The central statistic of casino finances is that 50% of taxable revenue comes from pathological and problem gamblers, about 4% of adults. One evil of casino gambling is that almost none of the money that these unfortunate persons leave at casinos belongs clearly to them alone unless they have recently, and legally, become very rich, without dependents. Thus 50% of pre-tax revenue, more than 50% of profit, has been diverted from persons who may never have gambled, innocent bystanders or co-dependents. Spouses, children, siblings, parents, employers, employees, clients – these are just a few examples. The typical gambling addict is into eight, twelve, fifteen other people whom he or she will serially sacrifice to “the chase,” usually until it has consumed the gambler and destroyed all good social and emotional relationships.
Most residents of the U.S. can recite that gambling addiction is a true addiction. Secretly, however, many believe it is a moral failing or a defect in reasoning that deserves catastrophe. They rationalize that, if everyone can avoid a small increase in personal tax outlays by the exenterating exploitation of the 4% who are problem gamblers, that’s a win for the other 96%. This “devil take the hindmost” approach may look utilitarian. It does not take account of the dozen or more people around each problem gambler who are wrung out fiscally and emotionally in the quest for “more revenue to education.” See the April 15 post “Robbing Peter” on this web site.
To comprehend the total misery dealt out by predatory gambling to a specified group of individuals would need much study. Consensus would be unlikely. Economists like Earl Grinols have painstakingly presented harm in terms of dollars. While we respect this completely for cost-benefit analysis, we have always noted that it understates the total impact, which is a stew of fiscal loss and emotional hurt. Quantifying in an entire population the cumulative lifetime misery associated with problem gambling so as to reach consensus is impossible. There are two aspects, however, that everyone can agree on qualitatively. First, the problem gambler alone does not sustain or mete out all the damage; second, not all the damage can be measured econometrically.
The graphic above, realized by Dave Colavito, is an abstraction, not data-based. It shows that the high casino profits due to problem gamblers, which are taxed into “revenues to education” via gambling “regulated” or operated by state government come at the expense — literal and figurative — of many more parties than those individual gamblers. The “iceberg” (actually it looks more like a volcano rising above the waves from the ocean floor ) schematizes lifetime gambling-related cumulative misery as a function of psychosocial closeness to a problem gambler. The problem gambler is the red apex. The strata of adjoining locations represent lifetime cumulative misery of other parties at varying psychosocial distances from the problem gambler. The anguish of a wife who has seen the furniture sold, the children made homeless and the husband she still tries to love gone or jailed will be more than that of a client cheated or a friend whose loan to “help pay my kid’s doctor bill” is never repaid. There are, however, more clients and friends around a problem gambler than spouses. Integrated over all these more distant persons, the totality of hurt and loss is likely to exceed that of the very nearest and dearest.
However we define misery –as pure fiscal deprivation or that plus emotional damage — it is not “just” the problem gambler who loses something lifelong in the havoc of out-of-control gambling. It is a dozen or more other people, whether innocent, trusting, co-dependent or any combination. To the casinos that prey on problem gamblers and governments that get income therefrom, these people are chopped liver.
Three references about impact on families http://s3.amazonaws.com/publicationslist.org/data/philip.darbyshire/ref-36/JGS%20gambling%20paper.pdf
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