Back in 1996, Congress was concerned about the explosive growth of legal gambling in the United States and so created the National Gambling Impact Study Commission. The commision was given $5 million and two years to conduct a thorough assessment of the attitudes, events and trends driving this explosive growth and of the social and economic effects it produced.
(Notice how that first paragraph does not contain even one of those awful gambling-oriented puns you’ve seen and heard so often in Maine news lately? You’re welcome.)
Anyway, the commission published its report in the spring of 1999. It is thorough, it assesses like all get-out, it’s pretty darn readable and it can be found, along with a similar Canadian study, online at www.casino-gambling-reports.com.
The nine-members included three from the gaming industry and three with rock-solid religious-conservative credentials. Still, the commission reached consensus on an amazing number of issues and unanimity on many. One example of the latter – especially relevant as Maine argues about the proposed Penobscot-Passamaquoddy casino venture – is this:
States (48 as of ’99) have embraced gambling in the most lustful way in the last couple of decades as a way to raise revenues without raising taxes, yet they have done so without any comprehensive plan as a guide and without any understanding of the impact the various forms of gambling have upon their citizens or their state’s economy. In the absence of fact and context, the commission found public debates are “infused with the drama of contests between great interests and sharpened by a visceral emotional intensity.” (Didn’t I say it was pretty darn readable?)
Maine is one of those 48. Despite its self-portrait as a wholesome place awash in bean suppers and other family values, Maine is a regular Dorian Gray, up to its depraved eyebrows in state-sanctioned gambling. Between the lottery, with its ever-expanding drawings and instant-lose propositions, and harness racing (live and off-track betting), Mainers fritter away more than $200 million year trying to be the exception to the rule.
Of that $200 million, more than two-thirds is blown on the lottery. Which brings up another point on which the commission was in unanimous agreement: Of all the forms of gambling a state can sanction, the lottery is the worst. The odds are awful, the ads are deceptive, it creates no jobs, it is a virtual government monopoly with no private-sector opportunities. The lottery is a solitary pursuit – no drinks, dinner and a show to complete the evening – it is a sin tax in which all the fun has been sucked out of sinning.
And, as a tax, said Dr. Philip Cook, a leading researcher working with the commission, “It’s astonishingly regressive. The tax that is built into the lottery is the most regressive tax we know.” That is, lotteries rely upon a small group of poor and poorly educated individuals for the bulk of ticket sales – nationally (38 states have lotteries), Dr. Cook found, lottery players with incomes below $10,000 spend more than any other income group, an estimated $597 per year. Twenty-three states have either commercial or tribal casinos or both.
While the impact of casinos, from luxurious mega-resorts to modest halls packed with slot machines, varies, the commission discovered some common traits. The popular image of casinos as cheek-to-jowl with mobsters and hookers is a thing of the past – they are perhaps the most highly regulated businesses going, their accounting is scrupulous, their record of preventing underage gambling is exemplary, their payoff to gamblers is the highest of all gambling venues, in excess of 90 percent. Many states require casinos to set aside a portion of proceeds to fund treatment programs for problem gamblers (estimated by the commission at 6 percent of the 125 million Americans adults who gamble at least once a year). Maine, even though its lottery games contribute some $40 million to the General Fund each year, has no state-funded program for this addiction.
Casinos, the commission found, do create jobs – given the size of the proposed Penobscot/Passamaquoddy casino resort, the tribes’ estimate of 4,000 jobs averaging $25,000 a year with benefits seems realistic. Casinos pay taxes – property, personal property, sales – everything but, as decreed by federal law for tribal casinos, corporate income taxes.
The commission also found that casinos can, if done right, help other businesses, such as restaurants, shops, hotels and entertainment attractions. (Atlantic City was cited as an example of doing it wrong – too many casinos in too small and constrained an area hurt other businesses.) The impact on the host community – traffic, noise, public-safety demands – can be mitigated and compensated for with advance planning. (The ongoing strife between Connecticut’s Foxwoods and the host town of Ledyard is an example of what happens without such planning. The lack of strife at the nearby Mohegan Sun was planned.) The report’s market analysis suggests the Penobscot/Passamaquoddy estimates that 88 percent of patrons of a Kittery casino will come from out of state, that Mainers will bet less than half of what they now bet on the lottery and that the state’s cut could be $100 million or more are accurate.
But of course the most salient point in the report is that Americans like to gamble. According to a survey commissioned by the Commission, 86 percent of us see nothing wrong with a little recreational betting; 68 percent do it guilt-free at least once a year.
So, unless somebody has a good idea on how to change human nature, here’s a suggestion for lawmakers. Dump the lottery and replace it with a casino. Trade the worst form of gambling going for something all the research shows is better. Swap the $40 million you now get from the lottery for the $100 million you’ll get from the casino and get some jobs and economic development to boot. Sounds like – no pun intended – a deal.
Bruce Kyle is the assistant editorial page editor for the Bangor Daily News.
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