March 19, 2015

The Usual Brackets:
America's Curious Embrace of Sports Gambling

"The greatest trick the devil ever pulled was convincing the world he did not exist. And like that, poof. He is gone."

~ Roger "Verbal" Kint (Kevin Spacey), in The Usual Suspects (1995)

Today is the beginning of one of the great American sports holidays—the NCAA men's basketball tournament, a/k/a "March Madness", a/k/a "The Big Dance". Tens of millions of Americans who rarely if ever gamble will enter office pools, filling out brackets to pick the winners of 63 basketball games over the next three weeks, hoping to win a piece of prize pools which can range from enough to feed a family off the fast food value menu to thousands of dollars in some higher stakes contests.

My first time winning a bracket contest was my junior year of high school. I was in a pool with a handful of guys on the basketball team, along with our coach (who was also the principal). The stakes? The winner got a free soda (50 cent value in those days) from each of the losers. Keith Smart and "The Shot" kept me in quality caffeine for a week.

It was also my first big gambling win.

In the ensuing couple of decades, I have participated in and/or organized scores of NCAA basketball pools in numerous formats (all scrupulously conducted within the requirements of Iowa's social gaming statute, of course). There have been straight brackets, randomly drawn brackets, and brackets with upset bonuses (add the difference in seed to the points for each win). There have been "against the spread" brackets where players draft teams which play through the bracket with the Final Four teams getting the prize money; the catch is that the "winner" which advances is the team that beats the spread. There have been Calcuttas, where teams are auctioned off to the highest bidder, with a percentage of the overall pool awarded for each win. For years I operated a Sweet Sixteen second-chance "confidence pool" which required participants to rank the remaining teams in the tournament, with weighted points awarded for wins.

One of my favorite pools was one operated by a friend and (now former) law partner. His pool had five games; your standings in the overall pool were determined by your agregated standings from the individual games:
  • Game 1:  Standard straight bracket.
  • Game 2:  Rank the top ten potential champs. Winner is the person with the eventual champ ranked highest (first tiebreaker was highest ranked runner-up). A "go for broke" strategy would be to eliminate one team from your picks which is a popular championship pick among the rest of the participants (say, Duke, to pull an example from thin air). If that team doesn't win, you likely have a major edge in where you've ranked the actual champion. 
  • Game 3:  Pick all first round games against the spread. Picking all the dogs was usually a winning strategy. 
  • Game 4:  Pick one team from each seed level (i.e., pick one of the four 1-seeds, one of the four 2-seeds, etc. all the way to one of the four 16-seeds). Points are scored for each win, with points doubling each round. 
  • Game 5:  Pick any five teams. For each win, you get points worth the picked team's seed divided by the seed of the team they beat (i.e., if a 5-seed beats a 12-seed, you get 5/12 = .417 points, while a 12-seed beating a 5-seed would get 12/5 = 2.4 points). So, a 1-seed or 2-seed doesn't score many points until the late rounds, but is likely to go deeper, while a lower seed might score big points early, then fall out of the tourney. A good strategy was to pick seeds 2-6 likely to make deep runs, with maybe one flyer on a 10-12 seed likely to win a couple of games.
The best part of the pool was that participants and their guests would watch the championship game together in a sports bar. The kicker was that while the top 40% of participants split the prize pool, the bottom 40% had to split the tab for the party. You could always spot the locked-in winners—they were the ones drinking the top shelf booze. And with numerous tiebreakers in play, many participants were rooting for strange outcomes in order to make the money or miss the bar tab: "You need North Carolina to win by more than six in regulation, or you need two overtimes and total points scored under 166."

Regardless of structure, all NCAA pools are gambling, assuming there is an entry fee. Frankly, NCAA pools are nothing more than the bastard love child of sports betting and keno (though Wall Street could probably sell them as "sports derivatives"). Whether these pools are illegal depends on applicable state gambling laws; many states carve out small-stakes social gaming from their criminal gambling and bookmaking statutes. Of course, even where NCAA pools are technically illegal, law enforcement rarely pursues them unless they are high-stakes or there are complaints of cheating or theft.

Despite being blatant gambling, NCAA pools occupy something of a moral and legal blind spot in American culture. President Obama can broadcast his bracket picks every year without any criticism that he is promoting gambling. Celebrities like Kevin Jonas and Kati Couric can participate in "celebrity bracket challenges" without fear of damaging their wholesome public images. Sitting down to help their young children fill out brackets is part and parcel of being an All-American Dad these days; none of these parents would dream of playing casino-style games with their kids. In Congress, fifteen Representatives have signed on as co-sponsors of an expansion of the federal Wire Act which prohibits electronic transmission of sports betting information; if I were a betting man—and I am—I would wager most of those Representatives have staff, friends, and family using one of the mainstream online sites (CBS Sports, ESPN, Yahoo) to manage their brackets. Opponents of online gambling legalization often dramatically tout the dangers in "making every cell phone a casino"; how many of them have a bracket tracking app on their own cell phones or tablets?

Americans' embrace of NCAA pools is directly at odds with their general hostility toward gambling. Recent Iowa polls, for example, show strong majorities opposed to legalization of online gaming (71% opposed) and daily fantasy sports contests (63% opposed). So why do NCAA pools get a free pass from America's otherwise judgmental gaze?

Our collective cognitive dissonance on the status of our brackets undoubtedly arises from the wild popularity of college sports in general and March Madness in particular. Even the most casual of sports fan is drawn to the drama of the tournament, rooting for their favorite team(s) and cheering for David-versus-Goliath upsets. Filling out brackets augments the enjoyment of the experience by giving fans something to root for in every one of the 63 tournament games, and something to talk about with friends and co-workers.

NCAA pools are just an old-school version of social gaming, the sports equivalent of Farmville or Candy Crush. Sure, they might cost a few bucks, but filling out brackets for a fun contest with friends or coworkers is nothing like calling a bookie or going to a casino. So, with a wink and nod, Americans have collectively convinced themselves NCAA pools are entertainment, not gambling. Fiction though it may be, that's our story and we're sticking to it.

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