Only partially agree with the moralistic principles and with the "greed" reasons. But there is a bigger reason and duty that is enumerated in the Constitution.
"To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;"
Clearly, offshort gambling constitutes commerce with foreign nations. Further, because of the nebulous nature of the online casinos, there is little or no recourse within a court of law for fraud or other illegal acts committed by these entities.
These casinos, while engaging in their games of chance, also act as banking institutions. They have tons of opportunities for fraud and abuse. They have the ability to rig games and engage in activities that if conducted in this country are illegal, yet because they are not subject to our jurisdiction, no court has the ability to seek recourse should they default.
I know that you can make the argument that the market takes into account these risks, but it is most certainly Congress's job to regulate this form of commerces, regardless of their religious or greedy motivations. There is a simple process to address this. It involves 2/3rds of both houses and 3/4 of the 50 states agreeing to limit Congressional Powers in this arena.
If a US citizen wishes to take these risks overseas then it is his money. It is not commerce with a foreign nation. You trade with people, specific businesses or entrepreneurs. The US citizen sends him money overseas basically. Which is his right. Now if he does so and takes a risk well the risk is his own to take. That said the US federal thugs have no jurisdiction overseas. None. No constitutional provision can give them one since other nations are sovereign and independent of the Congress. The money is not spent in the US but is spent overseas.
Now I live outside the US. I send money to Amazon and order books. Is Amazon now a bank because they have my money and there is guarantee I will get the books? And if the books don’t come can I really afford to go after them? No. You’d just have to eat the losses as suing would be too expensive. This is true of any product we purchase from overseas. Under the theory you explain then world trade would come to a crashing halt.
What Congress is doing is pure protectionism and probably a violation of various free trade agreements.
No, you can't compare Amazon that sells a product with a casino that does little more than transfer funds between accounts of different entities while taking transaction fees. Perhaps something like paypal is more appropriate.
I oppose tarriffs and protectionist policies, but these casinos are skirting the tax regulations and banking regulations. Most are owned by US Casinos that operate their sports book and online betting via foreign countries so as to exempt themselves from paying taxes. Most of these companies, especially the sports books are domestic corporations that by locating their servers in the Bahamas or other non-US location can conceal their transactions.
US Citizens that engage in banking with these foreign entities and that make profit off of these gambling websites (and it is obvious that someone is profiting), need to abide by our domestic tax laws and banking regulations. You gotta pay taxes. I don't like the system and don't like taxes, but it is the government's job to collect taxes on individual gains and on the gains of the corporations that are earning them.
People are not entitled to skirt capital gains taxes simply because our tax system sucks and they don't like it and they find a foreign site to avoid them. If we charge taxes on cigarettes and a company makes it a business to sneak cartons that are made for foreign consumption back into the US to skirt US taxes on the product, the government has a right to stop that. Often this is to the detriment of the consumers that buy those products because they have to pay taxes on them and that drives the price up. Online gambling should be subject to US taxes if they want to conduct business in the US. That is foreign commerce.
Now I am not arguing to make the point that the government is justified in taxing these businesses out of existence. That is never a good point.
You pose two interesting problems. First, how do the businesses in offshore gaming compete when their customers are taxed the same as domestic gambling. Second, how does the government ensure that it is collecting appropriate taxes from US citizens on their earnings.
If this fringe banking industry by banking, I mean an industry that's sole purpose is the transfer of monies from one customer to another. I have heard constant arguments that government should be powerless to stop crime or collect taxes or invade people's privacy.
I can't understand why I cannot transfer money into my stock brokerage and trade stocks with other traders all day long and completely avoid paying taxes simply because my stock broker has his server located in the Caymans. If you can explain to me how that is not exactly the same as playing Texas Hold'em via an offshore gaming site, I am all ears. If I can play small stakes poker and not pay taxes until I repatriate the money, why not trade stocks?
If the argument is that all income and capital gains taxes should be abolished, that is a great argument, but until that is done, folks gotta pay taxes. Whether it is gambling on sports, poker, or stocks. It is banking. Businesses that specialize solely in the transfer of money between parties are banks.
Justin you say that businesses that transfer funds between people are banks. So Western Union is a bank?? Paypal is a bank? The law doesn't see it that way.
And the issue was that the federal thugs picked only one legal business to attack. It did not outlaw online transfer of funds under any claim to have the right to regualate banking. It banned only the transfer to one industry -- gaming. And then it went after gaming only when it is outside the US. That is not banking regulations but protectionism.
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