But I got to ramble, rambling  man

Oh I got to gamble,  gambling  man

  -The Bob Seger System

My father was involved in many forms of gambling, and bookmaking was one of them.

Bookmaking was illegal. Dad had a number of cover operations--such as bars, restaurants, pool halls, and grocery stores, which fronted his activities.

He had a dry cleaner with no dry-cleaning equipment. Just a cash register and a garment rack.  When someone brought in clothes, dad had to take them to a real dry cleaner.

The dry cleaner was not profitable, but the backroom was. 

With the rise of the Internet, backrooms started to fade away. Online bookmaking became a billion-dollar online business. As I noted in a January column, Fidelity and Merrill Lynch became big stockholders in online bookies. They operate offshore but market to gamblers in the USA. 

Bookmaking is still illegal, but the law has become a  joke.  To everyone except US Senate Majority Leader Bill Frist. He pushed legislation to shut down online bookies.

I have been a frequent critic of Frist--a big stockholder in Hospital Corporation of America. This time, Bill and I agree.
 
Online bookies need to go away. They lure college students and others into trouble.  Online bookmakers acted legitimate. They weren’t. They violated the law.
 
Frist used his legislative skill to get the Unlawful Internet Gambling Enforcement Act through the Senate. The new law makes it illegal for Americans and their financial institutions to transfer money to online bookmakers.
 
I’m glad to see the foreign bookies banned. I don’t mind mutual fund customers losing  money on an illicit venture.
 
Shareholders should have complained when their mutual funds put their money into illegal activities. Fidelity and Merrill Lynch rolled the dice with their clients money and lost.
 
Now that Internet gambling is out, where do all those bettors go?  Many people enjoy gambling, and online bookmakers introduced new people to the concept.
 
Backroom bookies will come back.
 
Frist and I opposed Internet gambling for different reasons. He fought it on moral grounds, and I fought it for economic reasons.
 
Frist labors under the delusion that he can become president of the United States. The stars in his eyes changed him from a decent senator to one who panders to the religious right.  Fighting Internet gambling was a way to score right wing points.
 
I wanted online bookies stopped because they were unregulated, they took money out of the United States, and they caused people to run up millions of dollars in credit card debt.

Gambling is a dumb financial move, but I don’t care if people gamble within their means.

With the new law, bettors’ only options will be the corner bookies or Nevada.

Unlike the offshore operations, backroom bookies don’t take American Express cards.

Given a choice, I would rather have local bookmakers than offshore operations.  Local bookies know their customers and can cut credit off before people get in over their heads. Many local bookmakers are people of integrity like my dad.

Since his operation was illegal, dad’s clients couldn’t sue. They had to count on his word that they would collect their money.
 
Frist and others in Congress did not realize that when they shut down the offshore bookmakers, they did not actually stop betting. They just moved it back to the backroom again.
 
Which begs the question: Why not make it legal? Governments can tax the bookmakers and take a percentage of the winnings. Law-enforcement dollars can be spent on catching murderers and criminals.

It is hard to take a moral high-ground against bookmaking when most states have lotteries or slot machines. Lotteries and slots are the worst bets imaginable, and the players are usually poor people.

For the life of me, I can’t see why people play instant-lottery games. I do understand why they bet on sporting events. Sports betting is a test of skill. It boosts television ratings.  No one in Kentucky is going to watch MontanaOgden State unless they have a bet on the game. play

I’m not sure about rambling, but the  Bob Seger System (Bob’s pre solo group)  was right: there are people who have to gamble.

I would rather it be legal and taxed instead of operating out of fake dry cleaners.

 
Don McNay is the author of the Unbridled World of Ernie Fletcher and Chairman of the Board for McNay Settlement Group.   You can read his award-winning columns at www.donmcnay.com or write to him at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it