Lies About Predatory Gambling Americans are Dealt

gamblingThe anti-casino organization Stop Predatory Gambling Foundation (SPGF) is one of the more popular advocacy groups which oppose state operated gambling of any type, including state lotteries. Since their influence has been present since 2008, claiming to represent more than 10 million Americans, their positions affect casino players in all 50 states. Giving a serious examination of their claims opposing state-operated gambling will shed some light on the problems legislators have to deal with to get casinos built in their states.

To keep the article short and simple, the focus will be on their Lies vs. Facts section, since the argument seems to be that the public is being told lies by state governments in order to get casinos built. Before moving forward, we need to define what SPGF means when they use “predatory gambling” as a catch phrase.

According to their web site, “Predatory gambling is when government uses gambling in the form of casinos and lotteries to cheat and exploit citizens. It’s a mathematical certainty the more citizens spend on gambling sponsored by the government, the more money they lose.“ Therefore, their claim is that governments are knowingly acting like predators, no different than predatory lenders or child predators. The word “predatory” chosen by SPGF definitely evokes strong, negative emotions.

But beyond the emotion, they claim that gambling cheats and exploits citizens by offering a choice as to how they will spend their money. Experienced players know the odds of beating the casino are mathematically small over the long haul. But putting casinos and lotteries in the same bucket is overly simplistic. The same $5 spent at the local 7-11 for a chance at $20 million will get you almost nowhere playing at a casino. The gas to get there and back will probably cost more.

If people who play lotteries or go to casinos are exploited, it is because they choose to be ignorant of the realities of any type of gambling. The odds of winning the Powerball jackpots are echoed throughout virtually every media source. People do know the odds and do not feel exploited. They choose to take a chance, which is the essence of gambling.

Now, on to the Lies vs. Facts according to the Stop Predatory Gambling Foundation.

From their website:

Lie: “Casinos and State Lotteries Will Improve Government Budgets”

There is overwhelming irrefutable evidence proving that government’s gambling program has failed as a long-term revenue source for our society because it is both unsustainable and inadequate.

The presumption made by the SPGF is that governments have seen it as a long term revenue solution. That is difficult to prove compared with a short term solution to fixing state budgets. True, states have milked the casino and lottery incomes and included the revenue in their budgets, but that was only after gambling has proven to be profitable. States could not use casino and lottery money they were not profiting from, which means that the public was a willing and active participant by their own choice. Casinos and state lotteries will improve government budgets for a period of time, but in contrast to an increase to a sales or similar state tax, that improvement does not require every member of society to participate.

Lie: “Commercial Gambling Creates Jobs”

No great nation or state has ever built prosperity on the foundations of personal debt, addiction, and the steady expansion of businesses that milk existing wealth instead of producing new wealth.

The statement is true, but the cause and effect used in the argument is more than a bit of a stretch. First, there is plenty of personal debt built up on a huge number of things other than casino gambling. Should we begin with home mortgages or student loans? Making a case that addiction of any type can drive people into debt is also true, but presuming that every person who goes to a casino is or will become an addict has no basis in fact.

Finally, the idea of creating new wealth for continued prosperity is historically true, but where is the connection between a government run lottery or casino and a business? Governments do not create wealth, they tax it. Personally, I do not see the Stop Predatory Gambling Foundation generating any new wealth with its efforts. But they do ask you to donate.

Specific to the job creation argument, casinos do create jobs, but they are not going to be jobs that require college degrees or highly skilled people. It is condescending when the case is made that because someone is not as educated or intelligent as you are, that somehow working for a lower wage at a job that requires little more than honesty and integrity is less than honorable. Just ask the former employees of the recently closed Harrah’s Tunica casino in Mississippi.

Lie: “People Will Gamble Anyway and They’re Already Doing It Out-of-State”

Many public officials rationalize promoting casinos and state lotteries by saying people will gamble anyway and they’re already traveling to a neighboring state to do it. Yet state lotteries and casino operators openly discuss in the media and in their own marketing research that they are aggressively working to lure new gamblers and create “new markets.”

Actually, Pennsylvania is a model of how to keep their resident’s money in the state. They decided that instead of seeing millions of dollars in casino and entertainment money going across the border to New Jersey, they would have their own state-operated casino system. The result was not only did it stop the flow of money from leaving the state, but neighboring states came to Pennsylvania to play.

The “new markets” being created were in the state, not outside. Of recent vintage is the proposal to add a new casino license in the Philadelphia area. Research and analysis showed that the demand for casino entertainment had not yet reached the saturation point in the state, and that the area of the proposed new casino would not negatively affect other casinos in the area. There is the new market discussed that is intended to meet the business model of supply and demand.

Lie: “Casino 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.

Seriously? They could not have updated their website content at least once in the last 10 years?

But the specific context of the issue is that somehow casinos were supposed to draw in non-Native American players. But the government, out of touch with the American people for more than a decade, thought that the serious players would flock to the Indian reservations. But gamblers like to win, and when the payoffs are less than the competition, such as state-operated casinos, the money will go elsewhere.

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.

As with many of the Stop Predatory Gambling Foundation’s facts, this has a ring of truth to it. But the fact is packaged with a distance from common sense and a dearth of knowledge about casinos. Of course slot machines are the most profitable – there are far more of them than table games. They require no employee (consider the move to virtual Blackjack and roulette machines), can be purchased in large numbers, and require less floor space to play.

From the player’s side, most people like something that is relaxing and does not require a seminar to play. In other words, people prefer slots for entertainment because they require no skill. The argument against the machines becoming more addictive as a result of new technology can be used for video games on an Xbox. People like special effects and will spend their money to see them.

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.

SPGF makes the case that government in stacking the deck against players by dispensing favors to specific casinos and is engaged in border wars with other states, fighting for the best competitive casino location. What this has to do with personal freedom is questionable at best, since the government does the same with recreational facilities and businesses in general. Unless the SPGF doesn’t consider the casino industry as a business.

Since their lead-in argument is lame, they return to the argument that most everyone who goes to a casino is either an addict or debt ridden. In the mind of SPGF, the sole purpose of going to a casino is to win money to pay off debts or hit the jackpot to retire. The same applies to state lotteries. People are unable to make their own choices because we are some type of addict, just like in a supermarket. They should stop giving us all these food choices, such as snack foods, desserts, and breads. Any person with common sense and the slightest bit of insight can see where their thinking leads.

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.

This seems to be the beginning (or continuation) of a conspiracy theory that involves government and the casino industry. Politicians do not point to their own polls that favor them. Nor does any other business. By their logic, everything is a conspiracy against the mindless, clueless public.

But casinos, like any other business, will simply go out of business without customers. The main concern with state casinos today is that there are too many casinos and not enough players and money to sustain the increased casino construction currently going on. In other words, the free market is regulating the industry. Public support for our purposes is defined by the money flowing into the casinos, and in some places it has stopped. The public has spoken.

Lie: “Casinos and Lotteries Are Just Like Any Other Business”

Advocates of the predatory gambling trade say they are no different than other businesses.

The main argument here is that the promoters and owners of the casinos do not participate in or own the product they sell. That is true, but then do the owners of Campbell Soup eat their own product? Or how about Purina Dog Chow? The fact that the founders of these companies took a risk that their product would be successful applies to companies such as MGM and Wynn, who are both hotel and resort property owners – and casino owners. Asking Donald Trump might be a place for SPGF to start its reality check. I may not like Campbell’s Soup or prefer Cesar for my dog, but that does not make me a predatory product purchaser.

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.”

This is clear evidence of the disconnect between the Stop Predatory Gambling Foundation and the real world. Do they ever watch television or access the Internet? Beer commercials are designed to get the testosterone laden male to buy their product to hit the jackpot – that perfect female body with a jackpot personality to match. That is likely to be more life-changing to the average male than watching reels spin at the local casino.

Sarcasm aside, the expectation that someone will hit the jackpot is a dream. That is evidenced by the number of people who line up at the chance of winning a $400 lottery jackpot. They are fully aware that their chances are slim, but they are willing to take that chance at the hope of changing their lives dramatically. Experienced casino players know that the jackpots at the state operated casinos they play in are not likely to approach that size jackpot. The possibility of winning, yes. The promise of winning, never.

Lie: “Investing in the Stock Market is No Different Than Predatory Gambling”

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.

You have to give SPGF credit for continuing their casino-business comparison attack whenever possible. But they need to update their wen content once again because suggesting that banks and financial institutions are not predatory is really weak in 2014. Almost scandalous.

What SPGF overlooks is the fact that a casino offers immediate return on investment, with no middleman to pay and no financial investor required. You win and you can walk away with your money. Casino security is stricter than the SEC regulations because people can walk away with a small or large sum of cash instantly.

In a casino, a winner is a winner. In financial institutions, your money is always at risk. Your deposits may be guaranteed, but there is no guarantee or law when the bank or financial institution has to pay you even if you do profit.

Lie: “Government-Sponsored Gambling Diminishes Organized Crime”

No jurisdiction has EVER documented a decline in illegal gambling following the introduction of legalized gambling.

I have to admit, this final argument I have not heard much about. Personally, I thought organized crime was more focused on profiting from drugs and sports betting than casino operations. And if organized crime still has their hands in casino operations, then it is likely that owners of legitimate operations are aware of this. That means government, casino owners, and organized crime are in it together. Another grand conspiracy.

Like most of STGF arguments, they seem to be living in the 1900’s. THE 1900’s (1900-1909). Are they even concerned about the technological realities of identity theft and credit card scams? Do they realize that cybercrime is one of the FBIs greatest areas of concern for the consumer?

This article can be concluded and the SPGF arguments summed up in this last Lie vs. Fact item. The world has moved forward. No rational person will disagree that casino operations at any level have their predatory or seedy side. Yes, there are gambling addicts and people on welfare who take their government checks to the casino. But suggesting that all casino and lottery gambling is a massive, nationwide problem that is keeping the country from moving forward is baseless.

It is another way for states to increase their revenue pools which in some cases benefits the public tremendously. Like a business, if the model works, then it will be successful. If not, then people will go elsewhere to spend their money.

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Jared Bates

I have been working in, and with different casinos for over twenty years, and as such I have seen many things happen to gambling online and offline. From Vegas to Atlantic City, and small places in between, my passion lies with games where I can win money.

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