Democrats call for ban on US political betting exchanges

The past two US presidential elections have proven to be the most heavily contested nail-bitters on record. The November 2024 ballot does not much look like it will get a détente, with the Democratic party emerging in the polls and closing a 3-point gap with the Republican nominee, Donald Trump.

Do away with political betting in the US – in all its permutations

Now, the Democrats want to shed the vestiges of what they see as harmful practices that could harm the outcome of the political race, regardless of party affiliation.

Sen. Jeff Merkley (D-CT), and fellow Democratic Party senators have urged the Commodity Futures Trading Commission (CFTC) to act on a previously proposed amendment to its rules to sanction political betting exchanges that allow consumers, opportunists, political die-hards and pundits to buy and sell selections on the outcome of US elections, and other elections around the world.

Just ask the Conservative Party in the United Kingdom, whose members were caught betting against themselves. Now, Sen. Merkley wants these rules to come through. Lawmakers addressed the regulator’s boss, Rostin Behnam, urging the watchdog to move forward and ban such exchanges.

Their arguments were clear enough. "Election gambling fundamentally cheapens the sanctity of our democratic process. Political bets change the motivations behind each vote, replacing political convictions with financial calculations."

Although the argument does stand to reason, it may be an overreach. The United States already bans the type of commercial political betting that you could encounter in places such as DraftKings or FanDuel. They obviously do not run political betting odds in the United States.

Bet365, a British bookmaker, does offer political bets but back in the United Kingdom. So, the exchanges that are left are those that are mostly set up by academics (although they are fun to be a part of) for purely research purposes.

Commercial political betting is not allowed in the USA

However, Chair Behnam may be willing to side with the senators, as he too believes that even the type of political betting for the purposes of valuable polling insights is somewhat undermining the process of betting and creating an associative mistrust in the electoral system, which has already come under heavy blows, including from elected officials and a former president, for being "rigged."

Not everyone in team CFTC agrees, however. Commissioner Summer Mersinger has argued that the 10th amendment applies here, or in other words, federal authorities must not assume powers that were not explicitly vested in them by the constitution, but rather delegate to individual states to decide.

Banning political exchanges in the form they exist today may never come to pass, but it’s interesting to observe that as the latest presidential race intensifies, so do calls for shredding the last remaining hints of political betting in the United States.

The letter was backed by Chris Van Hollen (D-MD), Elizabeth Warren (D-MA), and Sheldon Whitehouse (D-RI) and Representatives Eleanor Holmes Norton (D-DC), Jamie Raskin (D-MD), and John Sarbanes (D-MD).

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