Friday, October 14, 2011

Casino gaming bill will pass, but at what cost?

When I have an important decision to make, I jot down the plusses and minuses. It helps me visualize the issue.

For background, I will tell you that I don’t have particularly strong feelings about casinos one way or the other. I’ve been to Las Vegas and Foxwoods, spent a little bit on slot machines, and walked away having lost my money but having been entertained. Call it even. I play the lottery once in a while, usually when the prize breaks $100 million. I don’t have any favorite numbers, so I get a Quick Pick.
I don’t harbor any addictive behavior that I’m aware of other than for Diet Pepsi and the New England Patriots. Given my “neither here, neither there” attitude towards gambling, I am inclined to vote based on constituent input which, from a nonscientific sampling, is running slightly in favor of the casino bill.
This is where my plusses and minuses list comes in. On the plusses list:
Gaming will bring more economic activity to the state. I’m not sure how much of that will be generated from outside Massachusetts versus inside, but there’s no question that there will be jobs to build and operate the casinos.

I’m already running out of plusses. Some would add the projected $300 to $600 million in taxes to this list, but I’m not at all convinced that giving more money to government is a good thing. And I seriously doubt the accuracy of these revenue projections. With a budget gap each year of more than $1 billion, the $300 million (if it holds up) will be used to balance the budget, not generate spending on new programs. We could do the same by trimming the $30 billion state budget by one percent.

On the minuses list:
Class 3 gaming will add to the currently available legal gambling that has many people spending nondiscretionary income, going into debt, and getting caught up in destructive, addictive behavior.

The sheer expansion of the state government’s regulatory structure is enough to make us think twice. The gaming bill adds a commission of five people with all of the incumbent bureaucratic positions and support personnel. New jobs? Yes. But this commission will not supplant the lottery commission; only add to it.

Casinos always make money. In the big picture, the collective amount of money spent at casinos represents money not spent on more productive activities or not stashed in a savings account. The Libertarian in me says that I shouldn’t be concerned about other people’s decisions, but I’ve been in rooms filled with retirees playing slot machines in a robotic way, some of them sucking on cigarettes and some sucking on oxygen canisters; some on both. It’s not a pretty picture.

Another issue is timing. We are about to launch bidding on three resort casino licenses and a slot parlor license during the worst, most protracted recession since the Great Depression. This will ensure less competition and lower bid prices. I predict that, because the bill regionalizes the licenses, the western Massachusetts license will go unsold for a long period of time. The region is just too close to Twin Rivers in Rhode Island and the two Indian casinos in Connecticut. Don’t be surprised if we’re back in the chamber voting to lower the minimum bid prices next year.

Another minus for me is the way this bill has evolved. When Sal DiMasi was speaker, an ardent opposition voice to Class 3 gaming, the Democrats in the House of Representatives defeated the bill. A year later, with Bob DeLeo as speaker, many of the same Democrats had “seen the light” and voted for it. We all know what’s going on here.

After the embarrassing show of wills we witnessed in 2010 between the governor, speaker, and senate president (all of whom supported Class 3 gaming), a compromise was worked out this year between the three of them. Horses were traded and an acceptable version of the bill was crafted. All of this was done behind closed doors; closed to all but a select few.

Finally, I point to a quote printed in the Cape Cod Times on September 26th“This is a jobs bill; that’s the only reason we’re doing this,” Senate President Therese Murray said. “If we had a cooking economy, you wouldn’t see this happening.”

That statement gives me great pause. Should we embrace all manner of vices in tough economic times? Periods of recession and prosperity come and go. The decision to establish casinos is forever.

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