A buddy of mine spends a couple of days in late January every year in Atlantic City. He goes for a convention, the Atlantic City Pool & Spa Show, but stays in a resort hotel and plays in the casinos.
This year, he was shaken by what he saw. Attendance at the convention was down by about 40 percent, he figured—a clear sign of our troubled economy. If the recession has hit the pool and spa business hard, it appears to have hit the casino industry even harder. My friend said he’d never seen the casinos so empty, not just at the high-roller tables but in the restaurants, where he’s used to seeing crowds swarming the buffet tables.
“The buffets, which are set up to hold maybe 350 people, are usually packed. We’d go in at peak time and see 20 people. It was scary,” he said.
As the Associated Press reported Feb. 1, the news out of Atlantic City is bleak: “One casino in the nation’s second largest gambling market is being run by a state trustee, another may be foreclosed on, and three others are facing down bankruptcy. Hope for Atlantic City always seemed to keep flickering, though, as long as Revel Entertainment forged ahead building a $2 billion casino and hotel. No more. The company this week laid off 400 of its 1,100 workers and stopped work on the interior of Revel, its first-ever project, reflecting the broad decline under way in national and global gambling markets.”
Las Vegas, the nation’s gaming capital, attracted 1 million fewer gamblers in 2008 than in 2007, leading to a drop in revenues of nearly 10 percent, according to a recent report in the Las Vegas Sun. As a result, casinos took on more debt to maintain operations. Many resort operators have halted planned developments; seven major resorts have defaulted on about $19 billion in loans.
The dreary news from Atlantic City to Las Vegas, however, appears to have little impact on the pro-casino forces in the Bay State. A Feb. 2 story in the Boston Herald, under the header “Study lauds casinos on jobs: New cards on the table,” wasted few words on the findings of a UMass-Boston study, “Gaming in Massachusetts: Can Casinos Bring ‘Good Jobs’ to the Commonwealth?”—you bet, the report says—before diving into the politics that bid fair to re-invigorate the push to legalize gaming in Massachusetts: “Last week, one of the state’s leading casino critics, former House Speaker Salvatore DiMasi, left his powerful post. He’s been replaced by Rep. Robert DeLeo, a Democrat who has expressed a willingness to consider legalized gaming in Massachusetts.”
The study praises Gov. Deval Patrick’s 2007 plan to license three resort casinos—a plan DiMasi helped defeat—as “unique in its groundbreaking provisions that, if enforced, could ensure that gaming jobs would be good quality jobs for Massachusetts’ workers.”
The timing of the release of the study, produced by UMass-Boston’s Labor Resource Center, is “a total coincidence,” center director Susan Moir told the Herald. Still, the timing couldn’t be better for casino boosters.
With the casino issue heating up again, the Patrick Administration is preparing to launch a plan to spend a sizeable chunk of the Bay State’s anticipated share of federal stimulus money to help private developers, such as McFarlane Partners and WinnCompanies, partners in the $810 million Columbus Center project in Boston. The justification for the dole out is based on President Obama’s “shovel-ready” concept: stimulus money should go first to projects that can begin putting people to work immediately.
Though Patrick’s largess to major developers will undoubtedly face opposition, the current economic crisis provides some cover: just as the recent federal bailouts to the financial industry sailed through Congress, bailouts to developers will be sold as something Massachusetts can’t afford not to do.
The economic crisis similarly provides Patrick with the cover to intensify his push for gaming. Though not yet shovel-ready, his proposed casinos will be debated against the backdrop of an economy in tatters, when desperate people will do desperate things.
