As usual, on his show Last Week Tonight, John Oliver nicely explains how these rapidly growing online betting markets like Kalshi and Polymarket (that I have previously discussed here) work and why they are such a menace.
Warnings are being issued that gambling in the US is getting out of control because of the ease with which the new apps can be used to make bets on pretty much anything at any time.
Gambling addiction is spiraling “out of control” in the US, a leading campaigner for stricter guardrails has warned, as experts from around the world are set to gather in Boston to push for more regulation of the industry.
The rapid expansion of online gambling, prediction markets and sports betting platforms, “demands a public health response”, according to Harry Levant, director of gambling policy at the Public Health Advocacy Institute (PHAI), urging policymakers to intervene.
“You regulate the distribution, the speed, the type, the access to the product, because the product is what’s dangerous,” he said, calling for gambling to be treated like alcohol or tobacco. “The problem is the product, not the people,” said Levant. “We have a crisis here.”
…Sports betting has been legalized in 39 states and Washington DC since the landmark 2018 supreme court ruling.
…On both the federal level and in numerous states, legislation has been introduced to regulate online gambling. One of the bills that will be talked about on Friday is the Safe Bet Act, introduced in Congress by Tonko and Blumenthal, which seeks to establish “minimum federal standards” for legal sports betting and seeks to impose limits on marketing, introduce affordability checks and restrictions on apps using artificial intelligence to track players and create bets.
It is not only the US that has this problem. The UK too has seen a surge in online gambling with terrible consequences, and there are tragic stories (such as this and this) about people who have taken their own lives because of their excessive losses. Britons have a long history of gambling on sports, with football pools being common, Even my father would enter those when we lived in the UK even though he was clueless about soccer and only had the vaguest idea how the pools worked. Betting on horse races is also common. But in the past, they required mailing the pool sheet in or going to the neighborhood bookies, all of which took time and effort, unlike the gambling apps of today, thus discouraging impulsive or desperation betting of large amounts.
Betting on sports can be the gateway to gambling addiction because it seems relatively harmless, people think they know what they are betting on, and it can even be seen as an expression of fandom, showing support for one’s team. But as I have said repeatedly, gambling is a mug’s game where you can easily lose your shirt. Almost everyone loses money. The only ones who do not are those who have some insider information or have the resources to spend all their time exploring the tiny niches in which they can get a small advantage.
The only way to personally deal with gambling is to treat it as entertainment where one allocates a certain amount of money that one can afford to spend on it, like one does with tickets to concerts or sporting events and such, not as a means of making money. The money that you bet should be treated as gone forever but the reward is that you presumably obtained some enjoyment from it, however fleeting it was. But the catch is that those other forms of entertainment do not have the addictive qualities that gambling sites deliberately create, nor are they so easy to spend on all day and all night, anywhere, just with the tap of a finger.
Add cryptocurrencies to the mix and you now have all the ingredients to have criminal groups manipulate the markets to make money at the expense of the poor saps who think they can beat the system.
Regulating this properly will be difficult since the Trump family is heavily involved with it, with one of his sons Don Jr. serving as ‘advisor’ to both gambling companies, though what advice he gives is not specified. It looks like he was appointed more as a bribe to have Trump favor the companies. And it seems to be working, As Oliver says, Michael Selig, the chair of the Commodity Futures Trading Commission (CFTC), the body that is entrusted with overseeing this area, has not only not done anything about it, he is even suing states to block them from regulating the industry, claiming that the CFTC has exclusive jurisdiction. The CFTC is supposed to have five members of which two have to be from the minority party but it currently has no one except the chair. You would think that that would make invalid any decision that body makes, but that does not seem to be the case. Selig seems to treating himself as the sole authority, another example of the rot that is endemic in this administration.
Sucking every last cent from gambling addicts is big business, sort of like the cancer/smoking industry. They can buy politicians as easily as the NRA and AIPAC.
So this is also connected to the issue of legal corruption aka campaign donations.
The difference between these companies and the drug cartels is, the latter need bodyguards.
The money that you bet should be treated as gone forever …
But sometimes it comes back, just often enough to destroy that mental model.
You can’t argue with an endorphin rush…
I don’t mind gambling, my favourite place in the world is Crown Casino in Melbourne. But sports betting and prediction betting are very different beasts. Sports betting for one can only be profitable on very tight margins and if you pull every trick in the book with odds etc. Prediction markets just seem to me to be openly criminal enterprises, prone and open to insider trading and manipulation. Play Blackjack, if you must gamble 🙂
@rorschach:
Sports betting and prediction betting have been getting less different, though, what with people arranging to bet on things like ‘how many points will (basketball player X) throw in the final quarter of the game on (date)?’ Things that mostly depend on only one person and for which that person has ways to cheat. (In that case, once the player achieves the specific number of points, he just keeps passing the ball to someone else rather than taking shots himself.)
There have already been multiple insider betting scandals just within the last year, things that make the 1919 Black Sox scandal look tame by comparison.
As usual, a new worrying development. Those who are prone to gambling addiciton have now unlimited possibilities to ruin themselves, betting on everything under the sun.
Plus, gambling always calls forth unlawful/criminal behavior. Two recent examples:
-- journalists getting death threats over their coverage of Iranian missiles hitting Israel, as much money was riding on the exact form those attacks were taking and many bettors did not like the outcome, so pressuring the journos to change their language,
-- and, humorously, a bet on the day temperatures at Charles de Gaulle airport, reportedly “adjusted” by aiming a hair dryer at the relevant sensor.
It’s goin’ to be a fine kettle of fish, wanna bet?
I’ve linked to this here before, but I’m going to do it again because I think it’s very insightful and ties together a lot of things about the current zeitgeist (including the “vibecession”, AI, enshittification, inter-generational inequality, creeping financialisation, and yes, the omnipresence of various forms of gambling) in a way that seems to make a lot of sense to me: Everyone is Gambling and No One is Happy
It’s quite long, but I do think it’s well worth reading.