Economists John Jackson and Douglas Walker published an article in Contemporary Economic Policy in early 2011 that showed that the increased revenue that comes from gambling often comes at the expense of sales tax revenue. The two also came to the conclusion that, in general, casinos and greyhound racing tend to decrease state revenues overall.
Regional Casinos
Economist Testifies On the Negative “Spillover” Effects of Predatory Gambling
Economist Loretta Fairchild testified at a hearing in the Nebraska legislature in October 2011 to express her findings that the costs of predatory gambling significantly outweigh any benefits. She also notes that gambling “is one of a very small number of consumer items that economics considers as ‘special cases,’ because almost all types of gambling do have significant ‘spillovers’ on to people who don’t provide the gambling or use it, and these spillovers are mainly negative, harmful ones, on to families, friends and other businesses.”
Testimony of Economist Loretta Fairchild to Nebraska Legislature
Nobel-Prize Winning Economist Paul Samuelson on Gambling
“There is a substantial economic case to be made against gambling…it involves simply the sterile transfers of money or goods between individuals, creating no new money or goods. Although it creates no output, gambling does nevertheless absorb time and resources. When pursued beyond the limits of recreation, where the main purpose after all is to “kill time,” gambling subtracts from the national income.”
From Economics, 6th edition, 1970
Penn National Finds a Way to Market to Problem Gamblers
In 2008, the Illinois Gaming Board fined Hollywood Casino, owned by Penn National, $800,000 for marketing to customers who put themselves on the state’s self-exclusion list. “As part of a campaign to develop new customers, the casino rented a list of names from a firm that operates ATM machines at Illinois casinos. In January, the casino mailed promotional materials, including coupons to use at Hollywood Casino, to nearly 15,900 people identified as prospective customers. However, the casino’s marketing department failed to check the list against the names of people enrolled in the Gaming Board’s Self-Exclusion Program. The board said 146 people in the program received the mailing.”
Atlantic City Sees Large Growth in Poverty
While predatory gambling operators around the nation are still selling the idea of “destination resorts,” it is important for citizens to consider how one of America’s most well-known destination resort is faring. The 2009 article below from the Press of Atlantic City reports that the “city’s population fell slightly to 34,769 in 2008, down from 35,770 in 2007 – but the percentage of families living in poverty grew to 24 percent from 19 percent in the same period.”
The Definition of Addiction Changes
The American Society of Addiction Medicine has a developed a new way of classifying addiction. “The definition, a result of a four-year process involving more than 80 leading experts in addiction and neurology, emphasizes that addiction is a primary illness – in other words its not caused by mental health issues such as mood or personality disorders, putting to rest the popular notion that addictive behaviors are a form of “self-medication” to, say, ease the pain of depression or anxiety.”
This new definition refutes a great deal of research funded by predatory gambling operators that claim that gambling addicts are merely suffering from another form of mental illness and that they would simply substitute a gambling addiction with another addiction.
Disney and Florida Chamber of Commerce Oppose Florida Gambling Expansion
The state of Florida often markets itself as a family friendly destination, attracting millions every year to Orlando’s Walt Disney World. That image could change if Florida lawmakers allow predatory gambling giants like Genting, Las Vegas Sands, and Wynn to bring commercial casinos to the state. The state’s tribal casinos oppose the idea because they don’t want the competition, but civic leaders and the Florida Chamber of Commerce fear the kind of economic development that casinos would bring. “The only reason they are even targeting Florida is that they are hopeful that desperate people will reach for desperate measures,” said Mark A. Wilson, the Chamber president. “There is never a good time to push a bad idea.”
Bad Odds for Youth Gamblers
A recent Johns Hopkins study found that gambling was considered to be normal behavior among a survey of adolescents, particularly among males. Even more troubling was that 12 percent of the participants had behavior considered to be “problem gambling” – much higher than the 1 to 3 percent that is normally attributed to U.S. adult populations.
Government Study Reveals the Massive Cost of Problem Gambling
While government-sanctioned gambling is often trumpeted as a new source of revenue, a 2013 study shows shows the staggering cost of problem gambling. This national Australian report reveals that the social and economic cost of problem gambling could total up to $2.8 billion per year.
Slot Machine Profits Jump 70% In a Decade
According to Nevada Gaming Control Board statistics, there were about 197,000 slot machines in that state that won roughly $4.8 billion from gamblers in 1997. By 2007, the number of slot machines increased just 2.5 percent to 202,000, but the amount they won from gamblers jumped 72.9 percent to about $8.3 billion. This is primarily because slot design became far more advanced in fleecing and exploiting users.