed course. But the change didn’t come out of nowhere. Leading up to the Department’s 2011 legal memo, the U.S. Fifth Circuit Court of Appeals had already ruled that the Wire Act applies only to sports bettering. But even for those who think that’s a question worth exploring, don’t expect that to happen at the upcoming hearing.
Rather than hold a fair and equal inquisition into the issue, the deck will be stacked with witnesses in favor of the Adelson bill if the planned list from the postponed hearing earlier this month is anything to go by. It included one witness who has argued that the federal government should outlaw all gaming in the states in one fell swoop.
What members of the Committee won’t hear is testimony from opponents of the bill like Michelle Minton of the Competitive Enterprise Institute, who has published a detailed history of the Wire Act demonstrating unequivocally that its intention was only to prohibit sports gambling over state lines.
Perhaps at this point the real question shouldn’t even be whether the Justice Department has the right or wrong interpretation, but why Congressional Republicans would want to go back to the old interpretation at all when it violates so many of their stated principles – like individual liberty, personal responsibility, and adherence to the 10th Amendment. How can Republicans plausibly argue against cronyism for the president’s friends and donors when they are going full bore to assist their own mega-donors even when it runs counter to the core beliefs that they espouse on a routine basis?
If members of Congress want to enact an explicit federal prohibition of online gambling they should be clear about why they believe that is the best policy, instead of pretending they are simply reacting to executive overreach. That would mean explaining to the American people why they think it’s so important to eliminate any potential competition to the business of one of their party’s largest donors.
Chaffetz has on repeated occasions lashed out at opponents of his legislation, including state lottery commissioners, for not coming to Congress to get permission to sell lottery tickets on the Internet, even just to citizens of their own states. The Constitution never envisioned requiring states to come before Washington on bended knee to beg for permission to conduct business within their borders.
The sooner the Republican leadership tells Adelson that the proper forum to overturn state laws he opposes is in state legislatures, the better off they will be. Republicans should fold their cards, cut their losses, shuffle the deck and find a new issue to champion. One that is consistent with the Constitution and their oft stated principles.
