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Betting On Casinos

John Harwood in for Tom Ashbrook

More and more states are betting on casinos for critical revenue. But if everybody’s got one – or a dozen – does anybody win?

Lights in Las Vegas. (Christina McCarty/Flickr)

Lights in Las Vegas. (Christina McCarty/Flickr)

As hard as this struggling economy has been for Washington to deal with these last few years, it’s been even harder for state governments. They’re desperate to generate revenue and create jobs – and that has more and more of them turning to the casino industry. Once it made politicians blush; no longer.

But is it really a growth strategy for the long-term? Is the jackpot shrinking even as new parts of the country raise the stakes? And for individual gamblers, is it really possible to beat the house?

Up Next On Point: Who can win the big new bets on casino gambling?

-John Harwood

Guests

Doug Walker, professor of Economics, College of Charleston, and author of The Economics of Casnio Gambling.

Vin Narayanan, managing editor at the Casino City Times.

Don Johnson, considered one of the most successful gamblers today. In one night last April he won nearly $6 million.He is no longer welcome in many casinos because of his ability to beat the house.

From The Reading List

The New York Times “These days the tribe is dealing with the latest improbability in its turbulent history: financial havoc. The casino is underwater, like a five-bedroom Spanish colonial in a Nevada subdivision.”

Chicago Sun Times “Five new casinos in Illinois and slot machines at the racetracks would yield nearly $200 million a year for state government and create more than 20,000 jobs, said a report being issued Monday.”

Detroit Free Press “Backers say it would be a win for Michigan. They say the new casinos would be a boon for the state economy, create up to 16,000 new construction and casino jobs in a state with chronic unemployment and raise $300 million a year in tax revenue.”

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  • Terry Tree Tree

    Casino owners are going to win, unless they are completely stupid.
        Native American tribes are going to win a LITTLE, or the owners can’t justify using the tribe’s name.
        Criminal elements are going to win, because this brings VICTIMS!
       Those opposed to public education are going to win, because the proceeds from casinos are NOT stable, so the lower amount of taxes to education is going to fluctuate, and cause problems.  The anti-public school forces are going to use those problems AGAINST public schools, to justify the charter schools, that they ‘just happen’ to be associated with.
        Those opposed to the United States, will win, because this puts MORE people vulnerable to pressure due to gambling losses.
       Ocassionally some poor schmuck is going to win, because otherwise, it’ll be TOO obvious that the odds are WITH the house!
       Want to bet?

  • http://profile.yahoo.com/QUX372NXWNXHKVC4KS5BOWCDYA David

    Watch the video that casino lawyers had banned from YouTube. On Facebook: Casino Surveillance Scam. Or google: Windsor Casino Surveillance Scam.

  • NrthOfTheBorder

    Gambling/casinos/state sponsored lotteries are a curse – an onerous, corrupting tax on the American Spirit.   It is as if more than a few – including scores of enablers from predatory capitalists to feeble legislatures – can envision nothing better for the  precious time and money frittered away on lady luck and the impossible odds of one day  - “OH! please Lord cross my fingers  strike it rich”. 

  • AC

    Las Vegas was fascinating for about 1 day, then I was super depressed. There was a fight because a person left their seat to go to the loo and the next sitter won right away….and a lady by the elvator machince was still there when we came back down the next morning…..I don’t understand the draw of ‘casinos’….

  • Wm. James from Missouri

    Fortunes Formula is a great book about the mob, math and gambling. Great investment insight also.

  • JustSayin

    Why is it legal for governments to run gambling — (oops, “Gaming”) — operations, but not individuals?  So many things are like this.. Governments across the nation license certain illegal and “morally corrupt activities” to corporate entities, but arrest individuals for the same things — why?

    If corporations are individuals now, aren’t they subject to the same laws as everyone else…  Something to ponder as we go about our day.

    • Terry Tree Tree

      JAIL ALL these ‘corporate-citizens’ for gambling?  Confiscate ALL the money and property?
        BET on it?

  • Anonymous

    I have no moral problem with providing a place for idiots to throw their money away but I don’t want casinos to dominate the cultural scene in Boston with restaurants and concerts being based around the casino.  As every state builds these, they aren’t going to be the budgetary panacea that is anticipated and eventually internet gambling will be legalized further cutting into the profits. 

  • GoingDown

    Big casinos are blatantly obvious icons appearing right berfore us displaying to us how our conutry is going down the drain. It used to be a sin to gamble. Now we do it as a last resort to get enough money to support our crumbling middle class. Governments bad, being rich is all american success, get what you can out of society and show off your wealth. Get money and use it to get more. It aint’ working folks. Admit it.

  • TomK in Boston

    The only way casinos create wealth is if neighbor states don’t have one. So, yes, MA has been sending $ to CT. When everyone has a casino they will just be urban/suburban blight along with empty malls in the voodoo economy.

  • Craig S.

    I have to say these casinos aren’t helping anyone. Say what you will about morals. Etc ..where I grew up,(south of Joplin,MO) there are now around 10? Or so Indian casinos across the line in Oklahoma. People are not able to stay out of them and a lot of people have lost all their money. Property values are going down and crime is going up. It is sad. This is not the answer.

    • Terry Tree Tree

      How MANY Native Americans ACTUALLY owning, and operating these casinos?   MOST of the few that I have seen or heard, have Sicillian-sounding ‘management’ administrators, and I have been told FEW Native American staff?

  • Patrik

    I tried gambling and I just never became addicted to it.  Casinos actually annoy me.

  • Brett

    To me, gambling seems such a waste of time. It is sad to see many people feed their addictions through gambling. I’d rather hang out with alcoholics than gamblers (and I can’t stand to be around alcoholics). 

    That said, thirty years ago or so, I used to love to go to the horse races and watch the ponies run, as it were. Some horses just seemed to love shooting out of the gate and galloping past the furlongs; others, seemed afraid and reluctant. And, there was a vast difference from track to track in the cultures of how the horses were treated. For example, say, at the Derby, the horses were treated like royalty, and all seemed healthy and happy; at the old Charlestown track, in W.Va, the horses were mostly nags who were one step away from the glue factory, so to speak. Many of the trainers at Charlestown were what I would consider abusive toward those majestic creatures. I also don’t like the use of Lasix. It may be necessary in some cases to keep the horses’ nostrils from bleeding, but some seemed all hopped up and agitated as if on some kind of stimulant drug, which Lasix is, really.

    I especially think slots, as well as scratch-off lottery tickets, should be taken out of legal gambling because they both feed into the compulsivity of gambling. They have a kind of reflexive quality to them, perfect for the person with little impulse control/who is compulsive; it’s disgusting. Go to any lottery retailer on a Sat. or Sun. afternoon and you can witness elderly people standing around the store scratching for hours on end. You’ll see lots of pathetic behavior; someone will drop $300 to win $80 and behave as if they’ve either won or have broken even, and so on… 

    Most alcoholics, on some level, know they have a problem. Most compulsive gamblers don’t think they have a problem at all. 

  • Jon

    I read the Atlantic Magazine story about Don Johnson. The most interesting thing is that high rollers can negotiate the rules of the game (for Blackjack anyway). They get better odds than you or me. I never go into casinos. 

  • Mjbjr

    A modest amount of well designed & located casinos could be fine, not everyone’s cup of tea but what is.  I see a major problem with every state turning to this, few will stand out and the bulk will be less than glamorous.  I am not a gambler but it could be unavoidable.  Being from Rhode Island I see that the pressure is really on.  We are so close to CT & MA and we get such a huge portion of our revenue from a couple of pathetic gambling venues in RI.  The argument being we will loose that tax revenue to the hot spots over the border unless we build something bigger and better.  When RI builds it’s casino (which will surely happen) it needs to capitalize on the attributes which draw people to our state to begin with, we are the Ocean State and have infrastructure linking freeways, rail lines, airport & ferries to a single large, industrial waterfront which in my opinion is under utilized and recently re-developed for the past, Quonset Point.  It’s on the bay between Newport & Providence.  A casino in that location would be able to compete for years to come. A lack of vision will be our down fall as proposals come in for backwoods or otherwise ridiculous locations with no inherent draw other than the building itself.  State by state this strategy is off to the races to build the bigger, better casino to draw gamblers from adjacent states…?  What’s good today will be gone tomorrow.  Out done by the latest and greatest.  As the old casinos fall by the wayside it will just litter the landscape with another monstrous carcass…   

    • QDC

      For a number of reasons, the Quonset Business Park fails as a location for a casino. The Park is home to 8,800 jobs at 168 companies, and hosts the 7th largest auto importer in North America.  The port operation, and a number of port-dependent businesses, could not co-exist with a waterfront casino.  Also, while a casino of this nature would require at least 175 acres, there is no single lot, or adjacent lots, near that amount of space available at the Park, particularly along the waterfront.  This is probably why the legislative leadership has expressed their opposition to a casino at Quonset, and the issue has become a moot point.

  • Yar

    I call myself a compulsive non-gambler.  That is not quite the case, for I am a farmer.  I would rather bet on nature than play a game that is designed to take my money for ‘entertainment’.  The sex drive plays an important role in risk taking.  Our hormonal secretions are metered out through social interactions and hijacked by entrepreneurs to be sold back to us in a crazy economic scheme.  We use entertainment to feel good, or through addiction to feel normal, whatever that is.  Entertainment, is a secondary economic niche, only possible where real value already exists.  We have a declining primary niches in our economic workforce: farming, manufacturing, and mining make up about 10 percent .  These support all services of which gambling should be a small section of entertainment.  In reaching out for economic growth, we should support primary economic growth, not focus public resources toward a small sector of ‘spin artists’.  We can’t all trade services for services, somebody has to produce real products.  How much of our economy is actually real?

    • Brett

      As unrelenting as mother nature can be, she’s much more forgiving than the ‘house’! ;-)

    • Terry Tree Tree

      Are Ladys LESS likely to ‘gamble’, with games of chance, than Men?
        Any studies WHY?

      • Yar

        No, but they gamble from different perspectives. Men tend to seek action, the thrill of the experience, women tend to seek escape, they are looking to avoid some pain in their life, at least for the time while they play. Nothing is absolute, even gender identity has variations, we are hormonally influenced beings.

  • Victor Vito

    I went into a casino about 15 years ago, and I couldn’t even figure out how to play the video slot machine.  I don’t really have money to gamble anyway, but enough of my worthless personal anecdote.

    Casinos and lotteries make oodles of money, so expect more to appear.  Those opposed to them will have their palms greased if they are powerful, and will be ignored if they aren’t.

    It’s America and the free market, Bay-bee!!  If it turns profit, it is good.  If you are opposed to this, you are less a patriot than you ought be.

  • TomK in Boston

    Actually, the having every locality get a casino to keep the $ home is like corporate tax rates. When one state cuts taxes, the can attract some business, so a race to the bottom starts. When everyone has low taxes, there’s no advantage, and everyone is left with too little revenue to run the government.

    I don’t gamble, I just invest in the stock market :)

  • http://twitter.com/Dave_Eger Dave Eger

    The big issue in this economy is wealth disparity, which casino’s will only tend to increase. 

  • http://gregorycamp.wordpress.com/ Greg Camp

    Gambling is a tax that gamblers choose to pay, and that’s their choice.  I choose not to participate, but I don’t like telling others what choices they’re allowed to make.

    • Anonymous

      One can always count on the Libertarian perspective to offer stunningly simple-minded talking points on complex issues.

      Personal costs and costs to the community in the form of bankruptcy, ruined families, crime, depression, suicide are borne by everyone. 

      • http://gregorycamp.wordpress.com/ Greg Camp

         One can always expect authoritarians on either side to promote one regulation, law, or policy after another to control what people do.

  • Guest

    Legalize gambling, legalize drugs, legalize prostitution.   Why not?  3 substantial revenue streams.  Crime will go down, and folks will be happy and sated.  To get Republican buy-in, tell them the best way to stop vice is to introduce government regulation!!

  • http://gregorycamp.wordpress.com/ Greg Camp

    Gaming sounds like marketing jargon, and no one with a brain is fooled.

  • Anonymous

    Doesn’t “gambling” imply winning and losing based on risk and chance whereas “gaming” means that the casino has gamed the system against the chumps?

  • David

    John,
    Thank you!!!    IT’S GAMBLING!!!! If you’re a journalist and call it gaming you are a stooge of the industry. A classic example of saying it loud enough and long enough…. people will repeat it.
    IT’S GAMBLING

     

    • TomK in Boston

      Yep, it’s GAMBLING, not gaming, just like Etchasketch is a LEVERAGED BUYOUT CON MAN not a “private equity” investment professional, Ryan’s MEDICARE GROUPON is not “premium support”….Newspeak is everywhere.

  • MarkVII88

    Is it true that casinos and other gaming endeavors tend to attract most of their customers from the lower income demographic, therefore siphoning a majority of the money from those who can least afford it?

  • http://gregorycamp.wordpress.com/ Greg Camp

    I occasionally play Solitaire.  I hate to think how much money I owe my computer. . .

  • Anonymous

    Here’s a piece on the proposed slot parlor in Plainville, MA and Australia’s obsession with slots (they call them “pokies” down under): http://www.latitudenews.com/story/massachusetts-adds-slot-machines-as-australians-debate-their-pokie-problem/

  • Brownduncan

     Okay. Michigan may raise 300 million dollars in revenue, or New York could raise millions (or billions).  What happens to the revenues?  Does the money go into the same bottomless abyss the current tax revenues go into?  There are ‘scratch cards’ now, and it seems to work as a tax on the poor hoping for a new and brighter future.  Will the casinos accept public assistance debit cards, as was recently the case in California?

  • Camphappi

    Casinos at race tracks do not necessarily benefit the sport. Gamers rarely bet or watch the races. Those ponies could run around the track day and night with no one watching and still make money due to account wagering firms. You are not promoting horse racing-you are just putting money into the pockets of the track/acct. wagering firm owners. The do pay taxes to the host state, but percentages are really low. Compare the conditions (horses, facilities) at tracks with casinos and those without. Little regard is given to the horsemen-there is no incentive besides bigger purses to lure horses and horsemen to the “racinos.” There is no element of prestige. It is a case of “be careful of what you wish for.”

  • http://www.facebook.com/people/Joseph-Rice/100000693874282 Joseph Rice

    Years ago, on the way to my night job, I would stop to get a sandwich at the convenience store, and was impatient with the line of people buying scratch tickets, but then came to realize that if we did not have them, it wasn’t like these customers were going to buy seats at the opera or put extra money in the college fund. They would simply find something equivalently foolish to dump that cash in.

    So while I don’t see the point to it, the horse is out of the barn as far as gambling/casinos, and we may as well have some semblance of regulation and planning. Of course, I have no doubt that our new “gaming commission” is now hard at work to make sure that regulations are custom tailored to Steve Wynn and Robert Kraft’s specifications. So much for “helping less economically developed areas of the commonwealth”.

    (Full disclosure: I used to buy Mass lottery tickets)

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  • bear

    I worked for a wisconsin casino for years and the wages were above average for the area

  • Markesq

    What a bunch of hypocrites.   This is all about morals and prejudices.

    If you don’t like to gamble, then don’t.   I enjoy playing poker, blackjack and craps on occasion.   But if you don’t want to do so, that’s your choice.   But don’t impose your morals and prejudices upon me.    

    I’m a vegan and I don’t patronize fast-food venues.   But if you want to do so, go right ahead — although I can’t imagine a rational person clogging their arteries with animal fat.

    I’m a Democrat and I never, ever vote for a Republican.   But if you want to do so, go right ahead — although I can’t imagine a rational person doing so.  
     

  • Heaviest Cat

    One issue not adressed inthis show was Gambling’s environmental impact. there was an important article in Mass. Audobon’s “Sanctuary Magazine” aabout 3 years ago on the threat to the aquifer serving 5 towns , as well as adjacent beautiful areas of “critical concern” thatserve as wildlife habitat had the Maspee Womapnoags chosen to build their large casino hotel complex in Middleborough ,MAss. And given their tribal staus they would have been beyond the reach of zoning and environmental laws if I understood correctly. So much then for preserving their “traditional ways”.

  • Heaviest Cat

    I ‘m further disappointed that there were no guests on this hour who outright opposed gambling while an out right advocatewas featured,including a guy who “beat the house”. So now “public” radio promotes gambling.

  • Pingback: Casinos: a bankrupt public policy | Get Government out of Gambling

  • Bin

    It’s insane to hear this “jobs jobs jobs” rush. Drug dealing and poppy growing create jobs too. We need not just jobs, but the RIGHT jobs. Get the real jobs back from abroad. Break the oligarchs. Otherwise, we will just become a nation of two-penny hustlers of “services” lorded over by a club of trillionaire financiers.

  • Slipstream

    I guess the Protestant values that our nation was built on are drifting back into the distant past.  What happened to the idea that making money from games of chance is an immoral activity?  Not immoral because there are “social costs” associated with it (e.g. gambling addicts losing all their family’s savings and the like), but immoral because gambling involves no useful work, creates no products that others can benefit from, and does nothing to improve the spirit of the gamblers?  If anything points out our own economic weakness and lack of vision for a better future, it is the spectacle of states falling over one another to build casinos to lure in chumps to throw their money away, and to try to use taxpayer dollars to do so.  

    Now having said all that, I am not opposed to some legal gambling – but only low level stuff.  There should be limits – very low limits – on how much someone can wager.  Then it really is a game, a game that is made more interesting with the addition of a little cash, and not something that can be construed as an “industry”, which one of the callers called it.  

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