Sports Gambling Is Exploding

The American Prospect provides a progressive's argument against online sports betting and the social, economic, and mental health havoc which has ensued:

https://prospect.org/2026/02/04/feb-2026-magazine-sports-scourge-online-betting-fanduel-draftkings/

The Scourge of Online Sports Betting
States and leagues must face up to the damage from app-based gambling for the next generation of bettors, most of them young men.
By Gabrielle Gurley - February 4, 2026

WASHINGTON – The room checks all the dive-bar boxes: cheap beer and cocktails, big-screen TVs, high-top tables, and one scuzzy restroom. The rain-splattered Liberty Bowl, with Navy battering Cincinnati, is on ESPN and turned up loud, while the rest of the muted screens feature competing teams of sharp-dressed sportscasters.

There’s nothing worth Instagramming here. The low lighting doesn’t set a mood, but it does help you read the large sports boards near the betting windows across from the bar. The multiple screens list the day’s NFL and NBA matchups, along with the spreads, the money lines, the over/unders. If this vibe isn’t working, you can head to the self-service betting kiosks next door.

Mostly solo Black and white men of all ages perch at the bar or one of the high-tops, mostly staring and swiping on their phones. One older Asian man studies what could be betting sheets, with a receipt and his phone splayed around him on his table. A Black middle-aged couple arrives, and the man and woman spread out papers and phones.

Caesars Sportsbook at Capital One Arena is an unremarkable destination in Washington, D.C.’s Chinatown. The venue opened several years ago, proclaiming the arrival of the first “state-of-the-art Vegas-style” sportsbook located in a professional U.S. sports operation. It’s one of the area revitalization projects that Ted Leonsis of Monumental Sports & Entertainment launched after he failed to move his teams, the NBA’s Wizards and NHL’s Capitals, to Virginia.

Going downtown to bet on games might seem redundant; even the Caesars Sportsbook website urges bettors to “get the app.” But a report from the Center for Gambling Studies at Rutgers University’s School of Social Work found that sports bettors who frequent “mixed venues,” in both online and physical locales, have higher rates of developing problem gambling. Yet even in this physical space, the gamblers are online, glued to the bets they’re making.

Smartphones have been the catalyst for an explosion of sports gambling, providing always-open portals to separate people from their money. Two companies, FanDuel and DraftKings, control over 70 percent of this online market, using sophisticated surveillance and marketing techniques to keep people betting, even when losing eats up money for groceries, utilities, rent, or the mortgage. A small but statistically significant number of bettors generate the profits that online sportsbooks haul in.

The Supreme Court unleashed this craze in 2018, ruling in Murphy v. National Collegiate Athletic Association that federal prohibitions against states legalizing sports betting were unconstitutional. Eight years later, 40 states and the District of Columbia have allowed some type of online gambling. The Bureau of Labor Statistics has reported that gambling was the second-highest service-sector industry for GDP growth between 2019 and 2024, behind only software publishing.

Nearly 40 percent of men and 20 percent of women gamble online daily. Two percent of these bettors gamble more than ten hours a day.

According to the American Psychiatric Association, nearly 40 percent of men and 20 percent of women gamble online daily. Two percent of those bettors gamble more than ten hours a day. Sports bettors have wagered over $600 billion since 2018. The National Council on Problem Gambling notes that about 2.5 million Americans “meet the criteria” for a severe problem; five to eight million more have mild to moderate issues.

As the country’s affordability crisis deepens, individuals and entire families can slide into cycles of addiction and debt. Bank of America warned in a November research note that gambling is creating “emerging credit risks” across the economy; an April paper from UCLA and USC found that credit scores in states that have adopted online sports betting are down, and bankruptcy rates and auto loan delinquencies are up. Eight U.S. studies found that 1 in 5 problem gamblers have tried to commit suicide, the highest rate for any addiction disorder.

Most bettors are men. They’ve gotten younger and younger as sports betting companies gamified gambling. Pokémon, the trading card and video game mega-franchise, co-opted slot machine and casino imagery in the 1990s, and technology companies latched on, eager to bring in young gamblers to replace the old heads. Public schools see problems with boys, and sports betting stokes some school officials’ fears of it becoming as ubiquitous as cellphones and as poisonous as social media.

State politicians have largely looked the other way: The attractive tax revenues from the relative handful of bettors reduce the need for broad-based taxes. Conveniently ignored are the profound contradictions between safeguarding the public welfare and the mental health and financial problems gambling can exacerbate. “It’s a system of taxation by exploitation, and it’s been an epic public-policy failure,” says Les Bernal, the national director of Stop Predatory Gambling, a national advocacy group.

Professional sports executives don’t help, wringing their collective hands about the “integrity of the game” while sportsbook ads wallpaper stadiums and arenas, promotions blast during games, and teams seek out television partnerships. These deals end up serving as a dirty-hands backdrop to the inevitable scandals involving players and coaches betting on, it seems, every moment of the game. Many league officials and state lawmakers refuse to accept that this festering integrity crisis cloaks a spreading public-health emergency. But a reckoning is coming.

IN THE UNITED STATES, SPORTS BETTING peaks in the fall, when portions of the baseball, football, hockey, and basketball seasons all dovetail. Many fans still watch sports for love of the game, but the love of money is now a major factor, making the finer points of home-team runners on base with one out in the bottom of the ninth inning of a tie game more interesting for people who usually wouldn’t care.

Online sports bettors are subject to state regulations on college and pro games. Prop bets are wagers on individual or team performances that don’t depend on the game’s outcome. As they watch live games, gamblers can also bet on nearly every aspect of the match. These micro bets aim for a slot machine–like experience, hinging on things like the next home run, pitch, or stolen base. Parlays link multiple wagers together; combining micro bets give the allure of a big win, but rarely pay out.

Bettors can tackle lesser-known or bizarre sports: water polo chessboxing, axe throwing, even pickleball, e-basketball (video game competitions), or table tennis. The last two are too much for Vermont state Rep. Thomas Stevens (D-Waterbury). “It’s frightening that this is available on a phone,” he says.

Stevens has proposed a bill that would end Vermont’s online sports betting, legalized in 2024, and the state lottery, launched in 1978. Three sportsbooks operate in Vermont: DraftKings, FanDuel, and Fanatics. State lawmakers wanted to keep gambling revenues at home, especially since residents tended to drive to casinos to bet (or even parking lots for online gambling) in Canada, New York, New Hampshire, or Massachusetts. “I was hoping to be able to limit the exposure, knowing full well that human nature is built to work around whatever enforcement mechanisms are in place,” Stevens says.

States have options on sportsbooks provider partners; Oregon has just one, DraftKings, while New Jersey allows more than a dozen to operate. Tax rates on sportsbook revenues are 50 percent or higher in Delaware, Oregon, New Hampshire, New York, Illinois, and Rhode Island, but just in the single digits in Iowa, Michigan, and Nevada.

In most states, excise tax revenues are small, comprising less than 10 percent of a state’s budget, and in many cases 5 percent or less. Sin taxes on gambling, alcohol, and marijuana are especially volatile and can often level off or plummet (as in the case of cigarettes) depending on the market or changes in social attitudes. In the sports betting sector, companies could pass their costs on to bettors in the form of higher odds. Such a shift could drive bettors into grayer areas. “If you can get better odds by betting with the bookie down the street, then maybe you’ll do that instead of participating in the legal market,” says Adam Hoffer, director of excise tax policy studies at the Tax Foundation, a Washington think tank.

But the “legal” market isn’t exactly generous to its customers either. DraftKings uses AI to learn which micro bets will entice users. Apps carpet-bomb promotions for “free” money that cannot be redeemed unless bet multiple times. “There’s been plenty of stories over the last couple of years on the people who do sign up [to bet] and are on losing streaks and get emails from DraftKings bots basically saying, ‘Here’s another $1,000!’” Stevens says. “That kind of business model that essentially poisons you if you are so addicted; it is something to me that the state should have no interest in from a public-health perspective.”

Vermont’s sports betting revenue goes into its general fund, a Responsible Gaming Special Fund, and industry regulation. In 2024, Vermont bettors did well enough that tax revenues were under projections at $6 million, still a healthy sum for a small state.

Stevens believes that young men, the targets of all this psychological warfare, think they can handle betting constantly on their phones, but they ignore the ever-present dangers. It’s the same for state officials, who dismiss the negative impact of gambling because it brings in money they wouldn’t be able to get otherwise. Can Vermont decouple itself from these revenues?

“What it really comes down to is we would rather tax, whether it’s by choice or not, with lotteries and gambling,” says Stevens. “That’s the way our culture is, and I don’t see that changing.”

THE PURITANS CONDEMNED GAMBLING. So did the Quakers. But they were outliers in the British colonies. Native American tribes had their own games, and white colonists gambled on horse racing, cockfights, and other forms of entertainment. Lotteries were serious business—they helped finance the American Revolution.

Nevada legalized gambling in 1869, backed off under political pressure in 1909, but reinstated it in 1931, in a bid to stimulate the economy during the Great Depression. Sports betting would follow in 1949, as fan interest in professional baseball and football soared. But outside of Las Vegas, gambling on sports was largely under the table.

State lawmakers elsewhere wanted to rake in the kind of dollars that Nevada did, but Congress stepped in to restrain them in 1992 with the Professional and Amateur Sports Protection Act, prohibiting sports betting from migrating into new locations. New Jersey challenged the law and prevailed when the Supreme Court ruled that Congress had overstepped and interfered with state powers under the Tenth Amendment.

At the same time, the sums that state regulators dedicate to problem gambling vary widely across the country. In Vermont, $250,000 went to the state mental health department for these programs in 2024; that expenditure doubled last year. Massachusetts devotes millions to problem gambling, but tracking spending, raising awareness about treatment options, and finding out who benefits remains a challenge. At least those funds exist: The District of Columbia zeroed out its budget allocation for similar programs through fiscal year 2028; instead, the city plans to pursue a $300,000 study.

Few parents consider that their children could be spending money and time on sports betting. But Tony Cattani has been thinking about it quite a bit. For nearly 20 of his 30 years in education, he has been the principal of Lenape High School, which serves students in Mount Laurel Township, New Jersey. Last July, he was named the 2025-2026 National High School Principal of the Year.

Cattani often hears teenagers talking about point spreads, individual players, over/unders, and prop bets during informal classroom conversations and at lunch. “Kids talk about how they were betting on this one player,” Cattani says. “He made this shot, but it was after the buzzer.” Otherwise, he would have won $50. “You hear kids talking about this at 15 to 17 years old.”

These bets should be illegal. Sports betting apps ban wagers from anyone under the age of 18. But that can be difficult to enforce since many young people can find their way around parental controls and may have bank accounts or credit cards in their names.

Cattani believes that sports betting has the potential to become as big a problem for schools as cellphones, which were banned statewide this year. Adolescents’ brains are not fully developed, so they struggle with constructive decision-making, don’t necessarily understand the consequences of their actions, and focus instead on the perceived reward, he says. “They’re just manipulating it on some account like it’s a video game.”