A campaign by Sheldon Adelson, a Republican donor, has divided
powerful interest groups in Washington.
A push by the billionaire casino magnate Sheldon G. Adelson to
outlaw online gambling has ignited a bitter civil war in the
gambling industry, dividing one of Washington's most powerful
interest groups and posing a major test of the Republican donor's
Mr. Adelson's effort officially kicked off on Wednesday, when
lawmakers, including a senator, Lindsey Graham of South Carolina,
who has accepted tens of thousands of dollars in donations from the
businessman and his family, introduced legislation originally
drafted with Mr. Adelson's lobbyist.
The bill would close a three-year-old loophole in United States
law by banning online gambling -- a growing industry that Mr.
Adelson argues is bad for casinos and gamblers -- and shutting down
online gambling in a handful of states that recently legalized it.
The dispute has already largely sidelined the industry's powerful
trade group, the American Gaming Association, after Mr. Adelson
threatened to withdraw from the organization if it continued to back
expanded online gambling, according to several industry executives.
Mr. Adelson's political prominence was on display Thursday in Las
Vegas at the start of the four-day meeting of the Republican Jewish
Coalition -- an event that has attracted several 2016 presidential
prospects, including Jeb Bush, a former governor of Florida; Gov.
Chris Christie of New Jersey; Gov. Scott Walker of Wisconsin; and
Gov. John R. Kasich of Ohio.
Mr. Adelson, whose $38 billion fortune makes him one of the
richest men in the world, poured roughly $100 million into
Republican campaigns in 2012, and he is known for pushing
ideological fights in Washington. The battle over online gambling
shows how he also lobbies for his business.
Dueling branches of the casino industry are now entering the
fray, employing a half-dozen former elected officials and a clutch
of lobbyists and public relations strategists through a pair of
A new group bankrolled by Mr. Adelson, the Coalition to Stop
Internet Gambling, is wooing socially conservative lawmakers opposed
to gambling, along with some Democrats who are worried about
possible online gambling by minors. But it also features a former
New York governor, George E. Pataki, a Republican who presided over
a sweeping expansion of gambling in that state, including online
bets on horse racing.
Rival casinos and online poker companies are counterattacking
through the Coalition for Consumer and Online Protection. The group
has signed up two Republican former House members, Michael G. Oxley
of Ohio, who a decade ago led efforts to outlaw online betting and
accused companies selling such games of "gobbling up victims in the
United States," and Mary Bono of California. Mr. Oxley, who retired
from Congress in 2007 and now works as a lobbyist, said in an
interview that he believed state-regulated online gambling was now
the best hope of countering the rapid expansion of illegal online
"The world has changed dramatically in the last 10 years," Mr.
Oxley said. "I have come to the conclusion you can't try to control
the Internet and the like."
Among the coalition's arguments against a ban on online gambling
is one that also figured in Republicans' battle against President
Obama's health care expansion: that it violates states' rights.
Some in the industry worry that a brawl between its biggest
players could threaten the painstakingly built image of family-
friendly entertainment the casino resorts have worked to promote.
"It is unfortunate, when an industry undermines itself," said Jan
L. Jones, a former mayor of Las Vegas who is now the head of
government relations at Caesars Entertainment, which is opposed to
the bill. "This fight is tarnishing the entire industry. You just
raise a whole specter of negativity that I think is unfortunate and
inappropriate, after we have spent the last three decades with a
message that gaming is just entertainment enjoyed by responsible