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* The setup…
With unemployment in Illinois now at 9.1 percent and the state facing an estimated $12.4 billion budget deficit, the easiest way to fix the Illinois’ economy is to ban gambling statewide, a University of Illinois professor told state lawmakers Tuesday.
“If you’re dumping money into these slot machines, you’re not spending money on cars, refrigerators, computers, education. In studies, it shows that around these slot machine areas we have people spending even 10 percent less on food,” said John Warren Kindt, a professor of business and public policy at the Urbana-Champaign campus.
A gambling ban would lead people to spend more money on consumer goods and services, which would lead to the creation of more jobs supplying those goods and services, which would lead to still more spending by the people with the new jobs, Kindt said.
“The lost consumer spending is enormous. The lost sales tax revenue - enormous. We’re losing. And when you start losing the economy, you want to go back to basics, you don’t want to keep going down the wrong path,” Kindt said.
* The Question: Does this argument have merit? If it does, then should Illinois ban gaming? If not, why? Explain fully.
posted by Rich Miller
Wednesday, Apr 22, 09 @ 7:27 am
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It real difficult to know what the economic affects of banning gambling.But,remember those casinos provide jobs.Anyway,with gambling next store in Indiana,Wisconsin,and Missouri: people will get their gambling fix somewhere else while they smoke!The lottery is gambling,one wonders if that is supposed to be banned also.Illinois is a bad place to do business,there’s much better places to operate.Illinois politicians don’t care because they have a coalition of voters who don’t really care.
Comment by Steve Wednesday, Apr 22, 09 @ 7:36 am
I would agree that the lion’s share of the money that the casino’s lift out of people’s wallets in Illinois go to the casinos themselves. The gambling boats/casinos try to candy-coat the loot that they take out of the state by saying that they create jobs (which they do) but it is tantamount to “two steps forward and 5 steps back” each time we try to move. I also like the idea of banning the gambling casinos in Illinois based on moral and compassionate reasons (not religious ones). But, the reality is that unless you can get the states surrounding Illinois to also agree to ban gambling casinos, people from Illinois will just drive over to Indiana and Iowa to give them their money to lower their state and local taxes instead. People go outside Cook County to buy large ticket items to avoid Cook County sales tax. It is just common sense to do so. Pandora was let out of the box too long ago to put her back into it again.
Comment by Beowulf Wednesday, Apr 22, 09 @ 7:49 am
Wow. This is scholarship? Some unsupported assumptions and leaps of logic here.
No, it has no merit. You can gamble online, you can gamble in neighboring states, you can gamble illegally. Or, if you’re like the great majority of people in the state, you don’t gamble at all.
Comment by wordslinger Wednesday, Apr 22, 09 @ 7:54 am
“If you’re dumping money into these slot machines, you’re not spending money on cars, refrigerators, computers, education. In studies, it shows that around these slot machine areas we have people spending even 10 percent les
s on food,”
Maybe this guy’s idea works on paper, but I really can’t see it working in the real world. I’d personally like to hear the demographics of who’s going to casinos and see if they’re actually from “slot machine areas which spend 10% less on food” and whether or not they’re the types of people who spend money on cars, refrigerators, computers, and education.
Comment by dan l Wednesday, Apr 22, 09 @ 7:58 am
Something about this theory smells wrong. My cop gene never seems to fail:
http://www.casinowatch.org/index.html
I smell wingnut.
Comment by dan l Wednesday, Apr 22, 09 @ 8:01 am
There is truth to what he says, but the state would never ban gambling.
However this should also be considered among the many reasons to avoid any future expansion of gambling.
Comment by Plutocrat03 Wednesday, Apr 22, 09 @ 8:19 am
All that would happen is even more of our money would head over the border or into that little coffee shop in your neighborhood with 3 poker machines, ect.
This goofy state of Illinois which isn’t afraid to steal taxes through corruption with the best of them somehow finds morals when it comes to casino gambling.
No smoking, no border casinos, a plan for a O’Hare casino 15 years too late, no Chicago casino. I think our politicians are only happy when they are stealing state residents taxes instead of trying to get our neighbors and tourists dollars.
Comment by Phineas J. Whoopee Wednesday, Apr 22, 09 @ 8:24 am
People are still going to gamble even if the state bans it. The state bans driver licenses but those people still drive. On top of that think about the job loss and the lack of revenue the state will lose. People need to be responsible for there own debt and not rely on the state to hold there hands.
Comment by Boscobud Wednesday, Apr 22, 09 @ 8:26 am
My favorite quote from my studies in economics: “the real world is a special case, we’re not concerned with that here.”
Comment by John Bambenek Wednesday, Apr 22, 09 @ 8:27 am
The theory is a little loose, but the underlying premise is sound. People have only so much disposable income, and if they spend it on gambling then they are less likely to buy consumer goods.
I would bet that if you removed gambling from an area, many people will not travel out of state etc to gamble at the same frequency. Convience is a factor. Yes people will still gamble, and travel to do so, but I would gamble that you would see a return locally by people who reduce gambling since it is no longer convient.
Also the peoria states attorney wrote a pieace describing the increase in thefts, embezzlement and realted criminal activites that went up when the casino opened in peoria, not to mention a large increase in bankruptcies. So there is a social cost to a casino that is much higher then with a best buy.
The State may lose out sales tax, but it gets a heft chunk of those casion profits. Overall, we probably do more dmage to our state socialy and economicaly by allowing casino’s. Part of our financial problems flow from our overdependence on gimiky, and often unreliabel, funding like sin taxes (gambling, smoking etc).
The profs theory is not as simple as he presents it, but I think the idea that we would benefit by reducing the redirection of disposable income to gambling from consumer goods has merit.
Comment by Ghost Wednesday, Apr 22, 09 @ 8:30 am
Reading this excerpt gives me GMAT deja vu for the reasons wordslinger mentioned. It’s like it was deliberately designed for us to analyze its obvious defects and unstated assumptions.
Even if his argument had merit, I wouldn’t expect a ban to redirect spending toward those areas the professor finds more useful (even though spending is most efficiently allocated by the individual consumer, rather than planners.) I guess if one believes the drug laws are pretty effective, then maybe we should adopt this.
Comment by Greg Wednesday, Apr 22, 09 @ 8:34 am
It is too late to ban gambling. It would not work or would just encourage people who like it to go to each of our neighboring states.
With that said, it is a poor economic foundation for the state to make itself voluntarily dependent on gambling, tobacco and alcohol for essential revenue. The Lottery was created with a false promise that it would solve our eductation funding gap. Promises were made then that it was not the first step toward casinos. Lies!
I do not think we can ban gambling, alcohol, cigarettes nor even effectively ban prostitution and many drugs.
But we do not have to embrace them in the future as our salvation.
Comment by Skeptic Cal Wednesday, Apr 22, 09 @ 8:36 am
It is funny to hear people say, “The state would never ban gambling.” How long ago was it that people thought the state would never allow gambling?
Comment by Homer J. Simpson Wednesday, Apr 22, 09 @ 8:41 am
Isn’t Prof Kindt using the same argument that was used to legalize gambling in the first place - namely the state was spending too much money trying to stop illegal gambling, and that the economy would benefit from the jobs that a gambling business would create? In fact, the Professor uses this logic with illegal drugs - FTA “You can create jobs if you legalize illegal drugs. You can create tax revenues if you legalize illegal drugs,” Kindt said”
In this case, Illinois legalized illegal gambling, but the Professor now claims that that move eliminates jobs.
Sorry, Professor. I’m not buying your argument.
Comment by JLP Wednesday, Apr 22, 09 @ 8:47 am
The more and more I read this guy’s google trail, the more and more convinced I am he’s a whack……
Comment by dan l Wednesday, Apr 22, 09 @ 8:49 am
More Nanny state. If someone is too dumb or too addicted to figure out that they can’t eat this week beacuse they can’t tear themselves away from the slots they will find another source if the casino is closed. Are the race tracks going to closed too?
Comment by Hank Wednesday, Apr 22, 09 @ 8:54 am
Unless you can get our neighboring states to ban gambling too, it won’t work. It’s not that far of a drive from our biggest population centers to the next state.
Comment by Sap Wednesday, Apr 22, 09 @ 9:02 am
So if an economics professor says that our state economy is being hobbled due to gambling, no one is willing to take him seriously? The responses so far sound more like bloggers would rather believe what they believe, instead of investigate any merit to what he is saying.
We need to know if what he says is true, and take corrective action if necessary. That is what we are supposed to do.
Let’s not prejudge. I’ll ignor him if lacks any facts to back him up, but not before.
Comment by VanillaMan Wednesday, Apr 22, 09 @ 9:05 am
Here’s my Earth Day contribution.
Gambling is good for the environment. Compulsive gamblers have shorter lifespans on average than the rest of the population, thus slowing down the population growth that is straining the world’s resources. They eat 10% less food, which slows down the destruction of rainforests to grow crops and allow livestock grazing. And they take money out of the economy that would otherwise go to buying consumer goods produced in pollution-causing Asian factories.
Comment by Six Degrees of Separation Wednesday, Apr 22, 09 @ 9:05 am
It has merit…if you ban gambling in Indiana…and Missiouri…and Wisconson…and on the internet. Wait, it has no merit at all.
Comment by L.S. Wednesday, Apr 22, 09 @ 9:06 am
This last weekend I was in two different private clubs in different parts of the state. Both had “members only - for amusement only” signs above their video poker/slot machines. One club had 8 machines and the other had 12 machines. Members filled all the seats the entire time and continually put $20 bills in those machines. Three quick observations - 1) could this be why IL casino revenue is down? 2) seems like the state should be making money off this activity that is currently illegal but obviously very openly going on 3) there was no smoking allowed in either club
Comment by off the record Wednesday, Apr 22, 09 @ 9:12 am
I think the study has a legitimate point but need to read the study to have a firm opinion.
Ultimately economic development is a matter of importing or exporting dollars. Casinos in Illinois largely reallocate entertainment dollars from the local trade area. They don’t import dollars like Vegas and Atlantic City. They likely export dollars to the corporate owners of the casinos.
The difficulty is that Indiana, Wisconsin and Iowa (and Missouri?) have casinos in our trade area. If we ban casinos in Illinois, money will be exported to these states.
I don’t like gambling but as long as there are some limits, it is up to people to decide for themselves.
Comment by Objective Dem Wednesday, Apr 22, 09 @ 9:16 am
this explains why AA was a C student in economics courses at the Big U way back when. The professors were kooks. What a relief.
The beer, girls, and goofing off had nothing to do with it.
Seriously, dan l and word are right on point. This guy is a goof and I wonder why he is on the faculty.
Comment by Arthur Andersen Wednesday, Apr 22, 09 @ 9:22 am
Professor Kindt is correct.
Gambling isn’t economic development. It’s economic dislocation.
Personally, I’d rather just close the book (pardon the pun) on all gaming.
But I’m a realist. Gambling ain’t ever gonna go away.
So I say — drop the idea of land-based casinos. Sunset the riverboats.
Keep a few things that serve more like occasional (I would hope) entertainment: horsies and flying ping-pong balls and scratch-off tickets.
Morality aside — gaming in Illinois has become a major economic drag. Time to rein it in.
Comment by Scott Summers Wednesday, Apr 22, 09 @ 9:31 am
I think all one has to do is ask Joliet and all the casino workers who aren’t working and therefore not buying anything if they would rather have the Empress up and running now or down for repairs as a result of the fire. I’ll bet the shopkeepers and grocery stores will tell you they want the casino open.
Comment by Irish Wednesday, Apr 22, 09 @ 9:39 am
HA HA HA HA HA…ban gambling in Illinois.
Seriously?
Let’s fire up the anti-gambling advocates. Who funded his study? The University? Doesn’t matter. Like AA mentions, goofs are everywhere. You can’t stop all crime…nor can you stop academics from publishing.
It’s a horrible idea. Years of corrupt government on all levels got us here. There’s no easy fix.
How about having a series of Illinois Aid concerts. People love music, booze and food. We love to spend money on this stuff.
Get creative and quit trying to regulate and tax.
As they say, I Love My Country, but…
Comment by BandCamp Wednesday, Apr 22, 09 @ 9:44 am
So it would be a boon to an area to lay off all of the people now working in the gambling industry? Some of those workers would end up buying 100% less food (unless you count food stamps as buying).
Once you have an industry in place, getting rid of it can be very costly.
Comment by Pot calling kettle Wednesday, Apr 22, 09 @ 9:44 am
Something seems too simplistic about this analysis.
If a senior spends $120 gambling once a week, what would s/he do with the money if Illinois banned gambling.
a. dine at restaurants more
b. go outside Illinois to gamble
c. save the money
d. use it to support a relative who is squeezed economically
e. buy a new car sooner
f. shop for clothes or similar items
Which of these options improves the local economy? Ending gambling would eliminate jobs, so the stimulus to the new spending needs to exceed the loss of jobs from eliminating gambling.
It’s not obvious to me that the new use of the money will stimulate the economy more than current use of the money.
Comment by Carl Nyberg Wednesday, Apr 22, 09 @ 10:01 am
AA,
Tenure.
Comment by Bill Wednesday, Apr 22, 09 @ 10:03 am
The argument has merit. From an IL perspective, I would like to see how much gambling revenue is generated by IL residents. Would the loss of taxes on out of staters gambling be offset by the in staters spending?
Walk through a casino and see who is gambling. It is not the rich(although they are in the back room). In most casinos’s 80% of the people make less then 30k per year.
If the numbers don’t add up, just from a moral perspective, should we be promoting gambling when people can’t pay their bills.
Comment by the Patriot Wednesday, Apr 22, 09 @ 10:32 am
It’s unfortunate to call people who publish studies “whackos” and “goofs.” For those who post here with ad hominem attacks, feel free to cite studies that show the benefits of gambling on the economy
Comment by phocion Wednesday, Apr 22, 09 @ 10:34 am
Well the state retiree seniors could put it towards Quinn’s proposed increase in their health insurance rates.
Comment by Cassandra Wednesday, Apr 22, 09 @ 10:36 am
I play poker over the internet. It’s the quasi-legal “gray area.” I’ve done — and continue to do — well gambling. It’s not a living, but when I’m playing well — and when I’m able to restrain my “gut emotions” — I can make a good bit of coin.
That said, my “gambling” has absolutely nothing — zero, zilch, nada — to do with my spending money on other things. In other words, I can have a bad day — or a bad week or a bad month — and my spending level on other items remains the same. Good gamblers don’t mix their bankrolls with their daily expenditures. You gamble to increase your bankroll — so that you can move up in stakes — and don’t — under any circumstances — take the $2500 you planned to spend on the big screen TV and look for a 5/10 game of no limit hold ‘em.
So I’ll throw that out there.
In addition — and I’ll admit to this — I enjoy the gambling rush. I get the rush when I lose (or when I misplay a hand) and get an even bigger rush when I win. I do not get this rush anywhere else. Professional poker players don’t like to admit this — the rush — because it has to do with controlling one’s emotions, and the best gamblers are those who can, in all circumstances, control their emotions. Lack of emotional control is the kiss of death — and sure sign of a dwindling bankroll — in poker and blackjack.
I don’t — and won’t — play slots or roulette. Again — for good gamblers, those two games in particular make no sense. The odds are not in your favor and you have no sense of control. I say “sense” because even in poker where you can control and assess an enormous amount of information for each hand, you’re still at the mercy of the cards. And like most gamblers, you hit bad streaks — statistically necessary bad streaks — and sometimes those streaks last a long, long time. (Try, for example, flipping a coin 100 times. You’d be surprised at how unrandom the flips seem — and how many streaks of straight heads or straight tails you’ll get. This always surprises people, and it’s a great experiment to show how “streaks” occur.)
So this is a long way of saying that no, banning gambling makes no sense. Even the old folks playing (and losing) at slots will simply take their money elsewhere to get the rush. It’s the rush that matters — not the money (especially if you’re playing a game with no hope of beating). It’s like buying a lottery ticket. It makes no sense, but I admit to doing it occasionally — and getting a mild rush when I do it.
If anything, legislators should *increase* gambling options — and embrace internet gambling — because gamblers will gamble. They won’t stop, and they won’t take the money and spend it elsewhere.
Sure, there’s a social issue here. Irresponsible gamblers don’t know when to stop. But I guarantee that if you’re not gambling responsibly, you won’t be spending responsibly either. And there’s no substitute for the rush. The gambling rush is unique — and if you’ve got the yearning for it, you’ll find a way to experience it.
If you want to raise money, help legalize internet gambling. Tax it up the wazoo. Whatever. It’s already unprofitable to play internet poker at the low stakes due to the house rake. I assume the rake would increase if the offshore poker houses were able to move onshore and expand. This is bad for gamblers, but good for politicians.
You can use all the misguided stats to attempt to correlate gambling spending with a corresponding decrease in non-gambling spending.
Instead of looking at the statistics, talk with the gamblers.
I guarantee — absolutely, 100% — that this is one instance where correlation does not equal causation.
Comment by Macbeth Wednesday, Apr 22, 09 @ 10:39 am
My study reveals: I bought a new couch and chair with the money I won a few years back.
Comment by BandCamp Wednesday, Apr 22, 09 @ 10:46 am
Gambling on the internet is not “quasi-legal” - it is illegal under federal law. Period. You are also dealing with mob-connected computer rooms in places like Antigua, with no real regulation and generally corrupt governments. Don’t say you weren’t warned!
Comment by Legaleagle Wednesday, Apr 22, 09 @ 10:55 am
What is the percentage of regular nonduplicated gamblers as a part of the total population? 5%? 10%?. Seems like a pretty low number to me. Follow the same arguement in a different direction:
“If you’re dumping money into (pick your favorite - clothes, car repairs, a savings account, restaurants, books, sports equipment, church donations, charity), you’re not spending money on cars, refrigerators, computers, education. In studies, it shows that around these (whatever item you selected) we have people spending even 10 percent less on food,”.
I thought gambling was a taxable activity that provides jobs to many people. As long as it is legal it’s a place I can spend my money as I see fit. If you are spending your money doesn’t it roll over in the economy several times regardless where you spend it? Seems the Professor needs to get out off campus and out into the real world a little more often.
Comment by zatoichi Wednesday, Apr 22, 09 @ 10:56 am
===
My study reveals: I bought a new couch and chair with the money I won a few years back.
===
But how many slot players will do this? Not many, I’d bet. And that’s the point. Gambling is not there to win you money so you can leave. It’s to win money in order to gamble so that the casinos make a profit.
The slot machines (especially!) are there to keep taking your money — not to give you a 1000 to 1 payout so you can cashout and buy a sofa. You win a wad, put it back in the machine, lose it. At the end of the day you’ve gotten your rush. You started with 10 bucks, hit $1000 payout, gambled it back into another “hot” machine, and then left with $0.
You’re out ten bucks, the casino is up (because you’re drinking either booze or diet coke — and both require tips), and you feel like you’ve had an experience. You’ll be back, too — because you crave that experience. (”It was so easy!”) Why wouldn’t the state want to cash in on this?
Show me a slot (or even blackjack) gambler with the discipline to *stop* gambling after a good streak so he or she can go out and buy a LazyBoy.
The odds are against it — and the casinos know this.
Is it immoral to cash in on the rush? Maybe. I suspect that’s part of the problem.
Comment by Macbeth Wednesday, Apr 22, 09 @ 11:00 am
#
- phocion - Wednesday, Apr 22, 09 @ 10:34 am:
It’s unfortunate to call people who publish studies “whackos” and “goofs.” For those who post here with ad hominem attacks, feel free to cite studies that show the benefits of gambling on the economy
Sorry Phocion: His position doesn’t make any sense, he looks like he has some sort of axe to grind against gambling, and he’s cited by the AFA and Sandy Rios. If that doesn’t give you a whiff of kook, I’m not sure what would.
You certainly don’t expect that to enhance his credibility, do you?
Comment by dan l Wednesday, Apr 22, 09 @ 11:00 am
===
Gambling on the internet is not “quasi-legal” - it is illegal under federal law.
====
Except that internet poker remains a gray area. Some say it’s a game of skill, others say it’s a game of chance. States disagree — which is why there is variation in the state laws for internet poker. Remember, too, that internet poker went through a transformation several years back because of increased banking scrutiny. So folks who already had a bankroll in some of the poker sites were not impacted by the new banking laws circa 2005.
Comment by Macbeth Wednesday, Apr 22, 09 @ 11:04 am
Macbeth, you last post just validates that it isn’t gambling that is the problem, it’s the PEOPLE WHO GAMBLE and have no self-control that is the issue. And this leads into so many other things, such as obesity, alcoholism, depression…blah blah…you name it. My wife left me and now I am depressed. BAN MARRIAGE!
You get my point. As adults, we need to have self-control. Sometimes we do, sometimes we don’t. But who is the government to REGULATE all these things? Ban Big Macs. Ban Bud Light. Ban scratch off lottery tickets. Hey, here’s one: BAN FUN!
Clearing the State of casinos isn’t going to solve any budget issues. I can gamble on-line and elsewhere, including with my “bookie”.
This study is self-serving, for sure. And as a side-note, I have empathy for those gamblers who can’t control what they spend in casinos. But like suicide, it’s a cop-out to blame the casinos for their problems. Sometimes we all need to take a good look in the mirror.
Comment by BandCamp Wednesday, Apr 22, 09 @ 11:13 am
“In studies, it shows that around these slot machine areas we have people spending even 10 percent less on food.”
Well, aren’t casinos intentionally located in economically depressed areas? Why is it alarming that people in communities with casinos spend less than average on anything, including food? Of course they spend less (buy lower priced items) and in lower amounts (less excessively). This is silly.
Pull out the casinos and the towns are going to have to increase taxes. The fine professor’s studies may reveal even less spending on food, goods and services in areas where the slot machines were. Meanwhile, gamblers are likely to seek out a similar activity, not decide they’d rather take a night class at a community college. Their risk/reward activity may not be productive from a sales tax standpoint, but it does generate revenue for the State.
Comment by KeepSmiling Wednesday, Apr 22, 09 @ 11:26 am
===
You get my point. As adults, we need to have self-control.
===
Exactly. And that’s the real issue here. Me, I’ve long ago (after the poker crackdown) moved on to the “sweepstakes” poker sites — where the sites are legal under state sweepstakes rules. (Yet some states still ban these sites, too.)
Same rush, free to play, and the winnings are considered the same as winning a lottery.
It’s a crazy world.
Comment by Macbeth Wednesday, Apr 22, 09 @ 11:28 am
Legalize slots in bars and restaurants like Montana and S. Dakota. The revenues is fail safe, tie the machines to the the lottery systems with automatic withdrawals nitely into the State. This produces local revenues mush more likely to return almost immediately into the local economy, unlike the Casinos where much of the revenue stream moves out of State.
Comment by downstate hack Wednesday, Apr 22, 09 @ 11:33 am
Conversely, if the state banned grocery stores, which generate little in sales tax, people would have more money to gamble at the casinos, hiking state tax collections considerably.
For the great majority of people who gamble, the money comes out of their disposable income. It’s the entertainment dollar — a trip to the casino comes at the expense of a trip to the movies or a restaurant.
Are there problem gamblers blowing the mortgage? Sure. And there were before gambling was legal and would be if it was illegal again.
Comment by wordslinger Wednesday, Apr 22, 09 @ 11:40 am
“In studies, it shows that around these slot machine areas we have people spending even 10 percent less on food.”
Have you ever been to a casino? They have food everywhere. you can eat well cheaply. So maybe the study just reflects that when people eat well at a casino they don’t buy as much groceries as they do when they are not eating well at a casino.
Comment by Irish Wednesday, Apr 22, 09 @ 11:41 am
Get a clue gamblers and politicians - The house always wins!
Comment by If It Walks Like a Duck... Wednesday, Apr 22, 09 @ 12:02 pm
Lets face it. Gambling adds numbers to the GDP. But like many other negative drains, it just sucks from our capacity to create an enduring and sustainable way of living. Might as well go down with a smile on the face.
Comment by vole Wednesday, Apr 22, 09 @ 12:14 pm
(1) The argument has merit on its face, but as others have said, it paints too simplistic a picture. Studies on gambling economics have skyrocketed along with the expansion of state-sponsored gambling over the past decade — Douglas Walker’s book summarizing the literature is the best out there — and depending on the assumptions you make & variables you consider in your regression analysis (availability of regional gambling, impact from statewide lottery, social costs, etc.), you’ll reach different results.
(2) BUT, assuming that the simplistic conclusion reached above is true (no gaming -> more cash for consumer goods and services -> more jobs in these sectors -> network effects), then policymakers should absolutely ban gaming if they care about boosting economic growth (and who doesn’t?). I haven’t seen a comment here that has adequately answered Rich’s “If not, why?” question.
Comment by JT Wednesday, Apr 22, 09 @ 12:16 pm
The social costs of gambling to society at large are enormous. For those reasons and some moral ones, I think gambling is a terrible way to fund a government.
Despite these personal beliefs, the genie is out of the bottle and you can’t put it back in now. Prohibition was a colossal failure not because there isn’t merit in sobriety. Obviously, there is, but people want to drink. It’s the same with gambling, if people want to, they will.
I’d also second the remarks of Carl Nyberg and say that the redirected revenue from closing down the casinos wouldn’t really go into the state’s coffers or local economy. There are way too many problems with that thought - casinos still exist in all neighboring states and people would gamble there; the increased sales tax revenue wouldn’t come close to exceeding the casino tax; the products that people would buy for the most part wouldn’t be Illinois-produced and therefore wouldn’t help employment or manufacturers in the state; and the state would lose the casino jobs.
Despite my own serious misgivings, I’m more inclined to believe that we should legalize, regulate and tax the poker machines in bars and clubs throughout the state. People are dumping their money into them anyway, so the state may as well take charge, root out any organized crime influence, and reap the tax benefits.
Comment by Randolph Wednesday, Apr 22, 09 @ 12:21 pm
This is a U. of I. professor?!?! Of what, sewing? His argument is utter nonsense. Banning all gambling in Illinois would only promote the legal gambling in other states or the illegal gambling here. Under his theory, Illinois should also ban alcohol and cigarettes, bottle water, Starbucks, doughnuts, pets, all shoes made in Europe, and any car that has a horsepower rating above 80; all of which are paid for to the exclusion of basic necessities. When the U. of I. presents it’s next budget to the Executive Director of the Board of Higher Education, will she just automatically deduct this yahoo’s salary. What an embarrassment!
Comment by springfieldish Wednesday, Apr 22, 09 @ 12:42 pm
=== Anyway,with gambling next store in Indiana,Wisconsin,and Missouri: people will get their gambling fix somewhere else while they smoke! ===
If anyone ever follows gambling as a business, they’ll see right through this argument.
If you want the facts on gambling, go to a business publication.
Business Week did a fascinating cover story on the rise of Player’s Clubs a few years ago.
Why were casinos going all-out to recruit player’s clubs? Giving away all these free benefits?
Because the most profitable gambler for a casino is NOT an out-of-state tourist or business traveler.
The most profitable gambler for casinos is someone who lives within a 30 minute drive, gambles every week, and loses an average of $100 a week.
Player’s Clubs offer incentives to keep their members coming back, but they also allow the casino to mine the data to find out how often members visit, and most importantly, how much they lose.
Is offering a $7.99 buffet to a senior for free a good deal for the casino? Absolutely, if the casino knows that Grandma is going to lose $5200 on the slots this year.
That’s $5200 that’s not going into the economy somewhere else.
And while casinos do employ SOME people, keeping 100 slots running creates alot fewer jobs than getting 100 people in and out of agrocery store.
Comment by Yellow Dog Democrat Wednesday, Apr 22, 09 @ 12:45 pm
If this clown is so smart why isn’t he working in private industry rather than the public dole. Those who can’t lecture and generally teach!
Comment by TheWatcher Wednesday, Apr 22, 09 @ 12:48 pm
You might be interested in this presentation by two economists.
Union League Club of Chicago
America’s Economy – How Bad Will It Get? When Will It Improve?
Date: Tuesday, May 05, 2009
Start Time: 7:30 a.m.
The U.S. economy is gripped by its worst recession in recent memory. Unemployment is up, consumer spending is down. The Federal Reserve has flooded the economy with money and the government has engaged in numerous bailouts and interventions. The Obama Administration and Congress have enacted several of the largest spending bills in history, with accompanying increases in our national debt. The Chinese finance minister has raised the possibility of the dollar’s demise as the global reserve currency and the Europeans politely declined to stimulate their economies as we have ours.
Where is this headed? How bad will it get and when will it improve? What will halt the slide? Keynesian spending? Further expansion of the money supply? Tax cuts? Tax hikes? More regulation? Less regulation?
Please join us as we welcome noted economists who will share their insights and answer your questions in a lively format. Our panel includes:
Dr. Geoffrey J.D. Hewings Director of the Regional Economics Applications Laboratory, University of Illinois
Paul K. Hoffmeister, Chief Economist of Bretton Woods Research LLC.
Breakfast@65West events begin with a buffet breakfast at 7:30 a.m., followed by the program at 8:00 and adjournment no later than 9:30.
Dress Code: Business Casual
Cost: $20.00
To reserve by phone call (312) 435-5946.
Cancellation due by Monday, May 04, 2009 at 12 PM.
www.65west.org
Comment by Illinois Economy on Life Support Wednesday, Apr 22, 09 @ 12:50 pm
I watched the press conference with the Professor and ILCAAAP on www.blueroomstream.com
I can no longer afford to subsidize casinos in Illinois. The research the professor talked about shows that - and it is the same as the National Gambling Impact Study came up with years ago - that for every $1 the state gets in revenue from the casinos - we, the taxpayers pay $3 in costs.
I can’t afford it anymore. I’m broke. Someone stop this. The casino owners get rich, legislators get campaign contributions, the state gets a little bit - and I’m paying for it all. It’s to much!!!!!!!!! I’m broke.
Comment by Broke Wednesday, Apr 22, 09 @ 12:52 pm
The genie is well out of the bottle on Gaming in Illinois, and while I oppose any further expansion of it, I don’t see a practical or political way to end it now, as far as it goes.
I agree gambling sucks away capital that could have been put to more productive use, and funnels the largest part of it out of state, and it preys mostly on our own citizens and especially the less-intelligent and most desperate ones. This is nothing positive to build our state on.
An all-out ban? to make a bad pun, the odds are exceptionally long on that one.
Comment by Gregor Wednesday, Apr 22, 09 @ 1:01 pm
The comment makes imminent sense if one is a thinking person.
Firstly, any profit from gambling comes from another’s loss.
Secondly, our nation thought gambling immoral for over a century–hence gambling was once allowed only in one or two locations, and one had to make a specific trip to that location.
Thirdly, gambling proceeds are not at all reliable, and the state gets what, a single percent of the proceeds? Who gets the rest? You can answer that one.
Comment by justsayno Wednesday, Apr 22, 09 @ 1:01 pm
–llinois took in more than $1.3 billion in casino tax and lottery revenue in 2008. But Kindt said that for every $1 gambling brings in to Illinois, the state ends up paying $3 in additional costs due to higher crime, broken families and increased poverty.–
$1.3 billion multiplied by 3 is $3.9 billion. Illinois is paying that much a year on problems directly associated with legal gambling?
I call. Show me your cards?
I’m not a huge fan of gambling. I don’t think it’s the economic boon that it’s been touted to be, but I also don’t think it’s the cause of all of our ills, either.
There are social benefits to legal gambling, as well. The creation of the state lottery in one fell swoop eliminated a major source of revenue for the Outfit, the policy wheel.
Now about those illegal video poker machines in the bars and clubs — who do you think owns them?
Comment by wordslinger Wednesday, Apr 22, 09 @ 1:03 pm
Obviously the guy shoulda prefaced with ‘I think’ before he spoke. Anyway, I have been known to gamble on occaision. I would go across the state line to gamble, an inconvenience but I’d do it. I notice he does not compare the loss of the states share of gambling revenue to the plus of consumers consuming. As an educator, he leaves a lot to be desired. Like proof.
Comment by Belle Wednesday, Apr 22, 09 @ 1:05 pm
Broke did bring up the Federal Gambling Impact Study. Wht was written in the late 90s was valid then as it is now.
Gambling was described as a failure in the context of it being used as a economic development engine. As … Duck says the house always wins. The casino owners and the governments make the big bucks. Casinos do not provide substantive jobs to the local economy and they stifle growth in the entertainment industry in the surrounding areas.
Are these folks “whackos” and “goofs.” as well?
I don’t gamble and don’t care if you do, but name calling folks who have positions different than yours does not lead to an intelligent discussion.
Comment by Plutocrat03 Wednesday, Apr 22, 09 @ 1:09 pm
I disagree with the Professor.
With most neighboring states offering gaming, Illlinois residents will just cross the borders to gamble. While I have misgivings about funding governement through the gaming industry, pandora’s box has already been opened.
Comment by Stones Wednesday, Apr 22, 09 @ 1:14 pm
yellow dog and zatoichi are onto something: the “80-20″ rule that most of your sales will come from a small percentage of your customers. If 80% of your sales are made by 20% of your customers (of course your mileage may vary) and your customer base makes up a very small proportion of the population in the first place, it’s probably not going to have a resounding impact on the overall economy. In other words I don’t see a net jobs gain from banning gambling.
So I fall on the side of not eliminating casino jobs, at least not at this point. If broke is correct, we taxpayers meantime should claim a bigger chunk of the proceeds.
Comment by yinn Wednesday, Apr 22, 09 @ 1:51 pm
yellow dog and zatoichi are onto something: the “80-20″ rule that most of your sales will come from a small percentage of your customers. If 80% of your sales are made by 20% of your customers (of course your mileage may vary) and your customer base makes up a very small proportion of the population in the first place, it’s probably not going to have a resounding impact on the overall economy. In other words I don’t see a net jobs gain from banning gambling.
So I fall on the side of not eliminating casino jobs, at least not at this point. If broke is correct, we taxpayers meantime should claim a bigger chunk of the proceeds.
P.S.: Wanted to add good post!
Comment by by: yinn Wednesday, Apr 22, 09 @ 1:51 pm
Just like someone with a dependence to alcohol…they’re going to go somewhere else to get their fix. This plan is way to drastic with our current economy.
I think you would have an easier time legalizing marijuana.
Comment by Yadi Dog Wednesday, Apr 22, 09 @ 1:51 pm
All of you that say “show me your cards”, just open up any book not written by the gambling interests. It’s simple, gambling is an economic and social drag.
For those that say people can just drive across borders, you are absolutely right. However, data released by the Gamblers’ Helpline of West Virginia clearly shows that it is the immediate area around gambling facilities that incur the worst social evils that arise from gambling. People are a lot less likely to gamble frequently if it takes 4 hours to get there.
GET GAMBLING OUT OF ILLINOIS
Comment by Thriller Wednesday, Apr 22, 09 @ 2:00 pm
Let’s just ring the IL border with casinos. That way anybody tempted to cross the border to gamble can stop on the IL side and foreign gamblers won’t be tempted to see how the slots play in Peoria.
Comment by Sap Wednesday, Apr 22, 09 @ 2:12 pm
Gambling is nothing more than money changing hands without a product or service. A ban would certainly put money into the real economy. It doesn’t take genius to know that the majority of gamblers are played as suckers but the gambling interests are laughing all the way to the bank with the spoils. Once they get in, they hold the government and citizens hostage with their insatiable demands. Before our elected officials embarked on this reckless gambling binge, we not only survived but thrived. When every 3 slots equal a loss of two jobs in the real economy, why not try a ban?
Comment by CasinoFreePA Wednesday, Apr 22, 09 @ 2:20 pm
Just a bit on context from the rest of the story that’s not highlighted above:
“In 2005, the Illinois House voted to outlaw riverboat gambling, but the proposal went nowhere in the Illinois Senate.”
Comment by Frank Booth Wednesday, Apr 22, 09 @ 2:29 pm
Yes, and let’s ban alcohol also. Those plans usually work real well. I would like to know, though, which line items I can cut by $3.9B if we follow his lead.
Comment by steve schnorf Wednesday, Apr 22, 09 @ 2:33 pm
“Wow. This is scholarship? Some unsupported assumptions and leaps of logic here.
No, it has no merit. You can gamble online”-Wordslinger
A)Internal gambling is illegal due to the “Wire Act”-in fact, it is a felony-please check the law Mr. Wordslinger
B)There are no unsupported assumptions, in fact those are authoritative sources
I personally feel for both sides of the argument, however at least listen to the facts before you make illogical accusations
Comment by John Smith Wednesday, Apr 22, 09 @ 2:41 pm
Johnny, there’s not legal gambling online? I think there is. A quick google finds that the Wire Act has been interpreted narrowly to cover sports betting (that’s going on, too).
And since you’re an authority, I’ll repeat an earlier question: Can you show me where the State of Illinois is spending $3.9 billion annually on problems associated with legal gambling, based on Kindt’s $1 revenue to $3 spending ratio?
http://www.gambling-law-us.com/Federal-Laws/wire-act.htm
Comment by wordslinger Wednesday, Apr 22, 09 @ 2:55 pm
I like Wordslinger’s argument the best. Gambling isn’t responsible, alone, for the ills of society.
== but the gambling interests are laughing all the way to the bank with the spoils. ==
Whatever. Casino’s are suffering as well. Layoffs and huge losses are happening at your local business as well as Harrahs.
Gambling is an entertainment business…it’s a business. And when the economy goes south, people stop going to the riverboat, just as they stop going to the electronics store, the movies, and they cut back on spending at the grocery store.
Comment by BandCamp Wednesday, Apr 22, 09 @ 3:04 pm
The professor’s theory could simply be a plot backed by all the neighborhood bookies and their errand boys who were practically forced into retirement by off track betting, and moreso by the river boats. Could be they have a new lobbyist.
What I’m trying to say is, I imagine getting rid of legalized gaming in Illinois would be a boon to organized crime. New games, different venues, no taxes.
We created this “monster,” now we have to live with it.
MacBeth, Interesting stuff. I had no idea. Wow. But, while poker or games of skill may not be totally illegal, isn’t wagering on them what makes them illegal?
Comment by Cheswick Wednesday, Apr 22, 09 @ 3:19 pm
Thriller,
4 hours to get to a place to gamble? Where do you live, Springfield? Since the majority of the population in Illinois lives within a 1/2 hour drive to get to out of state casinos (Chicago, East St Louis, Joliet, Elgin, Rockford, Quad Cities) getting legal gambling out of Illinois will NOT stop gambling. It will just ensure that any taxes on those bets will go to other states. Face up to reality - gambling is not going away.
I think it pathetic that so many of those who gamble can ill afford the monies they waste in those places but they are adults who get to make their own mistakes. Let’s just make sure that we get some benefit out of their poor judgement - tax ‘em!
Comment by dupage dan Wednesday, Apr 22, 09 @ 3:29 pm
What we should do is stop the sale of automobiles in this state because when people are paying car payments, they aer spending less money on food and other consumer goods. Oh and by the way, they also have less to gamble with.
Comment by fester Wednesday, Apr 22, 09 @ 3:37 pm
There is a huge amount of truth to this argument. Casino gambling is counter productive on so many grounds. Funny thing, every one who tells me they go always wins or does no worse than break even. Right! Let’s do away with Casino Gambling.
Comment by Avy Meyers Wednesday, Apr 22, 09 @ 3:54 pm
Illinois should not ban gambling, look at how much tax revenue Joliet was loosing when the Empress was shut down. $1.5 million a month tax revenue to Joliet And 900 employees.
People would just go to Indian, Iowa or Wisconsin. So why not keep the money here?
Comment by Third Generation Chicago Native Wednesday, Apr 22, 09 @ 3:57 pm
Indiana, (not Indian)
Comment by Third Generation Chicago Native Wednesday, Apr 22, 09 @ 3:58 pm
After reading many of the responses, I keep coming back to how many things you can spend money on where you usually do not come away with something you can touch or carry: movies, plays, sports, concerts, museums, fairs, and endless services that you pay someone else to do. If I pay $125 for Springsteen in Chicago or $5 for the local band in a bar there seems to be very little difference compared to what gambling would cost me in how the same amount of money money is used. How you spend your money is up to you. Like other stuff, live within your means. If you cannot, it does not really matter what you spend the money on, you will get an eventual problem. Talk to anyone with heavy credit card debt.
Comment by zatoichi Wednesday, Apr 22, 09 @ 4:16 pm
@plutocrat:
—-
Are these folks “whackos” and “goofs.” as well?
—-
Not necessarily. But this guy definitely is. Google is your friend.
Comment by dan l Wednesday, Apr 22, 09 @ 4:35 pm
Why are the casinos putting in so many Penny Slots? What kind of people find it entertaining to sit for hours losing money at slot machines? Can’t politicans come up with different ideas to fund state government? Or are they getting too much campaign money from gambling?
Comment by Follow the money Wednesday, Apr 22, 09 @ 4:44 pm
A number of comments have made the assertion that if you ban gambling, gamblers will just travel across state lines and gamble in other states, as if there were a fixed amount of gambling the gamblers needed to do. The facts, established by years of research, are that gambling, particularly compulsive gambling, is to a great extent a matter of convenience. Put the temptation in someone’s face and they’ll succumb to it, but they’re not necessarily going to chase it to the next state. For evidence, see the research of John Welte, Research Institute on Addictions, Buffalo, NY, published in the Journal of Gambling Studies.
The gambling industry has used this bogus argument in one state after another, bootstrapping from states that have gambling to neighboring states who fear they’re losing revenue. It all makes for a race to the bottom, in which every state loses. Hopefully, one state will be wise enough to call off this madness. Will it be Illinois?
Comment by joelrose Wednesday, Apr 22, 09 @ 5:36 pm
If the issue is the state is losing money due to casinos, the other approach is to increase the money the state gets from casinos. This could be accomplished via taxes, profit sharing, or ownership.
Like alcohol and cigarettes, we should tax at a high enough rate to cover the societal costs. If casinos can stop people from being addicted to gambling and making bets they cannot afford, the taxes would be reduced.
Comment by Objective Dem Wednesday, Apr 22, 09 @ 5:37 pm
It is truly amusing to read comments by people who can’t spell or put a sentence together and don’t identify themselves, yet consider themselves experts at economics. Those who resort to name-calling reveal that they really have nothing to say. They have obviously never read one of Professor Kindt’s studies. His reports in respected, peer-reviewed law journals have more footnotes of proof per page than actual conclusions. There are absolutely NO “unsupported assumptions” nor “leaps of logic”, Mr. Wordslinger. Have you also testified before Congress on gambling, as Professor Kindt has?
There are many, many studies that show the costs to the consumer economy of gambling. Go to www.ncalg.org for starters. These studies are not funded by the casino predators, as ARE the studies touting jobs and benefits from gambling.
Who cares if gamblers go to other states? They used to go all the way to Nevada. And, guess which state has one of the highest deficits and rate of foreclosures—Nevada. Gambling hasn’t helped Illinois to avoid budget problems.
Gambling has been banned in the U.S. TWICE before. So, it CAN be done. In fact, it was a requirement to ban gambling in a territory in order to become a state. Russia just recently banned gambling, and their economy boomed shortly after. What happened to all the people who want “change”?
People who say “keep the money here” don’t understand how the gambling predators work. Most gambling companies are now public companies, which means that they are owned by the stock-holders. Are you insinuating that those stock-holders are all located in Illinois? Most of the COMPANIES are not even located in Illinois. The tax revenues are not the TOTAL revenues.
Yes, Illinois should ban GAMBLING (not “gaming”, kids do that). Rev. Tom Grey says that they leave out the “b” and the “l” because they don’t want you to know about the “b”ig “l”osers.
Comment by Kathy Gilroy Wednesday, Apr 22, 09 @ 5:45 pm
We shouldn’t also forget that there are real costs to gambling addiction. Every now and then I hear the story of someone who loses their business, embezzles from their company or commits suicide due to a gambling problem.
Another approach to lowering the costs of gambling identified by the study is to look at ways to mitigate the problems. For instance, I could see putting stronger limits on how much people are allowed to gamble and waiving debts when the limits are ignored. My understanding is casinos are masters at developing ways to trigger the addiction reaction in people. They don’t have windows, the games create mesmerizing sense of motion, etc. The state can limit the worst of these.
Comment by Objective Dem Wednesday, Apr 22, 09 @ 5:55 pm
Hey, I’m no expert. I’m just a person with some life experience and an opinion.
It’s my belief that if we outlaw gambling as it is now in Illinois, someone’s going to fill that market. Some people here think Indiana, Wisconsin, Iowa, and Missouri will take up the slack. Personally, I think organized crime would love to be in control without state regulation or taxes.
Comment by Cheswick Wednesday, Apr 22, 09 @ 6:55 pm
Kathy, I was answering the original question regarding the merits of the study. I don’t think banning casinos will fix the Illinois economy. I also don’t believe that the state pays out $3 on gambling related problems for every $1 in gambling tax revenue it brings in.
I’m not a proponent of gambling. I’ve never been to an Illinois boat. My choice. I also didn’t call anyone names.
The professor is obviously an anti-gambling cottage industry. Check google and you can read excerpts from “studies” where he claims gambling undermines national security and world peace. I doubt it. I’m sure he testifies before Congress because he’s invited by committee members who agree with him. That’s the way it usually goes.
If you’re against gambling for whatever reasons, fine, it’s a free country. But it’s a constant battle in a free society as to what the state should ban for all because a small number can’t handle it responsibly.
You know, for many, a casino is a lot like life: Sometimes you’re up, sometimes you’re down, and the house always wins in the end. Doesn’t mean you didn’t have a good time
Comment by wordslinger Wednesday, Apr 22, 09 @ 7:18 pm
Kathy, in the future make your points without resorting to blanket condemnations of my commenters. That’s a sure path to future deletions. The only really stupid comment here today was yours.
Comment by Rich Miller Wednesday, Apr 22, 09 @ 7:27 pm
One thing is for sure. Even if the study would prove to be true, it would be a very rough transition for the employees being laid off and the new revenue would not come quickly. It may or may not be true that this execution would work but the real problem would be on acquiring that available disposable income.
Comment by johnbtes Wednesday, Apr 22, 09 @ 9:25 pm
Rich Miller, shame on you for badmouthing Kathy’s comments. Hers is the most intelligible of the whole bunch. I’ve heard Prof. Kindt speak a number of times and I’ve read most of his heavily annotated essays on the evils of gambling. He’s the very best, as is Kathy. Joe S.
Comment by joe sch Wednesday, Apr 22, 09 @ 10:16 pm
To sum up joe sch’s comment: Go team!
Stupid.
Bite me.
Comment by Rich Miller Wednesday, Apr 22, 09 @ 10:33 pm
Kathy,
Maybe you’re right. Maybe this kindt fella is totally legitimate and he just randomly became a winger poster child. Totally possible. Unlikely, but possible.
But let me in on this, because you’re clearly anti-gambling:
Do you really believe that the years of fiscal screw ups in this state could be resolved just by banning gambling?
Side note, for lulz:
Former Chicago Bears great Richard Dent’s philanthropy, the Make a Dent Foundation, attempted to sell raffle tickets for the chance to win a $200,000 Bentley Continental GT. The proceeds of the raffle were to go towards scholarships for needy youths and research on Alzheimer’s. Kathy Gilroy, a volunteer with the Northern Illinois anti-Gambling Task Force, who vigilance has earned her the moniker “raffle buster”, read about the raffle, checked with the Chicago Department of Revenue and determined that Dent’s foundation did not have a license to run a raffle. She further pointed out that the foundation was violating the city raffle ordinance by charging $1,000 a ticket, five times the maximum of $200, and allowing purchases by credit card, rather than currency or check. Once notified, the charity obtained a license, proposed giving raffle ticket buyers the option of a refund or getting five chances at $200 each and halted ticket purchases by credit card.
http://www.winston.com/siteFiles/publications/NEWVERSION_v3.htm
Secret Message
Comment by dan l Wednesday, Apr 22, 09 @ 11:32 pm
Jesus.
Harry Hitzeman Daily Herald Staff Writer What do you get when you combine police, a golf outing and dancers? A complaint about an illegal raffle. Glendale Heights police are looking into whether to fine the Northlake Fraternal Order of Police for holding a charity raffle without a license during an Aug.
7 golf outing in the village. The department’s inquiry came after Villa Park resident Kathy Gilroy, a volunteer with the Northern Illinois Anti-Gambling Task Force, complained that the FOP didn’t have a raffle permit. Glendale Heights Village Clerk JoAnn Borysiewicz …
http://findarticles.com/p/articles/mi_hb5273/is_200208/ai_n20589753/
Man oh man. Nobody let this woman come anywhere near your block party.
Comment by dan l Wednesday, Apr 22, 09 @ 11:41 pm
Rich, thanks for standing up for your regulars, even though we may not deserve it some days.
Ms. Gilroy cetainly filled her tinfoil hat during her inaugural visit to Captain’s Quarters and likely won’t be back for more.
Well done.
Comment by Arthur Andersen Thursday, Apr 23, 09 @ 5:15 am
She’s always welcome back. But she needs to realize that she can’t just vent that way and not be challenged.
Comment by Rich Miller Thursday, Apr 23, 09 @ 6:12 am
There is a difference, Zato.
It relates to the multiplier, the number of times that rhe purchase of the good or service reverberates through the economy.
The retail purchase of goods results in the purchase of replacement goods to stock the shelves. This provides money which is spent on his business by the wholesaler or middle man. This is true of the ma and pa who buys through a local, Then the middleman pays his people and makes purchases of goods, some locally some from outside the state.
When you get to Wal Mart and target and the big boys, it remains to be seen where the middle man is located. This is especially the case where there are fewer producers or manufacturers in Illinois from which to purchase finished goods. Wal Mart just sends in container loads from depots elsewhere. I high percentage of goods sold there are produced overseas — which cuts the U.S, economic multiplier.
But I digress, Gambling deals in cash. There is no middleman. The owners do not reinvest in the economy (except when the casino is locally owned. There is no tax on each sale (each pull of the slot machine is a sale) as there are at the cash registers at your neighborhood store, only a state tax on profits as well as the State fees. Therefore, by definition, unless the State take is a good approximation of the sales tax per transaction, the state may not be getting what would otherwise be generated. The local municipality benefits but only because of their location.
Location, location location, and those that don’t have a casino (or a shopping mall with the sales tax distributions) lose out.
Comment by Truthful James Thursday, Apr 23, 09 @ 8:12 am
Rich Miller — Your comment “Stupid” and “Bite Me” to my posting is too pedestrian to warrant a reply.
Comment by joe sch Thursday, Apr 23, 09 @ 9:01 pm
After reading these posts, I was dismayed that so little was said about the negative impact casino gambling and the rapid expansion of casinos are having on vulnerable communities: the elderly, the disabled, and communities of color.
Most people in this country aren’t interested in gambling at all and they believe the rhetoric of their local and state politicians, that casino gambling brings “economic development” to depressed communities.
People who don’t gamble, including many of the politicians who propose casinos as a quick way to generate new revenue, don’t see how pathetic the people inside the casinos are. They don’t see the tragedies that are happening as a result of the close proximity of casinos to just about every body in the country.
After struggling for two years with an addiction to slot machine gambling, I can say with certainty that this is not just a matter of choice or personal responsibility. The space of the casino with rows and rows of slot machines, no clocks, and no daylight filtering in, is designed to induce a high state of overstimulation, to hook people, like myself, who might not otherwise engage in such potentially destructive activity.
I should mention also that the number of women becoming compulsive gamblers is growing by the year. And they are committing crimes in greater numbers to cover their debts.
As Professor Kindt and other highly respected economists, psychologists, and neuroscientists are showing, slot machine gambling is especially pernicious, but slot machines generate nearly seventy percent of all gambling revenue.
There is much talk these days about predatory sub-prime lenders, credit card lenders who charge outrageous fees and high interest rates, yet the casino owners and operators continue to rake in enormous profits, even during the recession.
Take a look at Detroit. It has three large casinos, each within 2.5 miles of each other. Greektown Casino has filed for bankruptcy, but it keeps right on operating. The other two casinos, MGM Grand and Motor City casino are in very devastated neighborhoods, where you can’t even find a grocery store.
Those casinos haven’t brought economic development to Detroit. I admit that they can’t be blamed for the City’s woes, but they aren’t helping. And their patrons are not out of town tourists; they are poor, many of them are black, the working poor.
I don’t know if it’s possible to ban gambling, now that the floodgates are wide open, but we don’t need any more casinos. I would call for a moratorium on casino expansion.
With regard to Professor Kindt and his work, there is nothing “kooky” about him. I admit that I’m biased. I recently wrote a book about my gambling experience and benefited greatly from Professor Kindt’s studies.
They helped me understand the economics of casino gambling. I am also a professor. Although I teach literature, I know enough about scholarship to know that Professor Kindt work is thoughtful, rigorous, and carefully documented.
Comment by Sandy Adell Thursday, Apr 23, 09 @ 10:37 pm
=== And their patrons are not out of town tourists; they are poor, many of them are black, the working poor.===
What the heck does being black have to do with anything?
Comment by Rich Miller Thursday, Apr 23, 09 @ 11:05 pm