Yesterday, author Jim Kunstler made a very interesting article in his weekly blog about the effects of legalized gambling.
http://www.kunstler.com/mags_diary22.html


One of the main problems of legalized gambling is that many states are trying to expand it and use it as a substitute for Industry. Now, other posters have pointed out in a previous debate that the people who work in casinos are doing work, and that the State cannot totally prevent people from using their own money in irresponsible ways.

Gambling can be good for the local economy, provided that the casinos are built in a place that attracts a lot of tourists like Las Vegas or Atlantic City. In this article, Kunstler pointed out that casinos are being built in places that don't typically attract rich tourists, like farming villages and former Industrial centers. And that raises the question, who exactly are the casinos marketing themselves to? Mainly to people who can least afford to lose, like farm laborors and laid off factory workers.

Imagine this. If every major city like Detroit and Philadelphia were to build casinos and market themselves as gambling towns, could they all possibly become prosperous like Las Vegas?

So, the question for debate is
Are cities and states relying too much on casinos for economic growth?
And can the scale of America's manufacturing losses be made up for with the Service Industry in general?

Good question.

Being from Shreveport, Louisiana, I've seen it work in an economy that draws tourism. However, living in Dallas now, I also have seen some of the Indian Casinos in OK seemingly draw local dollars from an impoverished rural population.

I believe that people should know better than to allow gambling unless there is some tourist draw. For instance, people from Arkansas, Eastern Louisiana, and Dallas come to gamble in Shreveport.

To a certain exent, people from Dallas go to the Indian Casinos in Oklahoma, but some of the casinos are small, don't have adequate hotels, and offer nothing but gambling. Some of the people in a couple of those places (there are two casinos that are clients of mine) are really tough looking folks. People who look more desperate than on vacation.

I think the key in this post is that Casinos can't really sustain tourist draws in obscure locations, as rural areas won't offer fine dining or anything other than gaming as recreation. Shreveport, Jackson, and Biloxi at least have alternatives to sitting at a black jack table. Sure- some people go exclusively to gamble in Vegas, but I'd have to say that's the exception as opposed to the rule. After all, why do they have shopping, fine dining, and shows?

I can only speak about what I know, and I don't know about every state in the Union. Iowa, doesn't rely heavily on casinos for economic growth, however the caisnos we do have do provide a lot of revenue for the state. We have casinos spread all accross the state and they all have their own individula purpose, if you will. The casinos in Council Bluffs are a great tourist attraction. Two major interstates intersect in Council Bluffs and they all have hotels and fine dining. Des Moines has a great horse track with a casino and hotel. Accross the street is a theme park and another big hotel. We also have indian casinos throughout the state. I think this is an industry that is valuable, but I don't think the state relies on it for economic growth.

The service industry is a very important industry in America, and it is only growing. That does not discount the importance of our manufacturing industry. Without the manufacturing industry, our economic status in the world will collapse, as it seems to be doing now. Nothing will be able to take the place of manufacturing in America. That is something that we need to fight to keep right here, but that is for a completely different topic.

Are cities and states relying too much on casinos for economic growth?
And can the scale of America's manufacturing losses be made up for with the Service Industry in general?


1) Yes. This is not a positive way to drive revenue. Gambling extracts a huge social toll.

2) No. For a global power to remain one, it must have balanced, strong growth in R&D, manuf, services, finance and all other major fields. The nation whose research and applied technology is best, in both production tech, products, military equipment, etc., will leapfrog the others. We are no different now than we were in the late 1700s--we need to protect key industries and foster technological development. We cannot remain a great power with a near-two hundred billion dollar trade deficit and with one man selling pizza to another guy who provides dog sitting services.

I lived in Reno, Nevada for 15 years. So, I've seen the effects of casinos have on a community in a much broader sense than having a couple indian casinos nearby.

Nevada gets so much money from the high taxing of casinos and tourism that it doesn't even have a state income tax. With casinos, come hotels, restaurants, local technology research companies, slot machine manufacturers, etc... I could fill up a few pages here but you get the idea. With those, come world renowned chefs, literally hundreds of jobs per hotel for the lower class, IT people, Managers, etc... The tourism factor alone pays for Nevada's roads and other things that are paid for by gasoline taxes. There are literally so many advantages to having casinos that it would take much more time than I am willing right now to point out.

I remember every weekend, there would be thousands upon thousands of cars driving over Donner Pass via I80 from the Sacramento area to Reno. Reno is a little different than Vegas. First off, to dispel any common myths, Reno is about 500 miles from Vegas. Nearly everyone I tell "I moved here from Reno" say "oh isn't that near Vegas?" Secondly, if you want to see big shows with disappearing tigers and lounge singers, Vegas is your place. Reno used to be like that, in fact Reno used to be more popular than Vegas in that regard many years ago, but these days people go to Reno for other reasons. Namely, Lake Tahoe. It's a 45 minute drive from Reno to Lake Tahoe. You'll never see a clearer lake of that size anywhere. It's a glacier lake and there are parts of it that no bottom has been found yet, so it's pretty cold. But, there is skiing, cliff diving(for those crazy enough to go swimming), hiking trails that lead up to some smaller lakes just as clear as Tahoe itself, gambling of course on the Nevada side of South Shore, and can even be a fun 3-4 hour drive around the lake, which I've done many times.

The downsides to having a statewide sponsorship of legalized gambling? Well, you'll have to open up a bunch of treatment programs for gamblers that go into the casino to cash their paycheck and walk out with little or nothing left of it. The slot machines get old, real fast. They're everywhere. They're in 7-11, every bar, the grocery store, they're even in Denny's!!!! You'll hear that clink clink clink where ever you go, it's unavoidable.

However, and this could just be me here, but I think the economic value outweighs the downsides.

Yes it does, quick. As does smoking, litigation, heck, even competitive finance! THis is a country based on moral depravity. Its the edge that keeps us ahead of the pack. If the state can siphon money by cheating its own citizens, then by all rights and means, it is obligated, to do so, simply because it can. There is no such thing as balance within government. It is simply a matter of assimillation. As long as the world speaks english, gambles, smokes, and drinks like americans, it doesn't matter what happens to this country. Do you understand? No matter what happens now, we've won. They're us now. We're the new scum.

So...gambling is all right in my book. Its just another vector through which we conquer the known world, culture by culture.

For tax and spend state governments this is little more than a highly regressive tax. And no we cannot make up for lost Mfg. jobs with service jobs but that is a bigger question..