The Sports Gambling Backlash Is Here

Gamblers are ruining their lives, and Americans want action. What can we do?

One of the things that came out in the reader poll is that 95% of you either wanted me to cross-post my work from other places or didn’t care if I did so. Apropos of that, find reproduced below a piece that ran yesterday at The Dispatch, where I am a contributing writer. Also, if you’re interest in signing up for The Dispatch, apparently you can use promo code “LEHMAN” for a 15% discount.

The piece also dovetails nicely with my appearance on the House of Strauss podcast, which I encourage you all to check out.

With football season creeping closer, sports broadcasters are preparing for record attention to the national pastime. Earlier this month, the NFL struck a “landmark” deal with ESPN, trading control of the league’s broadcast properties for a 10 percent stake in the network. The agreement is most notable because of ESPN’s nearly-billion-dollar sports betting arm, ESPN Bet. The deal thus creates the closest entanglement yet between a league and a newer national pastime: sports gambling, an industry worth nearly $14 billion and commanding the attention of nearly half of men ages 18 to 49.

Yet as the two companies cozy up, Americans are growing more concerned about what sports gambling is doing to their country. In one recent poll, 58 percent wanted the federal government to “aggressively” regulate betting. Nearly two-thirds backed the SAFE Bet Act, a proposal from Democrats Rep. Paul Tonko and Sen. Richard Blumenthal that would impose stringent federal oversight. While a majority still favor legal sports betting, they also say that it should be illegal to bet on college sports, according to a recent AP-NORC poll.

This concern makes sense given the damage that gambling has done to both sports and bettors. Americans are recognizing the cascading harms legalization brought. Now they’re asking: Can we do anything to fix this mess? The answer is almost certainly yes. But it will require not only smart regulation, but the political will to overcome deeply entrenched financial interests.

Since 2018, when gambling became legal nationwide, professional sports have been beset by scandal. Most recently, two players on the Cleveland Guardians were suspended amid an investigation into whether they adjusted their play to make money on “prop” bets that they would behave in certain ways. But that’s just the latest: An ESPN timeline identifies dozens of incidents across college and professional sports in the past seven years, some involving millions of dollars in fraud.

That’s not surprising. Wherever players have the opportunity to make money through gambling, some of them will take advantage. Legal, online sportsbooks, with their deep markets and increasingly exotic bets, make doing so easier than ever before. And financial ties between the leagues and sportsbooks mean both parties are strongly incentivized to look the other way.

The rising tide of addiction and harm is less visible than the scandals, but far more harmful. An estimated 2.5 million Americans suffer from severe gambling addiction each year; 5 million to 8 million more have a mild to moderate gambling problem.

A growing body of rigorous research shows that legalizing betting systematically worsens the harms of addiction. Irresponsible gambling nearly quadruples following legalization, one June study found, followed by a 75 percent increase in calls to gambling helplines and increases in alcohol consumption. Legal sports betting increases credit card debt and risk of overdraft, another study found, and it increases the risk of bankruptcy by 25 to 30 percent, a third concluded. Gambling has also been connected to anxiety, depression, suicidality, and even domestic violence.

Many Americans now see a friend or loved one reflected in these statistics. In a recent poll, 18 percent of Americans reported that sports gambling has caused tension in their relationships; almost a third know someone whose well-being has been harmed by gambling. Since I first began writing about this issue, I’ve heard too many stories about people, mostly young men, tens of thousands of dollars in debt on betting apps. Such men are often those least able to afford a big bet; some will spend years or decades digging themselves out.

Such experiences are why Americans are clamoring for action. There are a lot of ideas out there for what that might look like.

Take the proposals in Tonko and Blumenthal’s bill: Curtail sportsbook ads, especially during live events; cap deposit frequency and prohibit credit card-backed deposits; prohibit the use of AI to track users’ habits. To those we might add bans on the most outlandish practices, like the discounts some sportsbooks offer for many-leg parlays. Or consider popular ideas like banning networks from broadcasting odds during games.

Lawmakers could also impose stiff fines on sportsbooks when players use them to profit off the game, creating an incentive for the operators to care about game integrity. Even if the feds don’t pick up these ideas, state legislators certainly can.

Regulation, though, is easier said than done. Because sports gambling is addictive, its harms concentrate among the small fraction of users who use most heavily. But these users also drive the large majority of sportsbooks’ revenue. Consequently, any regulation that gets at the fundamental problem will also be fiercely resisted by the industry.

Such problems are familiar to critics of industrialized vice, and overcoming them involves giving the public a clear harm done by a clear bad actor. Take the example of Candace “Candy” Lightner, whose 13-year-old daughter Cari was hit and killed by a drunk driver. Lightner’s organization, Mothers Against Drunk Driving, successfully passed hundreds of drunk driving laws, partly by telling the story of Cari and girls like her. Or consider America’s remarkable success at reducing smoking—thanks in large part to the villainization of Big Tobacco for its dissembling about cigarettes’ carcinogenic effects.

When people ask me if we will ever rein in sports gambling, I always give the same answer: once things get bad enough. From cigarettes to crack cocaine, our history with vices shows that we only start to take it seriously after the big tragedy happens. But as negative reports pile up, it seems like that story may be coming for sports gambling. Lawmakers—and the concerned public—need to be ready to act when it does, or expect more of the same.