Donald Trump and legalized sports betting

The ascendance of a casino magnate and self-admitted career opportunistic businessman to the presidency may be the final card that topples a house of interlocked legal, political, and sports and gaming industry special interests. President Donald J. Trump's election could shift things in favor of striking down the decades-old federal prohibition on sports gambling.

Betting on sports essentially has been illegal since 1992, when the federal government passed the Professional and Amateur Sports Protection Act (PAPSA). Only four states - Nevada, Delaware, Oregon and Montana, by virtue of legal grandfather clauses - are permitted to offer sports wagering. In an unexpected move last month, the U.S. Supreme Court did not immediately decline to review New Jersey's appeal of an unfavorable decision by the 3rd U.S. Circuit Court of Appeals in which the state is challenging the constitutionality of PAPSA. The court instead asked the U.S. solicitor general to weigh in on New Jersey Gov. Chris Christie's case, thereby inviting the Trump administration to provide its views on the issue.

New Jersey says it is antithetical to the U.S. Constitution for the federal government to provide a few states the opportunity to promote an immensely lucrative legal sports gambling industry while denying other states the same. A number of states, including New York, South Carolina, Michigan and Maryland, have introduced state bills addressing legalized sports gambling. Some, like New York's bill, are based upon a state constitutional amendment; others, as in the case of Maryland, are based upon a state voter referendum and repeal or amendment of PAPSA at the federal level.

Now that Jeff Sessions has been confirmed as attorney general, the most important vacancy in the Justice Department is the office of the solicitor general. No one knows who the new solicitor general will be yet, though the call for the solicitor general's view does mean that New Jersey's appeal will remain alive for at least a few more months. This will provide crucial time for casino lobbyists, professional sports and business interests, and most importantly, the White House to flex their respective muscles in aid of influencing the high court to consider this issue. If certiorari is granted, the table will be set for a seismic policy shift in the sports betting world.

The Perfect Storm

Support for a legalized sports gambling system subject to taxation and federal or state regulation within the sports and business community is at an all-time high. Geoff Freeman, gaming lobbyist and president of the American Gaming Association, recently stated, "We have a perfect storm coming together ... You have leagues, you have broadcasters, you have law enforcement, you have the casino industry - everyone is acknowledging that we are better off having a regulated environment."

NBA Commissioner Adam Silver has proclaimed his unequivocal support for such regulation. The NHL's expansion into Las Vegas next season will mark the first major sports team taking residence in Sin City. MLB Commissioner Rob Manfred has openly stated that Las Vegas presents new and desirable business and growth opportunities as a potential franchise expansion or relocation destination. NFL ownership has supported the Oakland Raiders' attempt to relocate to Las Vegas. Even NFL Commissioner Roger Goodell, while maintaining his ostensible opposition to legalized gambling on ethical and moral "integrity of the game" grounds, is encouraging the NFL to partner up in lucrative fantasy sports wagering deals as well as further entrenching the NFL's foothold in London and Mexico - foreign locales that both permit legalized sports betting.

On the political front, a Republican president, a Republican House and a Republican Senate are in place. A more conservative and states' rights advocate-minded government likely will not look kindly on federal legislation such as PAPSA. The law takes the issue out of the states' hands and places it solely in the hands and control of the federal government.

And then there is the Trump card.

What Will Trump Do?

Trump can appoint a solicitor general who, once confirmed, will have the power to weigh in on the issue of legalized sports betting on behalf of the White House. Moreover, Trump may feel a debt of at least some gratitude to Christie, who helped support Trump early in his presidential run.

Unlike other past commanders-in-chief, Trump may have a real dog in the fight when it comes to sports gambling. Trump publicly supported the legalization of sports betting in the early 1990s, when he was the owner of New Jersey casinos. Undoubtedly, with his deep Atlantic City casino and hotel ties and business history, there may be sports and gaming industry friends to please and favors to be repaid.

Trump's presidential platform is based, in part, on creating jobs and looking for domestic revenue generation sources. Legalized sports betting could be an appealing proposition to Trump, and he has not expressed any moral opposition during his campaign or otherwise. In a 1993 interview, Trump stated that "you have to be" in favor of legalized sports betting and "[i]t is vital to keeping your taxes low, it's vital to the senior citizens, and it's vital to putting the bookies out of business."

Moreover, while the lawmakers who supported PAPSA declared it would serve as a shield against corruption, many pundits today argue that the converse has actually occurred. They say PAPSA has resulted in an unregulated, illegal sports betting underworld worth billions of dollars. The American Gaming Association estimates that $150 billion in illegal wagers are placed each year.

Trump does not appear to recognize the deterrent effect of federal anti-sports gambling legislation. As recently as 2015, he publicly stated, "I'm OK with [sports betting and daily fantasy sports] because it's happening anyway. Whether you have [legalized sports betting] or you don't have it, you have it."

Then again, we know Trump does not like to lose. Even if Trump uses his power and influence to sway the Supreme Court to take up New Jersey's case, it will not guarantee a victory. All it guarantees is a chance for New Jersey to step up to the plate. If Trump senses that the judicial cards are not dealt in his favor, even if he privately disfavors PAPSA and its restrictive federal gambling prohibitions, he may nevertheless decline to publicly weigh in on the issue of legalized sports gambling for fear of going all-in and suffering a loss.