Why Is Harry Reid Betting on Online Poker?

The senate majority leader thinks now is the time to legalize online poker in the United States.

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With all problems facing America today Senate Majority Leader Harry Reid, amazingly enough, seems to think that now is the time to make online poker legal here in the United States.

Never mind that unemployment is at unacceptable levels. Or that the jobless recovery has many Americans thinking the economy is still in a recession even if it technically is not. Or that tax rates are about to rise on everyone, making it even harder for many families to make ends meet, unless Congress acts quickly. For Reid, online poker has suddenly become a priority and, as the Wall Street Journal, Politico, and other outlets have reported, he wants to make the legalization of online poker a part of the tax bill currently being negotiated.

[Read the U.S. News debate: Should online gambling be legal?]

Reid was previously an online gaming opponent, so some suggest his recent interest in the issue may have something to do with the support his latest re-election bid received from Nevada’s gaming industry. According to one senior congressional aide cited in the Politico story, the move is “’a total, 100 percent payback’ for the support Reid received from gambling interests.” This would include Las Vegas-based Harrah’s, now called Caesars Entertainment group, a company whose employees and PAC were major contributors to his re-election effort and, the same aide suggested, “even helped write the legislation.” [See who donates money to Reid.]

The company, Politico says, denies the charge. Nevertheless the timing is curious. The tax bill is an important piece of legislation, with many moving parts. It’s already going to be hard to pass. The idea that it also needs to include a provision that makes online poker legal is curious, to say the least.

[See the entertainment industry’s favorite lawmakers.]

Even if it’s not a payback, it’s another example of business as usual in Washington--and a sweetheart deal to boot. The Wall Street Journal, reporting on a draft of the language it had reviewed, said Reid’s proposal would “allow only existing casinos, horse tracks and slot-machine makers to operate online poker websites for the first two years after the bill passes.” The only companies that can get into the business are, essentially, the same companies who are already in the business.

Reid, who started the 2010 cycle looking particularly vulnerable to a strong challenge from the GOP, got a lot of money from casino interests in his fight to hold on to his seat. Now he’s trying to open up a whole new market to them, reversing a 2006 congressional ban that prevents U.S. financial institutions from processing online-gambling transactions. The question “Why now?” is a fair one. On the surface the whole thing seems pretty blatant, and is certainly worth a second look by good government watchdog organizations, even if it fails. Meanwhile, all we can do is stand by and shake our heads in disbelief.

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