25 minutes to go

[peterbirks]

I see that the French authorities have asked to interview John Anderson, CEO of 888 Holdings until late last year. This is a salutary reminder that the moves late last September in the US are not necessarily restricted to the US. Online gambling (with which, I fear, poker must accept that it will be lumped) in most countries is either illegal, possibly illegal, or only legal because the government concerned has never got around to making it illegal. The only online gambling which governments don't mind making legal is one from which they derive tax revenue.

Be sure of one thing, the morality of the matter has nothing to do with it. This is all about tax revenue. UK MPs can pontificate at length (and usually do) about the money people lose on the Internet casinos, and yet say nothing about the people I see putting up to a hundred quid (probably more than half their take-home wages) on lottery tickets. Perhaps the MPs imagine that those people punting most of their cash on lottery tickets have a particular affinity for the good causes that benefit from the lottery, but I somehow doubt it.

No, what pisses all politicians off about online gambling is that some people are making a lot of money out of this, and the government (whichever government you choose) is making nothing.

It strikes me as inevitable that if Party and Stars focus on Germany and France, then the take from these countries will go up, and the governments (far more interventionist when it comes to tax revenues than they are in the US) will then sit up and take notice.

Is the depressing prognosis therefore, the end of online gambling?

Well, that's one possibility. The other possible horror is that the established businesses (Harrah's, MGM Mirage, Ladbrokes, etc) will be given a free pass (I mean, look how the Chancellor took it up the arse on the change in UK betting tax rules) and will create country-specific online gambling sites. For the poker player, this is little short of disastrous, because it drastically reduces liquidity. But I can't see how poker will be excepted, because legislators simply don't understand poker.

The Internet is causing federal states a number of problems when it comes to revenue and online gambling is focusing these. A logical solution for governments would be to grant licences to their pet companies, and then to collect the taxes from those pet companies. Betfair already has a separate "Australia account" for when you want to bet on Australian events. Already it's becoming harder for me to be a "two-currency" person, effectively functioning in dollars and sterling. Countries are beginning to fight back against the globalisation of the Internet, because they can see their revenue shrinking if the world becomes much more "global". Companies already know how to minimize tax bills (five of the top 10 companies in the FTSE 100 paid no corporation tax last year, I believe...) and now the democratization of the world via the web means that individuals are finding it easier to follow a similar path.

Online gambling, meanwhile, finds itself in the front line, and online poker is a mere subsset of that caught in the crossfire. Governments don't "have it in" for online poker; it's just something that's caught up as an innocent bystander in a much bigger battle.

Comments

[countingmyouts.livejournal.com]

Hi, Peter:

I agree with you that online poker is merely collateral damage in the battle that is being waged.

Frankly it pisses me off that the attack on online gaming is being passed off as a moral issue. It's all about who is not getting their's in the form of taxes. Seriously, can you think of a more regressive tax than the lottery system? I don't see any moral wars being waged on lotteries.

Michael

[(Anonymous)]

You wrote all of that during Busby Berkeley Dreams? Even though I tend to repeat that one a few times (and then play Acoustic Guitar a number more), that's still good going.

I tried Charm of the Highway Strip again (from comments a couple of months ago) but failed to rediscover much in it. Possibly because I'm overdosing on Regina Spektor.

[(Anonymous)]

Occasionally I dream that someone has invented a new, potent kind of electronic money too slippery for governments to intercept; the world economy goes over to it; and governments disappear into the history books along with divine monarchs, protesting in amazement.

Then I wake up. Oh well. But the future can be an amazing place, who knows what will happen there?

-- Jonathan

Politicians & Idiots who choose to spend their own money

[real-aardvark.livejournal.com]

Umm, yes.

You have just given a succinct description of what, from the outside, I can only see as political hysteria. (It's like wisteria, only spelled differently. Also, wisteria is quite charming, and only tends to damage the brickwork.)

This is a large, indeed vast, subject, but it centres around greed, ignorance and innumeracy. There's a lot of that about. I've been wondering about the history behind Prohibition for a long time, and despite an Oxford degree in the bloody subject, I can't quite make it click ... but I think we're seeing the same thing all over again here.

Plus weird sidelines involving vested interests in the gambling business. God knows, there's a State dedicated to nothing much else.

This is all very stupid and depressing. I would love to hear a government representative, from the UK, the US, or anywhere else, explain why there is any difference, from a government point of view, between

(a) buying a lottery ticket
(b) 'gambling' on poker
(c) going down the bookies
(d) taking a short position on Airbus, with an option to buy out in twelve days
(e) burning the contents of your wallet and chucking the ashes down the drain.

The only one that doesn't make sense to me, and I think should be discouraged with the full force of a Hogarth caricature, is (a).

This is not, however, your typical politician's perspective.

Make of that what you will.

(Oh, and I didn't deal with the drastic reduction in liquidity, which is also true; but it's the second derivative, and I'm not sure I'm even up to the first at the moment.)

Re: Politicians & Idiots who choose to spend their own money

[peterbirks.livejournal.com]

It is a matter of never-ending amusement that my company blocks me from accessing Friends Reunited (a dating service, apparently) and resolutely prevents any access to Betfair, in case I want to have a fiver on a horse race, but has no objection to me taking a four-figure position on the movement of the dollar over the next 15 minutes.

A major cause of the problem is, quite simply, convergence and sophistication. Two, two main causes.

In the past, things were placed into categories such as "gambling" and "investment"; governments, not really being that clever, were quite happy to pass laws as if these two things were as separate as oranges and elephants. Then risk analysis beecomes more sophisticated, and it became clear that some things which we thought were different from each other, are, in fact, mathematically identical. Risk analysis is, as it were, the topology of probability. A doughnut is just a hose with holes at both ends.

Politicians, unortunately, aren't too up with modern developments in the analysis of risk, so they cling to the old-style categorisations, which begin to look increasingly farcical in the modern world.

PJ

Re: Politicians & Idiots who choose to spend their own money

[real-aardvark.livejournal.com]

Ah, well: it's interesting that you should mention "in the past" there. Back in the coffee-house days, I think you'll find that the gradation between gambling and investment was practically zero. In fact, if you consider the tulip mania or the South Sea Bubble, it's fair to say that the political classes of the day actively encouraged an insanity that was well beyond gambling, whereas halfway sensible people stuck with investment. Largely in land. Which was (in those days) relatively secure, and backed up by a whole nother set of laws, many of which were designed to make sure that landowners had direct influence over political decisions and ... well, as I say, it's a vast subject.

I'd be tempted to say that this weird distinction between "gambling" and "investment" is part of the super little class game we English play with ourselves. (Note to foreigners: yes, we do play with ourselves. Not only are our upper lips stiff.) You know: I invest; you take risks; he gambles... and it certainly is something that became noticeable in the 19th century, when the working classes actually earned money to gamble enough that they might be able to buy a house. You think I'm joking? A mate of mine at Cambridge had just sold his share of a plantation in the Bahamas, won on the roll of the cards (I think I have this termus technicus right) back in around 1690. He was, in his own term, resolutely Yeoman class. That is, lower-middle. Or possibly bog-standard West Ham supporter -- generations of inbred violence just work that way.

Where was I?

Oh yes. Blair urging cheaper football tickets. Now, I passed by the Telegraph with headlines like "Man charged by cow: Critical," because I understand his deep-seated need to explain to the cow in question that, no, the charge wasn't really necessary, and yes, it would have been much more aesthetic if the cow had done a Ronaldo and dived in the penalty area, and anyway, I paid £50 for this steak in an Aberdeen Angus, and I don't expect the mother to come around and sue me for the loss of her daughter, and ...

...and I can't help obsessing over this very strange remark from our own Turkmenbashi, the PM. "Blair urges cheaper football tickets," apparently.
Why? "I think there are very sensible market-based reasons for people to make sure the ticket prices aren't beyond the reach of the ordinary fan."

Well, me, I'm just a cretin. I see one line (ticket price) going up over time, and the other line (attendance) going down over time. Presumably, at some point, one can maximise income, all other things being equal. The question of whether this involves a crowd of, let's say, 20 millionaire donors to the Party, or 100,000 scrubbers like you or me who can't get in because of the insane banning of the terraces is largely irrelevant.

What Blair is saying here is tosh.

I'm very much looking forward to his applying the same principles when invited, post retirement, to give a speech to the Bridlington WI crochet club, and charging them somewhat less than the £30,000 or so that he would normally charge.

After all, it's all about bums on seats, isn't it?

Or is that the Houses of Parliament?

Possibly. They banned the national lottery back in 1730, or thereabouts, because of the carnage it wreaked on the inferior classes. Now it's back as a blatant subsidy for the Olympics -- and they're still putzing around over on-line poker?

Sheesh.

What will the non-US players and countries do?

[(Anonymous)]

Hi Peter,

With more attacks as you mention on online poker besides just here in the US, I am wondering just how much effort both various euro countries will go to in order to try to stop online gambling, and also how much effort the players there are willing to go to in order to keep playing. And as well whether the sites put as much effort into finding alternate funding mechanisms for euro players as they do for us yanks.

I think in retrospect a lot of this was brought on by the in-their-face step of taking privately held online gaming corporations public on the exchanges and trying to legitimize a business that has always been regarded as slightly shady or downright immoral. Indeed if I were a major stockholder in party gaming or neteller, I would be looking to go the LBO route and go back to 5 years ago with private gaming companies and private e-wallets and ease off on TV logos for players who made it tourneys via online satellites.

And besides all the obvious hypocrisy and cronyism in gambling legislation across the world, it also rankles me that the same anti-gaming folks never even look at compulsive shopping or other forms of entertainment that are the "vices" for other people.

If the WTO and EU free trade provisions don't ultimately stop the gov'ts from implementing country-specific sites as you mention, then that is indeed a likely outcome. And it really would be a shame as a lot of the appeal of poker or other forms of entertainment on the net is the global aspect of same.

BluffTHIS!

Re: What will the non-US players and countries do?

[peterbirks.livejournal.com]

Hi Bluff:

Here's an interesting quote from this morning's SportingBet figures (in which, by the way, they kind of admit that Paradise Poker has not been a storming success for the company).

Externally however, there is little sign that the market distortions which now exist across various global markets show any signs of being resolved. With diverse government policies ranging from licensing and regulation to blatant protectionism now in place, the need for clarification has never been greater.

Sadly, there is little sign that authorities such as the EU have the appetite to address the issue at present.

Re: What will the non-US players and countries do?

[(Anonymous)]

Peter,

The funny thing regarding "not having the appetite to do something", is that it is your country, the UK, that is doing the most nothing. Online companies were using the London Exchange and various overseas British territories to position the UK as the leader in global online gaming. And yet your gov't doesn't seem willing to back those those companies via initiating/joining trade disputes before the WTO and EU. So they are just allowing all the EU countries to adopt protectionist measures re online gaming, when they have the most to lose by not doing so and the most to gain by pushing for free trade.

Bluff

Not the argument sketch

[real-aardvark.livejournal.com]

BTW, the allusion in the headline went entirely over my head. (And thereby died of oxygen deprivation, no doubt; yes, how amusing.)

Is this a reference to some bizarre Dick short story that I haven't read yet? Something to do with a Lifestyle Shop, perhaps. This sort of thing is apparently all the rage with Metrosexuals (and I am firmly in favour of these people. I certainly wouldn't want to meet a Bakerloosexual down a dark alley anywhere near me).

"Hello, Mr Birks. We have a special on defunct poker site winnings at the moment -- give you a BBB- celeb star rating at a forward discount of 12.5% over six months, based on the renmimbi mutual fund bond market. What can I do you for?"

"I'd like to be Lawrence Llewellyn-Bowen for twenty-five minutes, please."

"Would that be for here, Sir?"

"No, that would be twenty-five minutes to go..."

Re: Not the argument sketch

[peterbirks.livejournal.com]

It's the title of a Johnny Cash song, Pete, as the song's narrator watches his own gallows being tested.

PJ

Re: Not the argument sketch

[real-aardvark.livejournal.com]

I presume the crash test dummy in question was a Bakerloosexual. Another good use for LLB -- a ponce in a technicolour dreamcoat, rather than The Man in Black.

No, don't see it. You really do need to visit the Lifestyle Shop, which I've just located at 132 Wardour St, so it should be nice and convenient for you.

Or, as the other Men in Black would have it, "Five minutes and you're almost there..."