Bet On It

By: Ellie Jeffries, Zach Phillips, Stan De Martel, Nathan Ellisen

Even before Floyd Mayweather faced off against Conor McGregor, the “biggest fight in combat sports history” had amassed over $60 million in bets, more than any previous fight. A group of friends from Palo Alto payed the $100 dollar pay-per-view fee and watched the infamous fight. They decided to put a few dollars on the fight to make it more interesting.

“Five bucks on McGregor,” one friend said.

“You’re on,” another friend said from across the room.

Although this casual “backyard” form of betting is common, the majority of gamblers placed their wagers through sports bars and casinos in Vegas and on Indian reservations. Most would argue they do not deserve to be arrested, but according to federal law, these informal bets are in fact, illegal. The prevalence and magnitude of sports gambling has transformed informal betting into a highly-regulated $240 billion dollar industry with a rich history and a possible bright future in the United States.

We were not the first to bet on sports, and neither were our parents. In fact, the true origins of sports betting can be traced to ancient Rome, with some of the most powerful humans in history placing wagers on sporting events. While the games and matches themselves have changed, people’s obsession with solidifying one’s beliefs with money on the line has not. In the 2,000 years since, sports have revolutionized the idea and landscape of gambling. Over the years, regardless of legality, sports betting has remained near and dear to the hearts of the ultimate sports fan.
With the rapid industrialization of the 19th century, wages grew and sports began to develop as we see them today, a major entertainment and economic mecca. Within a few decades, baseball went from an obscure sport to “America’s pastime.” This was, in large part, due to the rapid normalization of casual sports betting. The American sports environment was irreparably broken, and gambling was on its way to gaining a foothold in the new economy. Legal issues were bound to plague the sports world.

One of the earliest and most infamous sports betting scandals was the 1919 World Series. It was October of 1919 and the Cincinnati Reds and Chicago White Sox had made it to the World Series. Over 98 years ago, the World Series was a best-of-nine set of extremely competitive games. The Chicago White Sox were heavily favored. Unexpectedly, the White Sox went on to lose the first game of the series 9-1, causing bookies and fans to shake their head in disbelief. After losing the first two games, the White Sox went on a two game winning streak, placing themselves back in contention to win. Against all odds, the Cincinnati Reds were able to win the World Series in eight games. Not long after the Series concluded, rumors of a fix began to surface in Las Vegas. It soon came to light that gangsters had paid eight White Sox players to intentionally lose the World Series. Terms were agreed to, and the players concurred that in return for $80,000 each, they would intentionally lose the World Series. However, part way through the series, White Sox players began to feel unsure of their decision to throw the game. Several of those who had originally agreed to throw the game chose to back out. However, it later surfaced that gangsters began to threaten player’s families and loved ones. Once it had been discovered that the White Sox had thrown the games, each player was banned from the MLB for life.

These historic events centering around sports gambling have changed the way laws are carried out today, not only in sports gambling, but the controversy of gambling itself.
Some argue that gambling is and should be illegal, while others argue that they have the right to gamble and should not be micromanaged on how they use their money. The true law of this issue is just as unclear as the debate surrounding it.

In 1992, the Professional and Amateur Sports Protection Act (PASPA) banned all states from betting on sports, however, the law contained many exceptions. Gambling on horse racing was continued across the country, mainly due to the economic consequences that would come with ending the practice. According to Victoria Craig of Fox Business, the horse racing industry as a whole adds $101.5 billion to the United States GDP, proving how important horse racing is to the economy.

The horse racing side of the controversy is relatively clear but is commonly debated among anti-gambling supporters. The PASPA does not specify anything about horse racing and therefore betting on horse racing remains legal. Horse racing has been a tradition in the United States for years and continues to be used as it boosts the economy and continues long held gambling traditions. However, the horse racing industry is losing money, with the institution of new and easier forms of gambling. With new forms of betting that are far easier to use and make money on, horse racing is losing its popularity. The industry is in trouble as they are losing significant amounts of money and horse racing tracks as well as the traditions horse racing comes with.
These issues were strongly argued throughout statewide governments nationwide, as four states quickly ignored it and continued to allow sports gambling. Nevada, Oregon, Delaware, and Montana allow gambling today, as the passed laws allowing for sports gambling in their individual states. This defiance against the national government has stirred up even more controversy than before. The federal government prohibits any gambling, yet they allow for horse racing as it benefits the national economy and is a long held tradition. However they do not allow any other sports to be bet on, and some states ignore this federal law and allow for gambling anyway. This issue is evidently very controversial and confusing.

Nevada, Oregon, Montana, and Delaware have all passed laws in their states that legalize sports gambling and ignore the PASPA of 1992. These states thus have created huge economic gains from gambling and have taken advantage of the PASPA for their own state’s personal economic gain. It is still very controversial whether or not the federal government should and can interfere with these states laws. Many argue that the federal government should assert its power and end gambling across the country to avoid individual states from taking advantage. However, others argue that states have jurisdiction over an issue like sports gambling and therefore the allowance of gambling should remain. There is no definite solution to these gambling problems the government faces and it’s unlikely there will be any progress on the matter in the near future.
There are many ways to avoid the ruling of the PASPA and many gamblers use means other than government-monitored casinos or websites to bet on the sports they love. While it is impossible for the government to monitor every bet between friends, the laws are still in effect. This principle manifests itself when Fantasy Football comes around. Each year, millions of Americans will place bets, outside of casinos or websites, and face no punishment. It is likely, that as you are reading this article, thousands are illegally betting on sports games worldwide. While each of these acts is illegal, there is no sector of local or federal government which feels the need to delegate resources to crack down on casual sports betting. Placing a weekly bet on a home team does not seem like much of a misdemeanor, let alone a punishable felony, however according to United States law, millions are committing crimes each week and going unpunished.

Another method of avoiding the PASPA ruling is the institution of Indian Casinos in states that prohibit gambling. Since gambling is considered a Native American ritual, casinos are legal when operated by Native Americans. This allows for gambling in most states and therefore abolishes the ruling of the PASPA and gives the Indian Casinos an unfair economic advantage in sports gambling. Physical Education teacher Jason Fung agrees with the controversy of this topic.

“Technically it’s legal, but [only when] on an indian [Native American] reservation.. There’s two places in San Jose you can go gamble at. But the way they get around the rules is every time you place a bet you have to pay the house,” Fung said. “It’s not illegal, its just how you get around the words.”

The law of sports gambling is still an unknown, however, the institution of new and easier forms of betting, specifically sports betting, are completely changing the way sports gambling is policed and carried out by the government as well as the people.

One of the great allures of betting on sports, and anything in fact, is the possibility of making great returns on a relatively small investment. With obsessive, odds-calculating sharks congregating in the world of organized sports betting, the morale of normal players had diminished over the course of the 20th century. However, with the advent of alternative platforms, ordinary people have begun to win extraordinary sums of money.

The world of sports gambling has revolutionized itself as apps and technology have become more accessible and easy to use. In the past, in order to bet on a sporting event people had to actually go to the casinos, and if you didn’t live near one, or lived in a state where it was legal, you were out of luck. Today, all it takes is a tap on screen to place a bet, and you don’t even have to leave your bed. However, these luxuries may be short lived.

Since the rise of sports betting websites and apps began, their legality has been in question. While it is illegal to operate an online sportsbook (sports betting website) in America, there is still the option of visiting certified offshore outlets. These sites operate under the oversight of a governing jurisdiction which allow sports betting to be legal in their territories. This allows them to legally allow bettors all over the world, including the U.S., to use their sites and partake in sports gambling. No federal laws prohibiting this method of gambling exist in the U.S.

A single loophole allows apps such as Draftkings & Fanduel to retain legality in America. Under the Unlawful Internet Gambling Enforcement Act, which was passed in 2016, fantasy sports are categorized as a “game of skill” rather than a “game of chance” which is illegal. Under the law, if the game is not dependant solely on one team’s performance, or a player’s individual performance, as well as has an outcome that is reflective of the participants knowledge and not left to chance, then it is considered legal. Because of this, all betting on fantasy sports through websites and apps in America is legal, despite any other type of gambling on sports being prohibited.
This causes confusion though, because in some people’s eyes betting on games and players requires just as much, or more, skill than fantasy.

“It definitely does require skill, you have to do a lot of research, you have to know trends, you have to know teams, you have to know injury,” Paly teacher David Duran said. “It’s still gambling so you could do all the research you want and still end up on the wrong end, but there’s skill involved, some people make a lot of money off of it.”

In order to repeatedly profit from betting, it is highly improbable a person’s choices are solely based on luck. Many studies have found that there is high correlation between the true odds of a game’s outcome and the closing lines (the betting line before a bookmaker sets the odds for an event) on some of the best bookmakers. In order to have the best ability to make money off of sports betting one must study trend, stats, and outliers in the sports world, this can be done well and as a result, bring in an income. If this is the case, it seems obvious that sports gambling can contain skill, but does not necessarily need too. This leaves a gray area between those who take sports gambling professionally and seriously, and those who necessarily rely on it and abuse it. If sports gambling were to be classified as a skill, there is no clear answer as to how it would be regulated to a point where it was both fun, profitable, but all the while, still safe.
The laws surrounding gambling in sports have brought with them many arguments regarding its legality.

A big argument for legalizing betting on sports is that it happens whether it is legal or not. People bet all the time on sporting events. It could be simply putting 10 dollars on your fantasy football league with your friends, or using illegal platforms like overseas websites. Billions of dollars are spent every year in casinos and online, and people are saying that it’s time states such as California start cutting into those profits. People also say that they work for their own money, so they can spend it however they like. Also, just like anything else, gambling on sports requires work; everything should require work and dedication, and sports betting is no exception.

On the other hand though, a big concern of doing this is that it does bring a lot of problems with it, such as underage gambling, compulsive gambling, fraud and money laundering. Legal gambling is the fastest growing industry in the world, and it can have a corrupt influence on the government, since the casinos brings such a large revenue back to the government. Gambling is immoral as isn’t a fair way for people to earn their money, and it doesn’t contribute to society. Unrestricted betting can also lead to compulsive gambling, which can cost billions annually.

Recently, assemblymember Adam Gray recently proposed a new amendment that, if passed, would legalize sports betting in California. Gray is the one who pushed for legalizing online fantasy football betting and online poker, and now hopes to take it even further by loosening the restrictions on all sports betting. There will still be limitations in order to prevent money laundering, fraud, and underage gambling. The Golden State wants back in on the multi-billion industry that is sports gambling. The likelihood of the amendment being passed has gone up, due to the New Jersey sports betting case heading to the US Supreme Court. This case essentially is about New Jersey (the sports betting capital of the world) trying to expand the reach of sports gambling, and legalizing it all across the US.

So how do student at Paly feel about the topic?
The school wasn’t very opinionated although most people said that gambling fell under citizen’s first amendment rights, and that it should be legalized. “I think it should be held to a democratic process and if legalized, only be allowed in specific locations to ensure that it doesn’t get out of hand,” Leyton Ho (‘19) said.

“Sports gambling should be legal as it is an individual’s right to spend their money however they see fit. The government should therefore not restrict gambling as it is an infringement on individual rights” Nathan Ramrakhiani (‘19) said. The issue isn’t as pressing to Paly students now because they are not of age, but one they are in a place where these platforms will be accessible to them, their viewpoints on the issue may change.

Evidently, the issue of sports gambling is a highly debated and controversial topic with its many layers. The history of sports gambling is thick with strong consequences given to seemingly small crimes. The legality of sports betting is very disputed and unclear today with the unadvertised institution of new laws on the topic. New forms of sports gambling have paved their way into our everyday lives with their ease and and big winnings. Through all this however, individual citizens know very little about the deep and debated topic and how it may pertain to our everyday lives. Right now, sports gambling is still a big question with no apparent answers.


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