Editor’s note: This is the first of two Another Voice articles on the proposed expansion of casino gambling in New York State. The second piece will appear on Saturday.
By Sam Magavern
In deciding how to vote on Proposition 1, voters should ask a simple question: Will expanded casino gambling create more costs or benefits? The answer, according to decades of research, is that casino gambling generates costs to taxpayers that far outweigh the revenues it provides.
Casinos make most of their money not from casual gamblers but from frequent, problem and pathological gamblers who sit in front of slot machines for hours on end. Depending on the venue, slots are programmed to keep between 2 and 18 cents from every dollar wagered. The more you play, the more you lose, and so, by definition, frequent gamblers lose big. When large numbers of people gamble away large sums of money, all sorts of expensive social problems result: embezzlement, fraud, bankruptcy and mental illness, to name a few.
In addition to being individual tragedies, they impose huge expenses on taxpayers. That is why Maryland concluded that gambling addicts cost the public $1.5 billion per year. That is why professor Earl Grinols reports that casinos create $3 in social costs for every dollar they bring in. That is why professor John Kindt has estimated the socio-economic costs of pathological gambling at $80 billion per year.
In exchange, the public receives very little. Casinos do not produce any valuable goods or services. They do not make our economy smarter, more efficient or more productive – just the opposite. Proponents will tell you that casinos create jobs. Sure, casinos hire people to work at them; but for every job “created” at a casino, more than one job is lost somewhere else. Every dollar spent gambling is a dollar that would have been spent elsewhere: a restaurant, sports arena or theater; or, in the case of problem gamblers, perhaps on a car payment or mortgage. Because casinos are dominated by computerized slot machines, they require only a small number of mostly low-wage employees; as a result, they kill more jobs at other businesses than they create. For a look at what gambling does to a local economy, take a quick drive to downtown Niagara Falls and see how local restaurants, taverns and other businesses have fared in the shadow of the casino.
Pretty much the only people who benefit from casinos are the people who own them (and the politicians to whom they make donations). They absorb the profits while offloading the costs onto state and local taxpayers. They know that expanding casino gambling will work just like the computerized slot machines they operate: the house wins big, and everyone else loses.
Sam Magavern co-directs the Partnership for the Public Good.