This is more than grammar and punctuation … but it begins there.
How Washington Opened the Floodgates to Online Poker, Dealing Parents a Bad Hand
By Leah McGrath Goodman / Newsweek / August 14, 2014 (Excerpts from a much longer Newsweek article)
…on the Friday before Christmas Eve 2011, then-U.S. assistant attorney general Virginia Seitz quietly issued a 13-page legal opinion that changed everything. She reinterpreted the federal Wire Act of 1961, which, until that time, had been viewed by U.S. courts—and the DOJ’s own Criminal Division—as prohibiting all forms of online gambling….
For Seitz, reversing 50 years of legal precedent came down to the placement of a comma. In the key passage of the Wire Act, the description of the ban on gambling over state or international lines applies to “bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers.”
The first comma, for Seitz, was crucial. The question, she said, boiled down to whether “sporting event or contest” modified each instance of “bets or wagers” or only the instance it directly followed. She decided the former, writing, “We conclude that the [DOJ] Criminal Division’s premise is incorrect and that the Wire Act prohibits only the transmission of communications related to bets or wagers on sporting events or contests.”
Punctuation aside, Seitz opened wide the door to online gambling—and in the process, critics say, may have opened a Pandora’s box. Lawmakers and experts warn that online gambling is dangerously addictive for some, especially children raised in a culture of online gaming and smartphones.
Seitz, who came from the DOJ’s Office of Legal Counsel (once characterized by Newsweek as “the most important government office you’ve never heard of,” and the same office that wrote the legal justifications for drones and waterboarding), was appointed in June 2011 by President Barack Obama and previously worked at Chicago law firm Sidley Austin, where Obama and the first lady, Michelle Obama, met and worked until they married.
“That a single, relatively unknown person in an office at the Justice Department can just bring about such massive change to our economy in direct contradiction to what Congress sees as the governing law signals a gravitational shift in power that is very concerning,” says Jonathan Turley, a professor of public interest law at George Washington University in Washington.
“The Office of Legal Counsel once held a unique and revered position within the DOJ and government as a whole,” Turley continues. “It was viewed as the gold standard of legal analysis. This office was once tasked with the job of saying no to the president. Its job was to objectively interpret the intent of our laws passed by Congress. It had a tradition of independence and excellence, and that tradition was viewed as inviolate by past presidents….
What has not changed about that tradition, says Turley, is that once the Office of Legal Counsel has spoken, its word is treated as sacrosanct by the other government agencies. (Reached by Newsweek, the DOJ, as well as the FBI, both confirmed that, as a result of Seitz’s opinion, they have ceased cracking down on online gambling and will leave it up to the preferences of the states.) “It’s problematic that this office’s opinions are treated as legally binding, as if they came down from Mount Olympus,” Turley says. “Even in its heyday, it should never have been this way.”
“This is just the beginning,” predicts Jason Chaffetz, a Republican representative from Utah, the only state other than Hawaii that prohibits all forms of gambling, even the lottery…. “Many parents already can see how easy it is for a kid to get addicted to a video game that does not involve money. You put them on the Internet and they are gambling with money, now you have a real problem.” … Chaffetz, who has become a bit of a gaming connoisseur as he pushes to restrict the spread of online gambling across the states, is only too aware that the line between real-money “gambling” and social-media “gaming” has all but disappeared, especially for the young.
“The millennials are greater risk takers; they’ve grown up on the technology of video games and watching other young people winning the World Series of Poker, and they think they are smarter than everyone else,” says Jeffrey Derevensky, a professor of applied child psychology and psychiatry at Montreal’s McGill University and one of the world’s leading authorities on youth gambling addiction. On average, he says, 5 to 8 percent of university students are what he would classify as “at-risk gamblers,” with 2 to 4 percent suffering from “a serious gambling addiction.”
“Online and mobile gambling is going to be a big thing, and those aged 18 to 25 have the highest prevalence of gambling-related problems among adults,” says Derevensky, who has treated dozens of kids at McGill’s International Centre for Youth Gambling Problems and High-Risk Behaviors.
One of the hardest parts of the job, Derevensky says, is “getting parents and teachers to realize the dangers of gambling are often no less severe and sometimes much greater than drinking, reckless driving, drugs and unprotected sex.”
Once hooked, kids can take years to recover—or never recover—with the most severe cases only able to substitute one high-risk behavior for another. Some kids even commit suicide. “Once they’re addicted, these kids will take their parents’ credit cards, gas cards, anything they can find to gamble with,” he says. … when these individuals are engrossed in Internet games, certain pathways to their brains are triggered in the same direct and intense way that a drug addict’s brain is affected by a particular substance.”
Marc Potenza, a professor of psychiatry at Yale University specializing in the neurobiology of gambling, impulse control and addictive disorders, has noticed the same link. “We are only beginning to understand this condition and the potential for treatments, using brain imaging to investigate the neurocircuitry that underlies human decision making and similarities between substance abuse and gambling disorders,” he tells Newsweek….
Seitz’s opinion has essentially opened the U.S. market to what some estimate could be a $1 trillion global industry. The Center for Public Integrity has reported on the battle between offshore companies and brick-and-mortar casinos over how to regulate online gambling, with both sides investing heavily in lobbying and campaign spending….
As an Illinois state senator, Obama told National Public Radio in 1999 that herefused to take any money from the gambling industry, even though there were no limits on contributions in Illinois or on tribal donors. “It is very hard to separate yourself from the interests of the gaming industry if you’re receiving money,” Obama said. The president, who enjoys poker and blackjack, has often gone on the record stating his concerns about “the moral and social cost of gambling.”
Yet by 2007 Obama had cracked the list of the U.S. Senate’s top 10 biggest recipients of gaming money, and by 2008 he had risen to become the Senate’s No. 3 highest-paid recipient. During his 2012 re-election campaign, he accepted more money from the gambling industry and tribal casinos than any individual politician now in Washington.
McGill’s Derevensky, a consultant to international online gaming companies, says it’s not just campaign finance that’s at issue. Only a decade or two ago, most politicians would have been loath to cozy up to the gambling industry, he observes. But the financial crisis has brought a new urgency to raise revenue at both the state and federal levels, where the proceeds of gambling can provide valuable contributions. In the U.S., an online gambling license alone can cost hundreds of thousands of dollars annually, in addition to the proceeds states can reap from the winnings of casinos and online gambling companies.
“Since the economy tanked around the world, you’re seeing the greatest move to gambling ever,” Derevensky tells Newsweek. “Three states have online gambling, and you will see it proliferated throughout the United States. We’re never going back. The governments are just too dependent on it for tax revenue.”
The Obama administration’s ties to the industry go beyond money. Jim Messina, Obama’s 2012 campaign manager and a close confidant, earlier this year signed on as a consultant to the American Gaming Association, a powerful pro-gaming lobby in Washington that is pushing to make gambling more commonplace and less taboo.
Since Seitz handed down her 2011 opinion, Sidley Austin, her former employer, has expanded its deal-making practice in the gambling space, which now includes major markets in North America, Europe and Asia … Seitz, who left the DOJ’s Office of Legal Counsel in December 2013, plans to return to Sidley Austin to practice law, the firm’s Washington office tells Newsweek. In addition to being the place where the Obamas met, Sidley Austin has been one of the most generous contributors to Obama’s two election campaigns, donating $606,260 to his 2008 campaign and $400,883 to his 2012 campaign, according to the Center for Responsive Politics. …