Congress Should Reject Adelson’s Crony Power Play

Posted: Mar 29, 2014 12:01 AM

After blasting the deep-seeded cronyism of the Obama Administration for six years, a number of Republicans have decided to partake in some cronyism of their own.

A wealthy casino owner is asking the government to outlaw his potential competition, and Sen. Lindsey Graham (R-SC) and Rep. Jason Chaffetz (R-UT) have jumped at the chance to help him, introducing legislation this week to achieve that goal.

Billionaire casino owner Sheldon Adelson tried unsuccessfully to build an online gaming business. After failing to capitalize on the market, his company, Las Vegas Sands, has been arguing that online gaming represents a massive threat to the profitability of land-based casinos. With New Jersey, Delaware, and Nevada legalizing online gaming for their residents, the threat appears to be growing. So Mr. Adelson is doing what many billionaire political donors have done all too often – he is asking his friends in government to ban his competitors.

After bragging that he would "spend whatever it takes," to achieve his goal, Mr. Adelson launched the Coalition to Stop Internet Gambling, hired lobbyists to write legislation, and got his bill introduced.

The Graham/Chaffetz bill turns the idea of federalism on its head. At the press conference announcing the bill, Chaffetz declared that states wanting to legalize Internet gaming need to come to Congress for permission. Such supplication is big government bullying at its worst, and it should be anathema to conservative members of Congress. Supporters of a limited federal government understand that states should be empowered to make these decisions.

When states decide to exercise their rights under the Constitution to become "laboratories of democracy," the last thing we want is the federal government policing and overturning those decisions to protect the well connected. As the federal government grows more powerful and oppressive, a number of states have joined efforts to fight back. Some states refused to implement the REAL I.D. law. Other states have urged nullification of ObamaCare. Still others have legalized marijuana. We may not agree with all or any of those decisions, but that is what federalism is all about.

Federalism is one of the most innovative concepts the Founders put into our Constitution. It allows Nevada and New Jersey to legalize Internet gaming while, at the same time, it doesn’t mandate that Utah and South Carolina must do the same. States have the prerogative – the right – to establish these laws. The great irony here is that the very concept of federalism is what shaped the economic environment in Nevada that enabled Mr. Adelson to make his billions in land-based casinos. Nevada exercised its right to make legal – gambling casinos – what other states criminalized.

Supporters of Adelson’s bill in Congress are turning their backs on the first principles of our Constitutional order solely to help a political supporter. The Graham/Chaffetz bill seeks to reward those who deal in favors and create law that benefits a single, special self-interest at the expense of entrepreneurs and free markets. Sheldon Adelson might be a great American – donating hundreds of millions of dollars to Republican groups and causes – but that doesn’t justify abandoning first principles.

The Graham-Chaffetz bill is not about gambling. It is about undermining federalism and promoting crony capitalism. Congress should reject this billion-dollar power play.