How Betting Took Over Sports

0:02This is the New Yorker Radio Hour. a co-production of WNYC Studios and The New Yorker.

0:12This is The New Yorker Radio Hour. I'm David Remnick. When I worked at The Washington Post early in my career, one of my colleagues had a little bit of a side hustle. Late in the week in the fall, he'd go around the office taking bets on the weekend's football game, and then he'd relay those bets to a bookmaker. Now, a lot of us would put some money down small bets Nobody was losing their shirt, but still, we had a sense that it was somehow illicit, something you did on the QT. Now, it sounds like I'm describing life hundreds of years ago, because these days we are absolutely inundated with ads offering same-game parlays and no-sweat bets.

0:53You just can't turn on pro football or listen to a call-in sports talk show without hearing the odds, without emphasizing gambling. Wagering on the game now seems practically as important as watching it. How did things change so much and so fast? Literally, I was watching the last World Series, and right before the first pitch, they said, and by the way, here's a parlay you might want to consider placing. Danny Funt has been reporting on the gambling boom for The New Yorker. We've seen some pretty startling headlines lately. The former coach of the Portland Trailblazers was arrested in part for allegedly providing insider information to gamblers, And then there was those two pitchers on the Cleveland Guardians who were indicted for rigging individual pitches.

1:40They were purposely throwing wild pitches to align with live bets. They've all pleaded not guilty. Danny Funt's new book about the boom in sports betting is called Everybody Loses. So can you give me a sense in dollar terms of how big a business this is now? About$150 billion are wagered every year. Just last November, New York set a record with more than$2 billion wagered in the state of New York alone. It's hard to wrap your head around those numbers. Who's gambling? Mostly young men. That's the target demo, 21 to 34. It's hard to know exactly how many people total are betting. I've seen like 30 % is a good ballpark.

2:2630 % of that demographic. No, of Americans. 30 % of all Americans are laying down bets on what? What are the most popular things? Pro football? Absolutely. The NFL is king. All the major sports. I mean, even in Colorado, where I used to live, when it was legalized during the pandemic, most sports were shuttered, and all they could bet on was Eastern European table tennis. And they continue to bet millions of dollars every month. I guess they got hooked on ping pong. So from the title of your book, it's pretty clear what your POV on legal sports gambling is, or am I getting this wrong? That's fair.

3:07I hope you'll trust that I didn't have that title locked in as I started this. It was a realization of talking to hundreds of people, mainly in the industry, and seeing how they think about their customers, how they think about their business, left that impression that not only are we losing a staggering amount of money, as we were just talking about, but the credibility of sports, the integrity of sports, the independence of sports journalism, the list goes on. Are you a gambler yourself? Yeah, there's a stat that about half of people who bet, they admit that they're not honest about how much they bet and how often they bet.

3:46I'm in that demographic. How would you describe the dimensions of your own activity? Mostly when I'm watching a Lakers game, particularly when my wife is out of town and I've got nothing better to do. I'm trying to liven up a night alone. So you're scared of your wife and you're a gambler. Exactly, like a lot of people. It's a thing to do when you're bored and lonely. Yeah. I'll be honest with you, though, just hearing again and again and again how impossible it is to win, how these sportsbooks do everything they can to prevent you from coming out ahead long term. I've backed off a lot in the last year.

4:19Explain what a sportsbook is for the uninitiated and then talk to me about how they do their work. So a sportsbook is a company that takes bets. They have bookmakers and oddsmakers and hundreds if not thousands of people who are dedicated to offering as many things as they can possibly think of on every sport in existence practically. 95 % of this business is now conducted online. So back in the day, this was kind of an amenity to lure you into a casino. Just like all-you-can-eat buffets or whatever, it was let's bring people in. And hey, you can bet on sports, but hopefully you'll play some craps while you're here.

5:02So how am I gambling now? On your phone, predominantly. And what are the big companies? FanDuel and DraftKings control three quarters of the market. Why are you so tough on the gambling industry? I mean, people pay their 50 bucks and they lose a little bit more often than they win. What's the harm? The idea of legalization was that, among other things, this would install consumer protection so that you could, people have always been gambling, let's make sure you can do it fairly, get paid when you win, not get chased around town. If you owe someone some money, there's a lot of... Your thumbs won't get broken.

5:38Exactly. But just learning so much about how this business is done, you hear the word predatory again and again. There was an executive who told me, you know, if you think about it, he said, my job is basically to slowly bleed someone dry. And the techniques that they do to do that, I don't think you have to be moralistic to find issue with that. So I'm old enough to remember Bart Giamatti running baseball and other sports commissioners were staunchly against any betting at all. They thought it would really have a deleterious effect on a number of fronts. And betting was made illegal back in the 90s with the Professional and Amateur Sports Protection Act, right?

6:23Yes. PASPA, I guess you would call it, although Nevada was grandfathered in. How did that get overturned? You mentioned in your book that Adam Silver, who is the very popular commissioner of the NBA right now, was really the first to come out in support of this change. Talk about that a little bit. So his predecessor, David Stern, was among the commissioners who testified during the PASPA hearings and said this is an evil. He went even further with that speaking with Chris Christie, who was leading the charge. The governor of New Jersey. Yes. Christie told me that David Stern, who's passed away, said that gambling treats athletes like chattel.

7:02And he just got very animated describing how awful it was. The year that Stern resigned and his deputy Adam Silver took over, he wrote an op-ed in the New York Times in 2014 saying legalize and regulate gambling. What was Adam Silver's rationale? publicly, that this was happening underground anyway. He quoted a number that$400 billion were being wagered illegally every year, which I think is a what? You said publicly as if he had another motivation. Yeah, my understanding is he was looking mainly at British soccer, at the English Premier League, and how incredibly it had grown in recent years, in large part because teams there embraced gambling and got all this interest from foreign gambling sponsors that put their brands on the fronts of jerseys and poured all this money into the EPL.

7:58And Silver, who very clearly wants the NBA to grow, internationally said, what are we doing missing out on that opportunity? I think the most famous gambling scandal, there have been many, you know, City University had its days in basketball. But the most famous scandal was the 1919 infamous Chicago White Sox. Do we fear that this kind of large-scale scandal will happen in modern sports? Because we're seeing signs of that now. Yeah. Hard to understate what an existential threat the 1919 World Series was to the future of baseball and sports in general. After eight players on the White Sox, including Shoeless Joe, obviously, and others.

8:43colluded with gamblers to throw the World Series. It was eventually sniffed out by a reporter. They were prosecuted. They were exonerated ultimately. And there's a funny scene that someone else reported that they and the jurors celebrated at an Italian restaurant after that verdict was read. But there's so much to learn from that. And as you alluded to, every decade since then, there's been a gambling scandal. And you might say, athletes make too much money nowadays. is they would never do something so foolish. Yeah, but now you've got, for example, there's a pitcher at the Cleveland Guardians, Emmanuel Classe, who was allegedly throwing wild pitches on purpose because he was making bets on himself.

9:27And, well, we had in the NBA recently, you had the Trailblazers coach, Chauncey Billups, was arrested and charged for gambling with insider information and other incidents are starting to pop up. I assume you have part of your concern is the integrity of these sports themselves. Yeah, which once again was exactly what Bud Selig of Major League Baseball and David Stern and Paul Tagliabue and all these commissioners predicted was you would have actual instances of corruption and a general degradation of trust in the integrity of what we're watching. And immediately after Class A and Chauncey Billups and others were arrested.

10:06A poll came out that showed that 65 % of Americans think some athletes are colluding with gamblers to affect the outcomes of games. A key argument for legalization was, in fact, it'll strengthen the integrity of games because we'll be able to monitor all this betting activity. Why are they wrong? I've spoken with the companies tasked with doing that monitoring, and they say, A, There's still a lot of betting going on under the table. We can't monitor that. Any savvy fixer is not going to go bet on FanDuel. They'll go offshore or with a street bookie. We'd have little chance of catching that. So we haven't snuffed out that threat.

10:48And beyond that, there's simply too much ground to cover when you carve up a game and do thousands of betting opportunities. Like you were saying, a single pitch is something you can risk a lot of money on. These companies can't possibly investigate every suspicious bet tied to a pitch in a baseball game. I'm speaking with Danny Funt. His new book is called Everybody Loses. More in a moment.

11:30If I were to bet on FanDuel or the like over time, can I win? In other words, I watch these movies like Uncut Gems or Rounders, and you've got these savvy professional gamblers who figure out how to beat the house and win consistently. Is that ever true for sports gamblers? Well, let's not accuse Adam Sandler's character of beating the house. I think he's a mess. He got a bullet in the head when he finally did. Not only do about 1 % of customers come out ahead long term, but as soon as you show any signs of competence, not even winning, but just placing the sorts of bets that might give you a chance of winning, they'll limit how much you're able to wager down to literal pennies.

12:16I've seen guys who can't get down more than a cent on an NFL game. Of course, there are ways that you can bend the rules, and they'll definitely show you the door in that case. What I'm talking about has nothing to do with that. It's simply outsmarting the bookmakers. And they'll say, we're not going to take your bets because of that. Well, now, gambling has gone well beyond sports, Danny. You've also written for the magazine, The New Yorker, about companies like Polymarket and Kalshi, who they set wagers on everything from election outcomes to interest rates. A recent Polymarket user made a bet, and he made more than$400 ,000 betting on the Venezuelan president, Nicolas Maduro, being captured.

13:04Unbelievable. Is this more or less concerning than whether some player might throw a game? Of course. And by the way, insider trading, that seems to be at hand. And how else could you have been so confident that the U.S. would invade at that moment? Of course, betting on natural disasters or wars or things like that is much more serious business than sports. But why? I mean, it's unattractive. It's, as we say, a bad look in some way. Well, we can have an easier time understanding that if you're betting on elections, it could cheapen how you engage with politics. You know, make— Is that possible in this modern world?

13:44People like Elizabeth Warren would say so. Tell me about that. They think that, you know, of course people vote at times based on who they think will influence their pocketbook in a more favorable way. But if you've got a bet on the line, could that be an even more problematic way of thinking about who you should vote for? I think when we're talking about, you know, what's someone going to say on a talk show or will it rain tomorrow, that seems like we're just turning every single thing in our lives into an occasion to gamble. But that's an argument that's moral above all, right? And how are you going to get legislators excited about that?

14:24If they see surging rates of gambling addiction, particularly among young people. Are we seeing that? Yes. So many educators I talk to say they're panicked at how suddenly preoccupied with gambling. Kids as young as elementary school are, if you can believe that, in college, 20 % of students dip into tuition funds to fund their bets. And I spoke with an expert in this named Jeffrey Daravinsky, who specializes in youth problem gambling. And he pointed out that one of the dangers of gambling versus drug addiction or other things where you can kind of tell quickly if someone has a problem. Typically with gambling, it can take years for a problem to take shape.

15:07Why is that? I've spoken with so many problem gamblers in recovery who say, I was fine until I suddenly won$10 ,000 and I spent every day chasing not only that money but that feeling. And that is so dangerous. Finally, now that we've seen some of the really negative outcomes of legal sports gambling, death threats for players, fixed games, users going bankrupt, you know, the levels of gambling addiction that you've described. Is there any push in the government to regulate this activity again? Yes, particularly after those arrests in the NBA and Major League Baseball. The House and Senate sent letters to Adam Silver saying, please help us make sense of what you're doing so that more of this doesn't happen.

15:58Brian Schatz, the Democrat from Hawaii in the Senate, recently proposed regulating prop bets. A New York Assembly member has proposed banning live betting, which now makes up more than half of betting activity is placed during games. Whether there will be a bill in Congress that reaches the president's desk, I wouldn't bet on it anytime soon. It's hard for anything to pass, obviously. But people like Richard Blumenthal of Connecticut have really made... The senator from Connecticut. Yes, yes, have said, this is so out of hand and the industry is so brazen in what they're doing to defy just common sense of what's fair for customers.

16:39The federal government needs to weigh in. Danny Funt, thank you so much. My pleasure. Thanks for having me.

16:48Danny Funt's new book is called Everybody Loses, and you can also read him on the gambling industry at newyorker.com. And of course, you can always subscribe to The New Yorker there as well, newyorker.com. That's The New Yorker Radio Hour for today. I'm David Remnick. Thanks for joining us. We'll see you next time. The New Yorker Radio Hour is a co-production of WNYC Studios and The New Yorker. Our theme music was composed and performed by Meryl Garbus of Tune Yards, with additional music by Louis Mitchell. This episode was produced by Max Balton, Adam Howard, David Krasnow, Mike Kutchman, Jeffrey Masters, Louis Mitchell, Jared Paul, and Ursula Sommer.

17:30With guidance from Emily Botin and assistance from Michael May, David Gable, Alex Barish, Victor Guan, and Alejandra Deckett. The New Yorker Radio Hour is supported in part by the Charina Endowment Fund.