Stop Playing Games with Gaming

The latest state to parlay with Daily Fantasy Sports (DFS) is Florida, and this time the mighty mavens of DFS are looking for a deal instead of a fight.  Rather than going to court again, they are uniting to do what all good Americans with and ax to grind  and money to spare do – buy themselves some legislators.

The big hitters – Draft Kings and Fan Duel – as well as some of the upstarts have banded together to push $220,000 in the direction of some key legislators. All the DFS operators ask in return is the ability to run their games without the interference of government regulation.

Remember the famous words spoken by Abraham Lincoln in the Gettysburg Address?

Four score and seven years ago, our fathers brought forth on this continent a new nation,  conceived in liberty, and dedicated to the proposition that all men are created equal.

Inspiring words, but when Lincoln talked about equality, he must have known it to be a celestrial ideal, an abstraction, because it can never be an absolute that applies without limits to all. If everyone and everything was equal, we would have never developed the Bell Curve and the Supreme Court would have come down on the other side of Citizens United. No constitution can change the immutable law of politics: money talks, and bullshit walks.

This isn’t about whether DFS is a game of skill versus gambling. Anyone who decides it is or isn’t a game of skill is right. Anyone who decides it is or isn’t gambling is right. DFS is whatever you want or need it to be.

There is no aspect of life that comes completely risk free. And there is no betting game that doesn’t have an element of chance. The best poker players, horseplayers, or DFS players will always rise to the top in the long run, but that makes no difference to those who want to equate betting and gambling. Skill becomes irrelevant if it is your mission to make sure everyone “pays to play.”

In the case of DFS, the going rate in Florida would be an initial license fee of $500,000 and an annual renewal fee of $100,000. The best part would be no government interference in the activites of DFS. Are you kidding me? Horseracing is supposed to compete with that?

It gets even better. The Seminoles, who would like a gambling monopoly in Florida, sent $500,000 to Gov. Rick Scott’s political action committee called Let’s Get to Work. It should be more fully titled, Let’s Get to Work Getting Rick Scott More PAC Funding. According to a column by well known Florida writer Carl Hiaasen, Scott recently signed a new gambling compact that would give the tribe’s seven casinos exclusive rights to roulette, craps and blackjack. In return, the state would be guaranteed at least $3 billion from profit-sharing over seven years, beginning in 2017. Of course, the deal is contingent on the legislature approving it, but another few hundred thousand should take care of that.

The best part for Florida legislators looking to fill their campaign war chests is that the Seminoles oppose DFS. This means both sides will spend freely to support or oppose the tribal compact. In the meantime, horseracing gets no help, no equity.

Equality means all the gambling groups – Indian casinos, DFS, horseracing tracks – should all be regulated and taxed so that one doesn’t get the competitive advantage over the other. Let the market decide who succeeds and fails the old fashioned way. As long as horseracing has to pay up front to do business, they will always be at a competitive disadvantage against the other groups. And if DFS and the Seminoles get their deals, the uphill climb for horseracing just got a little bit steeper. What we need is fairness for all, but as long as we are reliant on having to line the pockets of governmental executives and legislators before they decide which laws and compacts they’ll support, horseracing is at a clear disadvantage. Horseracing cast its lot decades ago when the sport was king and profit was plentiful. It’s time to revisit the deal in light of the broad expansion of gambling markets. Forty years ago if you wanted to play table games your option was Vegas, and betting football in the rest country was limited to coded phone calls and conversations with local bookmakers. The times, they have a’changed.

Horseracing will not survive in its current incarnation without some relief, and I don’t mean slot machines or instant racing. I mean internal and external structural relief. Some companies, like CDI, have decided to join the casino business, and other tracks, like the Pennsylvania tracks, Delaware, and Charles Town, have simply become casinos with a side of horseracing. They will all tolerate the horseracing only as long as they have to. Starting with Florida would be fine, especially considering they are apparently wide-open for business, and someone like Frank Stronach may just have the clout to pull it off.

Horseracing simply cannot survive if it is forced to compete on an uneven playing field. If the industry doesn’t get smart and play the game that creates wins for all the stakeholders, then it will continue to deteriorate while DFS and Indian casinos prosper.