It's about time politicians started listening.
On Wednesday, Paul Lavers wrote a scathing column on Covers.com regarding how the American ridiculous endeavour to chase away Internet gambling while allowing the subprime mortgage situation to nearly collapse the American economy. Paul ended the piece by predicting the politicians would have to come around and embrace online gambling as a way to generate tax revenues and compensate for the slumping economy.
Not even a full day later, Representative Jim McDermott (D-WA) introduced the Internet Gambling Regulation and Tax Enforcement Act (H.R. 2607), designed to tax and regulate Internet gambling.
I know it seems unlikely McDermott read our column and immediately set to work creating his legislation to have it announced hours later. But it is fun to be ahead of the curve.
On the other side, my column from Monday failed to generate enough votes to have our online gambling question asked at the Democratic Debate held last night. So, we'll have to wait before knowing exactly where Barack Obama stands on gambling.
You win some, you lose some.
This proposed legislation is notable, if only for its sensibility. It doesn't propose any news taxes - it just proposes applying existing tax rules to online gambling companies.
As a companion bill to Representative Barney Frank's (D-MA) Internet Gambling Regulation and Enforcement Act (H.R. 2046), McDermott's bill fills all the gaps. Suddenly, the United States has the framework to make online gambling legal and regulated. It would generate anywhere from $8.7 billion to $42.8 billion in federal revenues over its first 10 years and I would wager it would be on the higher side of that estimate.
Adding another billion or five into the yearly tax stream can only be a good thing for the country as a whole. Think of the programs that could be funded.
McDermott's bill was not the only good news to be released yesterday. In separate news releases, both Antigua and Costa Rica announced that they are seeking WTO arbitration in their disputes with the US over America's online gambling restrictions.
The Safe and Secure Internet Gambling Initiative website has released a good analysis of the situation featuring some juicy quotes from Nao Matsukata.
"If the U.S. withdraws following another adverse arbitral decision," he says, "the country would face potential retaliation from all WTO Members affected by the arbitration, a pool of countries including the EU, Canada, and Japan... Inviting sanctions at a time when both the U.S. Administration and Congress are both striving to stimulate an economy on the edge of recession seems foolhardy at best."
This is the former Director of Policy Planning for the United States Trade Representative we're talking about - the government office that directly deals with the WTO. Hopefully more politicians start listening to him. He knows what he's talking about.