Debt Culture and Poverty
The Message of Government at the Time of “The Greatest Generation”
During the Great Depression, leaders like NYC Mayor Fiorello La Guardia (watch the brief news clip below) aggressively went after those who preyed on the financial struggles of his city’s working class.
What we now call “The Greatest Generation” challenged citizens to help make America and their families stronger by buying government savings bonds. Today, the daily voice of government to most citizens during the worst economic crisis since then is casinos and state lotteries. After forty years, it’s time government pulled out of the predatory gambling business because it is a failed policy.
The video is part of a “25 years ago today” UN newsreel story issued September 24, 1959.
For more information about how predatory gambling impacts low-income citizens, please also visit our Lotteries: Who Really Plays section.
Survey: 21% Say Lottery is Most Practical Path to Wealth
According to the survey of 1,000 Americans by Opinion Research Corporation for the Consumer Federation of America and the Financial Planning Association, 21% of those surveyed believed that the lottery would be their most effective and practical strategy for accumulating several hundred thousand dollars. This percentage in addition, was higher among lower-income individuals, with 38% of those who earn less than $25,000 pointing to the lottery as a solution.
Survey- 21% say lottery is most practical path to wealth
A Nation in Debt: How We Killed Thrift, Enthroned Loan Sharks and Undermined American Prosperity
This essay written by Barbara Dafoe Whitehead appeared in the July/August 2008 issue of The American Interest. It is excerpted and adapted from For a New Thrift: Confronting the Debt Culture, a report released in May 2008 by the Commission on Thrift. Whitehead exposes how anti-thrift institutions like state lotteries, casinos, payday lenders and credit card companies hinder the average American’s ability to save their earnings and get ahead financially. These institutions have been the main contributors to the growing amount of consumer debt accumulated in recent decades. Whitehead calls on the public to reform these institutions and to advocate for a culture based on saving and wealth-building.
Exploiting the Working Poor
In 2010, the Lehigh Valley Research Consortium released a report showing that 48 percent of those below the poverty line in the Lehigh Valley intend to gamble at the Sands Casino in Bethlehem, Pennsylvania. ”The casino ads always show young glamorous-looking people gambling,” said Michele Moser Deegan, a Muhlenberg College associate professor who directs the consortium. ”But when you go inside, you can see that it really is the working poor and middle class. This survey shows that.”
Bankruptcy Rates: A County Level Analysis
At Creighton University, Ernie Goss, Professor of Economics and Edward Morse, Professor of Law, used bankruptcy information to compare the roughly 250 U.S. counties with commercial or Indian casinos. “Our regression analysis on matched-pair counties indicates that those counties that legalized casino gambling during the 1990s experienced a cumulative growth rate in individual bankruptcies that was more than double the growth rate for corresponding non-casino counties.”
The Impact of Casino Gambling on Bankruptcy Rates – A County Level Analysis
The Impact of Casino Gambling on Personal Bankruptcy Filing Rates
John M. Barron, Dept. of Economics at Purdue University; Michael E Staten of the McDonough School of Business at Georgetown University, Washington D.C. and Stephanie M. Wilshusen Georgetown looked at larger market areas and determined, “Our analysis predicts an 8% decline in 1998 filing rates for casino and collar counties, and a 1.4% decline in filing rates nationwide if one were to eliminate casino gambling.”
The Impact of Casino Gambling on Personal Bankruptcy Filing Rates
Poor People Spend 9% of Income on Lottery Tickets
This blog post from WalletPop.com outlines the reasons why people on low-incomes spend so much on lottery tickets: the hype about big jackpots, the ritual of playing and the fact that many people believe that playing the lottery is best way to achieve financial security.
Poor People Spend 9 Percent of Income on Lottery Tickets
Poverty and Casino Gambling in Buffalo
In January 2011, the Partnership for the Public Good in Buffalo, New York published this policy brief which examines how the Buffalo Creek Casino exacerbates the city’s urban poverty crisis.
Poverty and Casino Gambling in Buffalo
Atlantic City Looks To Bus More Homeless Back Home
When predatory gambling interests come to your town or city, they falsely promise new jobs, revenue, and overall economic prosperity. However, the story below highlights the dark side of the industry. Beyond the glitz and glamor of Atlantic City’s multi-million dollar casinos, hundreds of homeless people are on the street with no place to go.
Atlantic City Looks To Bus More Homeless Back Home
Thrift or Debt: Which Direction is Right for Texas?
The Texas Thrift Coalition is a nonpartisan, volunteer group of leaders and organizations whose goal is to promote thrift and encourage savings as a path to family prosperity in Texas. In 2011, the group published Thrift or Debt: Which Direction is Right for Texas? which found: Texas families face a savings crisis; anti-thrift institutions are trapping Texas families in debt; Texans see a danger in the rise of the anti-thrifts; Texans oppose the expansion of state-sponsored gambling; and Texans want to save more. The coalition issued the following recommendations:
To Oppose Debt
To Support Thrift
Thrift or Debt – An Appeal to the Texas Legislature From the Texas Thrift Coalition
The Unusual World of Casino Debt Collection
Casinos often give out loans (or “markers” as they are known) to players in need of cash. To keep them coming back, casinos generally charge an interest rate of 0% and give players several months to repay loans that can run into the hundreds of thousands of dollars. But when players can’t pay the loans back, casinos send a demand letter and can refer the case to the local District Attorney’s office bad check unit which prosecutes such crimes. Sometimes casinos file a civil suit as well. In addition, casinos (like other debt collection agencies) do not have to abide by regulations of the Fair Debt Collection Practices Act.
SPG Memo – Casinos and Debt Collection