Election Recap

12 November 2002

Last Tuesday was election day in the United States, and a source in Washington, D.C. close to the political process is telling IGN that the results do not look good for the Internet gambling industry.

"It's obviously not a positive development from the standpoint of this industry," said the source, who did not want to be named.

Sometime in the next two weeks, both houses of Congress will return for a lame-duck session, meaning that the members who were voted out of office on Nov. 5 will return for a few final days of business before being replaced with the candidates who won their districts.

An exception to that will be Sen. Jean Carnahan, D-Mo., who was not re-elected in a special election in Missouri. Because she was filling the post on behalf of her dead husband, Missouri held an election two years into her six-year term. Last week she lost her seat to Jim Talent, a Republican. The change will take effect immediately, meaning that for the lame-duck session, the Republicans will have a majority in the Senate, where the Democrats had ruled before. The aggregate election results for both houses mean that the Republicans have the majority in both the House and the Senate.

IGN's source said that Trent Lott, R-Miss., who is the majority leader in the Senate, wants to keep the length of the lame-duck session to a minimum. If that happens, it is probable that the Senate will not have time to vote on HR 556, also known as the Leach Bill. Lott may have difficulty keeping the session short, however.

"He may be dreaming," the source said of Lott. "I think they want to do homeland security, terrorism insurance, something in the appropriations vein to keep the government running and then get out of there."

The Leach Bill, which would prohibit online gambling by cutting off funding, was passed by the House on Oct. 1 and is awaiting a vote in the Senate. If the lame-duck session ends before that happens, the Leach bill has to start over in the House. IGN's source said the elections present a tough outlook for the I-gaming industry in that a southern Republican is now chairman of the Senate financial services committee.

One thing the industry has going for it is that John LaFalce, formerly a Democratic representative from New York, did not seek reelection this term. LaFalce was at the forefront of House efforts to ban Internet gambling.

The following election results could also impact the industry.

Rep. Bob Goodlatte

One of the leaders in the effort to ban Internet gambling in the United States, Bob Goodlatte has tried unsuccessfully to pass various version of his bill since 1996. After stalling again over the summer, the Goodlatte bill was eventually merged into James Leach's Internet gambling funding bill, which passed the House in October. Goodlatte had no opponent in the midterm elections. He hasn't indicated, presuming the Leach bill dies this month in the Senate, whether he'll support Leach again in 2003 or reintroduce his bill.

Rep. John Conyers

Conyers won his district, the 14th district of Michigan, by a near-landslide: 83.2 percent. The Democrat made his mark on the industry last session by repeatedly voicing opposition to bills that would have banned Internet gambling.

Rep. Barney Frank

Frank, one of the most vocal opponents of the Leach Bill, ran for his 12th term and was unopposed. He is a Democrat from Massachusetts. In next year's session, he will be the senior Democrat on the House Financial Services Committee.

Sen. Tim Johnson

One of I-gaming's "friends" in the Senate, Johnson is still embroiled in the closest Senate election of the year.

The Democrat from South Dakota played a role in stalling the Leach Bill when it arrived in the Senate by introducing a competing bill. Johnson's bill is an extension of the Federal Wire Act. Unlike Leach's bill, it has no carve-outs for horse racing and Indian gaming. While Johnson played a role in keeping the Leach bill at bay, insiders feel that the Johnson bill won't get past the House because of its lack of exemptions.

Johnson is at the end of his six-year term and was in a hotly contested race for his seat against John Thune. With 100 percent of the vote counted after the election, Johnson was declared the winner, edging out Thune by only 528 votes. A recount of the election results has been ordered for Nov. 25.

Rep. Jim Leach

One of Internet gambling's biggest opponents in the House of Representatives is Iowa Republican Jim Leach. In each of the last three years, he has introduced legislation aimed at prohibiting Internet gaming. His bill was passed in the House in October and could be brought up during a lame-duck session in the Senate, but political observers say such a scenario is unlikely.

Leach, who was first elected in Iowa's 2nd District in 1976, faced a huge challenge in a race that could have implications far beyond the interactive gaming industry. Leach found himself in a redrawn district that didn't include his strong and friendly base of Davenport. The new district includes 20,000 more registered Democrats than it does Republicans. Leach still won his race by 6 percentage points though, garnering 52 percent of the vote while Julie Thomas finished with 46 percent.

Rep. Michael Oxley

As chairman of the Financial Services Committee, Republican Michael Oxley played a key role in getting the Leach bill through committee and before the House, where it passed under the suspension of the rules. Oxley was easily re-elected in Ohio's 4th District. First elected to the House in 1981, Oxley received 67 percent of the vote last week.

Emily Swoboda is the senior staff writer at IGamingNews. She lives in St. Louis, Mo.