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The House of Representatives approved a bill this month that outlaws using credit cards for online gambling.

As the internet gambling industry comes under continuous fire from legislators and religious groups, Cato policy analyst Radley Balco examines the paternalist temptation.

Why are Justice Treasury and now Congress clamping down an internet gambling of late?

Well, it's a good question.

I think in Congress, the motivation here is morality.

I think there are a few members of Congress who are morally opposed to gambling, and so they think the rest of the

country should abide by those same values. As for the Treasury and Justice

Department, I mean gambling has always been illegal in this country and And illegal gambling over the internet,

at least from the bet taking side of the equation,

has been illegal, basically, since the internet.

I think justice and Treasury are taking their lead from Congress though and I think they're

clamping down of late in part because this bill is making its way through the House.

What precisely are they threatening to do and how will that affect other companies such as credit cards

and internet providers?

The bill that just passed the House, basically it deputizes financial institutions to start monitoring their customers behavior so they can't gamble online.

So basically, right now, all the credit card companies have already sold out on this issue and agreed to not let their customers use their services to gamble.

They're pressured basically by the Justice Department and a few state attorneys general led by Elliot Spitzer in New York.

But you can still gamble online and how most people do it is they wire money from their

checking or savings account to an offshore payment service, basically an offshore version of PayPal.

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