Legalized Online Gambling a Sure Cure for State Budget Woes

[Qbins Missile Crisis]

States like California are running out of money and have become desperate for new revenue streams. Some, like Illinois, have begun to look at online gambling as potential cures for state budget woes.



Illinois is looking into legalizing online horse racing, which under federal regulation has already been permitted under the Unlawful Internet Gambling Enforcement Act.

It's actually unclear whether Internet betting is illegal under Illinois law, but tracks aren't willing to press their luck because a 2000 attorney general opinion noted state law doesn't expressly authorize it, according to Ryan Keith of the Associated Press.

California has been contemplating the legalization of online poker. That state has been crippled by a looming recession.

A proposed initiative to create a state-owned Internet poker game drew attention last August.

"It's silly for the state not to get into the business," said I. Nelson Rose, a professor and attorney at Whittier Law School in Costa Mesa. "Billions of dollars are being spent on the game here, and the state isn't getting one penny."

California is the world's online poker capital, analysts said. The last two World Series of Poker champions come from that state. The government is missing out by not legalizing, regulating and taxing it.

"Gov. Arnold Schwarzenegger said Monday that California faces a budget gap that could approach $20 billion through June 2009, a dizzying projection that adds further confusion to the depth of California's financial crisis.

"Right now, we have approximately, altogether, $20 billion of deficit," the Republican governor told business leaders in Orange County. "It's going to be a big challenge."

The estimated gap for the fiscal year that begins July 1 already has prompted talk in Sacramento of tax increases and spending cuts that could hit classrooms, law enforcement and health care.

The new figure essentially doubles the Republican governor's deficit projection from just days ago. California's economy has been hammered by the slumping housing market, while soaring gas prices have cut into consumer spending.

Just last week, the governor said the state would face a potential $10 billion deficit in the next fiscal year. His spokesman, Matt David, said Schwarzenegger misspoke at that time.

Schwarzenegger has yet to discuss the option of legalized online gambling, though a few of his Republican colleagues have been actively promoting the option in recent weeks.

Texas Republican Congressman Ron Paul wants current Federal legislature prohibiting most forms of Internet gambling reversed including online poker.

Paul spoke at a fundraising event for Republican New Jersey Senatorial candidate Murray Sabin. Both men understand the amount of funds that can be generated from a legalized online gambling industry. Sabin could introduce state legislation that would regulate the activity in New Jersey should he be elected. New Jersey is yet another state that is perilously coming close to running out of money and would benefit enormously from the billion dollar i-Gaming industry.

Dr. Sabin told Gambling911.com last week "When I take my place in the Senate, I will say NO to draconian laws that infringe upon the freedom of Americans to spend their own hard-earned money where they see fit! Enjoying a wager and participating in online gaming should not be banned. And those who provide sites that entertain and provide services to online gamers should not be treated as criminals."

******opher Costigan
Gambling911.com
Originally published April 29, 2008 11:38 am EST