"Poker chips kill Main Street" Third in a series

One of the most rapidly growing segments of travel and tourism in the U.S. is gaming, a $26 billion industry growing 12% a year between 1982 and 1990.

Gaming takes many forms. These include lotteries -- usually to fund the Triple Es (education, environment and economic development), casinos to revive rural communities, riverboats on the Mississippi operated by Iowa (low stakes) and Illinois (high stakes) to create jobs in slumping river cities, day-cruise casino ships to spur Texas Gulf coast tourism, off-track betting in Wyoming and Nintendo-like video lottery terminals to make it easy for anyone, anyplace, anytime to gamble.

Gaming is stimulated by the appetites of state and local government for new sources of revenue. It is an issue in nearly every state. Tribal-run gaming, with about 100 operations, has grown rapidly since Congress passed the 1988 Indian Gaming Regulatory Act.

These are troubling developments. The objections are many. Some are moral. Many people particularly object to state government using modern methods of persuasion to get people to gamble.

Others object on equity grounds. There is growing evidence that a disproportionate number of poor and low income people play lotteries and gamble. According to a recent report by gaming industry observer Robert Goodman, up to one-third of poor people who gamble spend 20% of their income on gambling, encouraged by the sophisticated advertising bought and paid for by state government.

Thus, state governments try to expand their revenues on the backs of poor people. And, lest we forget, what the state calls its "gross revenues from gambling" is another way of labeling "net losses by citizens." Even lotteries, because they draw money primarily from the limited disposable income of those in the local economy, hurt Main Street by robbing retail, one of the most troubled sectors of the U.S. economy today.

In the early stages of debate, gaming is often presented as an economic development tool. Goodman notes that, "(Community) leaders hail the coming of casinos the way they once welcomed manufacturing plants. They envision towns, revitalized by gambling, rising phoenix-like from the ashes of abandonment."

But as gaming expands, so do the opportunities for evaluation. Las
Vegas, in a class of its own, is booming. A diversified convention, entertainment, sports and family destination, Las Vegas has become a western Orlando.

Elsewhere, negative evidence mounts: the economic development pay-offs are meager; infrastructure costs are high; the social impacts are severe. For example, gambling is the fastest-growing teenage addiction. Per capita crime in Atlantic City rose from 50th in the nation to first in just three years after the first casino opened. Atlantic City is a mess.

Consider a 1988 report of the New Jersey's governor: "It is clear that retail business and retail employment in Atlantic City have continued to decline despite the presence of gambling, and that rampant speculation has rendered the redevelopment of vast parts of Atlantic City difficult if not impossible."

The 1991 Travel Industry World Yearbook reports that "today, Atlantic City, outside a thin row of large spectacular casino hotels, is a decaying, seedy impoverished town...which lost 20% of its residents" in the past 12 years. Change a few words, and this description might fit one of the newest casino towns, Deadwood, South Dakota, which some describe as an open sore in the Black Hills.

So, although people are divided on the moral issue, it's increasingly clear that gaming is a bad idea for economic development.

The rapid growth of travel and tourism has a dark side. Unfortunately, the dark side is government sponsored, promoted and supported.