9 Reasons Legal Sports Betting’s Time Has Come in America

9 Reasons US Attitudes on Sports Betting Have Changed

Former New Jersey Gov. Chris Christie launched a 5-year legal challenge to the federal ban on land-based sports betting.

The New York Times published an op-ed article on Friday discussing the change in attitudes among US residents towards sports betting over the past 25 years. Gary Belsky described the shifting opinions on sports gambling as “both an evolution and devolution of attitudes toward the subject”.

Belksy discussed a Gallup/CNN/USA Today poll from 1992, the year the Professional and Amateur Sports Protection Act (PASPA) federal ban on sportsbooks was passed. After a 1-year grace period that allowed states to pass laws which would give them similar exemptions to Nevada, Oregan, Montana, and Delaware, a 46-state ban on sports betting went into effect in 1993.

Over the past 25 years since the PASPA ban became enforceable law, American attitudes have changed towards sports betting. Dan Belsky cited a 2014 poll by YouGov┬áthat showed 52% of US residents now believe gambling is morally acceptable, while 34% have no great opinion on the matter (or say “it depends” on circumstances.

Only 14% of Americans now believe that gambling is immoral and should be banned. The question is why such a significant shift has changed over the intervening years.

From the NY Times article and experiences our writers have noticed that Mr. Belsky might have missed, here are the Top 9 reasons Americans approve of legal gambling in 2018.

1. Sports Athletes’ Salaries

A key argument the US sports leagues used at the time of the PASPA’s passage was the integrity of the sports was involved. The NFL and Major League Baseball argued that game-fixing scandals like the 1919 Black Sox Scandal or the late-1980s Pete Rose scandal undermined the public’s belief in the integrity of games’ outcomes.

That’s why the PASPA is the “sports protection act“, because the US leagues argued their sports would be undermined in the view of the public if legal sports bets were allowed. Players would be tempted by match-fixers or point-shavers to fix games.

The escalation of athletes salaries over the past generation makes match-fixing much less likely. When Tom Brady or Bryce Harper signed $100 million+ contracts, they have a lot to lose and less to gain in fixing a match. When even rookies make $500,000 and lower-tiered veterans make $1 million salaries, fixing games is beyond sports bettors’ ability to fix. Belsky noted that lower-tiered tennis, soccer, and cricket players are the face of match fixing these days.

2. Office Betting Pools

The proliferation of betting has a key role. Americans have gambling all around them, even if it’s usually small-time and harmless. 50 million Americans or 25% of adult Americans take part in March Madness betting pools or Super Bowl Squares every year.

March Madness brackets are done through their workplace usually. Authorities generally look the other way, because it is for low stakes. Occasionally, a huge betting pool get busted, but when a huge number of everyday people are doing something, it’s next to impossible to clamp down on the activity.

3. Tribal Casinos

Proliferation has taken many forms. Tribal casinos have had an indirect effect on the debate. In 1986, a California tribe’s lawsuit to gain the right to build a casino based on a reservation due to the federally-recognized sovereignty of Native American tribal grounds reached the US Supreme Court. In Cabazon Tribe v. California, the US Supreme Court ruled tribal lands are sovereign territory, because they signed treaties with the US federal government long ago.

That led to the 1988 Indian Gaming Regulation Act, signed by President Ronald Reagan, which opened the door to tribal gambling. Now, over 400 tribal casinos exist in 28 US states. Most Americans live within 100 miles of a land-based casino now. US residents see the impact in their communities and are, by and large, okay with it.

In fact, enough states have gotten comfortable with tribal casinos that commercial casinos operators now have businesses in US states — often in Middle America. Kansas, Iowa, Louisiana, and Indiana are just a few examples.

4. Multi-State Lottery Associations

The Powerball and Mega Millions multi-state lottery associations are another form of gambling proliferation. When the PASPA was signed into law, only 14 US states and Washington DC were members of the Powerball association. Mega Millions did not exist.

In 2018, 44 US states are members of the Powerball and Mega Millions associations. As more states joined, the prize pools spiraled into the hundreds of millions of dollars. Whenever the Powerball or Mega Million lotteries go for a time without a prize winner, the jackpot grows and it becomes a notable event in the US media.

Millions of Americans flock to the local convenience store to bet on the Powerball or Mega Millions lotteries, hoping to win a life-changing jackpot prize. Americans who would not set foot in a casino buy a lotto ticket.

5. Online Gambling

Online gambling had a tremendous effect on American perceptions towards gambling, too. Before, a person had to leave their home to gamble real money with strangers. (House games certainly existed.) With online poker, casinos, and sportsbooks, players suddenly could bet on all sorts of games in the privacy of their own home.

The convenience and anonymity of online sports betting made it hugely popular. For the first ten years of the Internet, betting at online sportsbooks existed in a legal gray area. Average people stopped using a bookie and started using BetCRIS.

Eventually, the federal government stepped in an banned online sportsbooks in the United States with the Unlawful Internet Gambling Enforcement Act (UIGEA). Any gambling activity which was banned over the interstate telephone lines by the 1961 Wire Act was banned under the UIGEA. In 2011, the US Department of Justice ruled that the UIGEA did not apply to online casinos and poker sites, because no one made poker bets, blackjack bets, or slots bets over the telephone lines in 1961. The ban on online sports betting remained.

6. Mobile Sports Betting

The ban on sports betting had little impact. The UIGEA drove the publicly-traded online bookmaker companies out of the US market. They were replaced by offshore online bookmakers beyond the authority of US agencies. Internet sports betting never went away in America; it went underground.

As the UIGEA went into effect, another form of electronic sports betting made the ban unenforceable: mobile smartphones. Over the past decade, it has become so easy for sports bettors to make wagers through their Android phones and tablet computers, iPhones, and iPads.

Granted, US-based Android and IOS sports bettors do not go to Google Play or the iTunes Apps Store to download sports betting apps. Instead, they go to online sportsbooks, which have their own Android and IOS sports betting apps. Now, everyone with a smartphone can make a bet on tonight’s game anywhere they go all day, every day. With live/in-play betting, they can make multiple bets on tonight’s game. When such gaming is available, banning land-based sportsbooks makes little sense.

7. Fantasy Sports

The other six reasons that the sports betting taboo no longer applies might not have had the impact that fantasy sports has had. In 1976, Art Rooney of the Pittsburgh Steelers argued to the US Congress that NFL football would be undermined, if the average fan was more worried about the outcome of their bet than the outcome of the game itself. In short, sports fandom was at risk with legal sports betting.

The growth in the popularity of fantasy sports has made that argument inapplicable anymore. Every sports fan knows the fantasy sports owner who obsesses about the stats of an NFL team’s slot receiver or backup running back. It does not matter so much if the Dallas Cowboys score against the Philadelphia Eagles. Instead, it is which Cowboys player scores against the Eagles.

Not only has fantasy sports made the idea of putting money on the line for a sporting event more acceptable, but it makes the “undermines traditional fandom” argument obsolete. Sure, sports purist will occasionally decry what fantasy sports does to its participants’ attitudes and motivations — and even fantasy owners get bored hearing someone complain that Julio Jones’ lack of touchdowns is killing their fantasy team. Despite that, a person might as well complain that the automobile replaced the cart-and-buggy, because fantasy sports has changed the way Americans watch sports.

8. Daily Fantasy Sports

Daily fantasy sports has had less of an impact, but it still erodes the resolve of US state legislatures to ban sports betting. DraftKings and FanDuel took a carveout in the UIGEA for fantasy sports and created a whole new industry out of that carveout. DFS sites took a hobby that was built around year-long contests and small-stakes betting among 10 to 12 friends’ league games and turned it into a daily set of contests.

Site members could deposit real money and enter one-day contests with handpicked individual players making up their daily starting lineup. A player might put in $10 on the outcome of the game. $9 would go to the winner of the contest, while $1 was taken by DraftKings or FanDuel to organize the contest and assure fairness (and quick stats). Whether in head-to-head contests, small groups, or huge tournament fields, fantasy sports owners could get a one-day return on their stake.

To the casual observer, it is hard to distinguish daily fantasy sports from sports betting. Yet there it was, with a loophole in the main ban on online sports betting. Even when state attorney generals began to target DFS sites, they lobbies and filed lawsuits and eventually gained recognition from over a dozen US states as a legal form of “gaming” — not “gambling”. It helped that 50 million Americans also play fantasy sports each year — and many of the state lawmakers were fantasy owners themselves.

9. Demographic Shifts

All of this might not matter if the same electorate that existed 25 years ago still was in place. Time changes the population (always) and the Baby Boomer generation’s time as the most important demographic is coming to an end.

For decades, the Baby Boomers were the biggest US demographic and had the most spending power. 75 million people were in the generation that arrived in 1946 and beyond, once US soldiers came home from World War II and began creating new families. They outnumbered their parents, the Greatest Generation, just as they outnumbered Gen X. The 55 million-strong Generation X simply does not have the same voting power, even if they were motivated to do so.

Not so with the millennial generation, which includes 95 million people. This year, the collective spending power of millennials outpaced that of Baby Boomers. As most of the Greatest Generation passed away in the past generation, more and more Baby Boomers are passing away at the same time the millennial generation is coming of age.

New generations mean new attitudes. The younger generation has much different attitudes towards sports gambling than their grandparents, or even their parents in Gen X. Raised while surrounded with technology and gaming culture, they do not see why sports gambling should be banned. Thus, the world has changed and it is time for the US federal government to realize so.

Will SCOTUS Legalize Sports Betting?

That does not mean the US Supreme Court is going to side with New Jersey in its challenge of PASPA. Despite attitude shifts, the Supreme Court consists mainly of Baby Boomers. Ultimately, nine opinions are all the matter, at least for now.