Gov. Andrew Cuomo has an idea for invigorating New York’s economy — for boosting tourism, creating jobs and increasing tax revenue.
It’s not manufacturing light bulbs or braiding hair or planting Christmas trees.
It’s gambling! Yes, gambling, an activity that for most of human history has been regarded as a vice and as an absolute drag on productivity. Rolling the dice and betting on the result. An activity in which nothing useful or even useless is created. An activity so worthless and even destructive that for most of our history in most of our states it has been illegal.
“Gaming,” the governor calls it, employing the marketing language of the casino industry.
“It’s not a question of whether we should have gaming in New York,” he said in his State of the State speech last week. “The fact is we already do,” and he cited the five Indian casinos and nine slot-machine operations attached to racetracks, urging that we simply go the logical rest of the way and legalize full-fledged casinos in the manner of Nevada, for which a constitutional amendment would be required. Blackjack, craps, roulette, poker, the whole works.
“It’s estimated,” he said, “that over $1 billion of economic activity from gaming can be generated in our state.”
Economic activity, he calls it. Push a $20 bill into a machine, press a couple of buttons and watch it disappear.
Everyone else is doing it, so we might as well do it too. If we don’t, well, our residents will just go somewhere else to lose their money.
The real attraction to government, of course, is the tax revenue. Never mind “jobs,” that tiresome old buzzword. What jobs? Walking the floor serving beverages to zombies sitting at slot machines?
It’s the free money pouring into the state treasury. The state already rakes in $3 billion a year from the lottery and slot machines, and the nice thing about it is nobody complains the way people complain about taxes.
Buy $10 worth of lottery tickets and about $5 goes straight to the state, but it doesn’t hurt because 1) you don’t have to buy the ticket if you don’t want to, and 2) there’s always the chance that you’ll win a fortune.
It’s a dream situation for elected officials. Taxes that are not called taxes, about which nobody complains.
As for real economic benefits, just use your common sense. If you lose $20 playing a slot machine, which takes no more than half a minute, that’s $20 you don’t have for something else. You could just as well call it $20 taken out of the economy as put in. You’ve spent your money, and you haven’t gained anything except a slight scratch to that part of your nervous system which itched.
And that is not to mention the social costs, which were analyzed by a professor of economics at the University of Illinois, Earl L. Grinols, in his book “Gambling in America: Costs and Benefits.”
The costs are for things that the gambling industry prefers not to talk about, things like bankruptcy, embezzlement, domestic violence, lost productivity at work, and what he calls “abused dollars,” or money acquired from friends and family under false pretenses.
State governments like to think of gambling taxes as free money, but of course there is no free money. What you don’t pay one way, you pay another.
A local official embezzles hundreds of thousands of dollars from a town bank account in order to feed a gambling habit, and that loss has to show up in a ledger eventually.
The Lottery Division, which keeps the records, would tally it as “net win,” if the money is lost on slot machines, but you don’t have to be a certified economist to see the deception.
When you have some free time, drop in on an OTB parlor and look around at the fun-loving, entertainment-seeking crowd you find there — and of course I’m being facetious, since the crowd is as dour and hopeless as the crowd you’ll find at any hour of the day in the casino at Saratoga.
Watch those people grimly lose their money — money that otherwise would have been spent on rent, or dinner out, or car payments — and ask yourself if this is the “economic engine” that Gov. Cuomo claims.
Grinols calculates that the social costs of gambling outweigh the economic benefits by a ratio of 3 to 1.
But of course the costs are often hidden and are diffused throughout the economy, whereas the benefits, at least the benefits to government, are immediate and easy to see — $3 billion a year right now and a lot more on the way if we become a statewide Las Vegas.
We might not even have to amend the state constitution. Slot machines, as opposed to lottery games, are prohibited by the constitution, but when the state wanted them the Court of Appeals helpfully ruled they were not really slot machines, they were video lottery terminals (VLTs), so anything is possible. They could just say a casino is a cow barn, and we’d home free.
At any rate, that’s economic activity for you.