Exploring the History of Gambling in the US

Jun 17, 2023

Las Vegas - often called the gambling capital of the world

How did Gambling Expand Across the US?

Gambling has been an integral part of American society for centuries. The acts of wagering or playing games of chance have been integral to the collective American social identity since before the United States declared its independence in 1776 through the Las Vegas Strip of 2023. Gambling history is intertwined with US history. Often defined as the act of wagering money or something of value on an uncertain outcome, legal gambling and illegal gambling has evolved over time. Originally US gambling entailed lotteries, dice, and cards, but it has since expanded to encompass various forms of entertainment (TV, politics, and video gaming) and competition (horse racing, casino gambling, table games, internet gambling and notably sports betting). Gambling has a propellant history from the 18th century on, and this summary highlights significant milestones and key events that have shaped its trajectory to the fastest growing consumer social network in the US today.

Gambling in Colonial Times in the US

From the earliest days of what was to become known as the United States of America, gambling took on multiple different forms. State lotteries emerged as a popular method of raising funds for public works. This included the funding and construction of roads, bridges, and even the establishment of significant educational institutions that are maintained to present day such as Harvard (1636), William & Mary (1693), Yale (1701), and Princeton (1746). Additionally, lotteries played a quite pivotal role in financing the American Revolution using the newly created Continental Currency. Though the first authorized state lottery in the American colonies was held in Massachusetts in 1744, this set a precedent for other states to follow and lottery popularity exploded - notably financing the revolutionary war. By raising capital from the original 13 states, the first US government was able to provide much-needed resources for the revolutionary war effort against Great Britain.

Gambling during the colonial period was not only a means of raising funds but also had social and cultural significance for American citizens eager to feel a sense of belonging in the new nation. Gambling often existed as a way to bring disparate communities (politicians, farmers, clergy, and more) together, fostering a sense of camaraderie and shared experience through common social bonds. The Pubs and Taverns of early America served as gathering places and often featured gambling activities, like table games including card games and dice as well as serving as the center of lotteries. Many early Americans gambled as escapism and these games may have provided entertainment and relaxation, offering a temporary escape from the physical challenges of colonial life.

Gambling in the US in the 19th Century

There was a heralded expansion of gambling in the United States in the 19th century as the United States spread West. Gambling establishments, such as saloons and riverboat casinos, became prevalent in frontier towns and along major trade routes. While these venues blatantly offered a chance to win and lose money - and often focused on illegal gambling outside of gambling laws, they also provided a gathering place for individuals from diverse social and cultural backgrounds to mingle on more equal footing than they would have during the hierarchical day-to-day of early American culture. The Gold Rush in the mid-1800s continued the popularity of illegal gambling and fueled prospectors seeking fortune and excitement they often could not find elsewhere, often unhindered by gambling laws. Many miners eager to stake their fortunes on finding gold in California worked 12-16 hours a day, and often used gambling as a way to relax and connect with fellow gold miners.

The Industrial Revolution also played a role in the expansion of legal gambling. Because of technological advancements, urbanization and industrialization progressed in turn increasing  societal leisure time. As American individuals had more time to themselves, they searched for other opportunities to spend money - leading to the establishment of racetracks and a spike in the popularization of horse racing. To complement the increase in gambling among horse races at racetracks, the emergence of lotteries, such as the Louisiana Lottery, created excitement and opportunities for individuals to test their luck and potentially win or lose significant sums of money.

Gambling in the US in the 20th Century

Against the rise of gambling in the 1800s, the early 20th century was a period of turbulence for the gambling industry. The 1900s began with intense crackdowns from the reform movements on opportunities for the citizenry to gamble. The temperance movement (began in the 1830s) created moral concerns surrounding gambling and as a result, their actions led to the prohibition of most forms of gambling across the country. The draw of fame, fortune, and glamor was too significant however, and in 1931 the tide began to turn when Nevada legalized casino gambling, paving the way for the establishment of Las Vegas as the gambling capital of the world alongside eastern powerhouses like Atlantic City and New York. The end of the Great Depression also played a role in the shift. As individuals had more buying power, governments on the federal and state level sought alternative revenue sources and began legalizing gambling in different forms to line state coffers.

Technological advances in the 20th century had a profound impact on gambling. The introduction of slot machines (originally created in the 1800s but expanded throughout the 1900s) that were initially mechanical but later became electronic, revolutionized the industry and made it more accessible to a wider audience. The rise of organized crime during the Prohibition era also influenced the gambling landscape, with illegal gambling operations gaining prominence in major cities.

Gambling in the US in the 21st Century

The 21st century has brought about a new era of gambling, driven by the rise of the internet and advancements in technology. Online gambling has experienced exponential growth driven by the popularity of organizations like DraftKings, Fanduel, and Robinhood, and providing individuals with the convenience and dangers of gambling from their homes or while mobile. The development of secure payment systems and regulations has helped legitimize the industry and protect consumers.

Additionally, the legalization of sports betting has become a significant milestone since 2018 with more than half of US states offering online sports betting from your phone. Following a Supreme Court ruling in 2018 that struck down the federal ban on sports betting, many states have moved to legalize and regulate this form of gambling. The widespread popularity of fantasy sports and the advent of online sportsbooks have further propelled the growth of this sector.

What’s Next for Gambling in the US?

Gambling in  the United States has a long and storied history that has evolved alongside societal changes and technological advancements. But while gambling has increased so too has the dangers from Problem Gambling. This has created important institutions like Gamblers Anonymous (1957) and the National Council on Problem Gambling (1972) to ensure that responsible gambling prevails, and that individuals who may suffer from Gambling addiction find themselves able to get the assistance and support they need. From lotteries funding the American Revolution to the establishment of Gamblers Anonymous in 1957 and the founding of the National Council on Problem Gambling in 1972, the gambling landscape has seen significant developments over the years. As the gambling and problem gambling industries continue to invest in new technologies and legalize new modes of gambling like online sports betting, it is essential to balance the excitement and entertainment gambling offers with responsible gambling practices, education, and measures to address problem gambling. Through comprehending the historical context and impact of gambling in the United States of America, we can better navigate the future of what has emerged as a very American and enduring social pastime.

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