Racing to the Bottom
In poker, the winners don’t always have the best hands. They get an edge by having good information and knowing not to chase after a big score when the odds are against them.
In proposing casinos and slot machine ventures, Gov. Patrick and other lawmakers are chasing against the odds with some very bad information. If they get their way, it’s the state’s residents and businesses that will end up paying the bill.
Their strategy comes down to this: stop the gambling dollars going to Connecticut and bring new revenues and jobs here. But they’re betting on optimistic and inaccurate projections by gambling industry proponents while failing to call for their own independent study.
Virtually every study, including those by the federal National Gambling Impact Study Commission, as well as by the casino industry itself, concludes that the more legal gambling opportunities there are in a state, the higher will be the number of problem gamblers. The federal research concluded that a new facility “within roughly fifty miles roughly doubles the prevalence of problem and pathological gamblers.”
The economic costs of problem gambling are not just borne by the problem gamblers and their families. While they are admittedly difficult to quantify, a conservative estimate, according to our research at the University of Massachusetts and that of other researchers, was that each problem gambler costs other state residents and businesses an average of over $10,000 per year to pay for the debts, bankruptcies, insurance and credit card fraud, embezzlement and other criminal justice costs of those gamblers.
An increase of only one half of one percent of problem gambling in Massachusetts would cost businesses and the taxpayers hundreds of millions a year.
While many people can gamble without serious problems, the evidence shows that from 25 to 50 percent of casino revenues come from problem gamblers. With more gambling available here we can expect, not simply the return of some of the gamblers going to Connecticut, but more gambling, more problem gamblers, and serious economic losses to Massachusetts businesses and taxpayers.
And there’s more to the issue than just those costs.
Ventures in Massachusetts may stop some gambling dollars from leaving the state. But with more gambling available closer to home, more dollars from local residents will be siphoned into gambling instead of being spent at other Massachusetts businesses.
And as has happened in other states, once the casinos are in place, there will be major political changes. Massachusetts can expect a big increase in gambling industry political contributions and influence, a much smaller government role in regulating gambling and a much bigger one as a gambling promoter.
Our legislators should do more than try to bluff the public with the illusion of gambling bonanzas. Like any prudent businessperson, they ought to take a serious look at the costs, and not just the income. No such independent study has been done. Without it, what’s being touted as a winning hand could be a very bad bet.
Robert Goodman
Former director, United States Gambling Study at UMass-Amherst
Former director, United States Gambling Research Institute
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Centralization is the Problem
Protesters gather to bring down the “greedy capitalist system” but ignore how corrupt politicians manipulate the system. The fact is that you can’t have a job unless you have an employer. And employers can’t employ people when government spending, borrowing and regulating take profits and investment capital and increase labor costs.
Every year the federal government takes $4 trillion dollars out of the private economy; 40 percent of this is borrowed mostly from our Social Security and pension contributions, and 60 percent is taken mostly from people who would otherwise invest in businesses and employ workers.
While government spending increases at 8 percent a year, our economy is only growing at 1 percent. Yet the U.S. Senate is unwilling to cut this annual increase and rejects balanced budgets passed by the House of Representatives.
The Senate majority would cut benefits in order to keep the bureaucracy. And they will make these cuts as painful as possible to provoke street protests and cause job losses that justify new spending and more borrowing. This will increase debt and inflation and devalue our wages and standard of living.
The root of the problem is in the centralization of power in the federal government. The solution is “subsidiarity,” the return of power to the states, the localities and the people. We do not need 80,000 new regulations every year. Most government services can be managed at the local level.
Protesters in the streets and politicians in Congress are not going to create one permanent, productive private sector job! We create jobs now by campaigning for and electing senators who will downsize government and grow the private sector economy.
Michael McCarthy
Hayward, Calif.
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Occupy X Demos Need Focus
Images of young women being pepper-sprayed by thuggish police officers, protesters pushed to the edge of the Brooklyn Bridge, even the gated-in “free speech zone” that surrounds our own little Occupy Northampton, have sparked interest and conversation in workplaces and homes across the country [Between the Lines, “Occupational Hazards,” October 6, 2011]. These protests are, and ought to be, a crucial part of our national debate.
The problem, however… is the lack of focus. Each of these protesters, with a scarce few exceptions, targets merely one head of the hydra and not the main stalk. The man behind the curtain has remained safely out of sight, and only slowly is the drape being removed.
While the Bank of America, Citibank, even Wall Street itself make attractive targets to those with more time than books, the attentive protester will know that the Federal Reserve, the Bank of International Settlements and the global Ponzi monetary system itself are the real issues.
The fake talk from Michael Moore on the need to end capitalism is only fuel to the Fed’s fire. Moore, like the Pied Piper of yore, leads the angry youth down a socialist path that the Europeans marched down years ago, only to find themselves in the same financial and debt debacle that we are all currently facing.
The answer to our situation is not a larger social safety net, nor a debt jubilee (though both actions would ameliorate the situation of so many). The solution is the elimination of the Federal Reserve and the return to a sound system of fiscal management based on the actual rule of the people, and not a bloated financial and military industrial complex.
We would all be better served if those protesting, in addition to holding signs, were reading Murray Rothbard, Ludwig Von Mises, Ron Paul, and, lest we be enveloped in a purely capitalistic anarchy, Noam Chomsky, Mikhail Bakunin and Rudolf Rocker.
Kyle Rowe
via Internet
