Why Adam Laxalt Needs to Reconsider His Position on RAWA

LaxaltNevada Attorney General Adam Laxalt stunned the gambling world on Tuesday when he revealed plans to sign a letter supporting the Restoration of America’s Wire Act (RAWA).

Citing a desire to “return to the status quo” and to nip online gambling in the bud, Laxalt is effectively spitting in the face of Nevada lawmakers, the casino industry and online poker players throughout the state.

While it has become clear that he has been poisoned by the Kool-Aid that Sheldon Adelson has been serving over the last couple of years, it is important to review the reasons why Laxalt needs to reconsider his position on RAWA.

It Treads on State Rights

Even before the 2011 memo from the Department of Justice regarding the Wire Act, many believed that online poker regulation was a matter that should be left to the states. After the memo, it was clear that the only way that we were going to achieve regulated online gambling was at the state level.

RAWA treads on state rights by taking away their ability to set policy and police the industry. Nevada, Delaware and New Jersey have successfully regulated and operated online gambling for two years and there’s no reason to believe that the federal government should do a better job. It is a matter best left for the states to decide.

RAWA Ends the Regulated iGaming Market

RAWA doesn’t stop a few undecided states from moving forward with online gambling expansion. RAWA ends most forms of online gambling, including those regulated since 2011. Unless a carveout were included in the bill, state lotteries would also be forced to go offline, cost countless millions to states that rely on lottery revenues.

With the uncertain state of Daily Fantasy Sports, you can believe that the government will find a way to group DFS in with other forms of gambling and make those activities illegal.

The only operators remaining will be illegal ones, and we can guarantee future scandals such as Lock Poker in the future. States will be powerless to stop them and the federal government has proven that they will only go after those they feel they can profit from.

Significant Casino Revenue and Jobs Will Be Lost

Of course, we have to consider the number of jobs and the amount of casino revenue that will be lost as a result of RAWA. Just look at the NJ iGaming market. Through October of this year, the market has pulled in $121.61 million. That’s approximately 5.6% of the total gambling win for the state in 2015.

While 5.6% doesn’t sound like a lot, if you look closer at some of the actual casino entities in Atlantic City, you get a better idea of how important that revenue really is. Resorts has pulled in just over $141 million so far this year. The Trump Taj Mahal has earned $156.72 million in 2015. Bally’s has earned $179 million and Golden Nugget $195 million.

Removing online gambling from the mix in Atlantic City would almost be the equivalent of shutting down one of the remaining 8 casinos, something that the city cannot afford at this time. That’s not even considering the number of jobs that will be lost in technology, customer service and other ancillary jobs. One could even consider the number of players that would lose income from playing online as well.

Laxalt Needs to Defend His State – Not Undermine It

Ultimately, Laxalt is in office to defend the laws and legal system of the state of Nevada and not cater to the whims of a casino owner or buckle to political pressure. State lawmakers decided that it was in the best interest to regulate online poker and he needs to stand by that decision.

His decision to try to undermine the efforts of state lawmakers sends the message that he thinks that he can make better decisions than the state legislature. That is not the job of the state Attorney General. If online gambling posed a clear and present danger to the citizens of Nevada, then one could possibly understand such a position.

However, what we have here is an admitted attempt to go back to the “status quo” where online gambling is unregulated and citizens do not have the protections they deserve. It is my hope that Laxalt reverses his decision whether out of shame or by suddenly developing a healthy dose of common sense.