States Hooked On Casino Snake Oil

Casino became legal in more than 30 states because they were sold as economic growth engines and poverty fighters. Wrong. Casinos on tribal land have not reduced the crushing poverty in the Native American community [1]. States which brought in commercial casinos -- like Michigan -- have not revitalized their local economies. (Check out our Stress Test report [2] for how states are struggling across the board.)

Yet desperate state governments [3] are still falling for the gambling snake oil. Stateline reports: [3]

States are betting that Americans’ love for gambling will help them beat a faltering economy as new racetrack casinos or “racinos” open this year in Indiana, Pennsylvania and New York. Maryland and Kansas are also working toward cashing in on the one-armed bandits that bankroll important state programs from Maine to Florida.

“Racinos are the best way to go” for states looking to strictly boost revenue, rather than other gambling proposals that also aim to create jobs, said Clyde W. Barrow, director of the Center for Policy Analysis at the University of Massachusetts Dartmouth.

Racetrack casinos are seen as an easier sell to voters than casinos, because the proposals generally don't involve building new facilities, but simply adding slot machines to tracks or other venues where gambling already is sanctioned. In some cases, adding slots to racetracks is pitched as a way to help bolster a state's own racing industry.

Also, higher taxes are levied on slots at racetracks than at casinos, making racinos more desirable to cash-strapped states.

How about instead of propping up an industry that creates nothing and preys on the poor, we bolster industries that will strengthen America's foundation, create sustainable jobs and help our workers thrive in the global economy?

We can invest in generating clean energy, building fuel-efficient vehicles, and turning buildings green. We can repair and rebuild our crumbling infrastructure. We can make teaching pay, attracting great educators while preparing the next generation for the global economy. We can provide quality healthcare for all, stemming skyrocketing medical costs that burden both families and businesses.

As Stateline notes: "Gambling is a bona fide business in all but two states for a simple reason: It’s an easy way to get dollars flowing into the states without raising taxes." But the casino quick fix is a proven failure that has done nothing for our weakened economic foundation.

In fairness to the states, it's hard for them to take the lead when Washington doesn't invest in America, and doesn't even provide state aid so they can close budget gaps and maintain basic services.

Change has to happen at the top, but that's no excuse for states to expand the failed policies of the past.