To understand what started gambling on sports one has to first examine the history of sports gambling in America. The US has a long history of allowing some kinds of legal gambling and also illegal betting to a certain degree. Political control and scandals concerning gaming interests have ended in certain backlashes that have resulted in prohibition or regulation of sports gambling. Standards and laws relating to sports gambling have kept changing.
Nelson Rose explains these adjustments in law as 3 waves. The first wave was in the colonial era that lasted up until the mid 1800s, the second wave started at the end of the Civil War and lasted up until the early 20th Century and the third wave commenced while in the Great Depression and it’s still continuing.
Throughout the Colonial Era, diverse attitudes were enforced towards betting. Puritan attitudes were adopted towards gambling and possessing dice, cards, gaming tables etc were banned. Later on it was allowed so long as it wasn’t a calling or trade except for moderate and innocent recreation. Settlers brought along with them views that said gambling was nothing but a harmless activity. The frontier spirit encouraged the appeal of gambling as it involved risk taking, high expectations and opportunism.
Eventually all colonies used lotteries as being a solution out of economic problems as well as help the colonies. It was a civic responsibility and profits were utilized to create a number of the first prestigious universities, build churches and even libraries. Lotteries remained popular right to the early Nineteenth century. Horse racing was also popular and the Long Island built the first race track in 1665. Casino gaming began to emerge slowly as roadhouses and taverns began to allow card games and dice.
The Lower Mississippi Valley became an organized and legitimate gambling area in 1800s. The grand river featuring its riverboats was a major trade avenue for wealthy merchants and farmers. New Orleans quickly gained recognition as the gambling capital. During the 1830s southern settlers turned against professional gamblers who had been blamed for committing crimes, debasing morals of society and endangering streets. During 1800s there seemed to be increasing attack of gambling especially lotteries and when operators absconded with the proceeds lottery scandals eventually concluded in prohibition of gambling.
The Gold Rush in California triggered a tremendous increase in the kinds of gambling and San Francisco was crowned the new gambling capital in the USA. During 1849 and 1855 gambling spread widely and by 1850 California and many cities had licensed gambling centers. But soon the Legislature made most types of gambling illegal and certain professional gamblers were lynched. This prohibition drove wagering activities underground and could not eliminate it. Gambling was legal during 1869-1910 in Nevada.
It is easy to now understand what started gambling on sports in the US. With the numerous scandals in the lottery gambling segments, 35 states in the US including California prohibited lotteries. In 1933 pari-mutuel betting was legalized and new automated systems and laws made horse racing betting more honest. In 1978 casino gambling was legalized by New Jersey and Atlantic City became a popular tourist destination. Despite its illegality sports gambling became quite popular and today is a billion dollar industry.