New York State is Addicted

Despair

New York State is addicted to revenues from gambling.  This is not just a figure of speech. Below are hallmarks obvious in the state’s behavior over the 47 years since its Constitution was amended to allow a lottery with periodic drawings and paper tickets.  In November another amendment, to permit “up to seven” casinos, will be on the ballot statewide. Intervention is needed.

  • craving
  • upping the dose
  • seeking short-term rewards e.g. “aid to education” without an uptick in personal or business tax rates.
  • discounting adverse effects  Problem gambling in New York drains from society  more than 3.5 billion dollars a year in quantifiable socio-economic costs like judicial administration, lowered productivity, and abused dollars.  This amount excludes suicide, proceeds of crime and psychosocial harm to the dozen or so individuals who are betrayed by every problem gambler in “the chase.”  No state official ever acknowledges the size of this problem.  The econometrics are in Gambling in America (Cambridge University Press, 2004) by Earl L. Grinols, Distinguished Professor of Economics at Baylor.
  • denying long term liabilities (e.g. spectre of fiscal flop with saturation, need for bailout à la NJ or DE, future inroads by internet gambling)
  • scoffing at the diagnosis “There’s nothing wrong with me!”
  • dismissing prospects of recovery  
  • cheating (e.g. allowing as if they are video lottery terminals (VLTs) hybrid electronic table games with outcomes not under the control of Lottery’s central processing unit.  See New York Daily News May 5 and 12, 2013. Another more recent example: rewriting the text of the amendment   to be on November ballot to make it an advertisement for a yes vote and boosting the proposal from the sixth slot where it belongs by date of passage into the “number one” slot.
  • deceiving e.g. pretending  increased regional cash throughput is “economic development”  Another example: saying that government regulation of commercial casinos will prevent the creation and exploitation of problem gamblers. In fact, government wants tough regulation to protect itself from being cheated, not to end problem gambling.   Half of casino revenues flow from the 4% of adults who are problem gamblers.  The casino owners don’t want to stop mining this mother lode, nor would tax-collectors like a 50% drop in revenues to the state. Even the most credulous person will realize that “regulation” in this situation is  programmed to fall far short of stated intentions.
  • scheming and manipulating  item, conceding money due to the state, localities and private citizens to deflect Indian opposition to potential competitors; item, promising a piece of commercial casino revenues not to “education” nor to “local property tax relief” but to horse-breeding and tracks if legalized casinos “cannibalize” racino gambling
  • conniving “If a law is in your way, get rid of it.”
  • dealing in a desperate and dishonorable way to keep “the connection.”  The Upstate NY Gaming Economic Development Act of 2013 authorized additional video gaming establishments under Lottery if the casino amendment does not pass.  A spokesperson for the Governor (see Wall Street Journal June 15) offered ball-park figures: three to four “upstate” facilities with up to 5000 machines each.  This would more than double the state’s current battery.  The same bill enacted, regardless of the amendment’s outcome, additional VLT facilities “downstate.” Curious, for a bill denoted “Upstate.”

New York State is not addicted in the sense that its whole government is preoccupied each day with raising revenue from gambling. Nor is a large proportion of total revenue to the state from that source.  It’s less than 3%. That the state is a high-functioning addict still able to multi-task does not excuse its being addicted nor give assurance that its dependence will not get worse.

New York is not alone.  Many states and Canadian provinces are addicted too.  All show typical denial. Nowhere but in NY, however, do voters statewide have the chance in 2013 to call the addiction just that and say “Let’s start to ‘Recover New York.’”

Most people, even if they have never been in one, know what an intervention is, how it can launch recovery before catastrophe has struck.   New York needs an intervention now. Rejecting the proposed amendment at the General Election is a good start. Sad to say that’s all it can be.  The intervenors have no leverage here. The addict has a big stash locked in the garage and no intention of handing it over or entering treatment.

I personally regret NYS has the “casino referendum” because opponents may be outspent >1000 to 1 as is happening in Massachusetts and the public bamboozled.  Now that the Governor and his legislature have brought us the referendum, though, we can and must use it to confront our government, challenge it to lead recovery from gambling addiction the way it leads on recovery from natural disaster,

Photo image “Despair” from flickr creative commons 3503412461_815c19b748

Opinions in this piece are those of the writer, Stephen Shafer,  and do not necessarily reflect the views of any or all other members of CAGNY.  Permission to reproduce in whole or part is hereby granted as long as the permalink above is cited.

Fraud, Deceit and Corruption in the Gambling Industry

Real Economics of Gambling

             FRAUD, DECEIT AND CORRUPTION IN THE GAMBLING INDUSTRY

                            by Nelson Acquilano, LMSW, CASAC, CPP, MPA

     There has been more fraud, corruption and deceit with gambling than with any other social problem.  It is inherent is the nature of gambling and the extreme greed and money associated with gambling.  The OTB and several New York racetracks were notorious for their fraud and corruption, showing that gambling and ethical corporate practice are incompatible partners.

     Governor Cuomo prides himself on running an ethical government, yet the fraud, corruption and deceit with this gambling issue has been anything but ethical.

  • Common Cause reported in 2012 that since 2005 gambling interests had spent $47 million on lobbying ($40 M) and  donations to political campaigns ($7.1 M)  in NYS http://www.commoncause.org/site/apps/nlnet/content2.aspx?c=dkLNK1MQIwG&b=5287775&ct=12188661 These outlays  included $2M  to the Committee to Save New York (a short-lived business-backed group closely aligned with Gov. Cuomo); Andrew Cuomo received $715,000; Eliot Spitzer $594,000; David Paterson $204,000; $3.9 million went to the candidates and committees of the State Legislature; and to other State Senators and Assemblyman and candidates. 

 

  • The Seneca Nation soundly voted DOWN a Gambling Compact on May 11, 1994, when Members of the Seneca Nation of Indians rejected a proposal to get into high-stakes casino gambling in an advisory referendum.  The casino proposal was defeated by a vote of 714-444; the nation’s leaders brought it back again and imposed it as “the will of the people” and it later passed on May 15th, 2002 because of passivity – not because it was the will of the people. 

 

  • Racinos now term themselves “casinos,” against the law, to increase crowds and profits; downstate racinos have now put in electronic table games in which the outcome is not determined by the Lottery’s central computer in Schenectady.  This violates the definition of lottery implicit in the opinion of the court in Dalton v. Pataki 2005 .   Deceit or fraud? http://www.nydailynews.com/opinion/doubling-casinos-article-1.1340994

 

  • The gambling syndicate tells you that gamblers generated $5.4 billion in revenue in New York State in 2010, rather than telling you that New York residents and visitors LOST $5.4 billion that year.  They also do not tell you that much of that money was not “disposable income,” but monies taken and lost from family savings and family support, from child support, money borrowed against life insurance policies or college funds, monies lost from social security or welfare support, or monies embezzled from businesses and industry.

 

  • Spokespersons for “gaming” won’t tell you that as according to a 2006 NYS OASAS (Office of Alcoholism and Substance Abuse Services)  study,  there were already 668,000 problem gamblers in New York State; and that 10% of adolescents meet DSM-IV criteria for problem gambling; and another 10% of youth are at-risk of developing a gambling problem. 

 

  • Proponents of more casinos won’t tell you that adding  seven  new casinos to  New
    York State  could (depending on siting)  create up  to 82,000 new pathological gamblers (a 47% increase), and  202,000 new problem gamblers.  They also “neglect” to say that quantifiable socioeconomic costs  related  to  ONLY new gambling addicts and problem gamblers are more than double than the tax revenues due to the state from licensing up to seven new casinos and taxing them (at 20% overall) on the take from all users. http://cagnyinf.org/wp/new-casinos-equal-1000s-of-gambling-addicts/

 

  • Slot machines are illegal under the NYS Constitution, thus, soon after 2001 they were re-termed VLTs (Video Lottery Terminals) in the courts to get around the law !

 

 

  • The May – June 2013 arrangements  re tribal casinos and exclusivity zones are expedient, intended  to  head off  opposition by the operators of tribal casinos to the proposed constitutional amendment that would legalize non-tribal casinos.  The pact with  the Oneida Nation of Indians is going to litigation,   with the towns of Verona and Vernon as plaintiffs.     Days after the Oneida agreement, Gov. Cuomo’s administration  forgave  the Senecas $209 million dollars  that the State had previously held were due  it under a compact that the Seneca Nation of Indians viewed as having been violated when VLTs came to racetracks in western New York State.  

 

  •  The very fact that the casino amendment was rushed through on the last day of teh legislative seesion without either a Health Impact Study or a formal cost-benefit study is a deceitful practice!

     Permission is hereby given by Cagnyeditor to reproduce this post by Nelson Acquilano in whole or in part as long as the permalink above is cited.  Photomontage by Nelson Acquilano

 

 

 

 

 

 

 

 

 

 

Crapping Out in New York: For Education

IMG_2115

By Dave Colavito.  first published in Huffington Post July 12 

Whether NY voters consent to amend the state constitution to expand gambling is something that will likely be decided in November. What’s certain is “Gambling for Education” will remain a trusted brand for Governor Cuomo and his handlers. The problem is the subtext: Gambling is Good for the Kids — unlike adequate nutrition, adolescent problem gambling won’t help build strong bodies or healthy minds.

Most adults appreciate the invaluable service carnival barking provides in the service of Albany’s gambling policies — how else do you keep convincing losers they’ll win, so long as they keep losing? But when it comes to educating the kids, voters know the importance of leading by example. So before heading to the polls in November, it’s worth considering whether more of the Albany example is really in their best interest.

State-sponsored gambling is already here, as are other permitted activities. But a proposal for the state-sponsored expansion of say, cigarette smoking or sugary junk food in schools would be roundly rejected and hailed as a public policy victory. Why — not everyone eating such junk food becomes diabetic, and its marketing surely contributes to the state’s economy and creates jobs? The answer assuredly has to do with education. And though Albany is a partner in educating children, it’s a deeply conflicted partner by virtue of its promotion of gambling.

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NY Legislature has no power to authorize casinos

First US Constitutional Convention

First US Constitutional Convention

 

Memo from Cornelius Murray, Esq.    20 June 2013   sent earlier today to journalists interested in New York State government

Re Upstate New York Gaming Economic Development Act of 2013

 

Art I section 9 of the Constitution CURRENTLY states that, except for circumstances not pertinent here, no gambling shall be AUTHORIZED or allowed and the Legislature is mandated by the very same provision in the Constitution to “pass appropriate laws to prevent offenses against any of the provision of this section.”

Yet the bill that will most likely pass the Legislature tomorrow does exactly the opposite. It purports to authorize such gambling with an elaborate regulatory scheme.  To be sure, the last paragraph states that it will become effective only if and when the Constitutional Amendment passes.  But it hasn’t, and until it does, the current sitting Legislature can’t pass a bill to take effect in the future on the supposition that the Amendment will be approved by the voters in November.  Don’t get me wrong.  I’m fully cognizant of the fact that a Legislature can pass bills to take effect in the future and does so all the time.  But that occurs where the Legislature has the power to act on a given subject to begin with.  Here it has no such power.  The Legislature can get into the business of authorizing and regulating casino gambling only after the People authorize it to do so, which won’t/can’t happen – if at all—until November.  If and when it does, then the Legislature would have the power to act.  But it can’t put the proverbial cart before the horse.  The Legislature has no power to act to authorize gambling currently prohibited by the Constitution.  It is – at least I hope it is – axiomatic that a Legislature can only exercise such power as the People give it.

Imagine if you will that the Legislature in its infinite wisdom (don’t laugh too hard) decided that slavery ought to be reinstated and passed laws now to regulate it which would take effect in the future once the 13th Amendment to the US Constitution and the corresponding prohibition in our State Constitution were repealed.

Cornelius Murray, Esq.  was lead counsel for the plaintiffs in Dalton v. Pataki

http://www.governor.ny.gov/sites/default/files/documents/GPB-33-UPSTATE-MEMO.pdf is a 4-page outline of Program Bill 33.  The whole bill is more than 220 pages

The picture shows the first US Constitutional Convention, not a NYS one.  credit Robinphillips.blogspot.com

Invest in Recovery

 

Dusk on the Neversink 8745715895_222d9cfde0_mNeversink

Dusk on the Neversink
8745715895_222d9cfde0_mNeversink

 

 

 

 

 

 

Dave Colavito, at a CAGNY press conference in Albany on 4 June  2013,  presented this outline of a just scheme that would save NYS more than the hidden quantifiable socio-economic costs generated by legalized gambling each year.

  • The first step in helping local economies: Don’t make them worse.  Yet the Gov.’s plan will do just that, because it ignores the financial cost of gambling disorders.
  • Socioeconomic costs of gambling in NYS are now estimated at $3.7 billion annually
    • Exceeds revenues from all Atlantic City casinos in 2012
    • 381,000 Problem and 172,500 Pathological gambler costs burden all NYers
    • Gov.’s plan will produce more people (and costs) with gambling disorders.
    • FISCALLY RESPONSIBLE ALTERNATIVE: NYS INVESTS in RECOVERY, not CASINOS
      • Stop Denying the Problem
      • State share of tribal casino proceeds isn’t restricted for education
        • § Dedicate $600 million escrow & future proceeds: Recovery, Prevention
  • Fund Professional Training, Staffing, and Siting to Address the Need
  • Fund Aggressive Marketing Campaign: Promote Addiction Prevention & Recovery

SOCIAL Implications

 Gov. Cuomo Claims NYS is the Progressive Capital of the Nation

 FIVE CONSIDERATIONS:

 1. NYers afflicted with a disorder (Problem & Pathological gamblers) classified by the American Psychiatric Association exhibit measurably different brain function than the general population.

2. Predatory Gambling incites  those differences in brain function  

3. Symptoms of those afflicted worsen uncontrollably when re-exposed to Predatory Gambling   

4.Vendors of Predatory Gambling derive  50% of their revenue from  these afflicted persons and from those who trust(ed)  them and lost their resources too.

5. NYS actively promotes predatory gambling via Lottery including video lottery terminals and electronic table games; Gov. Cuomo now wants to increase that promotion with added full-blown casinos.

New Yorkers could almost zero out the hidden costs of gambling if the State invested to guide all problem gamblers (and their families and friends) to become again the people they  were before the first bet.  This would save money and save lives, not take away money and take away lives.

The opinions expressed in this post are those of the author, Dave Colavito, and do not necessarily represent the opinion of any or all other members of CAGNY.  Permission is granted to reproduce and distribute in whole or in part as long as the above permalink is cited.

Assets for Sale

Peering over the Edge Flickr CC

Peering over the Edge
Flickr CC

Governor Cuomo  spoke in his press conference on May 9, 2013 (at  minute 46:16)   about setting tax rates on the new casinos he wants to see and the competition he expects among bidders.  He continued  “I think we have an asset to sell.”

He did not say what the asset is. It must be something big casino companies want. 

Greek yogurt production capability?

Deep shale natural gas?

Apple production capability?

Olympic-quality winter sports settings?

Maple sugar production capability?

Nanotechnology infrastructure?

 None of the above.

What else could that asset be other than a population to be trawled for customers?    New York’s people are on the block.

Casinos depend for half their “gross gaming revenue” on the small minority of their customers who are pathological or problem gamblers.*  These categories make up a very small fraction (about 4%) of the adult population.  To reward owners richly,  the casinos must maintain this small sector AND  replace each person in it as he or she recovers, dies, goes to prison, gets deathly ill or moves out of range.  The asset that’s really up for grabs, the mother lode, is current and future pathological and problem gamblers

Yet this is not all that’s for sale.   Each of these gambling addicts or problem gamblers has hidden assets that can be tapped through him or her.  Those are the fiscal and emotional resources of many non-gamblers who enable the addiction while the gambler betrays their love or trust .

The casino companies don’t just buy the opportunity to capture or create compulsive gamblers,  They buy a network of pipelines through each one of those afflicted gamblers to drain six, eight or a dozen other people.   Lesieur* put the number at  seventeen.

This is the asset for sale.  What are we bid?

 Grinols, Earl L. and  J.D. Omorow.  J Law and Commerce (1996-97) 16: 49-87

Lesieur, Henry   The Chase, 1976

The above text was distributed by hand to the offices of all legislators on June 4 and read at a press conference held by CAGNY that morning in the legislative office building.  It does not necessarily represent  the opinion of all CAGNY members.  Permission is granted by the author, Stephen Q. Shafer, to reproduce in whole or in part as long as the permalink above is cited.

The Albany Gambling Diet

albanydiet  The Albany Gambling Diet

Thoughts on Healthier Eating

by

David Colavito

 

 

 

     When you consider how injurious the socioeconomic consequences of state-sponsored gambling are, compared to its benefits, you have to ask why Governor Cuomo is promoting the expansion of casino gambling, let alone as economic development.  Sure, “gambling is already here” and “New York needs jobs” – neither is in dispute.  And used as they are to promote the Governor’s plan, they’re certainly appealing.  That’s the sweet side of half-truths many of us prefer to our vegetables.  But if Albany isn’t serving a balanced meal, it’s in our interests to understand why.  I’m suggesting it’s a failure of imagination. 

    The thesis has been with me for some time and came into sharper focus recently while reading False Idyll, an essay by J.B. MacKinnon.  Dealing with an unrelated topic, MacKinnon’s words struck me as eerily apropos to the social injustice inherent to the casino economy – “…  the way you see the world determines much about the world you are willing to live in …“ 

    And because I choose to be generous in spirit, I choose to believe Governor Cuomo’s promotion of the casino economy is rooted more in how he sees the world rather than in the belief he can make it better.  It’s an unfortunate conclusion, considering what life would still be like if others before him had constrained their own imaginations when confronted with the same choice on important public policy matters: emancipation and suffrage to name just two.

    And though you might argue Mr. Cuomo’s recent policy commitments to gun control and gay marriage render my thesis flawed, I’d respond by saying perhaps you’re correct, but unlike for example integration in the south, I don’t think either would have occurred without strong political winds blowing at Mr. Cuomo’s back.  Regardless, what really matters is the facts of the casino economy, their implications for social injustice, and Mr. Cuomo’s refusal to acknowledge either in his pursuit to fill state coffers.  All of which is also to say, his fixation on the gambling economy is apt subject material for an as-yet conceived book to be titled after MacKinnon’s essay.

    So, what might we imagine if enough people in Albany saw the world more through the lens of what it could be rather than the way it is?   Given that the majority of casino gambling revenue dollars come from the minority of gamblers with serious gambling disorders, would lawmakers continue to endorse expanding that predatory business model to increase state revenues?  And given the well-established relationship that increased opportunity to gamble produces more people with serious gambling disorders, would they continue promoting state policies that cultivate making people sick to balance budgets?  Or, might they instead work to formulate policies that mitigate the interstate impacts of gambling so often used to conscript state residents in a race-to-the-bottom casino economy?  I think we know what they’d choose.  And there’s also recent precedence for pursing equally important objectives.  Consider, for example, NYC Mayor Michael Bloomberg.  Regardless of where you come down on the 2nd amendment debate, Mayor Bloomberg doesn’t just believe in the need for federal gun policies that don’t undermine those of states; he’s a fierce advocate for them in Washington.

    Still shooting for the stars you say?  How about then just punting for the moon?  Albany could acknowledge a false premise it uses to pursue expanding the failed policy of state-sponsored gambling, though I suspect it isn’t spoken aloud there often.  It’s the keystone for the arch of my thesis – “we’re desperate; what else can we do if we don’t promote gambling?”

    The answer is, plenty. 

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“Job Creation” by Casinos not a Net Boon

“ JOB  CREATION ”  BY CASINOS  MAY NOT BE A  BOON  FOR THE COMMUNITY

"School Buses in the Fall"   found on  flickr  commons

Building a new casino complex opens job lines in the locality.  This is often trumpeted  as “job creation.”  Job creation is widely desired at a national level.  On a local or regional level, however, it may be more job substitution.  Persons newly hired at the casino complex will often have quit another job nearby for what they hope will be better conditions.  In a rural area a new casino complex will abruptly have hundreds more openings than there are ready able and willing workers in the community.  It will have to import staff, many of whom have left their jobs elsewhere.   The check list below refers to a medium-sized non-tribal casino complex in a mostly rural area.  Opening and filling job titles novel to  a community is not necessarily  True job creation, widely desired at a national level,   is not necessarily a net benefit to the community or county .

YES MAYBE N0
Construction jobs building  casino complex   ●
New construction or renovation outside casino complex    ●
Local skilled unionized work force enough for construction
Non-resident skilled workers needed for construction  ●
Most new job lines can be filled by local unemployed
Most new lines can be filled by local people who switch jobs
Some local workers will switch job to casino complex  ●
All casino job lines can be filled by local residents
Interest in hiring disabled persons  ●
sales local gas stations  ●
sales local stores and restaurants  ●
Net in total property tax roll due to devalued businesses    ●
Casino employees in rental housing will pay school taxes  ●
Casino will pay  school taxes
School  budget  overall  definitely bettered by casino  ●
Existing stock of rental housing for casino employees good    ●
 County-wide unemployment definitely decreasedOpinions in this piece are those of the writer, Stephen Q. Shafer MD, MA,MPH and are not necessarily shared by any or all members of CAGNY.  Photo of schoolbuses in the fall from flickr commons 5111493374_ca620e7837schoolbuses  ●

   ●

Five Arguments against Legalizing Casinos in NY

 

The Great Seal of the Sate of New York

The Great Seal of the State of New York

Five current arguments about legalizing non-tribal casinos in New York State in the light of the keystone estimate for casino revenues shown in bold below. 

52% of revenues at the average casino are from problem or pathological gamblers. (Grinols and Omorow 16  J. Law and Commerce 1996-97 p. 59)  Together, these types of gamblers are 4% of adults,  about 7%  of casino  clients.

 PRO: Would send new revenue to Albany without raising tax rates.

CON: Half that revenue would have been diverted, to their lasting harm,   from the families and associates of addicted and problem gamblers, or would be proceeds of outright crime. 

CON: If quantifiable social costs are considered,  raising $1  via tax on casinos costs the private  sector twice what it costs to gain that $1 by a step-up  in a conventional tax rate.  (*Grinols pp. 180-181)

 PRO: All or nearly all that revenue would be dedicated to “education.”

CON: Simply allows $$ that would have gone to education to be spent elsewhere in state budget. 

CON: Creates a pretext for annual increases. Who’s against “more money for education?”

 PRO: Would be regulated to cut out underworld and instructed to “prevent problem gambling.”

CON: See keystone estimate.  Casinos get 50 % of revenues from < 7 % of clients.  Steering those clients into lasting recovery and halting their replacement would ↓↓ high profit margins.  What for-profit business wants to cooperate in drying up the 7% of customers that leave half its take ?   No business.

CON: Promoting “responsible gaming” is a sham.   Seriously-affected gamblers seldom benefit by government-sponsored treatment programs until terrible damage has come to them and those close to them.  

 PRO: “Creates jobs.”

CON: May hurt other businesses by taking workers from them (“cannibalization” ).

CON: Importing workers can burden host community (housing stock, schools).

 PRO: “Economic development”

CON:  Increased local cash throughput  (does not equal)  economic development.

CON:  Local property taxes promised by casinos economic development.

Then what is economic development ?  “The creation of greater value by society from its available resources”  (*Grinols p. 57) 

*footnotes refer to Gambling in America: Costs and Benefits by Earl L. Grinols (Cambridge University  Press, 2004). Earl Grinols is Distinguished Professor of Economics at Baylor University.

 The opinions in this piece are those of the author, Stephen Q. Shafer MD MPH and are not  necessarily shared by any or all members of CAGNY.  Permission is hereby granted to quote from this piece at any length if the source is cited using the permalink.

 

The Central Statistic of Casino Profits

The_Goose_That_Laid_the_Golden_Eggs_-_Project_Gutenberg_etext_19994.jpg  from Wiki

The_Goose_That_Laid_the_Golden_Eggs_-_Project_Gutenberg_etext_19994.jpg from Wiki

When Governor Cuomo in 2012  proposed  new commercial casinos he said they would need regulation.  Casino promoters can’t dismiss the concept,  which  has several aims.  One specific to casinos is to mitigate gambling addiction and problem gambling.*  Promoters don’t deny these  can be outcomes of   “gaming.”  Another goal of regulation, applied also to the banking or securities industries, is to protect investors and tax-collecting entities against in-house predatory practices, organized crime and tax dodges.

Casino owners want regulation of how they handle consumers and accounting about as much as do big banks or brokerages: the least possible.   In any business, regulation hurts profits by constraining practices (say, payday loans) and limiting externalities.  For example, a company no longer free to discharge waste into a waterway faces new costs; raising prices may lose it business if competitors don’t raise theirs too.   Casinos are uniquely  intent on profit for its own sake. For them, that’s the be-all and the end-all.   Typical  industries, even those as controversial as “Big Pharma” or “Big Oil” make a product of real use to someone.  The casino business has only one tangible product,  in which it cannot take pride:  addicted and problem gamblers.  That product fuels it.

The central  statistic  of  casinos:  a  large proportion  (Grinols and Omorow** estimated 35-50%)  of  the  gross returns after winnings are paid out comes from compulsive and  problem gamblers — about 4% of the adult population — who comprise maybe 12.5%  of casino users.  Most of that 35-50% is from addicted gamblers.   From this statistic comes

The central dilemma :  if  casino owners  acted effectively to steer  into lasting recovery all pathological and problem gamblers in their sphere and  to prevent the creation of new ones,  profits would  drop by at least 35%.  How would that play on the bottom line?  Not well at all.

Resolution: publicly express concern on problem gambling but make it go on  under a façade of “prevention”  methods structured to fail.   Accede to customized and toothless “regulation” that won’t interfere with the real business.

Recall the goose that laid the golden eggs.  Casinos do not lay the golden eggs their promoters claim; they are gilded base metal.  Whether the bird’s owner knows this or not,  whether  he stores or markets the eggs,  the owner (assuming  he has more common sense than the yokel in the story, who killed it) will cosset the bird.  He won’t let  anyone  change her diet or re-house her.  To an owner eager for  eggs that look golden, regulation threatens the health of  the goose,  jeopardizing  her output.

Legislators weighing the proposed amendment in New York State to legalize new casinos must ask three questions. “Would those casinos knock themselves out  to profit 35%-50% less than many others do?” That’s obvious: No

“Do I really believe NYS can and will properly regulate casinos if they don’t want it?”    Someone very credulous might say so.  No one else will.

“Is it fair to NYS residents to commend to them, by an “Aye” on second passage,  a sham I don’t believe in.”  The response to that should be a third NO.

*These two categories of  “disordered gambling behavior”  are distinct.  About 1% of North American adults are past-year pathological (addicted)  gamblers, another 3% or so past-year problem gamblers. Sometimes for brevity (not clarity) the two categories are lumped into “Problem Gambling.”

** Grinols, Earl L. and J.D. Omorow (1997) “Development or Dreamfield Delusions? Assessing Casino Gambling’s Costs and Benefits.”   Journal of Law and Commerce 16, 1, 49-87.

The opinions are those of the writer, Stephen Q. Shafer and do not necessarily reflect those of all members of Coalition Against Gambling in New York.  Permission is granted to quote from this post at any length or to reproduce the entire post as long as the source is cited using the permalink above.

 

 

 

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