If wagering on presidential elections were legal in Nevada, the consensus of Jimmy Vaccaro, Johnny Avello and Jay Kornegay — owners of more than 100 years of Las Vegas sportsbook experience —pegs its potential handle at $1.5 billion.
“No doubt about it,” says South Point oddsmaker Vaccaro, “it’s right there.”
At current tax rates, that’s about $4 million to Uncle Sam and more than $100M to the Silver State. At a nominal sportsbook hold of four percent, that’s $60M to the state’s casinos.
Every four years.
“And to not be able to (reap) this, and be as stubborn as our politicians are, is beyond me,” said Vaccaro, 75. “When I was a kid, we were told politicians are very smart people and they do everything right. But put this in your little (story) — there are more politicians in jail than bookmakers.”
Kornegay, 57, tapped vast global resources to gauge potential election business at 10 to 15 times the handle of recent Super Bowls, which has been about $150 million. That puts the quadrennial event’s action closer to $2.25 billion.
“Look at other parts of the world that do allow wagers on the presidential election — it’s very, very popular,” said Kornegay, vice president of the Westgate Las Vegas SuperBook. “If it’s that popular over there, how popular would it be here?”
Avello, the 67-year-old director of the DraftKings sportsbook operations, crunches other astounding numbers. Twenty-three jurisdictions have legal sports betting. Soon, it could be 29. Kornegay expects 40 to 43 in the next few years.
“If those (projected figures) were to hold true in Nevada, look at the rest of the country,” said Avello. “It’s a huge number.”
“If those (projected figures) were to hold true in Nevada, look at the rest of the country,” said Avello. “It’s a huge number.”A chart comparing the 2016 & 2020 presidential election prediction markets:— PredictIt (@PredictIt) October 16, 2020
Current 2020 forecast:@JoeBiden - 66%@realDonaldTrump - 39%https://t.co/m3wC85dvlG pic.twitter.com/MoDi5hxPAS
Opposing team loyalties can sometimes inflame sportsbook patrons, but Avello doesn’t expect heated red-blue confrontations when election odds eventually are posted on the big boards.
“It might take the temperature down,” he said, “because you could put your money where your mouth is.”
Tick’s plan rejected
Former Nevada state Senator Richard “Tick” Segerblom has run hot because he believed he was making inroads back in 2013 to get election wagering legalized in the Battle Born State. Which might have furnished a fiscal safety net during, say, a pandemic crisis.
Today, he said, “I suspect (those who opposed the measure) wish they had supported me.”
Offshore companies currently place Democratic challenger Joe Biden as a favorite and Vaccaro expects his odds to settle at about -140. Republican President Donald Trump, the favorite not so long ago, will be an underdog, a role with which he is familiar.
A savvy punter in a distant land might currently hold underdog positions on both sides, arbitrage heaven.
“Right now, it’s very simple,” adds Vaccaro. “The people who like Trump are waiting, like they’d wait for a football underdog to go from six and a half to seven and a half. Then they’ll jump in to get the most value.”
None of which, he admits, means a damn thing, because of heavy bias and manipulation that has eviscerated neutrality and impartiality in newspaper headlines, polls and offshore indicators.
PaddyPower move backfired
More than a year before the 2016 election, Trump could have been nabbed at triple digits. Election morning, he was a 6-1 underdog. Hillary Clinton had been such an overwhelming favorite, PaddyPower Betfair (PPB, now Flutter Entertainment) in Ireland paid its customers with tickets on her three weeks before the election.
That’s a PR-seeking ploy not uncommon with certain sportsbook entities, but it cost PPB more than $1 million. Then Trump won, causing PPB to pay more than $4 million to his backers.
“Boy, did we get it wrong,” said a PPB spokesman. “We’ve been well and truly thumped by Trump.”
But don’t shed any tears for PPB. Its profits that year were the equivalent of about $500 million.
State laws bar election wagering, but they have been conducted on the sly since George Washington won that first one in April 1789. However, that changed early the evening of April 7, when West Virginia permitted FanDuel Sports to accept election wagers. Trump opened at -110, Biden +125.
That window slammed shut less than 15 minutes later. Jim Justice, spewing gubernatorial sanctimony, called election wagering “ludicrous.” Lottery director John Myers apologized for incorrectly allowing those odds to be released.
“They thought they were home, but they got shut down,” said Avello, “I’m hopeful it’ll happen at some point. As far as I’m concerned, it’ll be one of the bigger betting propositions for us.”
DraftKings posts election props, but in free pools. Less than a week before a Biden-Bernie Sanders debate, a list of questions included “Who will say ‘Trump’ first?” It attracted 75,000 players. For its presidential pool, more than 300,000 participants have answered who will claim the presidency and the victor in each of 11 states. Winners will split $100,000. He expects half a million players by Nov. 3.
“It’s a cool way to be involved in the election,” said Avello. “Five or seven years ago, all the sportsbook (directors) in Nevada tried to form a committee to get election wagering (legalized), but we didn’t get the push we needed.”
That coincided with Segerblom’s push in the 2013 Legislature. The Las Vegas Democrat shepherded his measure through the Senate, but it flopped in the House. A year later, his resuscitation effort evaporated before a preliminary panel.
“For some reason, they thought it would hurt our reputation,” the 75-year-old Segerblom wrote in an email. “No one was really pushing for it, except William Hill and me. Also, I think the ‘big gamers’ didn’t really care. Maybe they were opposed to it behind the scenes.”
He believes the casinos will be the election-wagering catalysts.
“They need the revenue,” he said.
Betting likely in future
Avello mentioned PredictIt, the Washington-based research outfit that conducts political futures trading — similar to the University of Iowa’s Iowa Electronic Market. The Commodities and Futures Trading Commission allows those, due to their low-stakes and non-profit templates.
It has been debated how the CFTC might counter a state legalizing election wagering, but Segerblom dismisses any issue.
“No one ever said it would be a violation of federal law,” he said.
In May, Segerblom said it’s a sore personal subject that so much business is being generated on American politics everywhere but in America. Last week, though, he tempered his emotions.
“Just sorry that the casino industry didn’t realize how important this would be when everything shut down,” he said. “And it only happens every four years, so now we have to wait until 2024 to really take advantage of it. C’est la vie.”
Vaccaro predicts 2028 will usher in legal election wagering in the States, because it’s long overdue and many older politicos will be gone by then.
“The kids who are in their mid-30s and early 40s (now), who have been playing fantasy football their entire lives and have been betting (on sports) will see that there’s nothing wrong with it if it’s done correctly,” he said. “Eight years, tops.
“I will be aggravated because I’ve been screaming about this for 30 years. But I won’t be able to take advantage of it because I’ll be sitting in Trafford (Pa.), watching Turner Classic Movies.”