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House Proposes Legalizing, Taxing Online Gambling

Soulskill posted more than 4 years ago | from the twenty-bucks-says-it-gets-shot-down dept.

Democrats 473

eldavojohn writes "Passed in 2006, the Unlawful Internet Gambling Enforcement Act is set to go into effect June 1. New efforts by Democrats in the House of Representatives aim not only to stop that but to legalize and tax Internet gambling. Jim McDermott (D-WA), said, 'This is a huge boon to the state governments. If you look across the country you're seeing programs cut. In Arizona, they just cut out a program for children's health for 40,000 kids. Here's a source of money.' Basically, the bill proposes that for each state, a 6% cut would be taken from all wagers and go to the state in which the bet was made online, while federal would get 2%. They estimate in the next decade this would amount to $30 billion for state and tribal governments and $42 billion for the federal government in new taxes. Banks and casinos appear to be very much on board, while the usual crowd (Republicans, Focus on the Family, Think of the Children) gathered in opposition to the move."

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473 comments

Tendency to agree... (4, Interesting)

ls671 (1122017) | more than 4 years ago | (#31986672)

I have a tendency to agree. Despite the social problems gambling brings. Just like alcohol, it seems better to tax it instead of watching the profits go somewhere else.

Oh yeah? (5, Funny)

Anonymous Coward | more than 4 years ago | (#31986702)

Ten bucks says you're wrong, sucka!

Re:Oh yeah? (3, Funny)

wjousts (1529427) | more than 4 years ago | (#31986778)

Hey, I want $0.60 of that in tax.

Re:Tendency to agree... (3, Interesting)

2obvious4u (871996) | more than 4 years ago | (#31986746)

I agree too, I would rather pay for freedom than either not have it or have to fight for it.

Re:Tendency to agree... (2, Insightful)

commodore64_love (1445365) | more than 4 years ago | (#31987076)

I object to gambling for the same reason I object to handing a beer to an alcoholic. It's enabling their disease and you are the pimp.

If a private person wants to run gambling halls, that's fine with me, but the government should take a higher moral stance. The government should not be running Lotteries to prey upon gambling addicts. I've seen a lot of lives destroyed via their addiction to the State Lotto. Instead the government should be providing assistance to these people to help them stop (as we do with anti-drink and drive campaigns).

Re:Tendency to agree... (1, Insightful)

srussia (884021) | more than 4 years ago | (#31987264)

I've seen a lot of lives destroyed via their addiction to the State Lotto. Instead the government should be providing assistance to these people to help them stop (as we do with anti-drink and drive campaigns).

Yeah, I've seen a lot of lives destroyed too via addiction to government handouts ^W^W state welfare. The government should be providing assistance to these... oh wait...

Re:Tendency to agree... (2, Insightful)

Wyatt Earp (1029) | more than 4 years ago | (#31987282)

The addicts will gamble, with this the states and federal government will get monies to help deal with addiction.

Re:Tendency to agree... (4, Interesting)

flitty (981864) | more than 4 years ago | (#31986826)

Agreed. Opening such activities to sunlight allows for better regulation and restrictions.

Re:Tendency to agree... (1)

cayenne8 (626475) | more than 4 years ago | (#31986894)

"Agreed. Opening such activities to sunlight allows for better regulation and restrictions."

Now...to start figuring out how to set up a gambling server to run from home!!

I'll happily pay the taxes....

Maybe some type of weekly lottery would be an easy program to put together!!

Re:Tendency to agree... (2, Interesting)

CyberBill (526285) | more than 4 years ago | (#31986892)

Agree. People are already playing online poker. It is better to have our government reap the tax benefits and for the profits to go to a US-based casino rather than just shipping the money outside of the country.

Re:Tendency to agree... (4, Interesting)

martas (1439879) | more than 4 years ago | (#31987070)

totally. next up, weed *fingers crossed*

Re:Tendency to agree... (1, Funny)

Anonymous Coward | more than 4 years ago | (#31987232)

but first, lets call Domino's and get some Doritos...I'm starving!

Re:Tendency to agree... (2, Interesting)

twoallbeefpatties (615632) | more than 4 years ago | (#31987280)

California is looking at a big budget deficit and is starting to wonder if taxed marijuana wouldn't be a fair tradeoff. You might not have to cross your fingers for too long if people start getting motivated enough.

TROLL (-1, Troll)

Anonymous Coward | more than 4 years ago | (#31986674)

LOL!

EVERYBODY (-1, Troll)

Anonymous Coward | more than 4 years ago | (#31986740)

GET IN HERE [slashdot.org]

what a great idea (4, Insightful)

Presto Vivace (882157) | more than 4 years ago | (#31986694)

what better way to fund state governments than predating upon the weaknesses of your citizens.

Re:what a great idea (4, Insightful)

DarkKnightRadick (268025) | more than 4 years ago | (#31986750)

Don't they already do that?

you mean the state lotteries? (1)

Presto Vivace (882157) | more than 4 years ago | (#31986922)

yes, they are doing it, but this further measure would just compound the harm.

Re:you mean the state lotteries? (1)

EdZ (755139) | more than 4 years ago | (#31987042)

Really? Here in the UK, online gambling is perfectly A-OK (we even have a national lottery, with justuner 1/3 of the proceeds going to charity). We have one 'mega casino', and everyone makes fun of it. The US has no legalised gambling. And a whole CITY dedicated to hundreds casinos that dwarf the UK's one 'mega' casino.
Seems to me that online gambling is the least of people's worries.

Re:you mean the state lotteries? (1)

BobMcD (601576) | more than 4 years ago | (#31987102)

We have one 'mega casino', and everyone makes fun of it. The US has no legalised gambling. And a whole CITY dedicated to hundreds casinos that dwarf the UK's one 'mega' casino.

Seems to me that online gambling is the least of people's worries.

Is it at all possible that the online gambling is displacing the desire for in-person gambling?

Re:what a great idea (3, Insightful)

i kan reed (749298) | more than 4 years ago | (#31986808)

I know. But its so much worse of an idea than forbidding citizens from doing something they enjoy or care about, sending some to jail for such excellent reasons as otherwise they might be poorer, driving the behavior underground where the poor saps can be robbed with no recourse, and then not get any taxes from it at all. That would be not nearly as bad.
Your point is so excellent.

Re:what a great idea (5, Insightful)

vxice (1690200) | more than 4 years ago | (#31987072)

I do wish people would stop using the taxation argument about legalizing it. If the only reason to legalize an activity is to tax it then it really shouldn't be legal anyways. Take for example murder, lets legalize it and tax it right? No. There are good reasons it is illegal. In the case of gambling there is no good reason for it to be illegal unless you're a pompous religious prick out to save everyones soul, that's the reason enough it should be legal and arguing about the taxation is just opening yourself to abuse by the gov't. Look at alcohol, the gov't taxes the hell out of it because it was illegal and they did us the favor of legalizing it for the taxes. They took something from us that they had no grounds to and then charged us to get it back. It will be the same with this or marijuana. We will all be so glad that the gov't has given us back a privilege they stole from us that we will accept their higher taxation.

Re:what a great idea (2, Insightful)

commodore64_love (1445365) | more than 4 years ago | (#31987128)

The government doesn't have to outlaw gambling. It just needs to stop being the Pimp (i.e. stop selling Lotto tickets). The ends (funding programs) don't justify the means (sucking money from addicts). It's immoral.

Re:what a great idea (0)

Anonymous Coward | more than 4 years ago | (#31986992)

If only I didn't have to eat. Damn government stealing all my money.

Weakness? (1)

AnonymousClown (1788472) | more than 4 years ago | (#31986994)

what better way to fund state governments than predating upon the weaknesses of your citizens.

What makes gambling a weakness? I don't gamble because I don't find it fun but a lot of folks do.

And considering recent events on Wall Street, gambling houses actually give you a fairer deal.

Re:what a great idea (2, Interesting)

Locke2005 (849178) | more than 4 years ago | (#31987188)

The big money is all in gambling, prostitution and drugs... 1 down, 2 to go!

But seriously, when a voluntary activity adversely affect society, criminalizing it won't stop the harm. The best way to provide funding to ameliorate the harm caused is to tax the hell out of it, which has the side effect of also discouraging it.

Re:what a great idea (1)

v1 (525388) | more than 4 years ago | (#31987292)

what better way to fund state governments than predating upon the weaknesses of your citizens.

and how does this differ than the state run lotteries or state licensed bars? those are proving to be a tremendous source of state income, and because they're out in the open, subject to close public and legal scrutiny, their ratio of problems-solved to problems-created is very positive.

Too many people seem to think that 100% of gambling is bad. It's like alcohol. Too much of anything is bad. In the end, gambling is going to go the way of prohibition, for exactly the same reasons.

At least keep the money in your state/country. Use some of it to help the people that have a problem with it, and use the rest of it to benefit everyone. Right now, anyone that WANTS to gamble online can, and 100% of that money gets on a plane and leaves the country. Legalizing it isn't going to make it any easier for those with gambling problems to gamble. But it IS going to pipe some of that money into local help for those people, AND keep the rest of the money in the neighborhood.

Can someone explain to me .. (5, Interesting)

lcoscare (1121345) | more than 4 years ago | (#31986724)

why "Republicans" are against this?? Aren't they supposed to be in favor of small goverment and fewer regulations? This is exactly why the tea parties are becoming so big, we should be able to do what we want with our own money in a free society, as long as it doesn't harm anyone else. To paraphrase Thomas Jefferson Who cares? "It neither picks my pocket nor breaks my leg."

Re:Can someone explain to me .. (3, Insightful)

DarkKnightRadick (268025) | more than 4 years ago | (#31986772)

Unfortunately gambling effects everyone the person knows. It affects the families of gamblers as they resort to lying, stealing, and other means of getting money so they can continue to gamble. It interferes with work.

Yes, there are those who aren't compulsive gamblers and can put it aside any time they want. But for those who can't, this is a bad thing.

Re:Can someone explain to me .. (5, Insightful)

lcoscare (1121345) | more than 4 years ago | (#31986874)

I guess it's much better to outlaw it and make these compulsive gamblers go underground, likley run by organized crime. And prohibition has worked out fantastically well every time it's been tried in the US. Look at how much safer we are thanks to the war on drugs, compared to say Holland or Canada.

Re:Can someone explain to me .. (5, Insightful)

jfengel (409917) | more than 4 years ago | (#31986880)

You'd think that it would come under the auspices of the "personal responsibility" the Republicans are so keen to chant about. Except when it's something they're opposed to, in which case "personal responsibility" is apparently insufficient.

Re:Can someone explain to me .. (2, Insightful)

Notquitecajun (1073646) | more than 4 years ago | (#31987094)

The problem with gambling is the number of people who AREN'T personally responsible. A few too many people gamble with money they "can't afford to lose," and the rest of us have to pay through our tax dollars for their mistakes.

I'm not against gambling per se, but it's one of things like drug use - the rest of us pay for the screwups.

Re:Can someone explain to me .. (5, Insightful)

flitty (981864) | more than 4 years ago | (#31986914)

It affects the families of gamblers as they resort to lying, stealing, and other means of getting money so they can continue to gamble. It interferes with work.

1. Lying isn't inherently bad on its own.
2. There are laws against stealing already.
3. "other means of getting money", if they aren't illegal, are a problem how?
4. "It interferes with work", and they get fired. this doesn't affect me anymore than the guy who shows up drunk. In fact, it affects me less-so, considering the drunk guy could get me killed/injured.

There are laws to take care of the effects of gambling addiction. The addiction itself should not be outlawed.

Re:Can someone explain to me .. (1)

Notquitecajun (1073646) | more than 4 years ago | (#31987032)

Lying *not* inherently bad? According to what standard?

I understand the whole thing that House MD spouts off about "everybody lies," it doesn't mean that it's ever the right thing to do - it just shows how screwed up humanity is.

Re:Can someone explain to me .. (4, Insightful)

flitty (981864) | more than 4 years ago | (#31987166)

If you can't think of a lie that was less harmful than the truth, you're only lying to yourself.

Re:Can someone explain to me .. (1)

Notquitecajun (1073646) | more than 4 years ago | (#31987246)

I'm not saying that doesn't occur. It just doesn't disprove my point.

You appear to be equating harmful with evil, which isn't always necessarily the case, either. More evil is done because we don't want to hurt someone than otherwise.

Re:Can someone explain to me .. (0)

Anonymous Coward | more than 4 years ago | (#31987240)

the act of lying can be good or bad, therefore its inherently neither. its what you lie about and the intention that makes it good or bad. it has nothing to do with House at all.

Re:Can someone explain to me .. (0)

Anonymous Coward | more than 4 years ago | (#31987262)

Lying *not* inherently bad? According to what standard?

"A sweater for Christmas? Thank you Grandma, I love it."

I would say lies are bad when people are harmed. For instance, lying to get something at the expense of others.

If you lie and no one is harmed, how is it bad? For instance, lying to preserve someone's feelings or just out of common courtesy.

For what reasons is lying inherently bad? According to what standards?

Re:Can someone explain to me .. (4, Insightful)

ndogg (158021) | more than 4 years ago | (#31986984)

Unfortunately alcohol effects everyone the person knows. It affects the families of alcoholics as they resort to lying, stealing, and other means of getting money so they can continue to drink. It interferes with work.

Yes, there are those who aren't alcoholics and can put it aside any time they want. But for those who can't, this is a bad thing.

Are you really making that argument? History tells us that the best way to mitigate the consequences of such behavior is not to ban it completely (and thus creating unregulated black markets), but rather to legalize it, and regulate it so that it's under the purview of the law.

Re:Can someone explain to me .. (0)

Anonymous Coward | more than 4 years ago | (#31987082)

Spend 50% of the taxes raised on gambling for education and psychological care. That way you get
1. to control gambling, instead of driving it underground
2. have gambling pay for helping compulsive gamblers
3. allow compulsive gamblers to make use of such programs without making sure everyone knows they're doing something illegal
4. have some money around for other purposes

Re:Can someone explain to me .. (1)

AshtangiMan (684031) | more than 4 years ago | (#31987196)

Gambling doesn't affect the families of the gamblers. Lying and stealing do. What you are trying to show is that gambling leads to lying and stealing. This could be true for a subset of people, but I would contend that people like that are predisposed to lying and stealing and will end up doing so regardless (similar to any addictive personality). It is beyond the scope of government at any level to regulate down to that level, as it then will necessarily impede the rights of all.

Re:Can someone explain to me .. (0)

Anonymous Coward | more than 4 years ago | (#31987290)

All of those same points could be use for alcohol and alcoholism, and yet it is legal.

Re:Can someone explain to me .. (5, Insightful)

EvanED (569694) | more than 4 years ago | (#31986868)

...why "Republicans" are against this?? Aren't they supposed to be in favor of small goverment and fewer regulations?

Only if you believe the crap they've been spewing out. The GOP is as much big-government as Democrats are, just in slightly different ways.

Re:Can someone explain to me .. (1)

jfengel (409917) | more than 4 years ago | (#31986940)

In theory, the Tea Partiers aren't in the thrall of the Christian Right as the rest of the Republican party is. They want lower taxes and are willing to cut services to do it. (Unsurprising, as they are on average wealthier than your average American, and so don't need the services they want to see cut.)

In practice, the Tea Partiers will oppose it on tax grounds, and hope nobody notices that it's precisely what the Christian Right wants.

Re:Can someone explain to me .. (0, Troll)

bolthole (122186) | more than 4 years ago | (#31987312)

In practice, the Tea Partiers will oppose it on tax grounds, and hope nobody notices that it's precisely what the Christian Right wants.

Oh dear.. well, we couldnt have THAT, could we? we couldnt vote for ANYTHING that "the Christian Right" wants, now could we?

I hear that those right wing nutjobs are against rape. The NERVE of those people! We clearly have to fight against Christian Morality Bigots, and legalize that sort of thing.

What? they're against theft too???

DONT DENY ME MY RIGHT TO "pursue happiness" by by personal choice of acquisition style, you bible bashing nutjobs!

Re:Can someone explain to me .. (4, Insightful)

gujo-odori (473191) | more than 4 years ago | (#31986958)

Not all Republicans. Granted, I'm a nominal Republican but really more of a Libertarian, but still, not all Republicans.

There are some who trot out an argument reminiscent of "Think of the children!" (I have three, thanks, and I should imagine that by the time they're old enough to set foot in a casino they'll already be decent poker players, if they're interested) that is basically that "Since some people will gamble uncontrollably, we have to make online gambling illegal for everyone." Never mind that most people in the U.S live not far from a legal bricks-n-mortar casino, and bookies aren't exactly hard to find, either. Or that it's quite easy to ruin your life through excessive use of alcohol or tobacco, yet those remain legal.

Just because some small percentage of the population cannot restrain itself for whatever reason(s), I just can't see that as a reason to ban it for the rest. Heck, some people drive their cars in extremely irresponsible ways and cause others to be killed or maimed for life, but we don't see any (rational) people calling for cars to be made illegal because of that.

Re:Can someone explain to me .. (1)

BobMcD (601576) | more than 4 years ago | (#31987204)

Just because some small percentage of the population cannot restrain itself for whatever reason(s), I just can't see that as a reason to ban it for the rest. Heck, some people drive their cars in extremely irresponsible ways and cause others to be killed or maimed for life, but we don't see any (rational) people calling for cars to be made illegal because of that.

I'm conflicted. On the one hand, we agree. On the other, this analogy is so bad that I really have to argue with it:

Gambling is available, much in the same way as operating vehicles at reckless speeds is: At heavily regulated, specialized venues for it.

What the analogy dictates is removing the speed limits on highways, because occasionally people speed.

Doesn't track, logic-wise, when we have a perfectly-workable solution with sufficient barriers to keep all but the most painfully addicted people from falling victim to it.

Outside of what we're already doing, however, I say we should go ahead and allow it.

Re:Can someone explain to me .. (1)

Attila Dimedici (1036002) | more than 4 years ago | (#31987034)

Republicans are against this because this about getting more money from the people. How exactly is this suggestion "fewer regulations" as far as I can see it is just different regulations. Of course, it will also be set up in such a way so as to make it harder for new people to enter the business, thus protecting the entrenched interests.

Re:Can someone explain to me .. (4, Insightful)

ravenspear (756059) | more than 4 years ago | (#31987162)

we should be able to do what we want

Republicans are for that only if it doesn't conflict with their religious morals. That means if you like to gamble, if you like to look at pr0n, if you like to use colorful language, if you are gay, or if you like to something on Sunday morning that doesn't involve going to church, well then you are SOL.

Re:Can someone explain to me .. (0)

Anonymous Coward | more than 4 years ago | (#31987236)

Mr. Jefferson would never support this; he was a libertarian who opposed the Treasury Department.

Re:Can someone explain to me .. (1)

phantomfive (622387) | more than 4 years ago | (#31987252)

I don't know why Republicans are opposed to this (special interests or something like that, I'm sure), but I do know in some cases gambling can be bad. I lived in one place where the residents generally were obsessed with gambling. Their favorite vacation spot was Las Vegas. Also, they were not very good at it. If gambling had become legal in that place wholesale before the residents got a chance to get used to *not* losing all their money in the excitement, there would have been very serious social problems.

I am in favor of liberalization of that kind of thing, but I recognize practically speaking you have to be careful how it is done.

Re:Can someone explain to me .. (1)

uvajed_ekil (914487) | more than 4 years ago | (#31987270)

why "Republicans" are against this??

They're against regulation and big government, unless their own monetary interests are at risk. We're talking about casino owners and big shots, who are greatly threatened by competition. We saw evidence of this recently in Ohio where casino gambling was legalized by way of a constitutional amendment. Casino owners in other states (Republicans) were among the bigger donors to proxy organizations who fought the legalization. It makes sense: once three or four casinos are built, in all corners of the state, Casinos such as those in West Virginia, Pennyslvania,and Indiana should take a huge hit, since a large proportion of their victims, I mean customers, are from Ohio. Legal online gambling would do much the same thing, but across the country. The only experience can not replicate the thrill of winning big in an actual casino environment, but how many people are really going to make a big, expensive trip to a "resort" in Cleveland?

True conservatives (i.e. Republicans) are also against gambling (or at least expanding it) for philosophical reasons. This conflicts with the desire to limit regulation, but it stems from traditional conservative beliefs. Gambling is considered a dirty vice, much like drinking and prostitution, to some. This could be seen like putting a bar or liquor store on every corner (which we practically have in Ohio already) - a little bit of existing gambling or drinking can be dealt with, but we don't want or need more of it.

Personally, I have mixed feelings. Further legalization of gambling does not appear to have any merits other than tax revenue, and the people that do it the most are too often those who can least afford it. But online gambling already exists, albeit in a shadier fashion than legalization would allow, and who should the current casino operators and state lotteries have total control? Would any new companies benefit, or would casino whores just shift their focus? There's no truly good answer to any of this.

How? (3, Insightful)

oodaloop (1229816) | more than 4 years ago | (#31986738)

Given that many of the current online gambling sites are run anonymously by organized criminal networks outside the US, how would collection or enforcement work? Would gamblers be obliged to write how much they won on their annual tax returns, like we're supposed to note purchases made online?

Re:How? (3, Insightful)

drummerboybac (1003077) | more than 4 years ago | (#31986762)

More likely, the international ones would still be illegailized and the commercial casino interests in the US(Harrah's, Bally's, Caesar's) would open legitimate front ends.

Re:How? (1)

AnonymousClown (1788472) | more than 4 years ago | (#31987050)

And the reason why current sites are "criminal" is just that they have to operate off shore. Meaning, they may be criminals but that doesn't mean they're not ethical. Kind of like the pot growers and consumers ...

Re:How? (5, Informative)

Anonymous Coward | more than 4 years ago | (#31986924)

Given that many of the current online gambling sites are run anonymously by organized criminal networks outside the US, how would collection or enforcement work?

Many gambling sites that don't allow Americans are taxed and regulated in Europe. Some (such as PartyGaming) are traded on the London Stock Exchange. It's better for business if they are legitimate...they won't even hesitate to follow all the regulations.

Would gamblers be obliged to write how much they won on their annual tax returns, like we're supposed to note purchases made online?

My guess is if you win/lose more than a certain amount, the gambling site will send a form to the IRS and to you at the end of the year detailing how much money you won/lost. This is what the brick and mortar casinos do in the U.S.

Re:How? (1, Interesting)

Skuld-Chan (302449) | more than 4 years ago | (#31987010)

Its like I had a friend who was a missionary in Italy - he said the church would only rent from people who had paid all the taxes on property so nothing was illegal (and other necessary paperwork). He quickly found that the only people who did this were members of organized crime families.

Which worked well in some regards - people didn't park in front of there place, it was really well kept etc.

Re:How? (4, Informative)

kramerd (1227006) | more than 4 years ago | (#31987306)

Its more likely that in order to be legal, these would have to be US based gambling sites. You would receive tax documentation showing losses and gains on an individual basis. You might even have to prove your identity (scan your driver's license/passport) just to be allowed to gamble.

From a gambler's perspective, most money lines are already in favor of the house. An even money bet (like the point spread bet or the under/over )might get you -103 to -112, depending on the place. While the payouts are even money, the odds of winning are not, and the house makes a profit by trying to get roughly equal amounts of betting on each possible outcome (adjusting the line as necessary). Professional gamblers are able to tell when the line is favorable to a specific bet. Adding a (6% state + 2% federal) tax on wagers (even though winnings would also be taxed as income whether you remove the winnings from your account or not) means that if you bet $110 on an even money proposition and are in the 25% tax bracket, your after tax winnings are only $69. In order to break even this way, you would have to win these propositions 61.5% of the time. The best gamblers win about that much, because the line is distinguished by people who bet on who they want to win, not on who is likely to win. Gambling sites are fantastic at finding where to draw the line to get the most action, but professional gamblers are not going to play just to break even.

As the summary notes, it would end up being a source of money, just not for those participating.

Not a tax on wagers... (2, Informative)

Anonymous Coward | more than 4 years ago | (#31986742)

It's a tax on deposits made into an online casino. Huge difference.

Not going to fix the problem (4, Insightful)

Maxo-Texas (864189) | more than 4 years ago | (#31986756)

a) Instead of showing ANY fiscal restraint, the governments kept expanding to take advantage of the property tax bubble.
b) low interest rates pushed forward a lot of activity in the home building market, creating a lot of jobs which will not be replaced.
c) the executive class, whose pay has increased from 50x average to 450x average is actively shipping jobs overseas (to the tune of thousands).
d) the long term trend is wages will stagnate or drop towards those in BRIC. (brazil, russia, india, china). This means the value of houses, etc. will drop because people will have a smaller amount of money for paying for property. Smaller incomes also mean smaller taxes for the governments.

So the long term trend is lower property taxes, lower property values, fewer jobs, lower paying jobs.

The governments are going to absolutely hate it, but they are going to have to cut a lot of programs outside of welfare/unemployment benefit programs to prevent social unrest.

People's expectations of living in a 3,000 square foot house are going to have to reset back to 1600 square foot houses (or even the 1100 square foot houses prevalent in the 1950's.

And that's ignoring the scarily fast advances in robotics lately. An entire swath of basic manual jobs are on the verge of going away in a few years.

Re:Not going to fix the problem (3, Insightful)

99BottlesOfBeerInMyF (813746) | more than 4 years ago | (#31986938)

So the executive class is making 100 times what they were and corporations are making more for their investors by getting cheap labor. And the average person gets screwed.

The thing here is, what you describe is not less wealth coming into the US, but the wealth coming into the US being less distributed among the populace. For example, you mention advances in robotics as a minus, but they're actually a productivity plus. They save time and allow for faster, cheaper manufacturing. You assume that profit won't make it's way to normal people.

What generally happens in situations like this is wealth disparity grows, then comes to a head, then there's a revolution. This could be a real revolution that redistributes the wealth by killing the rich, or it can be a social one like the new deal. Executives and the people who own companies are making 100 times more? Tax them 95 times more and redistribute that money back into the populace. Heck, they pay a tiny fraction of what they did in taxes in the 70's, we can sure reverse that and put the money into government programs. In fact, that's a much more likely solution than a populace putting up with greatly decreased standards of living and reduced government programs.

Re:Not going to fix the problem (2, Insightful)

CyprusBlue113 (1294000) | more than 4 years ago | (#31987056)

The solution to revolution is creating a straw man early on before the process really takes hold, then you can control the revolution, even have them believing that you stand for their interests while they continue to vote against their own benefit while fervently attacking any real opposition. There are examples of this throughout history, and even not so historically. I am not going to Godwin my argument, but the basis lies in example there, and several other prominent places.

Re:Not going to fix the problem (1)

eldavojohn (898314) | more than 4 years ago | (#31986998)

Aside from your post being grossly offtopic, I have several questions for you.

a) Instead of showing ANY fiscal restraint, the governments kept expanding to take advantage of the property tax bubble.

Tell me, when was the last time our government showed fiscal restraint and how did that help us? Any times when we had two ongoing wars?

b) low interest rates pushed forward a lot of activity in the home building market, creating a lot of jobs which will not be replaced.

At least where I live this is no longer an issue. The home market is repairing itself. While it might not be permanent, home builders are hardly something to worry about. It'd be equivalent to worrying about the all the poor software developers that lost their jobs during the dot com bust. This is simply a piece of unemployment and when it's restructural unemployment, it's a necessary thing for the market. Can construction workers bail hay? Pick rock? Drive truck? Take up a crappier job when times are tough? You bet they can and will. They're manual laborers but they aren't stupid.

c) the executive class, whose pay has increased from 50x average to 450x average is actively shipping jobs overseas (to the tune of thousands).

[citation desperately needed]

d) the long term trend is wages will stagnate or drop towards those in BRIC. (brazil, russia, india, china). This means the value of houses, etc. will drop because people will have a smaller amount of money for paying for property. Smaller incomes also mean smaller taxes for the governments.

Again, any evidence at all that wages are dropping towards (I laugh at the idea) those in BRIC would be very helpful for your argument here. I also find it funny how point c seems to be presented with no clue that the money will be taxed resulting in 450x taxes for the government (or more with capital gains tax). Instead you focus on the class that we are working to build tax breaks for? Laughable.

And that's ignoring the scarily fast advances in robotics lately. An entire swath of basic manual jobs are on the verge of going away in a few years.

No matter how many robots we make, there's always better jobs for humans. Yes, there may be restructuralizing and yes some people may be able to scream "DEY TUK UR JOBSSS" but trust me, you are far from having to worry about that. Where I come from, the magical thing about farm work is that there's always more of it. Give a farmer a cheaper way to do something and he'll always find more work for you to do or simply acquire more land next year and have the work ready for you. That's why so many seasonal laborers travel as far up as Minnesota from Mexico in the summer. And if you live there, you shouldn't be complaining about that.

Your ridiculous selection of variables and borderline questionable knowledge of economics almost makes me smile but instead this is a harsh reminder that people will twist anything to make it look bad or good ... whatever suits their desires. Reality: the situation is not as bleak as you paint it.

Re:Not going to fix the problem (1)

DeadDecoy (877617) | more than 4 years ago | (#31987126)

I can't really comment on most of your post, but automating labor with robotics is not necessarily a bad thing (unless you fear the coming robotic overlords). That just means we'd be able to produce goods more efficiently at even cheaper costs. Yes, a good chunk of menial jobs goes away, but this ultimately allows people to have more free time to go to school and develop skills which are either creative or too difficult (or expensive to develop) for robots to accomplish. I might agree that outsourcing jobs makes us poorer (locally), but improving efficiency through automation usually does the opposite.

Austerity and higher taxes (1)

AnonymousClown (1788472) | more than 4 years ago | (#31987170)

The governments are going to absolutely hate it, but they are going to have to cut a lot of programs outside of welfare/unemployment benefit programs to prevent social unrest.

For the US, austerity and higher taxes is the only course left to return our Government to sound financial standing, I'm afraid. Or otherwise, we'll end up like Greece - all because of the reason stated in the parent.

Congress and every politician needs to be bitch slapped and the special interest groups that protest when their programs are about to be cut need to get a grip.

Sorry teachers, but let's face it, other countries do a much better job educating their children by spending much less than we do - so it's not a problem of money.

Interesting POV for problems in arizona. (1)

irreverant (1544263) | more than 4 years ago | (#31986760)

I'm from Arizona, and this is some possible good news for arizona children, considering some recent changes placing arizona in a negative light for changes in state legislation.

Re:Interesting POV for problems in arizona. (0, Flamebait)

Attila Dimedici (1036002) | more than 4 years ago | (#31987092)

What changes place Arizona in a negative light? The only thing I have heard about Arizona lately is that they have decided to protect their citizens against illegal aliens, since the federal government won't. Every place I have seen it discussed by regular citizens (as opposed to the special interest groups and hard-core Democrats--most reporters) it has been viewed as a positive.

Shitty idea (0)

Anonymous Coward | more than 4 years ago | (#31986784)

Online gambling is totally un-regulated, and many online poker sites have been caught cheating their customers. If many have been caught, imagine how many do it every day. Online gambling should remain illegal to protect stupid people from their own addiction of giving their money away to unadulterated cheaters.

Re:Shitty idea (1)

ndogg (158021) | more than 4 years ago | (#31987150)

Which is why it should be legalized so that it can be regulated, and the sites that are cheating their customers can be taken down, and customers have a chance to use legit sites that don't cheat their customers (any more than regular gambling, that is).

Oh, and how is that campaign on alcohol prohibition going?

Re:Shitty idea (1)

AshtangiMan (684031) | more than 4 years ago | (#31987296)

Logic fail. As you point out the unregulated nature of existing on-line gambling leads to stupid people giving their money away to cheaters. What legalization and regulation do is help to provide a level playing field, where on line poker (for instance) has a much better chance of being fair (ie, not run by cheaters). What you are actually proposing to do is keep it illegal so that stupid people will continue to give their money away to the cheaters. All of that is beside the point though, as the role of government is not to protect stupid people in the first place. Nor is it to establish a moral code.

freedoms (1)

mestar (121800) | more than 4 years ago | (#31986794)

Nice to see the land of the free to get an another check in the checklist of things its free people are free to do.

how ? (0)

Anonymous Coward | more than 4 years ago | (#31986802)

How do they want to tax gambling when the server is somewhere abroad ?

Forbid credit card companies to deal with foreign gambling companies ? But US based gambling companies are fine ? That will go down nicely with the WTO.

Poor Tax (3, Interesting)

Alaren (682568) | more than 4 years ago | (#31986872)

Gambling is a fascinating issue; tar-and-feathering opponents as the "usual crowd" is pretty facile.

For example, "the lottery" has regularly been shown to basically be a "poor tax." Isn't there a "usual crowd" who speaks out against regressive taxation? Aren't they leftists?

The relative value of gambling is a worthwhile discussion (insurance is a kind of gamble, as is the stock market, right?). Arguments that it is just "another form of entertainment" have real analogues to the arguments we have about MMORPGs and the relative "addiction factor" involved there. The "let's make some revenue appear out of nowhere" argument is also an interesting one to have when talking about legalizing and taxing certain recreational drugs.

Lots of interesting issues. Let's avoid turning every single proposal into a political witch-hunt, okay?

Re:Poor Tax (4, Insightful)

Killer Orca (1373645) | more than 4 years ago | (#31986974)

For example, "the lottery" has regularly been shown to basically be a "poor tax." Isn't there a "usual crowd" who speaks out against regressive taxation? Aren't they leftists?

I would actually argue it is more of a "stupid tax" but I also feel that way about most forms of gambling.

8% of every wager? (3, Insightful)

Anonymous Coward | more than 4 years ago | (#31986890)

That sounds pretty extortionate. Consider that many games have a return rate in the high 90%s.

Previously a hundred dollars could go through dozens of wagers before being reduced by half on average. Now, that same hundred will provide much fewer wagers for the the same game.

Re:8% of every wager? (0)

Anonymous Coward | more than 4 years ago | (#31987198)

and typical of bureaucratic math - 2% nets Feds $42B in revenues during the same period that 6% nets states $30B

The Republicans need to wake up (3, Interesting)

MikeRT (947531) | more than 4 years ago | (#31986902)

I am actually more of a social conservative than most of these groups, and I fully support legalizing and taxing this. If you want people to be responsible, they have to have freedom. It's just that simple. A society where people don't engage in victimless crimes because the state is putting a gun to their head isn't a more moral society, it's just one where we pretend that everything is hunky dory.

Re:The Republicans need to wake up (2, Interesting)

IndustrialComplex (975015) | more than 4 years ago | (#31987038)

I am actually more of a social conservative than most of these groups, and I fully support legalizing and taxing this. If you want people to be responsible, they have to have freedom. It's just that simple. A society where people don't engage in victimless crimes because the state is putting a gun to their head isn't a more moral society, it's just one where we pretend that everything is hunky dory.

I'm not in favor of taxing it for the sake of increasing government revenue.

However I agree with your second statement.

In a world without temptation or sin, none are righteous.

Regulation (2, Interesting)

wjousts (1529427) | more than 4 years ago | (#31986916)

It seems to me that it would be inherently hard to monitor online gambling to ensure that the people running the online casino are actually playing fair. After all, it would be fairly trivial to set up a website to take peoples money but behind the scenes code it such that nobody ever wins. Of course, if nobody ever wins anything, they'll eventually stop playing, but you could easily set rules to feedback just enough money to keep them interested. Maybe return 80 cents on the dollar, but have code make sure that nobody can ever break even.

How would the federal government handle this? Do they insist on seeing the full source code running on every online casino site? If they do, how do they know the code the casino gives them is the actual production code? Basically, it would be too easy to load the dice at an online casino and take everybody's money.

This isn't a comment on the morality of gambling in general, or whether or not it's a good thing. It just seems like it'll be too easy to rip people off using some [not even that] clever coding.

Re:Regulation (2, Interesting)

wjousts (1529427) | more than 4 years ago | (#31986986)

Just replying to myself to add. I guess there isn't a problem for online casinos taking bets on, for example, sports. Something they have no control over. I also guess there's no problem if an online casino works only as a venue for players to bet against each other (example: poker) with the casino taking a cut (unless they hire their own players who are given some additional advantage by the code running the game). I was thinking more along the lines of online roulette, online slot machines, or online craps.

Re:Regulation (1)

ComputerGeek01 (1182793) | more than 4 years ago | (#31987214)

Why haven't you been modded 5 Insightful yet? Really this point is too good to pass up, even with regulation in place this is impossible to monitor.

Re:Regulation (1)

kcitren (72383) | more than 4 years ago | (#31987078)

It would be regulated the same way current casino slot and video poker machines are regulated. There are very strict regulations determining what machines are placed in casinos ["randomness", payouts, etc]. While I don't know if the source code is examined, I do know that the machines themselves, or at least a sampling of those machines, are examined by the gaming commissions.

Re:Regulation (1)

Call Me Black Cloud (616282) | more than 4 years ago | (#31987158)

Nobody ever beats the house anyway, given a long enough period of time. The best way for a casino to make money is to play fairly thus encouraging them to come back...like the "near-miss" feature on slot machines does.

Re:Regulation (1)

BradleyUffner (103496) | more than 4 years ago | (#31987190)

Of course, if nobody ever wins anything, they'll eventually stop playing, but you could easily set rules to feedback just enough money to keep them interested. Maybe return 80 cents on the dollar, but have code make sure that nobody can ever break even.

You mean do what physical casinos do?

congratulations (1)

vxice (1690200) | more than 4 years ago | (#31987242)

congratulations you just figured out the basic premise of being the house in gambling. All the games are already set so that the house has the advantage. In different games it is a different margin but in the end the house plays many more games against many more people so that the law of large numbers sets in and they will always win, by how much will vary slightly but in the end they win. You didn't think Vegas paid for all of its showgirls by paying gamblers to win money did you? Also you don't need everyone to loose all the time to make money, you just need MOST people to lose more than they win. The few winners as you note are spread around so that people have the illusion that they might win big which they can but not as likely as the house is to win big. This is why gambling should be an entertainment not a job and anyone who thinks other wise just doesn't get it, well in some cases they do get it because if you are not playing against the house and in stead other players you just have to be smarter than they are. Some of the games have small player advantages like blakjack if played properly the house just throws you out if you consistently win too much.

It's only fair (0)

Anonymous Coward | more than 4 years ago | (#31986988)

If Congress isn't going to rein in the legalized gambling known as "investment banking", it's only fair that they allow the average citizen to make stupid baseless bets with their money. At least when individual citizens do it they're (usually) using their own money.

Video Game Assets (2, Interesting)

kiehlster (844523) | more than 4 years ago | (#31987008)

How might such a law affect video game assets in the face of taking gambles? If I buy, with real money, a bunch of in-game loot and then take a gamble on successfully defeating the other team [slashdot.org] , or open up a second-life gambling casino [alphavilleherald.com] , what would the government tax me on? my video game fees? my profits from selling loot?

Re:Video Game Assets (1)

Locke2005 (849178) | more than 4 years ago | (#31987278)

Obviously the government would apply a capital gains tax whenever you convert the virtual assets into real dollars. The virtual property itself has no value to the government, and should not be taxed.

Silly Republicans (0)

Anonymous Coward | more than 4 years ago | (#31987046)

I don't understand why the Republicans don't like this. I'm a Republican and would be completely for it. It's called a sin tax, people. This is right up our alley.

Not all gambling is illegal (1)

bugs2squash (1132591) | more than 4 years ago | (#31987136)

Last I heard, you can still trade stocks and futures. Maybe all they need to do to bring everything into line is to create a new kind of derivative that shows results and settles hourly. Then have wall street run it.

I don't see a problem here (1)

Locke2005 (849178) | more than 4 years ago | (#31987138)

I'm all in favor of taxing stupidity... do the Republicans, Focus on the Family, and Think of the Children all oppose this because it places an undue tax burden on their members?

Oh, the winds of change (1)

Chicken04GTO (957041) | more than 4 years ago | (#31987142)

Times are good: RABBLE RABBLE MORALITY RABBLE EVIL GAMBLING

Time are bad: RABBLE RABBLE TAX INCOME RABBLE THINK OF THE CHILDREN

Make up your minds politicians.

I just don't get it (1)

vacarul (1624873) | more than 4 years ago | (#31987160)

this is what I understood:
1. gambling in US is legal in casino. They have systems that guarantee that you will loose money.
2. gambling online was made illegal so that casinos will not loose money (from gambling, drinks, hotels etc). They also have systems that guarantee that you will loose money.
3. nobody cares what the citizen wants if some corporation wants something else.

Where is the democracy? - (dmokratía) "rule of the people" [wikipedia [wikipedia.org] ]

International Trade Agreements (1)

PPalmgren (1009823) | more than 4 years ago | (#31987180)

Isn't the US already getting massively fined for blocking overseas gambling? Will they now tax overseas gambling wagers and eliminate this fine, or is this only allowed for state-side operations? I would consider the $100 billion fine reduction to be a bigger boon than the tax revenue.

Relevant link: http://yro.slashdot.org/story/07/10/12/1411242/US-Faces-100-Billion-Fine-For-Web-Gambling-Ban?art_pos=11 [slashdot.org]

Summary Is Wrong! (5, Informative)

coolmoose25 (1057210) | more than 4 years ago | (#31987206)

The summary stated that they would take 6% for state and 2% for Fed on each WAGER... That is incorrect... they are taking 6%/2% of your DEPOSIT in the online gaming account. If they took 6%/2% of your WAGERS, you'd be broke in no time!

Given this level of taxation, I'd be in favor, just for the legalization aspect alone... I'm generally not in favor of "feeding the beast" with more tax revenues, but if it gets me legal online gaming, then I'm okay with it.

6%? (0)

Anonymous Coward | more than 4 years ago | (#31987210)

So, EVERY ROUND OF POKER, 6% of the pot goes to the government? There's no way to break even on that!

Even at its most lax, this more than doubles (probably more than triples) the amount of money that it siphoned away from a bid: most houses are not so greedy as to take 6%!

This makes gambling unfeasible, rather than making it illegal. Ugh.

The Math is Screwy on This One (1)

McNally (105243) | more than 4 years ago | (#31987228)

The proposed rate (depending how you read the write-up either 6% total, or 6% plus 2%) has either been set by someone who has no understanding of the math behind gambling or by someone who is looking to deliberately kill on-line wagering while not appearing to do so. A 6% (or 8%) government rake on top of the the existing house edge (or house rake for games where you don't play against the house) will crush players, making virtually every gambler a short-term loser.

Yes, I'm anti-gambling (3, Interesting)

Just Some Guy (3352) | more than 4 years ago | (#31987274)

Basically, the bill proposes that for each state, a 6% cut would be taken from all wagers

First, what? Of all wagers, win or lose? Right now, you can hypothetically wager for an indefinite amount of time if the odds of winning are 50/50 (which they aren't but play along) and you never fall to zero. If each transaction is taxed, then you lose 6% on each hand, automatically, no matter what? I hope that's just poorly written.

Second, I'm against expanding gambling. Proponents point to Las Vegas and think that Spitsville, Arkansas will be just like that if only they legalize Keno. Well, no. What always happens is that the people who can least afford new, expensive habits end up losing everything. Crime goes up. Social service costs go up. Law enforcement costs go up. And the expenses are never covered by the trickle of tax revenue. Seriously, if you're against regressive taxes, then you kind of have to be against the realities of gambling. Warren Buffett isn't going to go broke on the craps tables, but Joe Sixpack very well might.

But more than that, I hate the outright lies told by the gambling lobbyists when they're trying to get it legalized. I lived in Missouri when they were voting on whether to add riverboat gambling. The idea is that all the taxes from it would go to education. How can you vote against that and take money away from the kids? Well, they were kind of telling the truth. What really happened was that if the education budget was $X (I forget the actual numbers involved), and the tax revenue from gambling was $Y, then the new education budget was still exactly $X. The difference was that $Y of it came from gambling, and the rest came from the general fund as usual. Furthermore, the total amount of taxes collected did not go up, as a lot of the hypothetical extra revenue was lost to decreased sales taxes, lowered property values, etc., while service expenditures went up quite a bit. A couple of years into the grand experiment, it looked like Missouri was losing about 3*$Y from their bottom line. The casino's owners, on the other hand, were quite happy to export the revenues to their own state and let someone else clean up the mess.

I'm pretty libertarian in my views. If you want to do something and it doesn't harm anyone but yourself, then have at. Contrary to the tone of the summary, I have no moral objections to gambling whatsoever. In practice, though, gambling seems to cause a lot of collateral damage around its participants. I guess I lump it in with smoking in restaurants; although I understand the arguments for allowing it, I have to admit that I've enjoyed not having it around anymore.

It'll Never Fly (1)

Petersko (564140) | more than 4 years ago | (#31987284)

"The bill calls for a 6 percent tax on all deposits to be paid to state and tribal governments made by residents of their jurisdiction. For example, if someone living in Missouri puts $1,000 into an online gambling account anywhere in the country, $60 would go to Missouri's state government."

Imagine if you had to hand over six percent of the money in your pocket as taxes just to be allowed in the door of a casino. Incredible horseshit, no? To even suggest it is ludicrous. And yet there it is.

I'm glad I live in Canada where they don't tax your gambling winnings at all unless you're a professional gambler.

Sadly, as the U.S. continues to collapse into the black hole that is it's debt, more of this kind of thing will happen.
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