Slippery slopes

A convergence of events prompts me to pick this subject.

First, last night I was reading the new issue of Card Player magazine. There's a news story about the broadening of Florida's laws to allow real no-limit poker (July 28 issue, page 26, article by Stephen A. Murphy). That wasn't news to me, but it gave more background about the history of Florida's poker laws than I had been aware of:

Florida legislators legalized penny-ante poker in 1989, but capped all pots
at $10. While the law would loosen up a little over the years, it never went as
far as most serious poker players would've liked.

In 1996, state-licensed pari-mutuel facilities were allowed to begin
spreading poker games with the $10 cap. In 2003, a new law passed that scrapped
the $10 cap but still forced the max bet in any action to be only $2. In 2007,
no-limit hold'em was finally introduced, but with the $100 max buy-in.

The second convergent event was reading today the final arguments in an interesting pro-con debate about online gambling sponsored by The Economist, available here.

The third event was today's passage out of committee of H.R. 2267, proposing to establish a federal licensing/regulatory scheme for online gaming. See the Poker Players Alliance's press release on it here.

Slippery slopes are real. (For an excellent overview of how and why slippery slopes work in law and politics, see Eugene Volokh's article here.) You can easily imagine how the latest Florida law is the literal, nightmarish fulfillment of an anti-gambling activist's parade of horribles. "You see? We warned you back in 1989 that penny-ante was just the first step, and they'd demand more and more. Now they have finally achieved what they really wanted 20 years ago."

It works in other subjects, too. A friend of mine from back in Minnesota, Joe Olson, co-authored a fine historical essay for a law review about how England went from almost no gun-control laws to a nearly total ban on firearms (and, along the way, use of any force for self-defense) in just a few decades ("All the Way Down the Slippery Slope"). When the Supreme Court declared unconstitutional restrictions on sale of contraceptives and laws against interracial marriage, few would have guessed that those decisions created a slippery slope leading to judicial striking of anti-abortion laws and legalization of same-sex marriage.

On the other hand, perhaps those pressing the first cases knew exactly what they were doing and saw the end from the beginning. After all, there is a clear history of smart, strategically-minded people using the slippery slope to achieve their purposes through patient gradualism. Thurgood Marshall's brilliant stepwise attack on racial discrimination laws jumps to mind. He very carefully plotted out how to use courts, legislatures, and public opinion to knock down barriers one at a time, starting with the most patently unfair and unreasonable ones. It took decades for his plan to play out fully.

It's good to see examples like Marshall's, and like the Florida poker history, and know that you can achieve meaningful reform of stupid, restrictive laws by continuing to press an issue over time. After all, you can't just fly to the top of Mount Everest in a helicopter and say you've conquered it. You can only get there one step at a time.

But it works both ways. Freedoms can be just as easily destroyed in small steps as they can be won--probably more easily, in fact. It is easy for politicians to vote either to ban or to continue or tighten a ban on some activity that only a minority of people want to do, whether it be smoking marijuana or riding a Jet Ski or shooting a machine gun or piloting a motorcycle without a helmet. Those examples also share the characteristic of being things that are either objectively or arguably bad or dangerous, which makes it even easier for politicians to prohibit them by law, in the name of protecting people from their own folly.

I'm not proud of this, but I was once all in favor of a bunch of prohibitions of things that I knew were bad for people. I have supported anti-tobacco legislation, helmet laws, seat belt laws, and even an attempted ban on tanning booths. They seemed like no-brainers to me; these activities are dangerous and no reasonable person could want to see his fellow citizens harmed needlessly.

I'd like to think that I'm more enlightened now. I have come to realize that if I don't want other people mucking around with the liberties that I want to engage in (driving ridiculously overpowered fast cars, playing with guns, entering poker tournaments, eating foods crammed with salt and trans fats, etc.), I can't very well be working to prohibit the things that they so irrationally want to do (drink themselves into a stupor, smoke cigarettes, hire prostitutes, go sky diving, drive Humvees, worship Baal, etc.), even if I think they've gone mental to want to do them.

Today's second and third items provide vivid reminders that there are lots and lots of people out there who remain as paternalistic as I used to be. The "con" author of the Economist debate and any number of politicians opposing H.R. 2267 (because they want online gaming to be illegal) want to control your life. They claim the right and power to decide for you whether you should be able to enter $1 tournaments on PokerStars in your pajamas, because, Lord knows, you're just too stupid to be trusted to make such decisions for yourself. Although they would undoubtedly deny it, it is absolutely, demonstrably the case that they believe they are in a better position than you are to decide what you do with your time and your money.

You should be appalled and resentful of this--unless, of course, you try to do the same to others with respect to some activity that you find abhorrent and want to ban, in which case you're just getting tit for tat and you deserve it.

Anyway, I have strayed from where I set out to go. What I wanted to get to was this: I remain opposed to the Frank bill, and all others like it, precisely because of the slippery slope. As I have argued here several times before, I think it is a dangerous precedent that is far more likely, ultimately, to kill online poker than to save it.

The reason I think this is that taxes and regulations, with rare exceptions, tend to ratchet in one direction only. If we get federal licensing of online gaming, then every time there is some crime or other scandal, as there surely will be, the regulations will get tighter and more severe. Witness what happened just last week with the banking industry, and what happened with respect to offshore oil drilling almost as fast as the tar balls washed up on the Florida beaches.

Same thing with taxes. How often do you see tax rates cut, compared to how often you see them raised? Isn't the latter, oh, about a hundred times more common than the former? Politicians tend to disbelieve the Laffer curve, or at least always convince themselves that they're still on the upslope side of it so that raising tax rates will increase governmental revenue. It will be the same with online poker. The initial tax rate will be painful but not lethal to the industry. Over time, though, the slippery slope will make the games less and less profitable, both because of increased tax drains (as you can see happen with tobacco taxes, gasoline taxes, alcohol taxes--heck, just about any kind of tax you can name) and because of increased rake due to ever-higher overhead costs of complying with ever-more-burdensome regulations.

The process may eventually stop or reverse, but it will only do so when the damage has become so great (i.e., both the sponsoring companies and the government making less and less money) that it is impossible to deny--and then it's too late. The kitten will have fallen off the end of the slide, and mother cat won't be able to rescue it. They will have killed the goose that lays the golden eggs. (Add your own overblown metaphor here.)

The current situation is not great. I am not fond of the legal haze of today's status quo, nor the fears that such uncertainty generates. I have heard from many friends, readers, and fellow players at the live tables that they don't play online because they're worried about cheating, or it being illegal, or the IRS being able to trace transactions, or funds being suddenly confiscated by the government, or sites being shut down or going bankrupt. It is a disgrace, an outrage that people in Russia are more free to play poker online than we are in the allegedly last great bastion of freedom. But I remain convinced that the way things are is better than the way they eventually will become if the feds get involved.

I am fully persuaded that what we will witness will not be a repeat of Florida, with gradual liberalization of the game. No, it will be a promise of Shangri-La, but actually leading to slow death by regulatory and confiscatory strangulation. Ironically, I believe that those currently fighting federal licensing will in the long run get their wish--the end of online gambling--while those begging "Tax and regulate it, please!" will celebrate now, only to see it all go to pieces on them later, one small step at a time.

The best hope for online poker is for the government to leave it the hell alone. That is what a free nation would do. That is what a free people deserve.