Why the Kyl Bill Is Bad Policy. Part 1

Senator Jon Kyl (R-Arizona), the chief sponsor of the Internet Gambling Prohibition Act, has taken the position that permitting Internet gambling is bad public policy. This position is defensible. A strong argument can be made that in-home gambling presents greater policy concerns than traditional gambling. For example, the easy accessibility of home gambling may increase the prevalence of problem gambling. The original, 1996 version of the Kyl Bill, which would have prohibited all interactive gambling, is a far cry from what is now before the U.S. Senate.

Changes in the Kyl Bill
Since 1996, the Kyl Bill has become a shadow of itself. To gain political support for his bill, Senator Kyl has basically given away the store. Certainly, the latest version of the bill prohibits Internet gambling except interactive wagering on state-run lotteries and horse racing over closed-loop subscriber systems. This is the equivalent of prohibiting pornography on videotapes but not on DVD or CD-ROM.

The exceptions
The horse racing and lottery industries can do quite well on intranets. Under many state laws, lotteries include anything involving prizes, consideration, and chance. If the bill passes, we may see the birth of interactive video lottery terminals, or state-operated online slot machines.

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