Bush to WTO: Drop Dead

Implications: The internet gambling ban which was attached to last year's port security bill is an example of the power of the fundamentalist, anti-gambling, pro-morality Republican constituency in the waning days of the Bush Era.  Led by (then) Senate Majority Leader Bill Frist (R-TN) in an effort to polish his conservative credentials when he was seriously considering a bid for the Republican presidential nod, the effort to ban internet gambling was successful. No Republican running for president can afford to offend this powerful minority of galvanized activists.  Coupled with the prosecutorial power of the Justice Department, the ban has sent shivers up the spine of the e-commerce community.

The WTO opinion, which will likely be appealed by the US Trade Representative, will carry the same weight as other international sanctions do with the Bushies....zilch, zero, nada. It does, however, give some political ammunition to those who are advocating a repeal of the ban.

Analysis: Although House Financial Services Committee Chairman Barney Frank (D-MA) has made public comments about repealing the ban, his comments are designed more to pressure the Administration to end it's jihad against the executives of the internet gambling companies, rather than as a serious effort to repeal the ban.  The pure political arithmetic is plain: as long as president Bush has a veto pen, the ban will remain in place.  With approval ratings hovering in the low 30's, the president can ill afford to offend the core constituency that is still supportive of his Administration.  The rules of the US Senate also give each Senator the ability to slow, or stop, any effort to repeal the ban.  There are more than a few Republican Senators, including John Kyl (R-AZ), who will use all of their procedural power to stop repeal, and endear themselves to the Christian right activist wing of the party. If the 2008 elections sweep a Democrat into the White House than this political calculus will need to be reassessed.