Don't Bet on It

One kooky California gambler has an idea: The state should make money off of online poker.
by | August 3, 2007

Gambler One kooky California gambler has an idea: The state should make money off of online poker.

Anthony "Tuff Fish" Sandstrom is proposing a ballot measure that would require California to set up a state-owned poker Web site. California would make money off of it the same way casinos do, with fees to enter tournaments and by taking a small percentage of money out of every pot -- a "rake." Ninety percent of the profit would go to local governments to repair roads, while the other 10 percent would be used to fight gambling addiction.

This proposal might sound nutty. Critics will no doubt point to the social ills associated with gambling. But there's nothing inherently weirder about government being in the online poker business than the lottery business.

Some states are already allowing charities to use poker tournaments as a fundraising tool (it's more lucrative than bingo). Just think of municipal government as a charity that pays for roads.

In fact, Internet poker has one big advantage over a lottery: The state could extract revenue from an international audience. Online gambling is a $13 billion-a-year industry worldwide. If California were to grab a piece of that market, a lot of roads could be repaired at no cost to the state's residents.

However, there's a good deal of risk in this idea (but I won't call it a "gamble.").

One complication: President Bush signed a law last year that ostensibly banned online gambling. I don't claim to know whether federal or state law would prevent what Sandstrom is trying to do.

The more fundamental obstacle is that no state government can hope for a monopoly over online poker. Gamblers can already choose from dozens of Web sites. In contrast, the power of the lottery is that it's the only game in town in convenience stores all over the country.

California could have a trump card (sorry!) though. If the warm and fuzzy feeling of helping municipal government offsets the guilt gamblers typically feel, perhaps California's Web site would be a hit.

Josh Goodman
Josh Goodman  |  Former Staff Writer
mailbox@governing.com  | 

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