Obama’s Big Lottery Gamble
State governments are the lottery’s real “big winners,” collecting $17 billion of revenue annually from ticket sales, which are really a deceptive and hidden tax that expand the government’s influence. While the ticketholder’s chances of winning the recent Mega Millions jackpot were about one in 176 million, state governments are always guaranteed huge payouts. Last December, the Obama administration once again bypassed Congress, unilaterally opened the Internet for gambling, and made it easier than ever for state governments to collect the lottery tax and illegal foreign operators to further target Americans in their homes. Now, Americans need only an Internet connection and a credit card to play their state’s lottery or gamblewith an illegal foreign operator.
In 1961, Congress passed the Interstate Wire Act, which prohibited certain forms of gambling. Since then, online gambling of any kind has been illegal. As lawmakers left Washington for Christmas in 2011, however, Obama’s Department of Justice reversed decades of precedent without congressional consult, ruling the Wire Act is limited to sports betting and effectively legalizing Internet gambling by removing the congressional prohibition.
Looking to bump tax revenues for the year and expand the size of government, statesare now moving quickly to take advantage of the new ruling. Obama’s home state of Illinois became the first in the country to sell lottery tickets online – just three months after the administration’s decision. Delaware, New York, Maryland, Ohio and California are preparing for an online launch as well.
Not only did the Obama administration come to this radical verdict without congressional insight, the Department of Justice avoided a public dialogue, leaving many concerns about Internet gambling out of the national political debate.
Many advocates worry that moving the lottery online could lead to increased gambling among children and teenagers, as the identities of those purchasing the tickets are easy to conceal during a digital exchange.
Others remain concerned about the impact on low-income families, as the lottery tax disproportionately impacts underprivileged Americans. In South Carolina, for example, people in households earning under $40,000 account for 28 percent of the state’s population, yet comprise 54 percent of frequent lottery players. Similarly in Texas, instant tickets are more likely to be purchased by someone who is unemployed than an individual who is working or retired.
Especially in a down economy, the state lottery can be a tempting game. Throughout the recession, state lottery revenues have skyrocketed. In fact, 28 of the 41 states that have a lottery achieved higher sales in 2011 than in 2010. Seventeen of those states set all-time records.
“Looking at historical data, it is fair that there has been a trend of lottery ticket sales moving in tandem with economic conditions,” Garrick Blalock, a Cornell University economist, told ABC News. “When people are feeling desperate, they are more likely to stop by the gas station and buy five lottery tickets, hoping they get a big windfall.”
While it’s tragic that for some the American dream has devolved to hoping for luck rather than working hard to make your own luck, it is unfortunate the President and states have sought to take advantage of vulnerability in order to boost tax revenues.
What’s more, this controversial policy has been brought about by bureaucracy, not democracy. By dubiously sidestepping our elected legislators once again, President Obama has not only expanded the role of government in our lives, but amplified the Executive Branch’s role in the legislative process.
Unfortunately, it’s not the first time this administration has bypassed congress to advance its own big-government agenda. Time and time again, President Obama has disposed of our system of checks and balances that have kept this nation stable and grounded for over two centuries in order to further their narrow ideological agenda. In fact, a recent New York Times piece explained “[Obama] declared, aides recalled, that the administration needed to more aggressively use executive power to govern in the face of Congressional obstructionism.”
Our nation’s Constitution was not designed so government would make “in the moment” policy decisions. It was designed so the nation as a whole could make slow and sure steps forward. While our 24-hour-a-day news cycle and a need for instant gratification seem to reward knee-jerk reactions, it is irresponsible to thwart the constitutional safeguards that protect Americans from sporadic and ill-thought-through policy decisions.
The Obama administration has overstepped the president’s constitutional bounds, circumventing Congress and implementing its own agenda. It’s time for Congress to regain control of this issue and call this administration’s bluff.