*Updated 2023
In 2018, the Supreme Court reversed a more-than-three-decades-old federal ban on sports betting, enabling each state to decide whether to allow bets to be placed on professional baseball, basketball, football, and hockey, among other sports games. Previously, sports betting had been prohibited nationwide, except in four states – Delaware, Nevada, Montana and Oregon. A vast majority of the American people supported the legalization of sports betting. Therefore, this change in the federal government’s approach to the subject is not surprising. Since then, in just five years, sports betting, which is currently legal in more than 30 states, has turned into a US$13.7 billion industry. However, the recent suspension of pro-football players for violating the NFL’s gambling policy shows that this decision and its benefits may not be so clear-cut.
Here are three reasons why the legalization of sports betting is positive and three more explaining why its negative:
In Support of Legalized Sports Betting
It was already a thriving industry
Even before the Supreme Court’s decision, the betting industry blossomed regardless of its legality. Illegal sports betting was already a multi-billion-dollar industry (as of 2018, some estimates were as high as $150 billion); anyone who wanted to place a bet could do so easily online or through local office pools and offshore books. Since the Supreme Court decision, states have been more inclined to consider or pass legislation to legalize sports betting, thus allowing people to continue betting but in a regulated and fairer environment. This has prevented betters from having to deal with questionable bookies. Moreover, betting addicts now have fewer stigmas, which may make it easier for them to seek help.
It`s the economy, stupid
Sports betting is good for the economy. Legalizing sports betting has obviously created huge state tax revenues. More importantly, it has created more tourism to states where betting is legal and jobs (a potential for 100,000 new jobs), including new roles, content and shows on mainstream sports channels like ESPN. Sources say that overall state tax revenues from sports gambling have jumped from $38 million (2018) to $126 million (2019) to more than $1 billion (2022).
Sports betting won’t corrupt the leagues
Louis Brandeis, an American lawyer and Associate Justice on the US Supreme Court, once said: “Sunlight is said to be the best of disinfectants; electric light the most efficient policeman…” Meaning, legalized sports betting will actually make it harder to fix games. This is because once legalized, sports betting – and advertisements promoting it – will be monitored, and any irregular activity will be easily detected. It is easier to fix games in an unmonitored environment, in which money flows under the radar. Proof of such successful monitoring is the recent suspension of 5 NFL players who were caught violating the league’s gambling policy. Therefore, the common belief that legalizing sports betting will corrupt sports is wrong.
Against Legalized Sports Betting
The house always wins
Many of those who argued for the legalization of sports betting claimed that it’s more about skills than luck. They said that much like stock trading, it’s about wittingly identifying opportunities and acting on them. But this assertion is wrong. The human element has a huge impact on sports; often, the unexpected happens, which can affect everyone from team owners down to the last player. Even where skill may improve the odds of winning, people who bet on sports may not always possess the deep understanding of statistics required to win. People usually bet on sports based on a hunch, not knowledge. Sports betting is not just about skills and it’s not like stock trading; it’s gambling, and as in gambling, the house tends to always win.
Legalizing sports betting won’t mitigate illegal betting or related problems
The main reason people bet with bookies is not the lack of alternatives but availability and, most importantly, the generous line of credit that bookies offer. Bettors don’t need to deposit money to bet with bookies, which makes it easier for them to bet with money they don’t have. This is also the main reason wagers get into troubling debt situations. Moreover, bookies will offer better margins and betting rates for their customers since they won’t pay taxes. Thus, legalizing sports betting may not fully eliminate illegal betting and the problems that accompany it. Moreover, current opportunities to gamble on sports have now increased around the US, and with the opportunity so has technology enabling one-click betting at home. Therefore, the ease of access to betting (i.e., apps) has increased for gamblers, yet services to help gambling addicts have not risen in parallel.
It will change the nature of American sports
Legalizing gambling in sports may gradually change American sports. As with everything that involves money, the sports industry is becoming even more commercialized than before. In a slow but consistent process, a focus of American sports has become betting rather than the game itself. Companies are now spending tens (if not hundreds) of millions of ad dollars promoting some form of gambling (in 2021, FanDuel reportedly spent $1 billion on advertising), and the American Gaming Association noted a 40% year-over-year increase in bets just on the 2022 NFL season alone. Such numbers show that gambling companies and their ads have managed to co-opt professional sports and have made them synonymous with gambling. Anyone who has ever gambled on a sporting event knows that once you place a bet, the focus of the game suddenly becomes money, not the game itself. And that’s not what sports are about.
The Bottom Line: The Supreme Court’s decision to overturn the federal ban on sports betting is reasonable, especially since it is already happening to a large extent, and states deserve to monetarily benefit from it. On the other hand, legalizing betting won’t eliminate illegal betting and will negatively change the nature of sporting events. Do you support the legalization of sports betting? Would you place a bet on your favorite team?
