Best of the Week
Most Popular
1.The Gallery of Crowd Behavior: Goodbye Stock Market All Time Highs - Doug_Wakefieldth
2.Tesco Meltdown Debt Default Risk Could Trigger a Financial Crisis in Early 2015 - Nadeem_Walayat
3.The Trend Every Nation on Earth Is Pouring Money Into - Keith Fitz-Gerald
4.Do Tumbling Buybacks Signal Another Stock Market Crash? - 26Mike_Whitney
5.Could Tesco Go Bust? How to Save Tesco from Debt Bankruptcy Risk - Nadeem_Walayat
6.Gold And Silver Price - Respect The Trend But Prepare For A Reversal - Michael_Noonan
7.U.S. Economy Faltering Momentum, Debt and Asset Bubbles - Lacy Hunt
8.Bullish Silver Stealth Buying - Zeal_LLC
9.Euro, USD, Gold and Stocks According to Chartology - Rambus_Chartology
10.Evidence of Another Even More Sweeping U.S. Housing Market Bust Already Starting to Appear - EWI
Last 5 days
More Downside Ahead for Gold and Silver - 31st Oct 14
QE Is Dead, Now You Tell Me What You Know - 31st Oct 14
Welcome to the World of Volatility - 31st Oct 14
Stocks Bear Market Crash Towards New All Time Highs as QE3 End Awaits QE4 Start - 31st Oct 14
US Mortgages, Risky Bisiness "Easy Money" - 30th Oct 14
Gold, Silver and Currency Wars - 30th Oct 14
How to Recognize a Stock Market “Bear Raid” on Wall Street - 30th Oct 14
U.S. Midterm Elections: Would a Republican Win Be Bullish for the Stock Market? - 30th Oct 14
Stock Market S&P Index MAP Wave Analysis Forecast - 30th Oct 14
Gold Price Declines Once Again As Expected - 30th Oct 14
Depression and the Economy of a Country - 30th Oct 14
Fed Ends QE? Greenspan Says Gold “Measurably” “Higher” In 5 Years - 30th Oct 14
Apocalypse Now Or Nirvana Next Week? - 30th Oct 14
Understanding Gold's Massive Impact on Fed Maneuvering - 30th Oct 14
Europe: Building a Banking Union - 30th Oct 14
The Colder War: How the Global Energy Trade Slipped From America's Grasp - 30th Oct 14
Don't Get Ruined by These 10 Popular Investment Myths (Part VIII) - 29th Oct 14
Flock of Black Swans Points to Imminent Stock Market Crash - 29th Oct 14
Bank of America's Mortgage Headaches - 29th Oct 14
Risk Management - Why I Run “Ultimate Trailing Stops” on All My Investments - 29th Oct 14
As the Eurozone Economy Stalls, China Cuts the Red Tape - 29th Oct 14
Stock Market Bubble Goes Pop - 29th Oct 14
Gold's Obituary - 29th Oct 14
A Medical Breakthrough Creating Stock Profits - 29th Oct 14
Greenspan: Gold Price Will Rise - 29th Oct 14
The Most Important Stock Market Chart on the Planet - 29th Oct 14
Mysterious Death od CEO Who Went Against the Petrodollar - 29th Oct 14
Hillary Clinton Could Be One of the Best U.S. Presidents Ever - 29th Oct 14
The Worst Advice Wall Street Ever Gave - 29th Oct 14
Bitcoin Price Narrow Range, Might Not Be for Long - 29th Oct 14
UKIP South Yorkshire PCC Election Win is Just Not Going to Happen - 29th Oct 14
Evidence of New U.S. Housing Market Real Estate Bust Starting to Appear - 28th Oct 14
Principle, Rigor and Execution Matter in U.S. Foreign Policy - 28th Oct 14
This Little Piggy Bent The Market - 28th Oct 14
Global Housing Markets - Don’t Buy A Home, You’ll Get Burned! - 28th Oct 14
U.S. Economic Snapshot - Strong Dollar Eating into corporate Profits - 28th Oct 14
Oliver Gross Says Peak Gold Is Here to Stay - 28th Oct 14
The Hedge Fund Rich List Infographic - 28th Oct 14
Does Gold Price Always Respond to Real Interest Rates? - 28th Oct 14
When Will Central Bank Morons Ever Learn? asks Albert Edwards at Societe General - 28th Oct 14
Functional Economics - Getting Your House in Order - 28th Oct 14
Humanity Accelerating to What Exactly? - 27th Oct 14
A Scary Story for Emerging Markets - 27th Oct 14
Could Tesco Go Bust? How to Save Tesco from Debt Bankruptcy Risk - 27th Oct 14
Europe Redefines Bank Stress Tests - 27th Oct 14
Stock Market Intermediate Correction Underway - 27th Oct 14
Why Do Banks Want Our Deposits? Hint: It’s Not to Make Loans - 26th Oct 14
Obamacare Is Not a Revolution, It Is Mere Evolution - 26th Oct 14
Do Tumbling Buybacks Signal Another Stock Market Crash? - 26th Oct 14
Has the FTSE Stock Market Index Put in a Major Top? - 26th Oct 14
Christmas In October – Desperate Measures - 26th Oct 14
Stock Market Primary IV Continues - 26th Oct 14
Gold And Silver Price - Respect The Trend But Prepare For A Reversal - 25th Oct 14
Ebola Has Nothing To Do With The Stock Market - 25th Oct 14
The Gallery of Crowd Behavior: Goodbye Stock Market All Time Highs - 25th Oct 14
Japanese Style Deflation Coming? Where? Fed Falling Behind the Curve? Which Way? - 25th Oct 14
Gold Price Rebounds but Gold Miners Struggle - 25th Oct 14
Stock Market Buy the Dip or Sell the Rally - 25th Oct 14
Get Ready for “Stupid Cheap” Stock Prices - 25th Oct 14
The Trend Every Nation on Earth Is Pouring Money Into - 25th Oct 14 - Keith Fitz-Gerald
Bitcoin Price Decline Stopped, Possibly Temporarily - 25th Oct 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Stocks Epic Bear Market

Police State Thieves, The U.S. Government Gambling Monopoly

Politics / US Politics Apr 20, 2011 - 11:11 AM GMT

By: LewRockwell

Politics

Best Financial Markets Analysis ArticleCollin Moshman writes: On April 15, the federal government busted online poker behemoths Pokerstars, Full Tilt Poker, and Absolute Poker. The Department of Justice issued a 57-page indictment against the owners, accusing them of such crimes as "Operation of an Illegal Gambling Business." The FBI also seized their domains.


US players are now restricted from playing on the two largest US online poker sites, Pokerstars and Full Tilt, with the status of many millions of dollars in online poker balances in limbo. Even for sites allowing players to withdraw this money, many worry it will be seized or indefinitely delayed if cashed out.

There is widespread outrage within the poker community concerning these events, among both professional and recreational players, as well as those in the extensive poker media and side businesses. After all, online poker is a voluntary activity. Participants choose to devote their own time and risk their own money when playing, and willingly pay the house rake for this privilege. So how do we understand the government’s aggressive actions in this case?

By definition, the US government has a monopoly on the use of force in the US. They may therefore claim a monopoly on any industry they wish, such as protection or the sale of alcohol. For instance there are government-run liquor stores. For private restaurants and businesses wishing to sell alcohol, however, the only option is expensive licensing for the privilege of competing with the government. If you don’t make the right payoff to get one of these licenses, you’re running an illegal operation and risk being shut down.

Similarly, the US government has a monopoly on gambling. If you want to gamble in the US, you can participate in a state-run lottery or play in a government-licensed casino. But despite poker being a game of skill, the government treats it as part of this gambling monopoly. Just try running a raked homegame and see what happens.

While the DOJ indictment against the poker site owners has many counts, including money laundering, the core of the bust is clearly protecting the gambling monopoly. After all, 8 of the 9 counts pertain to gambling that the government has deemed unlawful. Pokerstars, based in the Isle of Man, is not part of the US government, nor licensed by the US government, and therefore violates the gambling monopoly. Meanwhile a recent estimate has the company generating daily revenue of $1.37 million. For the government, this situation is unacceptable.

Government-approved solutions have been proposed, such as last month’s H.R. 1174:

If enacted, this legislation would allow the Director of the Financial Crimes Enforcement Network (FINCEN) to adopt a framework for legal internet gambling. Specifically, FINCEN would be authorized to license online gambling sites annually and require the sites to use age identification technologies and pay the appropriate licensing fees, which would cover the cost of monitoring online gambling sites. Importantly, online gambling sites which are not licensed by FINCEN would be considered illegal…

Indeed, the standard stance among the more optimistic US players is that now that the government has forced out the major sites which allowed US players, the next step is a site that does comply with the US monopoly.

As a player, I have no choice but to hope for this outcome as well, as the alternative is to play on smaller and dodgier sites, where it is increasingly difficult to deposit and withdraw. It’s important for us to remember, however, that the government monopoly-approved outcome would only be a victory in terms of allowing poker players to continue playing the game they love. When it comes to the basic principle that businesses and individuals should be allowed to participate in voluntary transactions without violent interference, we all lose.

Collin Moshman [send him mail] is the author of best-selling poker strategy books Sit ‘n Go Strategy and Heads-Up No-Limit Hold ‘Em. He heads Team Moshman, an international team of staked and coached players, and coaches for Cardrunners.com. He lives in Las Vegas with his wife Katie and dog Wilbur.

http://www.lewrockwell.com

© 2011 Copyright Collin Moshman / LewRockwell.com - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014