Best of the Week
Most Popular
1. Crude Oil and Water: How Climate Change is Threatening our Two Most Precious Commodities - Richard_Mills
2.The Potential $54 Trillion Cost Of The Fed's Planned Interest Rate Increases - Dan_Amerman
3.Best Cash ISA Savings for Rising UK Interest Rates and High Inflation - March 2018 - Nadeem_Walayat
4.Fed Interest Hikes, US Dollar, and Gold - Zeal_LLC
5.What Happens Next after February’s Stock Market Selloff - Troy_Bombardia
6.The 'Beast from the East' UK Extreme Snow Weather - Sheffield Day 2 - N_Walayat
7.Currencies Will Be ‘Flushed Down the Toilet’ Triggering a ‘Mad Rush into Gold’ - MoneyMetals
8.Significant Decline In Stocks On The Cards! -Enda_Glynn
9.Land Rover Discovery Sport Extreme Driving "Beast from the East" Snow Weather Test - N_Walayat
10.SILVER Large Specualtors Net Short Position 15 Year Anniversary - Clive_Maund
Last 7 days
Watch This Group Signal Stock Market Trend Changes - 22nd Mar 18
Stocks are Gapping Beneath the Trendline Support - 22nd Mar 18
Fed Action Casts Shadow on Bullish Case for Stocks - 22nd Mar 18
A Strong Economy and Weak Stock Market is Bullish for Stocks - 22nd Mar 18
Fed Raises US Interest Rates 25bp – Where Are We In The Stock Market Cycle? - 22nd Mar 18
Why Spotify Will Likely Surge During Its IPO - 22nd Mar 18
SY Police Arrest Woman for Blowing Trumpet at Sheffield Tree Felling Protest - 22nd Mar 18
Facebook: The Anti-Social Network Covert Data Gathering - 21st Mar 18
Additional Signs for Gold and Silver Amid Increasing FOMC Tension - 21st Mar 18
Credit Concerns In U.S. Growing As LIBOR OIS Surges to 2009 High - 21st Mar 18
Stock Markets Are Flat-to-lower Before the FOMC - 21st Mar 18
Will Powell’s Actions Pop Stock Market Perfection - 21st Mar 18
Economic Moral Hazards of the International Criminal Court - and Philippines Withdrawal - 21st Mar 18
Larry Kudlow vs. Vladimir Putin on Gold - 21st Mar 18
Trump Builds Economy and War Machine - 21st Mar 18
This Stock Market "Illusion" Can Destroy Once-Vibrant Portfolios - 21st Mar 18
Gold Short-term Pull Back in Progress - 20th Mar 18
Stocks Appear to be Under Pressure - 20th Mar 18
Time To Eliminate Your Wall Street Tax? - 20th Mar 18
The Beast from the East Snow, UK Roads Driving Car Accidents - 20th Mar 18
Can Bitcoin Price Rally Continue After Paypal Fake FUD Attack? - 19th Mar 18
2018 Reversal Dates for Gold, Silver and Gold Stocks - 19th Mar 18
This Tech Breakthrough Could Save The Electric Car Market - 19th Mar 18
Stocks Set to Open Lower, Should You Buy? - 19th Mar 18
The Wealth Machine That Rising Interest Rates Create Conflict With The National Debt - 19th Mar 18
Affiliate Marketing Tips and Network Recommendations - 19th Mar 18
Do Stocks Bull Market Tops Need Breadth Divergences? - 19th Mar 18
Doritos Instant £500 Win! Why Super Market Shelves are Empty - 19th Mar 18
Bonds, Inflation & the Market Amigos - 19th Mar 18
US Housing Real Estate Market and Banking Pressures Are Building - 19th Mar 18
Stock Market Bulls Last Stand? - 18th Mar 18
Putin Flip-Flops Like A Drunken Whore On Bitcoin Cryptocurrency Legalization - 18th Mar 18
How to Legally Manipulate Interest Rates - 18th Mar 18
Return of Stock Market Volatility Amidst Political Chaos and Uncertain Economy - 18th Mar 18
Bitcoin Price Trend Forecast, Paypal FUD Fake Cryptocurrency Warning - 17th Mar 18
Strong Earnings Growth is Bullish for Stocks - 17th Mar 18
The War on the Post Office - 17th Mar 18
GDX Gold Mining Stocks Fundamentals - 16th Mar 18
Nationalism, Not the Russians, got Trump Elected - 16th Mar 18
Has Bitcoin Bought It? - 16th Mar 18
Crude Oil Price – Who Wants the Triangle? - 16th Mar 18
PayPal Cease Trading Crypto Currency Bitcoin Warning Email Sophisticated Fake Scam? - 16th Mar 18
EUR/USD – Something Old, Something New and… Something Blue - 16th Mar 18

Market Oracle FREE Newsletter

Urgent Stock Market Message

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

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

By: LewRockwell


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 He lives in Las Vegas with his wife Katie and dog Wilbur.

© 2011 Copyright Collin Moshman / - 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.

© 2005-2018 - 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

6 Critical Money Making Rules