Vegas Casino-Owner Buying Friends in Michigan

Economist Bruce Yandle came up with the concept of the "Bootlegger and Baptist."  His theory described the marriage between merchants and moralists who come together to create political partnerships that can promote bad legislation.

Yandle examined and exposed efforts of illegal liquor bootleggers to forge a relationship with leading religious figures to keep the federal prohibition on alcohol sales in place.  Some say ongoing efforts in Lansing to outlaw legalized online gambling in Michigan are confirmation of Mr. Yandle's theory.

Since New Jersey and two other states legalized online gambling for their citizens, Las Vegas billionaire and casino-owner Sheldon Adelson has forged an unlikely relationship with religious and pro-family organizations to stop legalization of his competition.  His lobbyists have pushed legislation in Washington to prohibit states from legalizing online gaming nationally.  The attempt to impose a federal ban has for now halted the need for Adelson to battle gaming legalization efforts state by state.

Late last year, Pennsylvania legalized online gaming, and Michigan is now considering such a move as well.  Not surprisingly, an article appeared in the Detroit News by Dan Jarvis of the Michigan Family Forum that hits some familiar points.  The article mirrors arguments made by an Adelson-funded grassroots organization, the Coalition against Online Gambling.

Baptist, it's time to meet the bootlegger.

Likewise, when the Michigan House held hearings on the topic, David Cookson of the Bruning law firm in Nebraska represented Adelson's group.  It is the same group that continues to lead the fight against legalization.  Jon Bruning is the former attorney general of Nebraska, and during his time in office, he signed a letter urging a federal ban on state legalized online gambling.  Today, his firm is a paid consultant for Adelson. Adelson, it seems, is quite willing to dig deep to protect his existing market share.

The fact remains that legalizing online gambling in Michigan could create a significant economic benefit for the state and its residents.  New Jersey, for example, the first state to make such a move, has raised over $100 million in tax revenue.  It has also created thousands of jobs.

It should also be noted that legalizing online gaming would bring it out from the shadows.   A cursory search online reveals dozens of different online casinos, all of which are housed in foreign countries.  There is no consumer protection for Michigan residents who participate, and there is certainly no reason for an offshore casino to stop children from gambling.

Should Michigan reap the economic rewards from legalization, it will also be able to create regulations protecting gamers and their families.  A regulated online casino in Michigan will work to ensure that children do not gamble more than any offshore casino in Macedonia or Costa Rica.

Like it or not, online gambling is a fact in this interconnected world, therefore states like Michigan have a vested interest in being involved.  For Sheldon Adelson to attempt blocking states' rights smacks of a self-serving agenda for a man who already owns casinos.  It looks as though it could be a bad deal for Michigan, too.  The state should go all in to make sure its citizens are getting the best odds for success when it comes to controlling how online gaming is handled within its borders. 

Michigan families will be better off should the state legalize online gaming itself and control how the games are played, paid, and taxed.  That seems a lot less risky than betting on a plan to put control into the hands of the federal government.  Remember: the house always wins.

Steve Gruber is a conservative syndicated talk radio host based in Northern Michigan.  Find out more at stevegruber.com.