Government bookies protected from competitors

David MoonBlog

I never buy gas at the most convenient convenience store along my daily commute. It may be the only convenience store I’ve seen that doesn’t carry milk or fountain drinks. This past weekend, however, its parking lot was full – just like it will be next weekend. The lot was so packed last March that a car couldn’t have gotten to the pumps even if someone did want to buy gas.

The station does appear to sell a lot of beer and fishing worms; it also offers an opportunity for those who feel lucky or believe they have some special sporting insight to back up their confidence with a friendly wager. That is, the gas station really serves as a sports betting parlor, well-known within the area. Business was so brisk on the day of last February’s Super Bowl that a food truck set up in the parking lot.

Within two miles are multiple more traditional gas stations, complete with cold milk, fountain drinks – and lottery tickets.

Why can Weigel’s and Pilot legally cater to gamblers, but the pretend gas station guy is subject to arrest? Because lottery ticket retailers are partners with an insanely protective gambling operator: the government.

Government-run lotteries allow people to gamble while protecting consumers from unscrupulous gambling operators. That’s the stated logic, anyway. In a traditional sports book operation (such as at the gas station) 90 percent of the amount wagered is paid in player winnings, compared to only 50 percent in the Mega millions and Powerball government-run gambling operation.

Now tell me, who is the real menace to society?

You are 20 times more likely to be killed by a cow than you are to win the Powerball, yet lottery ads tease and tempt gamblers with the prospect of becoming multimillionaires. One assumes that the Tennessee Education Lottery Commission absolves itself of any responsibility for what amounts to a tax on the state’s poor and uneducated with a “Play Responsibly” footnote in its ads.

For the record, I don’t gamble. However, I do have a child who receives the Tennessee Hope scholarship, which makes me the perverse beneficiary of a regressive tax on the state’s underemployed people.

Since July 1, online sports gambling has been legal in Tennessee. Before residents can (legally) place online sports bets however, the state must develop rules and regulations to protect gamblers from unscrupulous operators. The Tennessee Education Lottery Commission, the beneficiaries of a legally protected monopoly are charged with creating the regulations that will govern sports betting in the state – a perfectly designed regulatory system to lock out competition and keep all the benefits.

I would much rather appoint the gas station guy as a committee of one.

David Moon is president of Moon Capital Management. A version of this piece originally appeared in the USA TODAY NETWORK.