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October 23, 2014

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POLITICS:

Key conservative joins Harry Reid in effort to legalize online poker

Harry Reid

Harry Reid

Rep. Joe Barton

Rep. Joe Barton

WASHINGTON — On most issues, Rep. Joe Barton, a Texas Republican, and Nevada’s Democratic Sen. Harry Reid are thorns in each other’s sides.

Reid hates oil subsidies. Barton is such a defender of oil companies that last year, he apologized to BP for Congress’ pointed inquiry into its mismanagement of the Gulf spill.

Reid has spent most of his career trying to kill the proposed Yucca Mountain nuclear waste repository. Barton is one of Congress’ biggest backers of getting it up and running, and predicted that: “I have a feeling we will, before the end of this year, do so.”

But despite their differences, these two are shaping up as a dream team for the online gaming community and its efforts to legalize Internet poker — and Internet poker only — this year.

Why a dream team is needed became apparent when California Republican Rep. John Campbell and Massachusetts Democrat Rep. Barney Frank introduced in March broader legislation to legalize Internet gambling. It seeks to amend the 2006 Unlawful Internet Gambling Enforcement Act by expanding consumer protections, introducing a licensing procedure for Internet gambling providers, and stepping up enforcement against illegal operators through the Treasury Department.

Frank steered an identical bill through the House’s Financial Services Committee last year when he was chairman. But under the new House majority, Alabama Republican Rep. Spencer Bachus controls that committee, and he is no friend to Internet gambling. In fact, none of the congressional committee chairmen with jurisdiction over the Campbell/Frank bill are: Bachus, Lamar Smith of the Judiciary Committee, and Dave Camp of Ways and Means.

So, enter Barton, who brings a new bill, a new face, and a new committee to the mix.

Barton is chairman emeritus of the Energy and Commerce Committee, which is where Barton intends to bring up his bill. The legislation is still a work in progress, but he expects to officially introduce an Internet poker-only bill this summer.

Poker has emerged as the most popular, and thus most promising source of potential tax revenue for the federal government and states that would license the operators.

In the past few years, poker has built a following that goes beyond casinos: A community of 15 million plays the game online, and it has become a spectator sport, with tournaments drawing millions of viewers to broadcasts on sports networks.

Barton is a fan of the game.

“I love to play poker,” he told the Sun last week, explaining why he decided to push to legalize Internet poker. “When I was in the minority, I told (other lawmakers), ‘you’re in the majority, do something about it.’ But now I’m in the majority and I’m trying to get it going.”

To do that, Barton is having to make a few strategic moves.

One is getting the bill under the Energy and Commerce Committee’s jurisdiction by giving authority to license new operators to the Commerce Department.

Another is making sure the legislation takes into consideration recent legal developments.

In April, the Justice Department indicted the three biggest Internet poker operators with clients in the United States — PokerStars, Full Tilt Poker and Absolute Poker — and charged them with bank fraud and money laundering. The government is seeking $3 billion in fines for playing the system to process payments from U.S. players, which has been illegal since late 2006, when Congress passed the Internet gaming act.

Several states also have taken up measures to legalize Internet poker. Most efforts have failed, but in April — just days before the gaming outfits were indicted — Washington, D.C., became the first U.S. entity to make it legal.

The crosscurrents of state pressure to change federal law to increase opportunities to gamble online, and growing federal concern that states may not license trustworthy operators, are fueling a debate that Barton is aware of. He wouldn’t detail exactly how he plans to address the tension.

Enforcement of good gambling practices will be key to drawing bipartisan support necessary to carry the bill. Last year’s bill proposed treating illegal online gambling operators similar to how comprehensive immigration proposals usually treat illegal immigrants: If you come out of the shadows, you’ll have to wait for a certain period (under last year’s bill, there was a 15-month blackout), but then you can apply for legal papers and join the system on the up and up.

It’s unlikely that any state’s statutes would allow licensing of a company that is under indictment or found liable for illegal activity, but that system left an opening for companies that have broken the rules to join a poker market that’s going to be tightly regulated by new rules: no underage gambling, no abusive gambling, and efforts to address gambling addiction. Many lawmakers, especially Republicans, aren’t sure those executing such regulation are up to the expectations.

“I’m not opposed” to considering Barton’s proposal, Bachus told the Sun last week. “But if there’s gambling, it has to be regulated.”

Click to enlarge photo

A woman who wants to remain anonymous plays poker online.

The poker lobbyists appear convinced that if anyone can bring conservative lawmakers along, it’s Barton.

“We think he can bring a very strong coalition of conservative-minded Republicans to support it,” said John Pappas, executive director of the Poker Players Alliance. “He’s respected, not only with the more socially conservative, but the more fiscally conservative caucus within the House, and brings a really credible voice to this issue ... because he understands why regulation makes sense, not only from the perspective of a lawmaker, but also that of a poker player.”

Barton said he has gotten a “yellow light” from Republican House leaders to proceed.

“This is not a Republican leadership initiative, but they’re aware of it,” Barton told the Sun. “It’s a sensitive issue, but an issue where there’s a majority consensus in the House and Senate to make this change.”

He’s also got the support of his chief competitors, Campbell and Frank.

“I’m co-sponsoring his (bill), I believe he’s going to co-sponsor mine. If his moves first, I’ll support him,” Campbell said. “The resistance is still there, but I think there are some minds that are more open now than they were last year.”

Frank said: “I’ll go for the broadest bill possible. We have an extraordinary restriction on people’s freedom right now, so I would support the broadest bill possible ... but I would take something over nothing.”

The Nevada delegation appears to be in favor of Barton’s efforts.

Rep. Shelley Berkley told the Sun that when Barton produces a bill, she’ll eagerly sign on.

Shelley Berkley

Shelley Berkley

Dean Heller

Dean Heller

Sen. Dean Heller said he supported the bill in concept and would like to see something move, but that he thinks a poker bill “needs to start on this side (in the Senate), because that’s where it failed last time.”

Last year, efforts to pass Internet poker legalization ran aground when Republicans, led by Minority Whip Jon Kyl of Arizona, said there was “zero chance” the GOP would accept that sort of a package. But in a policy statement this year, Kyl said he would keep a more open mind about poker-only bills, and “consider them carefully as long as they leave in place the broader proscriptions against online betting.”

In the Senate, all eyes in the poker community are on Reid.

If they team up it would be a remarkably cooperative venture for two statesmen so far apart on the political spectrum.

But Barton and Reid have both been in Congress since the mid-1980s and as such, are seasoned statesmen from a more collegial era. The suggestion that they might, as two like-minded opposites, engage in a little classic congressional cooperation, was enough to give Reid a little grin.

“We lost him elsewhere,” Reid said. “But we’ll work with him — and maybe we’ll win with him — on this.”

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  1. Thanks Frank for your assessement on Joe (oil company) Barton. A very good one!

    Now, tell us how you really feel about Joe Barton.

  2. I think Joe and Hairy make a perfect team. Between the two of them they take money from all the major players.

  3. Online gambling:

    1. If you get cheated, where do you go for compensation and how is it proven?

    2. Who gets the profits and where are they deposited? (On the Isle of Wight?)

    3. Does the State get any taxes? (No, the hdqrs are all offshore)

    4. Who gets the jobs? (What Jobs?)

    5. How does this boost the economy? (What economy?)

    Joe Barton is a Methodist, a "Christian", and so how does gambling fit in with his "Biblical Beliefs" and personal responsibility? Barton's belief is: He who cuts the pie gets the biggest church. Religious philosophy is a political plug-in for Congressional men. I've know bar tenders with better morals then Joe Barton, because just a little is better then nothing atall.

  4. I live in Joe Barton's congressional district. Barton is a great conservative and I love the fact that he is pissing off Nevada progressives. Your state is going down the toilet and you need this legislation. But being Progressives you just don't get it. Oh well, God Bless Texas.

  5. There is really only one big question regarding online gaming, and it is one that applies to any online activity: it is impossible to prove someone's age online.

    The postal service is going to offer a "prove your age" service for deliveries which will help online tobacco and alcohol sites, but that does nothing for gaming and adult sites.

    Adult sites currently operate under the rule that only adults can enter into a contract to receive a credit card. Again, that does nothing for gaming which requires one to be 21 years of age, not 18.

    Another problem would be an increase of credit card fraud, but that has always been present in the online world and there are ways to deal with it to some extent.

    I am not opposed to online gaming, but there are issues that must be addressed.

  6. "INSANITY" is the best word to describe this quest.

  7. There is nothing to stop little Johnny or Susie from getting their parents' ID information and submitting it to create their own account. It happens a lot.

    The best process I have seen so far has been sites (of any type) that require you to send a photo of you holding a photo ID next to your face, and a larger image of the ID itself so it can be verified as genuine if possible.

  8. Collusion is rampant in online poker, and is basically impossible to prevent. About the only thing that can be done is to prevent more than one player at a table from using the same IP address. That stops some of the multiple players in one room scenarios, but not all by any means.

    But there is no need for collusion to involve people in one room, any IM or VOIP program (i.e. Skype or Teamspeak) facilitates it.

    A skilled player can sometimes detect, or reasonably suspect, when such collusion is taking place and adjust their play, but it can not be prevented.

  9. I won't deny that reputable sites will take action against collusion, but not all, and I suspect only a small portion or it, is detected.

  10. All of the pro-poker comments for this story have "expired" so nobody sees them anymore. But there are millions of Americans who enjoyed playing online poker until last month when the Department of Justice seized our money and shut down the three largest online poker sites. I look forward to the Barton bill passing, as do millions of other folks.

  11. Hi SunJon, I would like to answer your questions.

    1. Since this is for US online sites you go to the US poker site your playing on and they look into if you got cheated or not. They have all the hand histories and can determine if some was colluding by how they played. If you have a problem with the poker site you can complain to the US regulators over the site.

    2. The poker sites will be in the US and the US gets a cut and the State you are playing from gets a cut and the State where the poker site is located gets a cut. The site gets keep what is left after all the above gets theirs.

    3. These will be US sites.

    4. Online Poker does bring in jobs.

    TV advertizing.
    Merchandising for site logo's.
    Satellites to bring more people to B&M tournaments.
    Customer service staff.
    Security staff.
    Programmers.
    Will bring tax dollars to the US instead of offshore as it is now.

    5. See 1-4.

  12. Hi boftx, As far as little kids playing online poker goes, Where are their parents. If the parents are not keeping tabs on their children enough to catch them on a poker site then what about them chating in a forum with a sicko pedifile. Maybe the kids will get moms car keys with that credit card and take a drive. Maybe we should do away with cars. Look how many kids die in pools. Should we do away with pools? See my point?

    There is collusion and the sites catch them by tracking their play and how many times they play at the same tables. There is software looking for paterns used by colluders. A US base site can turn these colluders over to the law and send the colluders info to all other licensed and regulated online sites. Skilled players at the tables can warn the sites to look at a player who looks to be colluding.