New Jersey Sports Betting Loss More About States’ Rights than Gambling

FootballSportsBettingWhether you care about sports betting or not, the U.S. Supreme Court’s refusal to hear the appeal of lower court rulings upholding the Professional and Sports Protection Act (PASPA) should matter to you.

New Jersey legalized sports betting in January 2012. The Department of Justice and five sports leagues took issue with the state law and challenged it in federal court. They won every step of the way with the final victory coming when the Supreme Court declined to get involved.

Many people find sports betting repulsive. The people on that side of the debate point to match fixing and rogue referees, an extremely rare problem, but one that is exacerbated by the lack of regulation. Opponents also associate sports betting with organized crime, which is only the case due to its illegality.

Proponents point to the fact that the activity is occurring anyway and states that choose to do so should be allowed to legalize sports betting within their borders. This generates tax revenue, jobs, and creates a draw for casinos. This was the hope for Atlantic City. Those plans are currently on hold.

Regardless of how each side feels, lawmakers, voters, and a governor, all agreed to legalize the activity at the state level.  The federal government and five organizations stepped in and put an end to it before it ever got off the ground.

Why PASPA Affects States’ Rights

The issue often cited by opponents of PASPA is that the law gives four states – Delaware, Montana, Oregon, and Nevada – an exemption. These four states offered some sort of sports betting in the 15 years prior to the law taking effect. The other 46 states are forbidden from legalizing sports betting.

New Jersey was given a one year window to legalize it in 1992 but failed to do so.

The real issue here is states’ rights. This has been a major political point over the past decade. Politicians at the state level often blame the federal government for over stepping its authority. Recent topics included in this debate are ObamaCare, Common Core, and the Bureau of Land Management.

Several Attorneys General that have no interest in sports betting submitted amicus briefs on behalf of New Jersey. AGs in Georgia, Kansas, Virginia, West Virginia, Wisconsin and Wyoming all wanted the Supreme Court to hear the case to get clarification as to what power the federal government has. The common thought is that giving four states an exemption violates the fundamental principle of equal sovereignty.

It appears that the courts disagree with the states on the case, even though logic suggests one state should not have more rights than others through a discriminatory federal law.

This case was not just about sports betting. There are many social issues that could be restricted by Congress on a state-by-state basis. Today’s hottest debate might be recreational marijuana. Congress could decide to forbid all states except Colorado and Washington from legalizing it since those two states already have laws on the books in an attempt to block expansion of something certain federal lawmakers oppose.

It could also be used in punitive ways to states that refuse to follow federal policies that are perceived to be overstepping. This has already happened in the past with the drinking age and speed limits.

The fact four states were exempted from this law is very unusual. Federal courts have ruled that there is no problem with this. We need to hope that Congress does not find more rights to take away from states that have yet to act on the expansion of social rights, especially ones that are victimless.

History of PASPA

Delaware offered three-team NFL parlay cards in 1976 but stopped after that year due to a lack of interest. Oregon offered NFL and NBA betting through its sports lottery that ceased operations in 2007. Montana offers fantasy NASCAR and NFL betting through parimutuel pools. Nevada is the only state that has a full slate of sports betting, including single game action.

Delaware attempted to spread full sports betting in 2009, claiming a PASPA exemption. The sports leagues challenged Delaware and prevailed. The courts ruled Delaware’s exemption only applied to NFL parlay cards that were previously spread through its lottery before PASPA.

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