Advertising fueled the increase
Dr. Christopher Hunt, a clinical psychologist at the University of Sydney Gambling Treatment Clinic, says a rise in compulsive gambling in Australia stands as an example of the social costs that come with widespread legal sports betting.
Hunt told ABC News Australia he used to see only “one or two” addicted sports gamblers every six months. Now, following what he terms the “gamblization” of sports in Australia, troubled sports bettors comprise one-third of the clinic’s patients. And that, he adds, should serve as a warning to the U.S. government, which some believe may legalize sports betting under President-elect Donald Trump, a veteran of the gaming industry.
“For the two-thirds-plus of Americans who rarely or never engage in commercial gambling, the change will be negative,” said Michael K. Fagan, former federal prosecutor and adjunct professor at the Washington University School of Law. “Anyone fairly and comprehensively evaluating the unbiased, independent academic, health-care and economic evidence readily finds that it weighs in favor of continuing prohibitions on commercial sports gambling.”
Australia legalized online sports betting in 2001, reports ABC. Though there was no immediate explosion of problem gambling, by 2009, when international gaming operators replaced mom-and-pop bookies and began to push the pastime through massive ad campaigns, the landscape shifted.
“All of a sudden, it was like you couldn’t talk about sports without making reference to what the odds were, what the prices were, whether they thought this bet was value or this bet was value,” said Hunt.
As a result, in 2014 and 2015 Australian punters placed $7.1 billion in bets and lost nearly $815 million on sports, according to the latest edition of Australian Gambling Statistics. That makes Aussies the biggest bettors in the world—and the biggest losers.
Could the scenario be replicated in the U.S., especially if sports wagers are legalized nationwide? According to ABC, in the weeks before the 2015 NFL season, U.S. daily fantasy sites DraftKings and FanDuel—which recently merged—ran a television ad every 90 seconds.
“Expanded and heavily marketed sports gambling significantly shifts the focus of fans from the athletic contest to the pursuit of personal profit,” Fagan told ESPN. “Other non-wager-determinative aspects of sport wind up diminished. This means the increased viewership sought by greed-driven, short-sighted league and network executives will be driven to a marked degree by money fans, not sports fans who will have been converted, in whole or part, to money fans, and this will work a change in life in America.
“Only the gamblers, in the short term, and those profiting off their losses, in the long term, will see this change as a positive one.”
But many see nationwide legal sports betting as inevitable over time, and are betting it could come sooner under a Trump administration. “The current U.S. approach to sports betting is not working,” according to a report from the American Gaming Association issued last month. “An open, transparent, regulated sports betting market boosts law enforcement oversight.”
Sam Skolnik, author of “High Stakes: The Rising Cost of America’s Gambling Addiction,” advises voters and state legislators to consider “the potential downsides of what would be a major expansion of legalized gambling.
“You’re going to have this pool of new gamblers, and there is going to be a subset of problem gamblers. This is extremely painful for them and not just their families. It’s for their employers, the whole communities that will pay the costs of increased gambling addiction.”
A similar debate is taking place in India. According to the India Times, former Central Bureau of Investigation Director Ranjit Sinha, an advocate of legal sports betting, has advanced an argument similar to the AGA’s: “The business of sport betting and gaming exists, despite the ban. The government should legalize it.”
He acknowledged the “adverse effects” of widespread legal sports betting, but added, “Proper regulation and an enforcement body can take care of that part. If regulated properly, we can generate huge revenues for the states.”
