Gambling and Obamacare and Wealth Transfer All Around

“Ninety percent of the hands aren’t shown in a poker game” – Doyle Brunson

Last week I came across an article about Sheldon Adelson, a casino mogul who is gearing up to try to stop the rise of internet gambling (found a copy here for those interested). What I found interesting about the article is not that a casino mogul would oppose online gambling – that seems rather obvious: it is a threat to his business model. No, what I found interesting was the contorted rationalization and moralization he used in opposition. Consider:

“My moral standard compels me to speak out on this issue because I am the largest company by far in the industry and I am willing to speak out. I don’t see any compelling reason for the government to allow people to gamble on the Internet …”

Seriously? First there’s “moral standard” then there’s “no compelling reason” for the government to allow people to do something. Let’s deal with those in turn. On “moral standard” the article notes that Adelson is concerned (deeply concerned?) about gambling hurting “young and economically vulnerable Americans” and that there is “no efficient technological way to stop minors or those suffering from alcohol or other substance abuse problems from gambling online.” This coming from a casino owner – a business known far and wide for reeling in young and economically vulnerable Americans and giving them complementary drinks while they lose money they can’t afford to lose. Then he drops some nonsense about stopping “money laundering” … maybe he’s concerned about other people taking a bite out of the money laundering aspects of casino gaming?

A word of advice: when you’re flailing in the wind and struggling to find a reason to oppose something, when the real reason is obvious (it hurts your business interest), pick one issue and stick with it. When you flit about from the economically vulnerable to drunks to money laundering you just look desperate.

(Sidebar: I’m told that the same sort of issue came up here in Maryland a few years back when they built a casino at Arundel Mills mall. The loudest and most moralistic arguments against the casino came from a group that wanted to build the casino in Laurel, MD instead.)

Then there’s the “compelling reason for the government to allow” remark, as though the government needs a compelling reason to allow free people to be free. “I’m sorry, I know you are a free man, but unless you can present a compelling argument as to why you should be allowed to invest in stocks, or buy a restaurant, or make a wager, or marry a person of a different race – then you just can’t.”  Compelling argument my [redacted expletive].

I’m not claiming here that online gambling is a “good” thing or a “moral” thing, just that free men ought to be free so long as their freedom does not infringe on the individual rights of another. I don’t see any compelling argument that my online gambling (I don’t gamble online, by the way – it’s just rhetorical flourish) violates the individual liberties of anyone.

Sheldon Adelson is worried that the wealth transfer from gamblers to himself might be interrupted if those gamblers go online. And that’s not fair! He’s got a good thing going. Speaking of wealth transfer …

I was reminded of the online gambling issue when I caught John Fund’s recent article “A Roll of the Dice” – where he discusses how 50,000 people in New Jersey have signed up for online gambling in the first week, while only 741 signed up for Obamacare in all of October. Of course there are plenty of reasons this might be true. People who want to gamble and people who need to sign up for Obamacare are different populations – plenty of people still have employer plans (for now). And, I imagine that the online gambling sign-up website is pretty smooth, while the Obamacare website is, umm, not.

Then there is the most obvious reason. People cannot stomach the insanely high pricetag that often accompanies an Obamacare-approved plan. This goes double for younger people. The whole premise of Obamacare is that young, healthy people will pay high prices for insurance they don’t need (or want?) in order to subsidize older, less-healthy people. It just doesn’t work if they don’t participate. The problem, of course, is that these young, healthy people also have absolutely horrible career prospects in the Obama economy. So they have a choice: do they stretch their thin paycheck from Aeropostale or the Gap to buy insurance they likely will never use, or do they pay the smaller fine and hope for the best? The answer thus far is the latter.

It’s here that a nice conspiracy theory enters the fray. The young people are not signing up for Obamacare. The only options remaining are for rates to rise even higher on everybody else (you know, the rates that are already causing great pain) or the government must step in and subsidize the insurance companies. Neither one of those are going to go over very well politically. But, if one wanted to go with the government subsidy route (pick any liberal and that’s their preference) how could you get it past the voter? Enter the dreaded Obamacare website.

You see, the website is being upgraded piecemeal. The latest flail is that the “back end” is still broken. That is, you may think you’ve bought insurance, but the insurance company may not have received your information or payment – even though the money has already gone to the government – and it’s the payment part that is critical. What ever shall we do if the insurance companies can’t get paid? Well, they could always just estimate what they think the payments should be, get a check from the government, and the settle things out once it’s all working. I kid you not. Consider a townhall article on just that.

“Health plans will estimate how much they are owed, and submit that estimate to the government. Once the system is built, the government and insurers can reconcile the payments made with the plan data to “true up” payments” – Daniel Durham, some sort of VP for American Health Insurance Plans.

Catch that? The money isn’t being transferred from the government to insurance companies because the website is broken. So they’ll estimate the costs and get the money from the government via special payment. After it all settles we’ll make it square. Anybody think that will happen? The insurance companies will make sure they get their costs covered. If the premiums don’t match the costs, well, it’s up to the Obama administration to make sure the government gets back the overpayment. Or, if you’re a conspiracy theorist, maybe the insurance company will just keep the overage and hide the subsidy they just got paid by the government – a subsidy that they’d never get if it was actually had to go through the legislative process.

Those pesky, failed websites may come in handy after all.

Wealth transfer. From Sheldon Adelson to Obamacare, it’s all about wealth transfer. We are apparently just not comfortable as a species if we can’t appropriate the production of others for our own consumption. The level of self-worship is impressive.

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