Friday, December 10, 2010
Thursday, December 09, 2010
Chris "Fox" Wallace, in Poker Pro magazine column, December, 2010, p. 71.
Over the years I have never had a student who is losing money because he is playing too tight in cash games. Occasionally I have advised a student to play a few more hands in late position, and I have advised almost all of them to be more positional overall, but I have never had a student who really needs to loosen up.
Wednesday, December 08, 2010
Joe Stapleton, on PokerStars Big Game, after Doyle Brunson told Daniel Negreanu that he didn't use a heads-up display (HUD) when he played online.
Doyle's HUD is a Post-It note with his password written on it.
Daniel Negreanu, on PokerStars Big Game, needling "loose cannon" William Given, after Given won only a small amount with quad aces, having slow-played them to death against Scott Seiver.
Where's the rest of the pot?
I could not believe my eyes when I received the following email from PokerStars Support today:
As many of you know, Daniel Negreanu, a member of Team PokerStars Pro, has long advocated the prohibition of sunglasses at poker tables. Two main arguments support this position: (1) A player's face is part of the information that should be available to opponents. It's a "slippery slope" argument--if one can wear sunglasses to conceal the eyes, why not a ski mask to conceal the entire face? (2) Many cheating schemes rely on marking cards with dyes that can only be seen using special filtered lenses that look like ordinary sunglasses. Banning sunglasses removes the risk of this form of cheating.
We have heeded Daniel's advice. Viewers may have noticed that on our hit television program, "The PokerStars.net Big Game," participants are not allowed to wear sunglasses. Though we have not emphasized this rule in the show's commentary, it was, in fact, the first step in a three-phase implementation of the practice across our products and services. We have been gratified that many viewers have noticed the absence of sunglasses on the show, and have contacted us with notes of approval and thanks for being the first televised poker program to take this step. We thought it best to lead quietly by example before placing any sort of restriction or requirement on our customers.
We are now ready for Phase 2 of this plan, which involves live tournament play. Effective January 1, 2011, all live-action tournaments sponsored by PokerStars will prohibit the use of sunglasses by any player. This includes the European Poker Tour (EPT), the Asia Pacific Poker Tour (APPT), the Latin American Poker Tour (LAPT), the Australia New Zealand Poker Tour (ANZPT), the North American Poker Tour (NAPT), and all other tournaments that our company now sponsors or may sponsor in the future, anywhere in the world. Additionally, all members of Team PokerStars will be required to adhere to a no-sunglasses policy anytime they are playing as a representative of our site and/or wearing our logos, in cash games or in tournaments, whether or not the event is one sponsored by PokerStars.
Phase 3 of our plan is likely to be the most controversial. We have always operated with the guiding principle that online poker should emulate the rules and practices of live poker to the greatest extent possible. To that end, we have decided to extend the no-sunglasses policy to online play.
This phase will begin implementation on February 1, 2011. On that date, we will release a major update of our client software, which will search the host computer for and seamlessly integrate with built-in or add-on cameras. In combination with advanced face-recognition technology on our servers, the software will scan players' faces. If it detects sunglasses, the player will not be allowed to join any cash game or tournament. If already seated in a game when the use of sunglasses is detected, the player will automatically be forced to "sit out," and a warning will appear prominently on the screen, explaining the reason for the interruption. The player will not be allowed to rejoin the game until the system detects that the sunglasses have been removed.
We understand that not all computers and/or monitors have cameras built in or attached to them. However, all modern home computers have the capability of adding such hardware, and it can be done at very low cost. Therefore, beginning on July 1, 2011, having a camera in continuous operation will become a requirement to participate in our real-money cash games and tournaments. Players currently lacking a camera need not do anything at the moment; in follow-up communications, we will provide full technical requirements and specifications. We will also soon begin making compatible cameras available at discounted prices, and available at no cost with the use of player points through our VIP Store.
Many of you will wonder why a sunglasses ban needs to be implemented for online play. There are two primary considerations. First, we want to provide a consistent poker experience between forms of the game, and believe that it will be easier for players to adjust to the prohibition in live play if they also have the same rule enforced during online play.
Second, after consultation with security experts, we have concluded that sunglasses open an unacceptable security risk for online play. Though the possibility is remote, we have been shown incontrovertible evidence that some of the newest-generation 3-D computer monitors, when used in conjunction with specially modified polarizing sunglasses, allow a user, under certain conditions, to see through the on-screen images of card backs and discern the outlines of the faces of cards dealt to their opponents. For obvious security reasons, we cannot go into the details of how this is accomplished. Furthermore, we have no reason to believe that any of our customers have yet been adversely affected by anybody implementing such a scheme. Nevertheless, we intend to be proactive in preventing it. 3-D monitors are growing in popularity, and, as the leader in online poker security, we are proud to be the first to take steps to prevent this from becoming a security breach.
We understand that each of the measures outlined above will generate questions and controversy. Full details of each of the three phases in this program can be found here, including a "Frequently Asked Questions" section. We will continue to provide updates both there and by email as questions emerge and as the implementation dates approach.
We are committed to maintaining the safest and most secure online poker experience in the world, and appreciate your cooperation with us as we make these changes. Thank you for continuing to play at our tables, and good luck!
The PokerStars Support Team
Like I said, I literally could not believe this.
I think that Harry Reid's bill is unlikely to pass in any form anytime soon. But the possibility of something that would so totally transform the online poker world (as laid out nicely by Grange95 here) going from faint rumor to enactment and a genuine online poker blackout in the space of a week or two is endlessly intriguing, and I find myself ruminating about it frequently. In the process, I keep coming up with things that are just completely baffling. F'r instance:
What's up with the PPA?
On Wednesday the Poker Players Alliance released a press statement about the Reid bill. The most notable thing about it was that it said, well, basically nothing. It was like a lot of college papers I have had the displeasure of reading--lots of words, little or no content. There was certainly no hint of either support or opposition to Reid's proposal. (And, oddly, the press release is not listed in the "press release" section of the PPA web site. Why?)
Then suddenly today the PPA's Twitter account sent this message: "Help! Call the Capitol Switchboard & ask for your Sen. Tell your Sen 2 support the online #poker bill. (202)224-3121 Call both your Sens!" The same message is now repeated as a banner across the PPA web site home page.
How did the PPA get from apparent neutrality to desperately seeking support for the bill in 24 hours? What went on behind the scenes? There has been no updated press release, so we have no way of knowing what exactly the PPA suddenly finds so attractive about this bill, or why it wasn't attractive a day earlier.
This issue again brings up the weird apparent conflict of interest between the PPA's most prominent board members and its membership, as thoroughly laid out here. Suppose there were a bill proposed that would forever prohibit PokerStars and Full Tilt and Bodog and UB, etc., from operating in the U.S., but instantly opened up equally attractive options from other providers with full legality and no other down side. One would think that most PPA members would say, in effect, "Well, Stars and FTP, sucks to be you, and we'll miss you, but we're all for it." But would that be reflected in the official response by the PPA, when it has prominent owners/employees of the major sites directing things?
Why is FTP apparently in favor of this dog?
Today I saw Tweets from Andy Bloch and Adam Schoenfeld--both Full Tilt pros--soliciting support for Reid's bill. I don't know that they consulted their corporate overlords before speaking (or tweeting), but it's hard to imagine that they got some sort of message from Howard Lederer saying "We can't support this bill--it will kill us," then went ahead and sent out the messages that they did. On the other hand, I haven't seen a groundswell of public support from representatives of any of the major online sites yet.
But I can't figure out why any current site would see anything good here. Sure, in the end they might get full legalization, and that might bring otherwise too-leery customers to their doors. But first they have to sit in the penalty box for a few years. Then they could apply for a license. But they'd have to get it through a state licensing body, and it's not hard to imagine the Nevada and New Jersey B&M casino industry leaning on the state legislature and/or gaming control board to pass a law and/or rule saying that no entity formerly offering poker before federal licensing would be eligible, and BANG, they're out forever. If F-Train's preliminary reading of the second leaked version of the bill is correct, mergers and acquisitions would also be effectively barred as ways around this dilemma.
Even if they eventually got licensed, they would then be facing new competition who had had a few years' head start. They would have to set up servers in the U.S. and segregate U.S. players from the pool of the rest of the world. And, of course, who knows how many states would opt out, and prevent large swaths of the country from participating at all? On top of that, they would have to set up means of tax collection, distribution, and reporting. Games would be less profitable to players (and thus presumably less attractive) because of the federal 20% rake on top of what the site owners already take--and I'm assuming, though I do not know, that the bill allows states to skim some off the top, too.
Even without running a single calculation, I simply cannot believe that all of this works out to a +EV answer for the current big sites, as compared to just letting sleeping dogs lie. As I have expressed endlessly before, I'm convinced that federal licensing and regulation like this will be horrible for the long-term health of the online poker industry. But the specifics of the Reid proposal look bad not just for the field as a whole, but very specifically for the current site operators.
It seems likely to me that insiders at Tilt, Stars, etc., had pre-election advance knowledge that Reid had something in the pipeline, and that was what prompted their last-minute political support. Did they know how apparently toxic it was to their interests? If not, then Reid is a world-class turncoat. If they did know what was up, then I have to ask again what I did a month ago: What am I missing?
I responded to Bloch's Tweet with this: "Full Tilt is OK with pulling out of US market for 2-3 years, then using US-based servers and segregating US players from others?" To Schoenfeld, I was a little more direct: "So you want a 20% rake to the feds, plus whatever the state decides to take, on top of the current rake? Funny--I don't." Unsurprisingly, neither man responded.
Would any sites and/or players go rogue?
The legal consequences of a site continuing to operate sans license after enactment of the bill would be grave: Civil fines up to a million dollars a day, plus surrendering 50% of their take, plus getting put on the UIGEA blacklist, meaning that U.S. financial institutions could not do business with them, presumably making it much more difficult to move money to and from the sites. Oh, and a five-year prison term, too, in case that wasn't enough. Basically, if you liked the UIGEA, you'll love the Reid bill.
How would such penalties actually play out, when arrayed against a business entity whose only U.S. presence is electrons zipping across the ether? I don't know. I don't understand either the law or the enforcement tools that the DOJ might have at its disposal enough to make an intelligent guess.
On the one hand, it all sounds pretty drastic. On the other hand, as others have pointed out, there are hundreds of online casinos operating in the U.S. right now, including big ones offering the most clearly forbidden form of gambling of them all, the sports bet. (We're looking at you, Bodog.) There are occasional dustups, but the feds haven't landed any killer blows; no poker site that chose to continue U.S. operations after passage of the UIGEA has been shut down because of law enforcement. Maybe they haven't been trying very hard, and with sufficient motivation and new weapons provided by Harry Reid (and his puppetmasters, Harrah's and MGM) could make life very, very unpleasant for overseas site owners. I sure wouldn't want to be one of the part owners of FTP sitting in Vegas under such circumstances. "Hi, my name is Damocles, and this is my sword." (Google it.)
So maybe one or two rebellious sites would defy the feds and continue offering their games. Bodog sure seems like the most probable candidate for such a role--but who knows?
Is there a workaround? Take Washington state as a current example. FTP and Stars are using two means to exclude players from real-money games. (By the way, I assume that the sites would be able to continue offering free play during the blackout period, which would at least sort of keep their names before the public.) You can't play if either your IP address registers as being located in Washington, or if the physical address you provided when you signed up is there. It is, however, an open secret that when some online sites temporarily barred Nevada residents, some very well known pro players continued having access (hint: at least one name rhymes with "Drunson"). I have little doubt that some enterprising and determined Washington residents are still playing right now, by means of technological subterfuge.
If current operators withdrew to play by the rules, I wonder if businesses would crop up in some relaxed jurisdiction somewhere in the world that would offer to help keep U.S. players in the game. They could provide a mailing address or P.O. box, a foreign bank account, and IP address rerouting to make it appear as if the player were physically located in, say, Fiji. A player could deposit and withdraw through this third party, which would make its profit by keeping a small percentage of such funds transfers. As far as a U.S. player's bank was concerned, they'd be processing a check to or from some obscure business, rather than interacting directly with a gambling site.
Maybe there are anti-money-laundering international treaties that would quickly shut down such entities. Or maybe they would prosper like mushrooms in manure. Or maybe the online sites, fearful of doing anything to upset the legal powers that be in the U.S. would work hard to sniff out such businesses and refuse to do transactions with them. After all, one would think that there would be large numbers of players all claiming the same address, even if with different box numbers. Or maybe not--maybe they would just make up physical addresses so that no checks ever needed to be mailed to or from them, and make all transactions purely electronic, though I would think there would still be enough similarity for a large number of players that the sites could easily figure it out. I don't know. I'm just thinking out loud here.
I don't know the answers to these or several other questions that I'm too tired to add in here, but my Spidey sense is all tingly. This whole thing stinks to high heaven, if you ask me, and not just for the generic reasons have caused me to long oppose federal involvement in the whole arena. I just cannot see any long-term good for players coming out of this proposal, and I remain completely baffled at how anybody concludes that it would be good for poker.
But as Dennis Miller famously ends his rants, "Of course, that's just my opinion, I could be wrong."
Incidentally, there was this coverage in the Sun today (though, predictably, they got some important things about current law completely wrong). Also some interesting observations from some of the Nevada people/entities that would presumably be involved in licensing here.
Tuesday, December 07, 2010
Sometimes I put a note on Twitter with no context, except that it's what happened to be floating through my mind at the moment. Friday saw such an example when I wrote: "I wish I understood why so many people think that checking in the dark is a smart move.... besides the fact that they see Phil Hellmuth do it on TV, that is."
One of my followers--one who is trying to make a living playing poker, in fact--responded with a serious query: "Checking in the dark isn't a good move?"
I didn't reply, for a bunch of reasons--Twitter not being a good medium for poker strategy discussions chief among them. But the question got me to wondering how I might explain the whole subject to a novice who asked me about it.
My first reaction to the question is to answer it with another question: "In a game in which information is money, why would you ever choose to make a decision without information when you could wait five seconds and make it with information?"
After mulling it over on and off for a few days, I think that remains a pretty solid generalization. It's not 100% true. Though I don't think I have ever checked in the dark, a handful of times I have bet in the dark, about which one could ask the same skeptical question. But I think these have all been all-in bets, in situations where it would have been apparent to any thinking opponent that I was effectively pot-committed anyway, so there was essentially no difference, in terms of either strategy or what information I was conveying about my hand, between betting in the dark and waiting for the card(s) to hit the board.
It's easy to list some downsides of the dark check. Most prominently: (1) You lose the opportunity to lead-bluff at a dry board against an opponent who has a tendency to give up if he whiffs the flop, and (2) you risk giving a free card to your opponent, one which makes his hand and costs you a pot that you otherwise could have won by betting the flop when you had the best hand (e.g., you have A-Q versus A-K, flop is queen-high, king on the turn). More generally, I would put it this way: Having to act first, rather than last, is only occasionally advantageous, but when it is, it's a potential disaster to have given up that advantage blindly in advance.
I find it harder to specify the advantages of a dark check. I suppose that, like most every other poker tactic, it has some useful role, even if only a small niche, but, frankly, I don't know how to list the set of conditions in which it should come into play--a fact that is undoubtedly related to the fact that I have never deployed it.
Perhaps I have missed an occasional opportunity when a dark check would have been advantageous. But even if so, I'm willing to make these three assertions categorically: (1) If one never, ever checked dark, it would be, at worst, a small mistake in one's game. (2) Using it habitually, rather than thoughtfully and selectively, is just plain bad poker. (3) Whatever marginal or situation-specific utility the technique may have, it is vastly overused. (This, of course, is true of several other tactics one could name, such as the min-raise. It has its place, but only really bad players employ it more than occasionally, and I suspect that very few of them would be able to articulate a cogent explanation of why they're doing it in any given spot.)
I suppose some players think that the dark check looks strong and intimidating. I never read it that way. To me, it looks weak and scared. It reeks of, "I'm really uncomfortable having to make the first decision, so I'm going to push that responsibility off onto you." Most players that I see using it regularly are weak and timid, and the check reflects that, I think.
But maybe I'm wrong. Maybe I'm missing some terrific potential advantage here. I'd welcome thoughtful advocates of the dark check to explain why they think it's either a good practice to engage in routinely when first to act, or to delineate the specific circumstances in which it is smart to selectively use it (e.g., small pot or large? against one opponent or many? against what type(s) of opponent? deep-stacked or short-stacked? limit or no-limit? etc.) Perhaps I can be convinced that I'm missing out on a good thing by being a refusenik.
Incidentally, while looking for some sort of image with which to illustrate this post, I happened to notice that there is a band named "Check in the Dark": http://www.myspace.com/checkinthedarkmusic
As for the photo I found? Well, it's a dark check. Dark check--get it?
This happened Thursday on the PokerStars "Big Game." It was indisputably the hand of the week. Watch it here (cuz if you don't, the rest of what I have to say won't make any sense):
(In case that embed stops working for some reason, go here, find Week 10, Episode 4, and fast forward to the 13:30 mark.)
I thought there were all sorts of interesting things about this hand.
I was stunned when he made the call. Yeah, I know it's easy to make good decisions when I'm looking at the guy's hole cards. But that's not it. It's a confluence of two thoughts. First, this "loose cannon" had not put all his chips into the pot all week, and he was not under any extraordinary time pressure to do so here.
Second, of the hands with which the LC might shove there, what could Hellmuth beat? As Hellmuth himself notes, he's unlikely to have pushed with A-10, let alone A-2. A wary call would be the play of choice. So if his opponent is value-betting because he thinks he's ahead, he has top two pair (A-J), a set, or a straight--all of which have Hellmuth beat.
I conclude from that that Hellmuth saw this guy's range as purely polarized: he was very strong or he was on a complete bluff with, most likely, a busted flush draw. Hellmuth must have known that his aces-up hand was only a bluff catcher now, which means that he decided it was more likely than not that the LC (David Fishman) was on a bluff. But that was a very expensive call to make when there were so many plausible hands Fishman could have that had him beat, and when Fishman had shown not a single bluff all week. Hellmuth had to call about $74,000 to win a $167,000 pot, which means that Fishman had to be bluffing at least 44% of the time there to make it a profitable call. That seems to me like a rather large overestimate. Hellmuth had shown strength at every opportunity in the hand; how could he conclude that the amateur would pick this spot for his first big bluff with that kind of frequency, when failure would mean the end of his dream?
Seems like a seriously bad call to me.
The call gets even worse when factoring in the tells. Hellmuth says after the fact that he hesitated in making the call because of the guy's chatter, the implication being that all the talking made Hellmuth estimate him to be stronger (i.e., less likely to be bluffing) than he otherwise would have. Which, if correct, should have tipped a close decision toward a fold.
But the tells were kind of a mixed bag. First there was the phony "I'm not going to let you do this to me" stuff--sighing, looking scared, rubbing his face as if in fear. Weak means strong. Again, should have been a red flag.
Then there was the obvious trembling. At face value, shaking more often signifies a monster than a bluff, which Phil obviously must know. Assuming he noticed it (and how could he not have? It doesn't show up terribly well in this clip, but it could not have been missed at the time, given how prominent it was), that would be another reason not to call.
I thought the shaking looked unnatural, and in an interview afterwards, Fishman told Amanda Leatherman with a laugh that it was not real. I don't get that. Unless he doesn't even know the most basic facts about tells, why would he simulate looking strong when he was trying to induce a call?
I guess I shouldn't criticize, because whatever he did, it worked--but as I was watching it, I really thought he was harming rather than enhancing his chances for a call. If Hellmuth's commentary after the fact is to be believed, I was correct to be thinking that. He came close to blowing it.
Lesson: Unless you're really, really good at understanding what specific effect your chatter will have on an opponent, it's better to just keep quiet.
For what it's worth, the adrenaline-induced shaking that often sets in with a big hand tends to affect the small muscles more than large ones, so you will see it more in the hands than in the arms or torso. It also tends to be of a higher frequency than what Fishman was doing voluntarily. Those were the two reasons it read false to me; even though trembling would not be unexpected in his situation, it wouldn't look like that.
The clip above cuts off the discussion, but I liked William Perkins (whom I had never heard of before) laying into Hellmuth for his complaining. He said, emphatically and repeatedly, "He's a schoolteacher [read: he doesn't make much]. You have endless trunks of money." In other words, let it go. Rise above it. The money means more to him than it does to you. Grow up, stop whining.
Nicely done, sir, though I'm afraid your target is not capable of learning to behave in the civilized and sportsmanlike way you point out that he should.
The subsequent play
That hand gave Fishman a lock on a big win and a virtual lock on the extra $50,000 end-of-season tournament buy-in bonus--as long as he didn't blow it. He chose to fold every hand thereafter. It cost him about $10,000 in blinds and antes, but he didn't have the option to quit playing, so that was his least costly tactic.
Of course, he could have kept really playing, trying to increase his profits. But, first, that would obviously jeopardize his winnings. And, second, perhaps he understood what would happen. His opponents were no dummies. They would all know that he was now going to be playing scared money, and they would bet and raise him mercilessly, putting him to painful decisions on every street of every hand, knowing that if he played back at them at all, it would only be with the stone-cold nuts and then they could easily fold. Indeed, the one time he momentarily broke from his lock-down commitment, with pocket kings, he tried to limp in, somebody raised, and he agonized before folding. Every single hand would have been like that. It would have been an impossible position from which to try to win. (And, interestingly, the one time he folded pocket aces pre-flop, Phil Laak had 6-6 and flopped the other two sixes in the deck. That could have been a true disaster.)
The lesson: This illustrates that you must be willing to lose in order to win. If your opponents know that you are unwilling to lose any significant fraction of the stakes you have on the table in a no-limit game, you are toast. They will eat you alive, if they're any good. Never continue to play when you have in front of you an amount that you are unwilling to lose, that you are unwilling to put into the pot when you believe you have the best of it.
I thought the producers would hate Fishman for basically refusing to play for the last 1 1/2 episodes of a 5-episode series. And maybe they did. But I was glad that they let the two commentators both discuss and praise the LC's strategy. They made clear why he was doing what he was doing. Moreover, they said they didn't blame him at all. They said, paraphrasing, "He's playing by the rules we set up for him. It's his money and he can do with it what he wants to. He has two small children to think about." Maybe it was all phony, meant to cover up the producers' true feelings, and play to what was inevitably going to be an audience rooting for the underdog to have such phenomenal success. Or maybe they really meant it, whether or not the producers agreed with them. Or maybe the producers loved having a nobody walk in and take $130,000 from the pros, and didn't mind him nitting it up the last portion of the week as part of the bargain. I can't tell, and I don't really care. The commentary came off as sensible, supportive, and compassionate, and I appreciated that. It would have felt terribly out of place for them to criticize him in that situation.
The closest they came was when he had the aces and they said something like, "No true poker player can lay that down." But that wasn't true. There are a few rare, specific situations in which folding aces pre-flop is either unquestionably correct or at least justifiable. This was one of them, and his decision to muck A-A said nothing about either his skill or his sincerity as a poker player.
The other players were classy and supportive, too, except for Jason Mercier, who seemed not to understand why the guy was folding every hand, and even placed a prop bet that Fishman had not actually folded aces. (You lose, dude.)
All in all, it made for a really interesting hand, and an interesting aftermath, seeing if he would stick to his chosen strategy, and how the others would react to it. The Big Game doesn't always hit home runs, but last week they sure did.
Monday, December 06, 2010
Bluff magazine's annual readers' choice awards are now open for voting here. I've never participated before, but the nomination of Hard-Boiled Poker in the category of best poker blog gave me reason to. I read and like all four of the nominated blogs, but I am particularly fond of both the author and the content at HBP. There simply isn't any other solo poker blog out there that updates every weekday, and does so with thoughtful commentary on poker news, tournaments, politics, personalities, television, books, plus his own play and poker-related travel. It is hard work coming up with original things to write about in the poker world that frequently, and to do so with high-quality writing. I can't think of anybody more deserving of the nomination.
FWIW, my other votes were as follows:
1. Gabe Kaplan
2. Kara Scott (but I'd still be voting for Shana Hiatt if I could)
3. High Stakes Poker
4. no vote (I don't watch any of them)
6. PocketFives (but I check in with any such sites only rarely)
7. Erik Seidel, and this one shouldn't even be close
10. no vote (never been to any of them)
12. Frank Kassela
13. PokerTableRatings (I don't use any of them, but I gave them the vote in recognition of the nice work they did this year about online poker security)
14. Michael Mizrachi
The first insta-analyses of Harry Reid's proposed legislation to license and regulate online poker are here:
Best commentaries I've seen so far about what all this means:
Worst legal commentary so far:
This is written by one Jeremy Schrute, about whom I know nothing, except that he has no idea what he is talking about. In the first place, his article, dated today, was apparently written in complete ignorance of the fact that the draft bill was posted on the Review-Journal's web site Friday. Excellent situational awareness there, Mr. Schrute. Granted, there may be other draft versions, and the whole thing remains the proverbial moving target, subject to ongoing revision. But it's just utterly irresponsible journalism to post commentary about a bill without having discovered that it has been available online for three days, and that others have already written about the draft.
"There isn’t a whole lot of information on Harry Reid’s proposed online gambling regulation, partly because the bill is so secretive." Yeah, so secretive that it can only be found on the web site of the state's largest newspaper.
Mr. Schrute writes, "Most U.S. states don’t have any laws specifically regarding online gambling, but a few states, such as Washington, specifically ban the action. It seems that Reid’s bill would attempt to override Washington’s ban, though from a constitutional standpoint Washington’s state law trumps federal law. Because it doesn’t involve interstate activity, the federal government has no jurisdiction. That problem could be solved if Reid’s bill has an opt-out clause, though, where individual states can opt out of legalizing online gambling."
Again we have the problem that the author hasn't looked at the draft bill and therefore doesn't know that there is an opt-out clause. But the problem goes deeper than that. His understanding of how the interstate commerce clause has been applied by courts is lacking. Back in 1942 the Supreme Court ruled that a famer growing wheat on his own land for his own use could be regulated by Congress under the interstate commerce clause--even though he wasn't selling it--because growing his own wheat instead of buying it on the open market affected the national wheat economy. That case is hardly dead law; it was the main precedent behind the Court holding in 2005 that the federal ban on marijuana was applicable to a California man who was growing pot for his own use in accordance with state law. Never mind that he wasn't selling it, so that it wasn't commerce, nor that the stuff was grown, harvested, and used entirely in California, so that it wasn't interstate; still, the interstate commerce clause applied.
Now, I happen to think that both of these decisions are dead wrong. But Mr. Schrute appears to have no knowledge of them. These cases are at the center of much of the litigation currently going on about whether the federal government can require individuals to purchase health insurance; there was a court decision on that just last week.
My point is not to say that it's obvious that Reid's bill--whether or not it has an opt-out clause--is clearly constitutional. My point is only that Mr. Schrute's analysis of how the commerce clause works is hopelessly, embarrassingly simplistic and ignorant.
Leaving aside Mr. Schrute's piece, what I don't get about coverage in the last few days is how some people seem to think that Reid's bill is good for online poker players. Wicked Chops Poker, for instance, wrote that it made them glad they had voted for Reid in the recent election. Prof's Poker Blog gushes, "Legal Internet poker will produce billions in tax revenues that will be shared by states and the federal government while providing players a high degree of security through time-proven intense scrutiny of the legal Internet poker rooms. Online poker players will enjoy a level of protection from cheats and scams plus a guarantee of honest games, something that has been missing from current offshore Internet poker rooms. Give 'em Hell Harry!"
I have explained until I'm blue in the face why I'm convinced that federal taxation and regulation of online poker would be a horrible blow to the industry, rather than the boon that many blithely assume; see, e.g., here and here and here. The current proposal does not one thing to assuage my fears. On the contrary, it reinforces them. They will start with a 20% tax (though, as F-Train notes, it's unclear whether this means a 20% rake or a 20% tax on deposits). Would you care to guess which direction the rate will tend to go from there? Add to that at least a 15-month period during which there will be no legal online poker provided by anybody, and at least a 39-month period during which current operators (Stars, Full Tilt, Bodog, UB, etc.) will be unavailable here. Add to that reports made directly to the IRS on exactly how much each player won and lost. Read "Bill Rini's" back-of-the-envelope calculations about how much this ban would cost the biggest current operators.
What Prof crows about as tax revenue for the state and federal governments translates to me as money out of my pocket. It is beyond my comprehension how he thinks that security will be enhanced by excluding from the market the two companies (Stars and FTP) with the most worldwide experience in providing a secure game and leaving the field exclusively to operators who have never done online poker for real money before. How in the hell does that give us "time-proven" security? If he somehow believes that a federal imprimatur guarantees, ipso facto, an absence of fraud, he must have never heard of what goes on, say, in the highly regulated securities industry.
This bill is not good for players or for current operators. It is good only for the big Nevada casinos who are overtly favored in every aspect of the bill's structure, and for the Nevada gaming commission's revenue. I cannot imagine how any thinking person could conclude that it is good for poker overall.
Addendum, December 7, 2010
See F-Train's update here.