Predatory Gambling Lies

reprinted from “Stop Predatory Gambling Foundation 2011”
Lie: “Predatory Gambling Will Improve Government Budgets”

There is overwhelming evidence proving the government program of predatory gambling has failed as a revenue source for our society. States with lotteries and casinos have not lowered their taxes and according to the recent national report by The Rockefeller Institute, it has made their budget problems even worse. It helps explain one of the reasons why casino states like California, New York, Pennsylvania, Illinois and Nevada face enormous budget deficits.
Lie: “Predatory Gambling Creates Jobs”

Predatory gambling is a something-for-nothing scheme that veils the most cut-throat business in the country. It milks existing wealth instead of creating new wealth because it is a business based on people losing money. The failed energy giant Enron, the subprime lender Countrywide Financial and jailed investment manager Bernie Madoff are all examples of businesses that employed people and made a lot of money. But hardly anyone believes these kinds of business practices are the right direction for the state and for the country. Predatory gambling operators push the “jobs” story line but no one defends these jobs as jobs with justice because they can’t. These are jobs with injustice.

We are going to have to get out of this economic crisis the old-fashioned way–by digging inside ourselves and getting back to basics: improving U.S. productivity, saving more, reducing our debt, strengthening our families, studying harder and inventing more products and services to export. After a decade of housing bubbles and financial speculation, the days of phony prosperity are over.
Lie: “People Will Gamble Anyway and They Are Already Doing It Out-of-State”

Many public officials rationalize their support for predatory gambling by saying people will gamble anyway and they are already traveling to a neighboring state to do it. While that may be true for a few, the evidence is irrefutable that gambling interests in partnership with our government have turned a nation of small savers into a nation of indebted habitual bettors. In 1982, citizens spent $4.2 billion at casinos and $2.2 billion on lottery tickets for a total of $6.4 billion. In 2008, citizens spent more than $120 billion – $32.54 billion at non-tribal casinos, $26.7 billion at Indian casinos and almost $61 billion on the state lottery.

The predatory gambling trade’s “going-out-of-state” argument has been and always will be a public relations tactic to avoid intense scrutiny about their something-for-nothing business model and their business practices which are the most predatory in America.

When less predatory gambling is available, people lose less money and gambling problems are less. For example, South Dakota outlawed video slot machines for 100 days and the number of gambling addicts treated each month dropped by 93.5%.
Lie: “Predatory Gambling Provides a Better Life for Native Americans”

The Indian Gaming Regulatory Act represents one of the biggest failures of U.S. policy in the last fifty years. Passed by Congress in 1988 under the guise of “economic development” for the country’s impoverished Native American tribes, IGRA has resulted in the transfer of tens of billions of dollars to casino operators while many Native Americans still remain in serious poverty. It also has been the driving force behind the massive expansion of predatory gambling that has overwhelmed the U.S. over the last twenty years.

Casinos are the most predatory business in the country and their business model is based on addiction and pushing people into debt – a truth that remains unchanged regardless whether they are Native American casinos or commercial casinos.
Lie: “Slot Machines Don’t Addict People”

Electronic gambling machines like slots and video poker represent the purest form of predatory gambling and, not surprisingly, are the most profitable. According to the research findings of Natasha Schull, associate professor in MIT’s Program in Science, Technology, and Society, the machines are designed to get every user “to play to extinction’’ — until all their money is gone — by using technology described as a “high-tech version of loaded dice.” Schull writes:

“… its (the gambling business) efforts to make slot machines so effective at extracting money from people yields a product that, for all intents and purposes, approaches every player as a potential addict — in other words, someone who won’t stop playing until his or her means are depleted.”

Dr. Bob Breen, the Director of the Gambling Treatment Program at Rhode Island Hospital, has been even more direct in his public comments about slot machines: “Given the right circumstances, almost anyone can get hooked on slots.”

It is time we stopped pointing fingers at the people using electronic gambling machines as the “problem” and instead, focus our attention on problem machines, problem environments and problem business practices.
Lie: “Predatory Gambling is About Personal Freedom”

Predatory gambling operators and some public officials peddle the myth that casinos and lotteries represent “personal freedom,” attempting to elude charges of exploitation by pleading it is a “voluntary” act.” But the predatory gambling business model is dependent on addicted or heavily-indebted citizens and it only works if our government, in its role as promoter and regulator, takes away the freedom of millions of Americans. By definition, someone who is an addict or someone who is deep in debt is not free. They have lost their free will and their freedom to choose. In a country where everyone is considered equal, where all blood is royal, how can the state actively promote a government program that renders some of our fellow citizens as expendable? John Stuart Mill, the father of the libertarian vision, famously wrote that each individual has the right to act as he wants so long as these actions do not harm others. Today, no business in America is doing more to harm others than the predatory gambling trade.
Lie: “Public Opinion Supports Predatory Gambling”

The predatory gambling lobby promotes the illusion that public opinion supports their business by pointing to polls paid for by predatory gambling interests. Yet independent surveys reveal the opposite is true. A 2010 national survey on predatory gambling by PublicMind, usa-today-sept-2010-casinos-rank-at-the-top-of-most-unpopular-projects_0 Fairleigh Dickinson University’s research center, found that a majority of those with an opinion on the subject believe casinos hurt local communities. Among those who live within 30 miles of a casino, nearly one out of two people said casinos have a negative impact. And a 2010 poll in USA Today showed that casinos rank at the top of the list next to garbage dumps for most unpopular projects with 73% of the citizens in opposition. (click on the graphic on the left to enlarge)
Lie: “Casinos and Lotteries Are Just Like Any Other Business”

Advocates of the predatory gambling trade say they are no different than other businesses. They describe it the same as “drinking wine, going out to a restaurant or going to the movies.” Yet the owner of the vineyard drinks the wine he makes. The owner of the restaurant eats the food he serves. The movie actress watches the movies she makes. This is the only product or service where most of the people who own it and promote it, including public officials, don’t use it and don’t want to live near it.
Lie: “It’s Like Drinking Alcohol”

Drinking a glass of wine or a can of beer is far different than buying a $20 lottery scratch ticket or playing a slot machine. No sip of a Miller Lite has ever offered the false promise of “life-changing jackpots.” While alcohol can be habit-forming, no one has ever compared the potency of its high or the speed at which it addicts people to cocaine – like it has been proved with an intense gambling experience. One out of five Americans don’t think the best way to achieve long-term financial security is to drink Budweiser. Most tellingly of all, the vineyard owner drinks his own wine – most predatory gambling operators don’t gamble.
Lie: “Investing in the Stock Market is No Different Than Predatory Gambling “

While there may be risk associated with buying shares in the traditional stock market, that is where the analogy ends. When an individual buys a stock, he is buying a piece of a company. An applicant for a bank loan can put down $10,000 worth of stock certificates as collateral but try putting $10,000 worth of lottery tickets on the table instead and see if the bank makes the loan. Click this link to watch one of the world’s greatest investors, Warren Buffett, describe why the government program of predatory gambling is the worst kind of public policy.
Lie: “Government-Sponsored Gambling Diminishes Organized Crime”

No jurisdiction has EVER documented a decline in illegal gambling following the introduction of legalized gambling. In fact, illegal gambling tends to increase for a number of reasons. “We loved legalized gambling,” said former Chicago mob casino boss William Jahoda. “It created more customers for us.” Untaxed illegal operators can offer better odds, bigger payoffs and loans that legal operations cannot. Once gamblers start betting legally, they become less averse to gambling in unlicensed establishments. Law enforcement in gambling states see illegal gambling as a state revenue issue rather than a criminal activity, making enforcement less of a priority. Lastly, when commercial interests gained control of the casino business from organized crime, they obtained the ability and the license to abuse and destroy customers to an extent that was not possible when casinos were run by criminals.