Editorial: Thank You Sir, May I Have Another?

17 June 2002
A Chronology of Headaches for Bob Goodlatte

October 1999 - Rep. Don Young informs the House Judiciary Committee that he opposes the Rep. Bob Goodlatte's Internet Gambling Prohibition Act of 1999 because none of its many exemptions cover Indian gaming. He seeks to have the bill reassigned to the Committee on Resources, of which he chairs.
November 1999 - The House Crime Subcommittee moves the Goodlatte bill, but without the full support of the committee's members. The racing and fantasy sports amendments are heavily debated with no solution, and the issue of enforceability enters the discussion.
March 2000 - The Christian Coalition expresses its disapproval of the Goodlatte bill (and its many exemptions) in a letter to Judiciary Committee Chairman Henry Hyde. In it the group's director of government relations, Jeffery Taylor, criticizes the legislation for including an exemption for state lotteries and pari-mutuel wagering. The Family Research Council announces its opposition as well.
April 2000 - Deputy Assistant Attorney General Kevin DiGregory tells MSNBC, "The (Justice) department does not understand why the pari-mutuel wagering industry should be allowed to accept bets from people in their homes, when other forms of gambling have rightly been prohibited from doing so. The same concerns that we have expressed about children and compulsive gamblers having unfettered access to gambling via the Internet is true whether the betting is on horse races or on casino games."
May 2000 - The Christian Coalition and Family Research Council convince Reps. Hyde, McCollum and Goodlatte to support an amendment that will remove an exemption for state-run lotteries. A group of GOP lobbyists, including former Illinois Rep. Marty Russo, respond by voicing their adamant disapproval.
May 2000 - Reps. Leach, LaFalce and Baker introduce the Internet Gambling Funding Prohibition Act as a companion to Goodlatte's legislation. The Leach measure eventually evolves into a competing bill.
May 2000 - House Commerce Committee Chairman Thomas J. Bliley Jr. asks Speaker J. Dennis Hastert to give his panel jurisdiction over the Goodlatte bill. Bliley's committee argues that the bill would impose a mandate on ISPs to enforce it.
June 2000 - The Washington Times publishes an article outlining five reasons why Congress should not legislate Internet gambling.
July 2000 - Vice President Al Gore voices his objection to the Goodlatte/Kyl legislation. Gore's concerns echo those expressed repeatedly by the Justice Department--that the bill contains loopholes that could lead to more wagering in the long run.
July 2000 - Assistant Attorney General Robert Raben explains in a letter to Speaker of the House Dennis Hastert that the Goodlatte bill would make certain types of gambling legal over the Internet that are not legal in the physical world. He also suggests that the bill may bring even murkier enforcement issues in its wake and would be inconsistent with current federal gambling laws.
July 2000 - The U.S. House votes 245-159 in favor of passing the Goodlatte bill, however, it needs two-thirds of the vote to pass because Goodlatte elected to bring up for a vote without debate. Thus, he fails at his first attempt to pass the bill in the House.
July 2000 - The White House issues a statement reiterating its opposition to the Goodlatte bill, saying that it "appears to be designed to protect certain forms of Internet gambling that currently are illegal, while potentially opening the floodgates for other forms of illegal gambling."
August 2000 - Working with the U.S. Department of Justice and at the behest of the Clinton Administration, Reps. John Conyers and Chris Cannon introduce a second competing bill. HR 5020 is a straight amendment to the Wire Act.
October 2000 - Internet auction site eBay expresses its concern over the Goodlatte bill's burden on ISPs, claiming the bill punishes ISPs that police their sites for illegal materials. The group proposes a "Good Samaritan" amendment, which would let Internet service providers off the hook for removing potentially illegal information from their clients' sites.
December 2000 - After meetings held in Las Vegas, the American Gaming Association is said to be on the verge of withdrawing its support for the Goodlatte bill.
December 2000 - Word gets out that Nevada Assemblywoman Merle Berman is drafting legislation that would legalize and regulate Internet gambling in her state.
January 2001 - New Jersey Assemblyman Tony Impreveduto introduces a bill that would allow Atlantic City casinos to operate online.
June 2001 - Nevada passes a bill legislating the framework regulating Internet gambling in that state.
July 2001 - A representative from Visa USA tells a U.S. House Subcommittee on Oversight and Investigations that the responsibility for keeping Americans from participating in Internet gambling shouldn't be placed on Visa's shoulders.
March 2002 - American Gaming Association President Frank Fahrenkopf indicates that the association cannot support the current version of the Goodlatte bill. The AGA does, however, support the Leach bill.
March 2002 - One of the Goodlatte bill's many cosponsors, Jim Gibbons, R-Nev., asks to have his name taken off the bill. Gibbons says the decision is based on the Goodlatte bill's change of focus.
May 2002 - Sportingbet Plc, the global sports betting group, launches a major campaign to promote government regulation of the online gambling industry and encourages the government to tax its industry. The company takes out full-page advertisements in the Washington Post, The Washington Times, The Hill and Roll Call.

How much more can Bob Goodlatte take?

Year after year--and lately, week after week--the Virginian Republican comes up to bat in the name of protecting Americans from themselves, and each time his opponents bring the high heat under his chin. But remarkably, he keeps getting up, brushing off the dust and stepping back up to the plate.

For five years he has tried to pass his Internet gambling prohibition bill, and he's fallen short in a different manner each time he has a go at it.

Goodlatte's plight is the classic cartoon scenario in which the animated hard-luck victim de jour is trying to plug holes in a dam that's about to burst. Each time he plugs a hole, a new hole forms and water comes gushing out. Last week's hole was opened by Rep. Robert Wexler, D-Fla, who is calling for exemptions for dog racing and jai alai. Before that, he found himself patching together language that made the bill palatable for land-based casinos in an effort the bring the American Gaming Association, a defected supporter, back on his side.

In case you got into the game late, the routine is nothing new. It goes like this: Goodlatte brings his prohibition bill to the table, various gambling lobbies pressure him to start carving out exemptions, he obliges and the anti-gambling crusaders, whom he originally sought as supporters, blast him for legalizing various forms of gambling over the Internet. As soon as he moves a finger to plug a new hole, water comes hard from the hole he just abandoned. Delicately, he tries to patch holes in a way that pleases everyone, but he hasn't found the right combination of patchwork to save the dam. That right combination, he's slowly learning, may not exist.

He's tried to go with no carve-outs. He's tried to go with amendments galore. He's tried to bring the bill before the full House for debate. He's tried to pass it without debate. But every time he goes for it, he's managed to alienate just enough people to kill the bill. Then he reverts to the no-exemption approach and we go around the circle again.

Meanwhile, the Justice Department chimes in from time to time advising that he'd better figure out a way to enforce the legislation, at which point the ISPs and financial institutions bounce the "don't look at me" his way, all the while it becomes more and more apparent that poor Bob doesn't have many friends when it comes to I-gaming.

And if all that isn't enough of a headache, many of his former backers have thrown their support behind the Leach bill, a competing piece of legislation that focuses on blocking Internet gambling-related financial transactions.

As most people in this industry are aware, it wasn't Goodlatte who invented the rotating exemption routine. It was perfected by Arizona Sen. Jon Kyl, the father of the prohibition movement in the United States, but Kyl managed to escape the insanity. Twice Kyl got his prohibition bill passed in the Senate, and both times Goodlatte was unable to move the House version. So Kyl has elected to step out of the picture and leave the onus on Goodlatte. Before we give Jon Kyl credit for his achievement, though, let's keep in mind that the situation has grown increasingly complicated, and Goodlatte faces a much stronger opposition than Kyl ever did.

Regardless, Kyl is free of the online gambling mess for now, and you've got to believe he's happy to be out of the crossfire. Unfortunately for Goodlatte, there is no way out. Goodlatte, for the better part of a decade, has been on a mission to be the recognized Internet expert in Congress. When it's all said and done, and the U.S. legislature has passed approximately 90,000 Internet-related bills, he wants to be the guy who led the way.

Pulling out and conceding defeat on the Internet gambling issue could indicate that perhaps he's not the go-to guy after all when it comes to tech legislation (especially if the Leach bill passes) and maybe even reveal that he doesn't quite have a grip on the dynamics of the Internet.

One can only imagine his frustration now that he's invested too much to turn back. It's become apparent that he'll make whatever concessions are necessary to gather enough votes to get it done, yet he still can't win. Every move he makes turns someone against him. What's worse, he's been left with a piece of legislation that has no soul.

There are lessons to be learned here, and ultimately the ordeal will make Goodlatte a better legislator. This is about biting off more than you can chew, and it's a shining example of why it doesn't pay to take the easy road.

"Internet gambling is evil, so let's get rid if it."

It sounded like a slam-dunk, feel-good initiative, but five years later the notion has proven to be a gross miscalculation. Goodlatte has special interest groups coming at him from more angles than he probably thought were mathematically possible. New hurdles are sprouting like pop-up windows at an adult portal. A project that was to be a quick check on an impressive list of Internet-related accomplishments became a living nightmare driven by the conception of an impossible goal: Draft a gambling prohibition bill that's approved by the casino industry, the lottery industry, the racing industry, Native American groups, Internet service providers, family groups and the banking industry, while preserving states' rights, convincing the Justice Department that it's enforceable and not violating the First Amendment of the U.S. Constitution.

He should have waited a few years and boarded the "anti-terrorism" train.

Ironically, a battle brought about by poor judgment could earn Goodlatte merit for his remarkable resilience. He keeps getting punched silly on the House floor, but he comes back every time with a head of steam. Not since Jerry Cooney hung up the gloves have we seen such an ability to stand in the ring and take a beating. No matter which side of the debate you're on, there's no denying that his drive and dedication are admirable.

And fortunately, the nightmare is almost over. In the near future, he'll either pass the bill or the House will put the legislation out of its misery. If you listened to last week's House hearing you would have immediately picked up that his colleagues, including those among committee leadership, are tired of dealing with this legislation. They've had about all they can take. And through his words and mannerisms, you can tell that he's had about all he can take as well.

Eventually, the referee has got to get in there and stop this fight.

Mark Balestra

Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.