US Congress

Does RAWA Postponement Mean a 2015 Legislative Push?

This week’s news that the Sheldon Adelson-backed Restoration of America’s Wire Act (RAWA) has been pulled from US Congressional consideration during the end-of-year lame duck session represents a short-term win for America’s online-poker and online-gambling interests.  However, it’s important to understand that RAWA not being attached to some random piece of “must pass” legislation by Adelson’s chosen and well-funded political mouthpieces doesn’t mean a new Adelson-backed bill won’t pop up in 2015 or 2016.

congress-stepsBut before that scenario is addressed, a recap of recent events in order.  Late last week, news reports indicated that RAWA’s primary sponsors, Sen. Lindsey Graham and Rep. Jason Chaffetz, might be able to get the controversial bill added to some random piece of year-end legislation, in much the same manner as the original (and heinous) UIGEA was tacked onto an unrelated bill by Bill Frist, a conservative Southern Senator with Presidential aspirations.

One of the interesting elements come out of this latest cycle of the political rumor mill was that Adelson, the billionaire CEO of Las Vegas Sands Corp., who is strongly anti-online gambling and has spent millions in support of GOP candidates who will back his cause, had been in discussions with Senate Majority Leader Harry Reid (D-NV).  Reid himself continues to be one of the key players in the debate, since Nevada has legalized online poker (despite Adelson’s best efforts), and to a certain extent all US Senate legislation passes through Reid.  Reid could have supported Adelson’s bill in exchange for significant payoffs elsewhere, and despite their polar political differences, several reports have indicated that Adelson and Reid are friends.

Meanwhile, the storm clouds were mounting… again.  Back in 2006, there was little incentive for any US Congressman to push too hard in favor of online gambling, which was widely perceived as the sole domain of unregulated, offshore sites.  The UIGEA passage in 2006 wasn’t an isolated incident, despite the anti-democratic manner in which the bill was passed.  Similar bills had been introduced before that, with now-disgraced lobbyist Jack Abramoff figuring as a central character in those early battles.

This time around, several states have already legalized various forms of online gambling, ranging from poker to lotteries, and many more are considering it.  Worse, the venal Adelson’s slams against online gambling have been so extreme and blatantly hypocritical that few legislators have wanted to support RAWA.  In the Senate, only three Senators joined Graham as co-sponsors of the bill — Sens. Mike Lee, Kelly Ayotte, and rampant nanny-stater Dianne Feinstein, and none have joined on since last March, when the bill was introduced.

Over in the House of Representatives, where Chaffetz’s version was being considered, only nine other Representatives signed as initial co-sponsors, and only nine more have joined since.  The nine original co-signers were Tulsi Gabbard, Jim Matheson, Lamar Smith, Jim Jordan, Brent Franks, George Holding, Frank R. Wolf, James Lankford and Emanuel Cleaver.  The nine who joined later, mostly this summer, included ardent anti-gambling stalwart Spencer Bachus of Alabama, but no one else of prominence.  The eight besides Bachus are Charles Dent, Mike Rogers, Randy Forbes, Steve King, Trey Gowdy, Daniel Lipinski, Cedric Richmond and Louie Gohmert.  Including primary sponsor Chaffetz, the House sponsors included 14 Republicans and five Democrats, which on the one hand can be called “bipartisan,” but really amounts to a topic with fringe appeal.

This week saw the pushback, with a surprisingly democratic result: At least in the short term, the evil Adelson won’t be able to purchase his desired outcome.  First came former Senator and GOP presidential candidate Ron Paul’s blistering attack on Adelson.  (For a deeper look at libertarian maverick Paul’s takedown of Adelson, read FlushDraw contributor Dan Katz’s story here.)

Then came the news that RAWA was dead, at least for the duration of this year’s legislation session.  The first mainstream report came from conservative news outlet Human Events, which confirmed in a feature that a possible deal between Reid, the GOP and Adelson to move RAWA forward never really got off the ground.

There’s a statement within that report that offers decent hope that Adelson’s RAWA aspirations might not play well down the road, either.  According to the story:

If the RAWA bill was brought up, it would have put conservatives and libertarians in a bind because they did not relish the idea of Congress outlawing a contributor’s Internet competition.

Other opponents of the bill, many of whom abhor gambling, are uncomfortable with the federal government interfering with commerce inside a sovereign state, while others, agnostic on the morals of gambling, did not want Big Brother dictating lifestyle or behavior choices.

While it might be too much to believe that the typical GOP politician can look beyond the next major campaign contribution, at the least, the above offers a glimmer of hope.  Therefore, despite the tens of millions Adelson has contributed to various GOP campaign coffers, the party was uncomfortable enough to grant him his “big ask,” as the Human Events story put it.

Still, when the 2015-16 Congressional legislative session begins, Reid will no longer be the Senate Majority Leader.  Instead it will be Mitch McConnell, who is more anti-gambling in general than Reid, but whose state also houses a prominent horseracing industry and a major corporate benefactor, Kentucky Derby owner Churchill Downs, which has shown plenty of interest in the online gambling space.

In other words, the GOP Senate majority that the next session will feature might on its surface represent a big advantage for Adelson and his monopolistic plans, but between strong state opposition and an uncertain federal landscape, that’s not necessarily so.

The most likely federal outlook for the next two years, then, is nothing.  No strong force exists to push forward pro-online gambling legislation at the federal level, just as RAWA may well be too extreme to garner any real traction.  That leaves it up to more states themselves to legalize and regulate online gambling, in whatever form they see fit, and for international, offshore sites to continue offering unregulated services to much of the rest.


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