3rd Circuit Rules Federal Regulators Oversee Kalshi Sports-Related Contracts
Why a Wise Court Sometimes Refuses to Dance
By sitting out the ballroom fight while a new betting war brews, the Court shows that in a corrupt storm the most political act can be a refusal to move.
The scene is almost comic. A president wants a ballroom; Congress guards its formal right to approve any new structure on federal grounds; a statute seems to speak clearly; yet the Supreme Court, by a narrow vote, lets the demolition and renovation proceed and is praised for sitting out “the dance” between the two branches. At the same time, judges below them split over who commands a sports‑betting platform that boasts of reaching all fifty states. One conflict is gilded plaster, the other raw money and jurisdiction. Both ask the same question: when does a high court preserve the republic by acting, and when by refusing to act?
I begin from the effectual truth, not the sermon. Courts, like princes, wish to maintain themselves. The first danger to a high court is to become merely the third party in every political quarrel, dragged into every ballroom and betting shop to decide fights that the contestants would rather win by judicial fiat than by lawmaking or persuasion. The second danger is to appear powerless, either because its orders are defied or because it wades into battles it cannot really resolve. When I wrote in The Prince, as translated by W. K. Marriott, that men judge “more by the eye than by the hand,” I meant precisely this economy of appearances.
Look at the ballroom affair through that lens. If the Court had squarely taken the floor as arbiter between president and Congress, it would have invited every future conflict over buildings, ceremonies, and pomp into its halls. It would become the decorator of the regime. Instead, by allowing the project to proceed while refusing to choreograph the underlying dance, the Court preserves something more important than ornamental purity: its distance. It signals that not every impropriety, even one written plainly in a statute, will be made into a judicial duel between two ambitious branches. Sometimes you let the great trip over their own feet.
Many will say this sacrifices legality to convenience. I answer with the distinction I drew long ago between founding and maintaining. In founding moments one needs harsh remedies and spectacular acts; in ordinary times, the highest prudence is conservation. To maintain the state, a ruler or a court often chooses the lesser scandal over the greater conflict. If the likely consequence of blocking the ballroom is a furious campaign against the Court’s legitimacy from both political branches, then a strict reading that invites open defiance can be worse for law than a quiet retreat that leaves the statute wounded but the institution feared. A law may be mended later; authority, once laughed at, seldom returns whole.
Now consider the Kalshi dispute. Here the Court has not yet moved, but the ground under it moves. One circuit announces that federal regulators alone command these “sports-related event contracts”; another recounts a state board’s cease-and-desist against a platform that advertises itself as legal everywhere. This is not velvet architecture but raw sovereignty: who taxes, who licenses, who punishes. When equal tribunals pull in opposite directions, the law becomes a battlefield where only the rich and cunning can fight. As I observed in the Discourses, in Ninian Hill Thomson’s translation, wise founders assume men will be bad, and they build orders that hem in that badness; a circuit split tears those dykes.
Some might urge the Court to keep abstaining, to avoid another politically charged case. That is the middle course, which I distrust. To refuse the ballroom quarrel is to deny the great the flattery of a costume judge; to refuse a mature conflict over jurisdiction and betting, after the lower courts have openly contradicted each other, is to abandon the people to confusion and the strongest hands. Fortuna rules most where no common umpire exists. In this sphere, virtù for a court means taking the risk of decision, knowing some faction will cry out, but trusting that in the long run consistency earns respect even from the grumblers.
When I compared fortune to a raging river, I added that prudent rulers raise dykes and barriers in fair weather. Your Court is judging in foul weather: partisan suspicion, money‑soaked markets, distrust of every institution. It cannot change the weather. It can shape the banks of the river. Abstaining from the ballroom dispute is one such dyke, protecting the Court from being washed into every vanity project. Resolving the betting split, when it arrives dressed properly as law and not as choreography, will be another, channeling a dangerous current into known channels. The art is to know which occasions to seize, and which temptations to leave to the flood.
The effectual truth of this moment is that the Court preserves its power by refusing to become entertainment while preparing, or being forced, to decide where real power over markets and states will sit; whether it can keep balancing these two roles without sliding into open hatred remains uncertain even to me.
From the works cited
- The Prince — Virtù versus fortuna — the raging-river figure: preparation in fair weather is the whole difference between the drowned and the dry.
- The Prince — The economy of violence and the feared/loved calculus: better feared than loved if one must choose, but never hated — fear rests on the prince's will, love on the fickle will of others.
- The Prince — Occasione: the new prince needs the matter (a crisis, a vacuum) and the virtù to shape it — opportunity without capacity is a tragedy, capacity without opportunity a biography nobody writes.