Funt Book Explains Why “Everybody Loses”

What should have been the capstone of Barrett’s athletic career tipped the 27-point spread in favor of Purdue, triggering a hailstorm of social media abuse and death threats from those who had bet on Grambling to beat the spread. A typical post: “Kill yourself for taking that 3 you f—ing worthless loser. Slit your f—ing throat you f—ing f— that was completely uncalled for.”

Bankrupting middle-aged gamblers or exposing college players to temporary online abuse is one thing; destroying the lives of athletes whose brains have not matured is quite another. The sportsbooks’ most profitable — and corrosive — vehicle is “prop bets,” which can be as general as how many points will be scored in a given game by a given player, or as specific as the next 2-point conversion. If you know that a player will take himself out of a game, betting on an “under” performance is a sure thing.

Especially if you happen to be that player. In 2024, DraftKings noticed an unusual amount of betting on Jontay Porter, a Toronto Raptors second stringer who had a habit of benching himself for feeling ill or for an “eye injury.” An FBI investigation uncovered huge gambling debts; the NBA banned him for life, and he later pleaded guilty to wire fraud.

A Disruptive Force — But Not the Good Kind

The eight years since the Murphy ruling have seen countless variations on the stories of “Matt,” Carson Barrett, and Jontay Porter. More systematic data show that when a given state legalizes gambling, significant upswings in bankruptcies and credit card delinquencies, and widespread decreases in credit scores, inevitably follow.

The best estimates of the prevalence of sports betting on U.S. college campuses fall into the 60% range — higher among males, lower among females; at the high school level, where sports betting is illegal and done through older intermediaries, the prevalence runs around 20%.

Moreover, gambling experts estimate that about one in five bettors fall into the “problem” category, among whom the suicide rate is about 20 times that of the normal population. One New Jersey study found that one in five sports bettors have at one time wished they were dead, and one in ten had attempted suicide.

With less than a decade of data, gambling-related U.S. suicide statistics beyond New Jersey are sparse. Data are more plentiful in the U.K., where sports gambling has been legal for two decades; researchers there estimate that gambling suicides take between 250 and 650 lives per year.

Critically, the U.K. data clearly show that sports bettors get into trouble far more frequently than casino gamblers. The casino gambler encounters multiple frictions: traveling to the venue; purchasing chips; interacting with a dealer, croupier, or mechanical device; and finally, needing to go home. The sports bettor, by contrast, has the casino in his pocket or on his night table 24/7, which allows him to rapidly sequence wagers on almost any aspect of any event on his phone — the next free throw, the speed of the next pitch, the next pass interception, or whatever else he can think of. Sports bettors skew young, male, and overconfident: Testosterone does wonderful things for muscle mass and reflex time, but it certainly does not enhance judgment.

The House Always Wins

The bulk of “Everybody Loses” sends the reader on a lurid journey through the sportsbook ecosystem. The customer bestiary pigeonholes bettors into three main groups. First come the “squares,” ordinary bettors who deploy a lethal mix of home-team bias and pathetically simple heuristics. If they are lucky, they pay only a modest entertainment premium; if they are less fortunate, they methodically transfer large chunks of their wealth to firms like FanDuel and DraftKings.

Next come the “sharps,” analytically gifted participants whose skill is sussed out by the sportsbooks. As a result, they soon find their betting limits cut nearly to zero. This usually devolves into a cat-and-mouse game in which the sharps deploy their wagers through a network of “mules” and “beards” who, in turn, also get limited out. One sharp, who was especially skilled at tennis betting, was quickly frozen out of that venue but allowed to keep betting on football, where he had no edge.

You might think that success as a sharp is glamorous and fun. But you’d be wrong: Successful sports gambling is grinding, soul-sucking work that alienates its practitioners from their loved ones and vaporizes the enjoyment of the game.

Last come the “VIPs” (also known, as in finance, as “whales”), for whom no perk is too large: private jet travel, drinks with your favorite retired point guard, hotel suites with patios large enough to land a helicopter, you name it. On rare occasions, a VIP will team up with a sharp and see his perks melt away faster than a daiquiri in a sauna.

As economist Herb Stein famously said, “If something cannot go on forever, it will stop.” The most arresting passage in the book is psychologist Joshua Grubb’s assessment of how the burgeoning crisis ends: “Either a rash of young sports bettors will commit suicide over a short period of time, a gambler will attempt to murder an athlete who cost them money, or gambling-related corruption will taint a high-profile sporting event.” It’s difficult to come away from “Everybody Loses” without a strong premonition of the inevitability of one — if not all three — of these.

A Few Minor Missing Pieces

Funt is a talented investigative reporter with a velvet prose hand, but “Everybody Loses” features some key omissions. The book, for example, should have included a discussion of how app design exploits the evolutionary psychology and neuroscience of gambling behavior; this reviewer was disappointed that Funt failed to mention Natasha Dow Schüll’s superb exposition of the topic, “Addiction by Design.” Another obvious lacuna is the failure to discuss the sharp’s most important tool, the rigorous application of some approximation of the Kelly criterion, which limits the chances of ruin.

Funt also doesn’t delve deeply enough into sports gambling’s political economy and sociology. He does hint that sports gambling addiction is a manifestation of “financial nihilism”: the despair borne on increasing economic inequality that condemns a wide swath of young people who may never be able to own a home, afford childcare, or retire. But he misses the larger point, which is that gambling addiction is but one more manifestation of the social ills attendant to wage and wealth inequality, much like incarceration rates and deaths of despair.

These oversights, however, are minor, and perhaps even necessary in such a tightly focused, powerful work. This reviewer will be gifting the book to all his close male relatives, whether they gamble or not.

William J. Bernstein is a neurologist, the co-founder of Efficient Frontier Advisors, an investment management firm, and a writer with several titles on finance and economic history. He has contributed to the peer-reviewed finance literature and has written for several national publications, including Money magazine and The Wall Street Journal. He has produced several finance titles, and four volumes of history, The Birth of Plenty, A Splendid Exchange, Masters of the Word, and The Delusions of Crowds about, respectively, the economic growth inflection of the early 19th century, the history of world trade, the effects of access to technology on human relations and politics, and financial and religious mass manias. He was also the 2017 winner of the James R. Vertin Award from the CFA Institute.

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