Albany and Art of Deception

Albany and Art of Deception: From the Land Where No Means Yes

by David Colavito

"Peering over the edge" Flickr CC

“Peering over the edge” Flickr CC

Question:  When can state government promote responsible policies without leveling with voters?

Answer:  It can’t.

Question:  Has Governor Cuomo leveled with New Yorkers about his proposal to amend the state constitution to permit casino gaming?

Answer: No

Beyond special interests and hidden agendas, it’s simple.  Public policy initiatives designed to mislead the public aren’t responsible, and when they’re promoted, hang on to your wallet, because you can be sure that same public will eventually be picking up the tab.

In his 2012 state of the state address, Governor Cuomo rolled out his economic development plan that featured, among other things, his proposal to amend the New York State constitution to permit casino gaming.  He implied that those who question whether we should be in the gaming business are the equivalent of delusional because, as he put it, New York is already in the gaming business.  He referred to horse racing and video lottery terminal locations throughout the state as bedrock justification for his assertion.  He waxed, perhaps not eloquently, about the benefits casino gaming would bring to the Empire state.  And he cited, as common-sense, the need to rethink how our state manages gaming, if it’s to stem losses of potential revenue flowing like water out of New York into neighboring casino-permissive states in what might be thought of as a casino siphon.  The Governor came as close to saying as one could without actually saying it: New Yorkers are fools if they don’t get with his program to legalize casino gaming in the Empire State.

And so it was that Mr. Cuomo chose to bury the lead, raising the same tired red flags proponents of similar proposals hope go unnoticed.  It was deeply disappointing for people who took seriously the commitments to transparency and disclosure he’d laid claim to throughout much of his political career.

 Casino gaming is fiction, because casino gambling isn’t a game.  It’s the antithesis of a game, because games aren’t reliant upon participants incurring personal and economic hardships, an immutable aspect of betting against the house.  Medical and law enforcement professionals have long acknowledged that gambling disorders are real and incur substantial costs for society, just as substance abuse and tobacco related diseases do, though you’d never know it from Mr. Cuomo.  And although federal and state governments have for decades derived substantial revenue through taxation on tobacco and alcohol products, they aren’t in the business of promoting either.  But this isn’t about ideological purity; it’s about Mr. Cuomo playing it straight with New York voters, the same ones he needs to ratify changes to the state constitution in order to have his way.  So it’s also about what paths he’ll travel to get his way.

Casino gambling epitomizes wagering against the house, where the house’s odds of winning ensure everyone else must eventually lose, and as every casino owner knows, that’s a very different paradigm than Saturday night card games among friends.   All this isn’t to suggest everyone entering a casino becomes addicted to gambling, anymore than it’s to suggest everyone consuming alcohol becomes an alcoholic.  What it’s saying and not just suggesting is trained professionals tell us gambling disorders are real, and they come with hefty costs to our communities that can greatly exceed benefits.  And if this was intended to be a scholarly work it would also cite documentation of the disproportionately high level of casino revenues obtained from people with serious gambling disorders, sick people in need of help not exploitation from state government.  It’s a predatory business model, because in a variety of ways it arguably cultivates those disorders to facilitate preying upon those so afflicted.  Sound familiar?  It should, at least for those of sufficient age to recall the earlier days of lawsuits against cigarette manufacturers, but with one important twist: the government was party to some of those smoking related lawsuits.   

So appreciating the first red flag raised by the governor is to appreciate gaming for what it is, his euphemism of choice intended to inoculate voters against making an informed decision.

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What We Didn’t See Is What We Got

                                          What We Didn’t See Is What We Got

 

8410159320_9203082701I recently posted on  how the NYS Lottery has made itself a role in balancing the State budget. The role is supporter of “education.”   The Governor thinks a like role will make acceptable to the voters the  new casinos he wants as one of his legacies to the State.  Voters know more about the downside of casinos in 2013 than we did about the future of State Lottery in 1966.  That makes for a harder sell. The magic words “for education” could still charm it through.  This 700-word essay has two parts:  (1) a history of  amendments in Article I § 9  starting with the one in 1966 that launched NYS Lottery (2) figures on  NYSL  as of  FY 2012.

             Between 1967 and 1993 there were 485 bills introduced to the legislature to amend Article I, an average of 18/year.  This made Article I one of the most targeted articles. Almost half the proposed changes were to do with gambling, which is in §9 but is not the entirety of that section.   Only two proposals in those 18 years to amend Article I passed both chambers in two legislatures.   Both concerned “charitable” gambling; both were approved by referendum.  In that same era, a total of 61 (1.4%) proposed amendments on all topics passed both chambers in two successively-elected legislatures .  Forty-one (67%) of these 61 passed in a referendum.  

Benjamin and Cusa* mention a total of six amendments to Section 9 between 1939 and 2001.  I reviewed those between 1966 and 2001 in McKinney’s.

1939 pari-mutuel (OTB legalized 1970)

1957 charitable gambling with many restrictions

  • 1966 State Lottery “implementing language” followed
  • 1975 amendment of wording on charitable gambling
  • 1984 further rewrites about wording on charitable gambling
  • 2001 small change in § 9 “fireman” to” firefighter.”  Many such small changes throughout entire Constitution, most of which were to replace gender specifying pronouns or titles.

 

*An excellent article on the amendment process for the years 1967-1993 is by Gerald Benjamin and Melissa Cusa  “Amending the New York State Constitution Through  the Legislature” pp 55-73 at the following web site:

http://www.rockinst.org/pdf/government_reform/1994-nys_constitution_a_briefing_book.pdf    

         As of now, the NYS Lottery operates about 13,000 virtual slot machines at nine racinos (Hamburg, Aqueduct, Monticello, Saratoga, Yonkers, Finger Lakes, Vernon Downs, Batavia and Tioga).  Chapter 383 of the Laws of October 2001 allowed the State Lottery to join with Mega Millions (2002).  In 2010 Powerball, another multistate lottery with stupendous prizes, was allowed.  Both these events have very frequent drawings, not daily, with the jackpot rising when there is no winner yet.  Two  other Jackpot “Games” wholly under State Lottery are Lotto (draws not daily, prize rises until winner known) and Sweet Million (draws not daily,  fixed prize $1M). There are four Daily “games”  Take 5, Numbers, Win 4 and Pick 10.  There are at least 8000 Quick Draw settings, with a result every 4 minutes,  23.5 hours a day.  There are scratchoff   instant games for bets ranging from one dollar to thirty dollars.  Here are the returns for FY 2012 (thru March 31) for each category. Column 2 and 3 in $millions.

Category                                Intake               “To Education”          % “To Education”

Jackpot 923 395   43
Daily 2010 808   40
Instant 3579 816   23
Social (Quick Draw) 502 156   31
“Casinos” (Video Gaming) 1426 696   48

 

      The first four rows, inexplicably referred to as  “Traditional,”  returned to the Lottery 7.01 billion   before prize payouts.   Most of the return went to prizes.  “To Education” went 2.10 billion, or 31% .  The racinos (AKA “Video Gaming Casinos”) saw a total amount bet of 19.48 billion, with a net of  1.426 billion after payouts to  bettors.   “To Education”   went 696 million (48%). Because these establishments must by law contribute to horse racing and to the support of the privately-owned tracks at which they are situated,  slightly less than half their net passed “to Education.”   In summary, Lottery as a whole sent “to Education” 2.89 billion in FY 2012.  This figure will likely be more in FY 2013, with Aqueduct’s share up and that of Yonkers,  down.

 http://nylottery.ny.gov/wps/wcm/connect/2aaf628044bec0b08c5d8c3b1ada7a32/YearEndReport12.pdf?MOD=AJPERES&Annual%20Report

Opinions are my own, do not necessarily relect those of other members of CAGNY.   Photo from flickrCC “scratchoff cards”

“Lottery for Education” Steals a Good Name

6007594833_b6983433f0rockhorse photo FlickrCC 6007594833_b6893433f0rockhorse.jpg 

The New York State Lottery generates revenue to government outside the tax stream that goes directly “to education.”  This special fund, however, is not as most people thought in 1966 it would be, to enhance “education” above subsistence level.  It’s more like a reserve called  every year.  Used thus, it frees for  other expense sectors (e.g. pensions, welfare) money from taxes put into the General Fund that would have gone to “education.”  This can be called “total budget fungibility.”   

Compare government-sponsored lottery to the unpopular revenue-booster  of  increase in conventional taxes:  it looks to the average tax-payer like finding money in the street.  It is not.  It is socially unjust in taking money disproportionately from the less affluent.   It is two or three-fold  more expensive when hidden quantifiable socioeconomic costs are factored in.  Big-time predatory gambling like NYSL also leaves in its path untold harm that cannot be quantified, including family breakup and suicide.   In 2013 we face the spectre that newly-legalized casinos will be hailed, like Lottery, as benefactors to “education” and therefore to NY residents.   They would  be wolves in sheep’s clothing.   Continue reading

Letter to Legislators about Proposed Amendment

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The letter below was written to be distributed to all NYS legislators on the morning before the Governor’s State of the State Message.  The three casinos “upstate”  he projected in the SOSM   we can see would create fewer gambling addicts than (say) five in the Metropolitan area.  This “phase I ” scenario, however, does not rule out a second phase with  four casinos south of “upstate.”   to compete with casinos in neighboring states.  Nothing is off the table.  The Governor’s discussion of the amendment  was a trial balloon..  The amendment is a terrible idea, but if it is to go  to referendum the Governor and his appointees should not be calling the shots.

 Dear Legislator:                                                                                                          

Even if new to the Legislature, you don’t need an alert or reminder to know that soon you will consider in committee or on the floor “second passage” of S06734.  Enacted on March 14, 2012, this was a proposal to amend Article 1, Sec. 9 of the NYS Constitution to allow “no more than seven” casinos to be built “as prescribed by the Legislature.”  If a like bill is passed by both chambers in 2013, the proposal to amend will be put to public referendum.

 Coalition Against Gambling in New York (CAGNY) believes this amendment would create tens of thousands of new addicted gamblers and problem gamblers.  The figures for this forecast can be seen and downloaded at    http://tinyurl.com/aas2tew The harm to each person so affected would be multiplied by eight or ten times as family, friends, and associates are inextricably caught up in the misery…. or have to flee it!

CAGNY observes  that the Governor, who urged this amendment early in 2012, has ignored the collateral damage from “recapturing,” by new in-state casinos, gamblers who have been going out of state.  In not acknowledging  this collateral damage, he says in effect that thousands of NYS residents are expendable.  Do you believe that too?

You will hear over and over that “the State needs the money.”  CAGNY does not deny that the State needs money.  We don’t deny, either,  that governments at times  lay out money putting  lives at risk—soldiers and first responders, for example.  We do hold that government should never plan a revenue-raising strategy that exploits illness and misery in its people !  Government  should never on purpose enable life-threatening addictions!

 We don’t know when the vote will be.  In the days to come, however, we will return to your door often with more handbills that show why a “no” on second passage is a vote for truly good government.  We’ll try to meet with you in person. We welcome your questions and your requests for detailed background.  Feel free to call 917-453-7371 or e-mail our Chairperson at sqs@columbia.edu.

Gov. Cuomo tips his hand on amendment for casinos

flickr-3882328030-original Venetian

Gov. Cuomo tipped his hand a little in SOS yesterday.  He  wants for now (1) no new casinos in NYC (2) three  “upstate,” another four in future (3) locations and scale to be decided by a Gam[bl]ing Commission he will appoint.  I thought the first-passage bill in 2012 said “as prescribed by the legislature,” which seems cut out of the deal.  If the amendment proposal goes to referendum, how much devil will be in the details?

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States Playing “Race to the Bottom” with Casinos

Image Source: (Syracuse Journal, September 18, 1891) “A romanticized cutaway sketch of an early Erie Canal packet boat.”http://stagecoachdays.blogspot.com/

That the amendment proposed to the NYS Constitution for 2013 would greatly increase the occurrence of problem gambling and gambling addiction in New York is a strong argument against its utility.  Another is that it would if passed set neighborhoods and other community levels against each other in hostile and envious competion  where everyone loses in the end.  This can be framed as a Prisoner’s Dilemma, a staple in game theory.

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Opposing the amendment is not “prohibitionist.” It is protective.

New_York_City

Photo by Alain Maury,  found through Creative Commons

 

 

 

 

On  January 2,  2013 I told a friend about the petition started recently by A.K. France,  Vice-Chairperson of Coalition Against Gambling in New York (CAGNY), against the proposed constitutional amendment that would  allow < 8 new commercial casinos in NYS.   I sent the link by http://tinyurl.com/cj2v5bj.  It was disappointing to get the following response by e-mail:

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