Do We Need Sports Betting to Get to Mars? Maybe
Freedom is a vibe
There has been a great deal of discussion lately about the legalization of sports betting, with pundits increasingly arguing that it was a mistake. Apparently, when given the freedom to blow their paychecks on their favorite team, a lot of American men jump at the opportunity. In Nate Silver’s latest book, I learned that this is a particularly scammy industry, where the major companies go as far as limiting your ability to bet or banning you completely for winning too much.
The marketing appears aimed at the most primitive kind of male consumer, as seen in this video.
To me, the question of the harms of sports betting is not that interesting. Fools and their money are easily parted. Stop the presses. Perhaps government can do some good by protecting these people from themselves, though I would hesitate to grant even that given that we have no way of measuring how much value individuals derive from sports betting. You can’t say amusement parks are not worth the costs simply by looking at how much people spend and not considering what they get out of the experience. And since we have no way of measuring such things, our default is to leave people alone and assume that their financial decisions reflect their values and preferences. I don’t see why sports gambling is all that different.
Perhaps those who want to ban the practice are correct that it is a net negative for society. The issue is that by using their methodology, there’s no reason you should stop at sports betting. Should men be allowed to watch sports? Buy jerseys? Which is greater: money lost on sports gambling, or the opportunity costs of actually watching and reading about sports and going to games? Given how much time people spend in front of the TV when they could be exercising or working, I wouldn’t be surprised if it was the latter.
I believe that the strength of a slippery slope argument depends to a large extent on what is at stake in the question we are debating. If an asteroid was heading towards earth, it would be pretty dumb to say we can’t give government the power to marshal resources in response because then we might eventually get socialism. When the world faces an existential threat, we can worry about the slippery slopes later.
On the other hand, when the stakes are small, a slippery slope argument can make the difference. Here, we’re debating a ban that might slightly increase the prospects of low-income men while depriving a larger segment of the population of the enjoyment they gain from gambling. Even if banning sports betting makes sense on its own terms when all costs and benefits are taken into account, I’m not selling freedom that cheaply.
So much of American stagnation over the decades has been the result of well-meaning government policies centered around the precautionary principle. Building infrastructure is much harder than it used to be because the law requires us to take every possible effect on the environment into account. Elon Musk is hindered in his mission to get to Mars by worries over the feelings of seals. And much has been written about how the fear of meltdowns has stopped us from relying as much as we should on nuclear power.
In these debates, the concern is with harms done to others or the environment. The principle that government must take note of externalities is sound, even if it is applied wrongly in the cases of SpaceX launches and nuclear reactors. Yet if we as a society have a tendency to overshoot when correcting for externalities, it seems to me that government really shouldn’t have the power to try and protect us from ourselves. A state that abuses its power and goes too far when it is acting on sound principle should not be trusted in areas where the appropriateness of it taking any action in the first place is questionable.
All of this sounds very abstract. So let’s bring it down to earth. I don’t believe a government that sits around worrying that Bob from Cleveland is betting too much on the Browns will ever let us reach the stars. Freedom is a vibe. Elites with such concerns are going to freak out over every conceivable technology or reform as long as some theoretical harm can be imagined. There are no good ways for government to determine which of our purchases provide enough value to be worth it and which ones don’t. If we have a culture and legal regime where it tries anyway, it empowers a certain kind of person and legitimizes a mode of governance that prioritizes safety over liberty, ultimately to the detriment of society.
If the connection between sports betting and space travel is too tenuous for you, consider how hard it has been to get prediction markets legalized. Those who are opposed come up with lists of reasons why people shouldn’t be allowed to bet on politics, like it will undermine faith in democracy or open up opportunities for corruption. The case for betting markets is that they provide information, as generally a market price is better for understanding how to think about a question one is interested in than the opinion of a journalist. Yet despite the overwhelmingly strong case for prediction markets, they remained banned until very recently. I don’t think it’s a coincidence that both sports betting and prediction markets have become less illegal in tandem over recent years. In practical and legalistic terms, it’s difficult to allow betting on everything except sports, which means that the arguably net negative practice of sports gambling is probably necessary for us to gain new knowledge in practically all other areas of economic and social life. Even if sports betting isn’t necessary to get to Mars, if banning the practice puts prediction markets in jeopardy, to me keeping it legal is an easy decision.
To be fair, the US did reach the moon and achieve spectacular economic growth during an era when narcotics were illegal and most states banned gambling. These things aren’t perfectly correlated. Perhaps my framing of freedom versus safetyism isn’t the most useful one, and there’s a kind of civilizational progress versus decadence axis, where the positions that you should do inspiring things and crush the vices go together rather than being in opposition to one another.
But the culture that could limit the desire to meddle in people’s personal decisions to a few areas of life is long gone due to a collapse in civilizational confidence and traditional morality, and safetyism and freedom appear to me to be the two main things left on the menu. Nonetheless, if you were going to argue against my position this is probably the best direction to go.
Perhaps you imagine that one day we can again have a society that both bans sports betting and also lets SpaceX break as many windows as necessary to test its reusable rockets. Or that we may have a regulatory state under which you’re not allowed to bet on football games, but you can risk your money on who is going to win the presidency. If you think this sounds plausible today, you have a lot more faith in the discernment of government officials than I do.
Those of us who believe in progress have an important mission, which is to convince elites that they’re too neurotic, worried about theoretical harms, and willing to err on the side of caution in situations where they more often need to get out of the way. If they don’t even have the stomach to let fools blow their money on football, consider how they can be expected to react when faced with the prospects of nuclear meltdowns or exploding spaceships. While there’s little directly at stake in the question of whether sports betting should be legal, the principle involved is fundamental in determining what kind of civilization we aspire towards.
"I don’t see why sports gambling is all that different."
Because it's addictive, Richard. That's the difference with amusement parks, or television, or other forms of entertainment. It creates compulsive behavior that is fundamentally irrational. Even when people want to stop, they convince themselves they can't, or convince themselves that a big win that will even their ledger is just another play away. That's why it was regulated akin to cigarettes and alcohol (wherein the physical harms are more obvious, but the financial harm has an upper bound, whereas the same is not true of gambling). That's the justification for government interference and not just leaving it up to individuals, especially when there's a whole industry very carefully optimized to induce you to become addicted and stay addicted.
You can't look at, say, the trend in smoking rate in this country over the last 40-odd years since the government got involved, and conclude that society isn't better off for it. Many more people are alive, and those alive are much more healthy, as a result of that gap between then and now. And given the 50 years previous to that, as far as public health is concerned, it was clear it wasn't a problem that was going to solve itself. Mere information is not sufficient, society needs to *help people* on these matters, and stop bad actors from bad acts. Like getting 15-year-olds addicted to smoking.
Same with sports betting. It's not "theoretical harm" that we're afraid of, as you wrote - it's very tangible (and immediate, as opposed to saving the seals or whatever). As Gregg Easterbrook used to say, his compromise with his Baptist upbringing is to be pro-topless but anti-gambling. I can support that position, because one of them is harmful beyond all measure of an individual's ability to self-regulate, and the other basically isn't at all.
It's pretty easy IMO to draw a line on government regulation that recognizes the difference, and sports betting will definitely be on the "regulate it" side of the line that most reasonable people would draw. For me, it's pretty easy to even note the difference between prediction markets and sports betting, because the former has longer-term deals and is mostly zero-sum between participants (and they're not opposed to having winners), while the latter can give you that dopamine hit multiple times a day if you're super into it. It's really only a comparison to the extent that both involve a wager. So does the stock market, and we obviously regulate that but just as obviously, don't ban it. So it should be here.
Rationality is also a vibe. There are trade-offs and the most important thing isn't to always come down on the side of people can make their own mistakes, but on the side of we are explicit about the trade offs and we are making a decision based on what we think they are and are willing to reconsider when the data changes. We should look at regulating vice as a series of trade-offs. How harmful is the vice? how many people would do it if it was advertised like Coke? How long has it been part of our culture? How hard is it to enforce a prohabition? What are the different types of reglatory regemes that would reduce harm? What is the smallest amount of regulation that would reduce harm to the greatest extent? What is easy to enfornce? Ban advertising for sports gambiling, might be an okay policy, the fixes things with a minimal effects on freedom. Sports teams should not be able to mention it or be sponsored by it. Another possibility is maybe it's legal but you need to go in person to vegas to do it. Policies have trade-offs, moralizing freedom is the same as moralizing against vice, it fails to recognize trade-offs. So just be an adult and make rational decisions that recognize the trade-offs. Figure out what data would change your mind before a policy is rolled out.