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Poker: Chance or Skill?

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Chasse Rehwinkel

I gamble, therefore I write...or I write, therefore I gamble...honestly, they're pretty similar professions…

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The Unlawful Internet Gambling Enforcement Act, which was brought up in yesterday's post,states that any game that is "subject to chance" will be prohibited from online play in the United States if a player stands to "receive something of value given a certain outcome."

Unfortunately for online players, a game that is "subject to chance" is never completely defined within the Act, leaving the door wide open for lawmakers to restrict certain games of skill, which may have a historically misunderstood reputation. And when I say "certain games of skill," I mean chiefly the game of poker, which has been demonized by a few politicians lately as a degenerate game of luck.

This whole poker witch hunt carried out by Congress is a big, unfunny joke to me.

A joke because while I type this article, my computer is plugged into my apartment wall, being powered by electricity that, in part, is being paid for by the game of poker.

Unfunny because I think no matter how much proof exists to show how poker is a randomized game of skill--see my paid electricity bill--lawmakers will be unable to look past the short term luck of the game.

That being said, you will never be rewarded for not trying. So let me explain how poker is a game of skill by looking at the problem from three different angles, the comparative,legal and practical or visual.

If you still are unconvinced that the UIGEA doesn't restrict poker after this, I guess nothing will. So here's hoping that won't be the case.     


The Comparative Proof

One of the major problems poker faces in being recognized as a game of skill is that it is most commonly seen outside of the home as a casino card game.

All other casino card games, with the exception of the rare gin rummy or bridge tournament, are obviously games of chance, so it is easy to understand how poker often gets lumped into this group.

If we compare poker to these other card games, however, a glaring difference in play is exposed, revealing the true complexity of the game of poker.

For the benefit of the readers I'll compare poker to two of the easiest to understand and most recognizable card games found in casinos today, casino war and blackjack.

If casino war doesn't sound familiar to you, you probably know it simply as war. Yes, the popular children's card game is spread in most casinos nowadays, usually with a house edge of two to three percent due to the casino's betting advantage during a tie.

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Time to put all those hours of practice spent in recess to good use; it's casino war time!


War is the most basic of all the card games, where nearly every decision has been made for the player before the beginning of each match. The dealer is blind to any other moves not outlined by the rules of the game and really so is the player, barring any sort of money shortage problem.

The outcome of every game is always predetermined, making casino war a pure game of chance, with little-to-no strategy involved in play.

Blackjack, on the other hand, is a less obvious game of chance. First, there can be multiple players in addition to the dealer, who, although not directly competing with each other, do effect the other players' results. Second, while the cards are predetermined to come out of the shoe before any action is performed, players do have the chance to make certain decisions throughout gameplay that change where those cards end up on the table. And lastly, betting can be altered from round-to-round instead of from deck-to-deck, so players can make alterations to their bets if they believe certain cards are less likely to appear--that last one is called card counting and is not a recommend strategy in a live casino if you want to keep playing.

The problem is that all this choice amounts up to about a -.4 percent edge for the player, meaning that in the long run an optimal player will still lose his money to the house.

In blackjack the dealer is still blind to the larger game being played above each game round, he must always follow the predetermined rules of play set by the game regardless of how hot or cold the deck is. So in blackjack, a dealer can never be taken advantage of by a more knowledgeable player; weak dealer play simply doesn't exist.

Conversely, in poker the house owns a zero percent edge; just a set rake is collected every hand, which resembles a house fee being paid by each player for playing in the casino.

This means the house has no stake in the game other than to keep the game active. Poker, therefore, has a metagame, a game played above the set rules of each hand.

In other words, while each hand in poker certainly has its optimal play, since players are playing against other players the hand is played through the added lens of the psychological states and playing styles of each player.

When playing an aggressive player the right play might be to call or raise, while when confronted by a passive player it might be best to fold.

Each hand, however similar, is completely different from the last in poker. No two hands in the whole of poker history have ever been completely the same, which cannot be said about casino war or blackjack.

This concept of a metagame in poker allows truly great players to, theoretically, never lose in the long run. A better player may get out drawn on occasion, but, as poker author Mike Caro states in his book Secrets of Winning Poker, the money always "flows from the bad players to the good players;" in the end the better player will always win.

The Legal Precedent

Discussions of game complexity and metagame strategy is all well and good, but what lawmakers really like to see is legal precedent--politicians never really like making a bold decision unless someone has already made it first.

There are two monumental cases on the side of poker being a game of skill on record, William E. Baxter Jr. v. United States and Commonwealth of Pennsylvania v. Walter Watkins.

The earlier of the two, Baxter v. United States, pitted poker hall of famer Billy Baxter against the IRS in 1986 over the classification of Baxter's poker winnings.

Baxter argued that his yearly income was earned through playing high stakes poker and that his winnings should be taxed as earned income. The IRS disagreed, believing poker to be a gambling game of chance and therefore Baxter was not subject to write off his losses as tax deductible.

The court ruled in Baxter's favor stating, "The money, once bet, would have produced no income without the application of Baxter's skills. [ . . . ] it was Baxter's extraordinary poker skills which generated his substantial gaming income, not the intrinsic value of the money he bet."

Then the issue of poker as a skill game lay dormant until 2008, when a Pennsylvania underground card game was raided by police and it's manager, Walter Watkins, was arrested for violating the state's anti-gambling laws.

Watkins made the case that poker is, in fact, a game of skill, not chance and, therefore, did not fall under Pennsylvania's gambling policy.

The court again ruled in favor of poker, Judge Thomas A. James Jr. ruling, "Texas Hold'em is a game where skill predominates over chance. Thus, it is not 'unlawful gambling' under the Pennsylvania Crimes Code."

Two well known legal rulings that show how poker is a game of skill, not chance, and therefore should not have online play be restricted by the UIGEA.
 

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Bam! Can we be done now?

 

Playing the Game

Reportedly, when the United States was making it's case against Billy Baxter in 1986, the judge who was ruling the case stated, "I find the government's argument to be ludicrous. I just wish you had some money and could sit down with Mr. Baxter and play some poker."

Oh, how I wish it was that simple. I think the easiest proof for showing how poker is a game of skill has to be the actual practice of playing the game.

If every politician could have a chance to face off against a world class player and see the difference in skill first hand I'm fairly sure no doubt would be left about what type of game poker really is.

I just wish politicians could have that opportunity... Oh, wait! They can!

In 2008, online poker pro Phil Galfond and his sponsor Blue Fire Poker issued a million dollar challenge to President Barack Obama or any member of Congress to play a heads-up match of poker to determine whether the game was one of skill or chance.

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Galfond is looking at you Washington


The challenge would require the politician to put up $1 of their own money--no that's not a typo, it's really just one buck--against Blue Fire's $1 million. If the lawmaker beats Phil Galfond, the million goes to a charity of the politician's choosing. If Galfond wins, Blue Fire would then claim that the skill debate would be settled.

Stated Blue Fire Poker, "No one in their right mind would turn down this challenge if poker were a game based on luck, because the odds are so far in their favor--putting up $1 for a chance to win $1,000,000 for the charity of their choice."

No one ever said politicians acted as people in a "right state of mind," however, and Galfond has yet to face anyone on Capitol Hill over the battle of poker's status.

Even if this doesn't sway politicians' minds, I hope my examples and explanations at least convince some of you readers that playing poker is not actually gambling in the long run.

For those of you convinced, please write your congressman or congresswoman stating your support of poker as a skill game. Thank you.   

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