The hearing today marks what I hope will be only the first step in this Congress to address the very serious social problems sometimes associated with the expansion of gambling throughout our country, and the recurring reliance on gambling in some areas as an economic development tool. I have been concerned for many years with the expansion of high-stakes gambling and was the first House sponsor of legislation calling for the creation of a National Commission to study the impact of the spread of gambling on individuals, families and communities.

Gambling has become too widespread a phenomenon in American society to eliminate it. We must instead focus our efforts on ways to mitigate its potential adverse consequences on America's families and communities.

Gambling can provide a tool for concentrating public and private investment and consumer spending to promote economic growth, as long as it is restricted to a limited number of jurisdictions. But when it expands virtually everywhere, this ability to concentrate economic resources is lost. This is one of the particular problems associated with Internet gambling. The potential negative aspects of gambling, such as excessive debt, bankruptcy, broken families, alcoholism and other problems, will be felt in communities in every part of our nation, without the affected communities realizing any economic benefit or any additional tax revenues to help offset these added social costs. In many instances, the economic benefits of Internet gambling go solely to web site operators half way around the world.

I recognize that there is a wide variation of opinion within the Financial Services Committee and the Congress on the merits of Internet gambling. But I believe, strongly, that Internet gambling represents a threat to many of the most vulnerable segments of our population -- especially young people who know the medium so well and who are so active in its use. A dormitory room, with one student, one laptop and one or a dozen credit cards can become a virtual casino. And, that is true of any room in any building in America, or anywhere in the world. How does society benefit from that?

The National Commission recommended that Congress act to prohibit wire transfers and other payments to known Internet gambling sites. I am glad that the Subcommittee is examining the issue of Internet gambling, and I hope it will lead to legislation putting the Commission’s recommendation on this subject into statute. However, we should not limit our inquiry to this one area.

The Commission also recommended that we prohibit the placing of credit and debit card machines and other electronic payment devices in the immediate vicinity of gambling activities. The Commission found that the migration of ATMs and credit card machines inside the casino has been a significant factor in the dramatic increase in problem and pathological gambling. I believe that this Committee should examine this issue and enact legislation to carry out this other recommendation of the National Commission. In the last Congress, I introduced such a bill, H.R. 2811. In the near future, I plan to reintroduce that legislation and legislation similar to the bill that I cosponsored in the last Congress to prohibit the use of credit cards and other payment systems to place bets over the Internet, but without provisions adopted in the Banking Committee that I believe substantially weakened its effectiveness.

I look forward to hearing the testimony of all the witnesses. But, I am particularly pleased to welcome Dr. Valerie Lorenz, the executive director of the Compulsive Gambling Center, Inc, who is an expert in the treatment of compulsive gambling. Dr. Lorenz has first hand knowledge of the harm created by Internet gambling in the lives of individuals.

Thank you, Madam Chairwoman.