The disussion of the House of Reps. - Long
This is the discussion that occured shortly after the bill was passed in the House of Representatives. It's exceedingly long, but most of these people have a greater grasp on this than we thought. If they vote it in, they will be doing so knowing full well what they are doing. Each post is a secion of a long conversation and has multiple links under THOMAS:
The Chair recognizes the gentleman from Ohio.
Mr. OXLEY. Mr. Speaker, I yield myself 2 minutes.
Mr. Speaker, I rise today in support of H.R. 4411, the Internet Gambling Prohibition and Enforcement Act. This bill represents the combined efforts of my esteemed colleagues, Chairmen Bob Goodlatte and Jim Leach, who have crafted an effective piece of legislation to finally stop the illegal Internet gambling we have worked against for so many years.
The Goodlatte-Leach bill combines two complementary approaches. First, it cuts off the flow of money to Internet gambling Web sites. These Web sites, almost always located on some far-flung Caribbean island, will no longer be allowed to accept bettors' credit cards, fund transfers, or checks drawn on American banks.
Secondly, H.R. 4411 clarifies that the 45-year-old Wire Act covers illegal Internet gambling. As a former FBI agent, I can attest to the fact that the Wire Act is an effective tool in stopping crime, and this bill will help us make better use of it.
Illegal Internet gambling is bad for a number of important reasons. Experts at the FBI and Justice Department have warned that these sites are often fronts for money laundering, drug trafficking and terrorist financing. Internet gambling sites evade U.S.-based regulations that ensure the integrity of casino games, prevent minors from gambling, and puts in safeguards for problem gamblers.
Because these businesses are located overseas, they provide no tax revenues, provide no U.S. jobs, all the while evading Federal and State law enforcement. Unlike legal gambling here in the United States, no enforcement mechanism exists to ensure that individuals are protected against these overseas Internet gambling sites. And with no age verification, savvy online gambling sites are preying on minors and young adults.
This Internet gambling bill is a culmination of a decade of hard work by Chairmen Goodlatte and Leach. I would also like to commend the efforts of Mr. Bachus, Mr. Wolf, Mr. Pitts, Ms. Hooley, and Mrs. Kelly, just to name a few. With their help, we have passed several versions of this legislation in the House. I remain hopeful that the Senate will be able to do the same and we can once and for all give the banking regulators and the Justice Department the tools they need to stop illegal Internet gambling.
In the meantime, I strongly urge my colleagues to support the Goodlatte-Leach bill.
Mr. Speaker, I reserve the balance of my time.
Ms. HOOLEY. Mr. Speaker, I yield myself as much time as I may consume.
Mr. Speaker, I rise in support of H.R. 4411, the Internet Gambling Prohibition Act.
I would like to thank Mr. Leach and Mr. Goodlatte for their hard work on bringing this bill to the House floor. It certainly has not been an easy task.
I would like to thank Mr. Frank, our ranking member on the Financial Services Committee, for the opportunity to manage this debate. Even though he and I do not see eye to eye on this legislation, I appreciate and respect the fact that we have agreed to disagree, and I welcome a healthy debate on enforcement of the illegal Internet gambling laws.
Internet gambling is a growing problem in the United States, particularly among young people and college students. It is known to destroy families, marriages and entire lives. As so aptly put by University of Illinois Professor John Kindt, ``You just click the mouse and lose your house.''
This legislation makes clear that we are serious about enforcing our Internet gambling laws that are already on the books. It takes a very important step forward, and we have worked very hard on the Financial Services Committee over the last few Congresses to advance this measure.
This bill cuts off the flow of money to Internet gambling Web sites by regulating payment systems. The Department of Treasury and the Federal Reserve will jointly develop policies and procedures for identifying and preventing financial transactions related to illegal Internet gambling. Payment systems will be required to comply with these regulations.
Even when criminal law cannot be enforced, the Federal Government's jurisdiction over financial systems can nevertheless cut off the money sources for these illegal businesses.
I believe we should mean what we say when it comes to Internet gambling. If we are to keep laws on the books that prohibit Internet gambling, then we should take steps to enforce it. And by cutting off the flow of money, we can accomplish just that.
As was previously noted, this bill is supported by 48 of the 50 State attorneys general, by the NCAA, the NBA, the NFL, the MLB and the NHL. It is a good bill and a commonsense approach to a growing problem. I urge my colleagues to end the flow of money to illegal Internet gambling Web sites, and I urge passage of this bill.
Mr. Speaker, I reserve the balance of my time.
The SPEAKER pro tempore. Without objection, the gentleman from Iowa may control the time of the gentleman from Ohio.
There was no objection.
Mr. LEACH. Mr. Speaker, I yield myself 3 1/4 minutes.
Mr. Speaker, for nearly a decade, many in the Congress have sought to deter Internet gambling. But time and again the issue has been stymied, often in ways that reflect imperfectly on this institution. But it cannot be stressed enough that from a macroeconomic perspective, there are no social benefits for Internet gambling, and from a microfamily perspective, enormous harm is frequently inflicted.
John Kindt, a professor of business at the University of Illinois at Urbana-Champaign calls the Internet ``crack cocaine for gamblers. There are no needle marks,'' he says. ``There is no alcohol on the breath. You just click the mouse and lose your house.''
These comments could not be more apropos than for Greg Hogan, Jr., a 19-year old Lehigh University class president and chaplain's assistant from Barberton, Ohio. This pastor's son gambled away $7,500 playing online Texas Hold-'Em, then confessed to robbing a bank to try to recover his losses. His life is ruined.
Never before has it been so easy to lose so much money, so quickly, at such a young age. Internet casinos are proliferating. Soon they will be ubiquitous.
In the next 5 years, if Congress does not act to clarify and enforce the laws banning Internet gambling, and if Internet casinos' business plans come to pass, gamblers will be able to place bets not just from their home computers but also from their cell phones, while they drive from work, or from their BlackBerrys as they wait in line at the movies.
Mr. Speaker, the time has come for Congress to finally deal with the subject matter. The measure before us, H.R. 4411, is supported by the NCAA, all the major professional sports organizations, from the NFL and Major League Baseball to the NBA and NHL, as well as the financial services industry, family groups, religious organizations and 48 of the 50 State attorneys general.
The reason the sports groups support the legislation, as our colleague, Tom Osborne, so thoughtfully noted, is that they are concerned with the integrity of the games.
The reason the religious community has come together is that they are concerned for the unity of the American family. Internet gambling is not a subject touched upon in the Old or New Testament or the Koran or the Bhagavad Gita. But the pastoral function is one of dealing with families in difficulty. And religious leaders of all denominations and faiths are seeing gambling difficulties erode family values.
It will be suggested in this debate that there is no call to rein in activities of individual choice. But it should be clear that in the history of the Western world, whenever gambling has been legalized it has been subject to careful regulation. This is simply not the case with the Internet. Nor is it the case that an individual's misjudgment does not affect society as a whole.
There is nothing in Internet gambling that adds to the GDP or makes America more competitive in the world. Indeed, if an individual cannot repay his or her debt, neighbors will be subject to higher interest rates. Everyone loses if this industry continues its remarkable growth.
While Congress has failed to act, the illegal Internet gambling industry has boomed. This year, Americans are projected to send more than $6 billion to unregulated, offshore, online casinos, half of the $12 billion that will be bet worldwide on Internet gambling, FBI and Justice Department experts have warned that Internet gambling sites are vulnerable to be used for money laundering, drug trafficking and even terrorist financing. Further, these sites evade rigorous U.S.-based regulations that control gambling by minors and problem gamblers, and ensure the integrity of the games.
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Internet gambling's characteristics are unique: online players can gamble 24 hours a day from home; children may play without sufficient age verification; and betting with a credit card can undercut a player's perception of the value of cash, leading to addiction, bankruptcy and crime. Unlike in brick-and-mortar casinos in the United States where legal protections for bettors exist and where there is some compensatory social benefit in jobs and tax revenues, Internet gambling sites principally yield only liabilities to America and to Americans.
H.R. 4411 was introduced to provide federal and state governments strong tools to enforce existing gambling prohibitions. It would crack down on illegal gambling by clarifying that the Wire Act covers all forms of interstate gambling and would account for new technologies. Designed to cut the money flow from gamblers to Internet gambling sites, the bill would enhance criminal penalties for gambling businesses settling Internet wagers with financial instruments such as credit cards, checks, or fund transfers. It would also require payment systems to establish procedures for blocking these transactions.
Internet gambling has become as much a part of the college experience as late-night study sessions and rooting for the football team. Researchers have called gambling online addictive. Players attest to becoming obsessed with it. The activity is illegal, but the law is not being forced.
According to a study by the Annenberg Public Policy Center, nearly 10 percent of college students gambled online last year. They play in their dorm rooms, in library lounges, in class. The number of college males who reported gambling online once a week or more quadrupled in the last year alone.
Finally, a note about horseracing. In 1978, Congress passed the Interstate Horseracing Act (IHA) to set forth the rights and responsibilities applicable to interstate wagering on horseracing, to affirm that States have primary responsibility for regulating gambling within their borders, and to prevent States from interfering with the gambling policies of other States. In 2000, Congress amended the IHA to clarify that the statute applied to the transmission of interstate off-track wagers via telephone or other electronic media.
The Executive Branch has taken the position that the 1961 Wire Act overrides the IHA, even though the IHA is a more recent statute, because neither statute expressly exempts IHA transactions from the Wire Act. The horseracing industry vigorously disagrees. H.R. 4411 has been very carefully drafted to maintain the status quo regarding horseracing, preserving the ability of the Executive Branch and the horseracing industry to litigate the proper interpretation of these two statutes. The text of the bill is clear: ``this Act does not change which activates related to horseracing may or may not be allowed under Federal law.'' To the degree this act provides new definitional standards, it bolsters rather than diminishes the Justice Department's latitude.
Bills of this nature are always controversial and subject to intense lobbying by powerful interests. I believe the approach on the table represents the only credible initiative likely to be considered in the foreseeable future. I urge support for this important legislation.
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Mr. Speaker, I reserve the balance of my time.
Ms. HOOLEY. Mr. Speaker, I yield 4 minutes to the gentleman from Massachusetts (Mr. Frank), the ranking member on the Financial Services Committee.
Mr. FRANK of Massachusetts. Mr. Speaker, I strongly disagree with the gentleman from Iowa with whom I often agree. I don't disagree with him entirely. I will stipulate that there is nothing in the Bagavagida about gambling. But other than that, I don't think he got much right.
He says that gambling on the Internet does not add to the GDP or make America competitive. Has it become the role of this Congress to prohibit any activity that an adult wants to engage in voluntarily if it doesn't add to the GDP or make us more competitive?
What kind of social, cultural authoritarianism are we advocating here?
Now, I agree there is a practice around today that causes a lot of problems, damages families, people lose their jobs, they get in debt. They do it to excess. It is called drinking. Are we going to go back to Prohibition? Prohibition didn't work for alcohol; it doesn't work for gambling.
When people abuse a particular practice, the sensible thing is to try to deal with the abuse, not outlaw it.
By the way, this bill allows certain kinds of Internet gambling to stay, so apparently the notion is that those few people who are obsessive and addicted will not take advantage of those forms which are still available to them.
But the fundamental point is this. If an adult in this country, with his or her own money, wants to engage in an activity that harms no one, how dare we prohibit it because it doesn't add to the GDP or it has no macroeconomic benefit. Are we all to take home calculators and, until we have satisfied the gentleman from Iowa that we are being socially useful, we abstain from recreational activities that we choose?
This Congress is well on the way to getting it absolutely backwards. In areas where we need to act together to protect the quality of our life, in the environment, in transportation, in public safety, we abstain; but in those areas where individuals ought to be allowed to make their own choices, we intervene. And that is what this is.
Now, people have said, well, some students abuse it. We should work to try to diminish abuse. But if we were to outlaw for adults everything that college students abuse, we would all just sit home and do nothing.
By the way, credit card abuse among students is a more serious problem, I believe, than gambling. Maybe gambling will catch up. But we have heard many, many stories about young people who have credit cards that they abuse. Do we ban credit cards for them?
But here is the fundamental issue. Shouldn't it be the principle in this government that the burden of proof is on those who want to prohibit adults from their own free choices to show that they are harming other people?
We ought to say that, if you decide with your own money to engage in an activity that harms no one else, you ought to be allowed to do it. And once you say, oh, no, but that doesn't add to the GDP, and that can lead to some problems in families, then this is hardly the only thing you will end up banning.
The fundamental principle of the autonomy of the individual is at stake today.
Now, I have to say, I understand a lot of the conservatives don't like it because there are people on the religious side who don't like it. Some of my liberal friends, I think, are being very inconsistent. We are for allowing a lot of things. I mean, many of us vote to say, You can burn the flag; I wish you wouldn't, but you can. It shouldn't be a crime.
You can look at certain things on television that maybe other people think you shouldn't. You can do other things but you can't gamble. There is a fundamental inconsistency there.
I guess people think gambling is tacky. They don't like it. Well, fine, then don't do it. But don't prohibit other individuals from engaging in it.
People have said, What is the value of gambling? Here is the value. Some human beings enjoy doing it. Shouldn't that be our principle? If individuals like doing something and they harm no one, we will allow them to do it, even if other people disapprove of what they do.
And it is, of course, likely to be ineffective. The best thing that ever happens to illegal gamblers is when you do a measure like this.
I hope the bill is defeated.
Mr. LEACH. Mr. Speaker, I yield 1 minute to the gentleman from Alabama (Mr. Aderholt).
Mr. ADERHOLT. Mr. Speaker, I rise today in support of H.R. 4411, which is the Internet Gambling Prohibition and Enforcement Act. Gambling in any form, especially Internet gambling, is especially dangerous to children. Because these illegal Web sites lack reliable age verification tools, children of any age can access the sites and begin gambling.
For adults, these sites encourage gambling addiction with their ease of access, especially with regard to how easy it is to use credit cards.
I would like to be clear for the record, Mr. Speaker. I oppose the expansion of gambling in all forms. I have been a long-time opponent of gambling. I have cosponsored tough enforcement measures in the past, including increased criminal penalties and support for international anti-money-laundering efforts.
Today's bill includes those measures and takes a strong step to curtail those dangerous sites by cutting off their source of funding. It is an important step toward eradicating this threat and ensuring the safety of our children and our communities.
Mr. Speaker, in closing, let me just say, I encourage my colleagues to support this legislation and to vote against the amendment that would be brought up today that would actually gut the results of this legislation.
Ms. HOOLEY. Mr. Speaker, I yield 2 minutes to the gentleman from Texas (Mr. Paul).
(Mr. PAUL asked and was given permission to revise and extend his remarks.)
Mr. PAUL. Mr. Speaker, I rise in opposition to this legislation. It is not easy to oppose this legislation because it is assumed that proponents of the bill are on the side of the moral high ground. But there is a higher moral high ground in the sense that protecting liberty is more important than passing a bill that regulates something on the Internet.
The Interstate Commerce Clause originally was intended to make sure there were no barriers between interstate trade. In this case, we are putting barriers up.
I want to make the point that prohibition, as a general principle, is a bad principle because it doesn't work. It doesn't solve the problem because it can't decrease the demand. As a matter of fact, the only thing it does is increase the price. And there are some people who see prohibitions as an enticement, and that it actually increases the demand.
But once you make something illegal, whether it is alcohol or whether it is cigarettes or whether it is gambling on the Internet, it doesn't disappear because of this increased demand. All that happens is, it is turned over to the criminal element. So you won't get rid of it.
Sometimes people say that this prohibition that is proposed is designed to protect other interests because we certainly aren't going to get rid of gambling, so we might get rid of one type of gambling, but actually enhance the other.
But one of the basic principles, a basic reason why I strongly oppose this is, I see this as a regulation of the Internet, which is a very, very dangerous precedent to set.
To start with, I can see some things that are much more dangerous than gambling. I happen to personally strongly oppose gambling. I think it is pretty stupid, to tell you the truth.
But what about political ideas? What about religious fanaticism? Are we going to get rid of those? I can think of 1,000 things worse coming from those bad ideas. But who will come down here and say, Just think of the evil of these bad ideas and distorted religions, and therefore we have to regulate the Internet?
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H.R. 4411, the Internet Gambling Prohibition and Enforcement Act, should be rejected by Congress since the Federal Government has no constitutional authority to ban or even discourage any form of gambling.
In addition to being unconstitutional, H.R. 4411 is likely to prove ineffective at ending Internet gambling. Instead, this bill will ensure that gambling is controlled by organized crime. History, from the failed experiment of prohibition to today's futile ``war on drugs,'' shows that the government cannot eliminate demand for something like Internet gambling simply by passing a law. Instead, H.R. 4411 will force those who wish to gamble over the Internet to patronize suppliers willing to flaunt the ban. In many cases, providers of services banned by the government will be members of criminal organizations. Even if organized crime does not operate Internet gambling enterprises their competitors are likely to be controlled by organized crime. After all, since the owners and patrons of Internet gambling cannot rely on the police and courts to enforce contracts and resolve other disputes, they will be forced to rely on members of organized crime to perform those functions. Thus, the profits of Internet gambling will flow into organized crime. Furthermore, outlawing an activity will raise the price vendors are able to charge consumers, thus increasing the profits flowing to organized crime from Internet gambling. It is bitterly ironic that a bill masquerading as an attack on crime will actually increase organized crime's ability to control and profit from Internet gambling.
In conclusion, H.R. 4411 violates the constitutional limits on Federal power. Furthermore, laws such as H.R. 4411 are ineffective in eliminating the demand for vices such as Internet gambling; instead, they ensure that these enterprises will be controlled by organized crime. Therefore I urge my colleagues to reject H.R. 4411, the Internet Gambling Prohibition and Enforcement Act.
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