Head to Head: Should Sports Betting Be Legalized In All Fifty States?
March 3, 2021
The sports betting world is not only a major industry worldwide — it is ever-growing, especially in the United States. However, sports betting is only legal in 18 of the 50 states. So the question everyone wants an answer to is should the industry be allowed to grow and be legalized nationwide? Or should it remain under heavy regulations so as to not ruin sporting events and their outcomes?
For Sports Betting Legalization
The legalization of betting on sports events has been a highly controversial topic recently, and I believe that it should be legalized across the country. First off, many people struggle with gambling addiction, and I am sympathetic to those who struggle with this. That being said, sports betting is only a small portion of all gambling occurring in the United States. Sports betting is legal and operational in 18 states (plus Washington, D.C.). Four additional states have passed bills legalizing it, with another nine other states having active bills. Other forms of gambling, such as lotteries, commercial and tribal are all legalized in more states than sports betting.
Although sports betting is just a small percentage of all gambling occurring in the nation, it has an even lower proportion of gambling addiction cases. ESPN reported that less than 1% of all callers to the Nevada Council on Problem Gambling Helpline in 2014 listed sports betting as the form of gambling that they struggled with the most. These hotlines receive calls regarding lotteries, scratch-off tickets and casino activities such as slots and poker much more often.
The Delaware lottery placed nearly 2 million more sports bets in 2014 than in 2009, and Delaware’s council on problem gambling says that they have not seen a noticeable increase in calls regarding sports betting. This may be an indicator that sports betting is not as addictive as many other types of gambling.
Lotteries are one of the most addictive forms of gambling, and yet they are legal in 44 states. The odds of winning the Powerball are roughly 1 in 292,201,338, and yet the majority of states allow people to spend their money on it. Massive sports betting parlays can have odds similar to this, but for the most part, the odds are significantly better. This allows far more people to make money on sports gambling than on Powerball or lotteries in general, and yet it is only legal in 18 states.
Another huge benefit of legalizing sports betting is the taxes that it brings in. Gambling, in general, is often a huge boost to the economy, and sports betting would make it even larger. The taxes taken from sports betting often go towards roads and education, both necessary parts of our infrastructure. An Oxford Economics study estimated a gross gaming revenue of $11.9 billion per year if sports betting was legalized in casino, retail, and online locations.
The same study also estimated that at a base tax rate (10%) with moderate availability, the combined gaming tax revenue for the US would be $1,547,000,000. All of this money going towards roads and education could have huge results.
Many people also participate in illegal sports betting, most commonly through bookies or online betting with offshore operators. A GMA study based on the Oxford Economics study estimated that the illegal sports betting market produces $150 billion in wagers every year.
Essentially, the U.S. is missing out on 150 billion taxable dollars each year simply because they haven’t legalized sports betting. And if it is legalized, more people will be betting, so that number goes up naturally.
Legalizing sports gambling also can help shrink corruption in sports. Many people think that the opposite would happen, but in reality, it would create a lower liquid and more regulated gambling market. Currently, the market is highly liquid and under-regulated, and the legalization of sports betting would help to change that and help to shrink corruption.
At the end of the day, nobody is forced to participate in sports betting. Of course, having more sports betting will naturally increase gambling addiction, but at a lower proportion of gambling addiction cases compared to other gambling types such as slots, lottery and scratch-offs. The choice for an individual to participate in sports betting is completely voluntary. I am simply arguing that the option to participate should be there for those who want it. I think that the positives greatly outnumber the negatives and that sports betting would do much more good than harm.
Against Sports Betting Legalization
It was October 1919. The Chicago White Sox were playing nine games against the Cincinnati Reds for the World Series title. The White Sox were the powerhouse of the American League with sluggers like Shoeless Joe Jackson and Eddie Collins. The Sox were not playing very good baseball though, and sportswriters were puzzled. Easy catches in the outfield were being muffed, throws were landing short of the glove, pitchers were allowing an abnormal number of walks and normally strong batters were not finding their way to the bases. The word started to get out, the fix was on.
In the weeks leading up to the championship games, eight Chicago players had met in secret and decided to throw the series and rake in the winnings. While they all saw a chance at decent money for betting on games they were sure to lose, the “Black Sox” as they came to be known, had beef with owner Charles Comiskey over their compensation and his authoritarian leadership. A few believed he treated his players more like livestock than humans.
The White Sox would go on to lose the series and the word got out that indeed eight players had thrown it. Major League Baseball got its first commissioner in 1920 as a response and the “Black Sox” never played another professional game.
After more than a hundred years, the story of “Black Sox Scandal” is hardly talked about except by true fans and historians. But as the old adage goes, if we learn nothing from our history it will repeat itself. And it will do so at our peril.
I have nothing against gambling. I was raised with the Texas Lotto and I have an uncle who is still salty about the Michael Jordan push-off, partly because the Jazz lost the finals but mostly because the money he had riding on it. He still tells the story, and I still laugh. Betting on games can no doubt be a lot of fun — it gets skin in the game, adds another level of complexity and creates memories. Also, people should be able to do what they want with their money. They will too, as a few hedge fund managers found out last week.
The difference between now and 1919, money has a dark mode. Obfuscating the source and path of electronic money transfers is commonplace and easier today than it ever has been, for better or for worse. The same technology that allows for cryptocurrencies and the growing trend toward decentralized finance also expanded dark money into politics and emboldened the tax-skirting elites.
If sports betting is expanded there will be a golden age where things couldn’t be better. More money will change hands, and on a regulated market that means more tax revenue and funding for public needs. My parents didn’t pay for a single day of my primary education because of the Texas Lotto. However, the dark days will follow.
Eventually, the biggest bookmakers and betting houses will buy out and consolidate the little guys. With little competition, the bookies will have the power and it will seep into the more sacred parts of our sports world. Our field of view will be cut down by betting line figures and bookie sponsorships. The bigger the bookies get, the more money they handle and the harder it will be to track, providing an avenue for another, albeit more digital “Black Sox” scandal.
Last, but perhaps the most important concern for me as a university student, the NCAA has been kicking the collegiate athlete compensation can down the road for decades now. Disgruntled student-athletes have been voicing their concern with not being able to profit off of their own likeness. Establishing a regulated betting market for college sports without cutting the players in is not only disrespectful but it’s irresponsible. The NCAA and collegiate institutions have a duty to protect and provide for their athletes, instead athletes are treated like Comiskey treated his White Sox, a means to an end, cattle to be culled for profit. What do you think will be said about the first-star Division I QB who throws a game so he can get the payout he deserves? The payout that was instead pocketed by the NCAA and the university he plays for.
It won’t be understanding, I’d bet on it.