2 months ago

New Jersey goes all in on the Constitution in sports betting case

By Jonathan Wood Attorney

Can Congress dictate to states what their own laws must be? Anyone familiar with federalism will likely immediately say “no.” Our Founders drafted a Constitution that preserved the independence of the the states, believing that dividing power between the federal government and the states would be a bulwark to protect our liberty. To preserve the Founders’ design, the Supreme Court has said that the federal government cannot “commandeer” the states by requiring them to adopt or enforce federal policy.

Yet the Professional and Amateur Sports Protection Act, passed by Congress in 1992, purports to tell most states—but not others—that they must forbid sports gambling. In particular, it forbids states from “authorizing” sports betting “by law,” which means that those states that forbade sports betting in 1992 must continue doing so forever. That’s unconstitutional.

With the benefit of experience (prohibition has predictably led to a large, difficult-to-police black-market), New Jersey voters have roundly rejected their state’s ban, passing a referendum against it by a whopping 2-to-1 margin. Responding to the will of the voters, New Jersey’s legislature has twice tried to reform its gambling laws, first by replacing it with a licensing regime, next by repealing the prohibitions at casinos and racetracks. Professional sports leagues and the NCAA challenged these reforms under PASPA and the Third Circuit sided with them in each case.

Now the Supreme Court has agreed to weigh in. PLF has filed an amicus brief, joined by the Competitive Enterprise Institute, Cato Institute, and Wisconsin Institute for Law and Liberty, supporting New Jersey. We argue that PASPA unconstitutionally commandeers the states by dictating to them what their own laws must be and that it undermines political accountability.

Congress can forbid sports betting if it wants to, and it can preempt state laws that conflict with any federal prohibition. But, as the Ninth Circuit recognized nearly 50 years ago, Congress cannot reduce the states “to puppets of a ventriloquist Congress.” Supreme Court precedent also forbids Congress from forcing states to adopt, maintain, or enforce a federal chosen policy. That’s precisely what PASPA does.

Why did Congress take this odd approach in PASPA, forcing states to ban sports betting rather than doing it itself? The answer is almost certainly politics. Nevada, which has long had a thriving sports-betting industry, would have strongly resisted a federal prohibition.

And, by forcing the burden of prohibiting sports betting and enforcing that prohibition onto the states, Congress could avoid political accountability for its decision. Voters will naturally assume that a policy enacted as a matter of state law and enforced by state official is a state policy, and will punish state politicians if the policy proves ineffective, unpopular, or too expensive. For the democratic process to work, government must be transparent about what officials are responsible for a policy. Commandeering muddies the waters, letting federal officials set policy free of ordinary political constraints.

The Supreme Court will hear the case later this fall and, if its earlier cases are any indication, New Jersey has made a wise bet on the Constitution.

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