GAMBLING CAUSES ECONOMIC DECLINE
(from the New Mexico Coalition Against Legalized Gambling)
Across the nation gambling proponents try to promote casinos, state-run
lotteries, river-boast gambling, and Indian Gaming based on the appeal
of the "economic development" that these activities would bring to the
area. We are promised that thousands of jobs would be generated and that
local hotels, restaurants and other commercial endeavors would benefit
from the coat-tail effect of the gambling. We are promised that regional
economies will prosper with the advent of the lottery or casinos, and
that state revenues that pour in from direct management of the lottery
and taxation or management of the video gambling will bring great
prosperity to the state government and lots of its projects. Actual
research on the effect of gambling on local and regional economies
indicates that increases in gambling brings economic decline.
Professor Robert Goodman, in his study entitled, "Legalized Gambling as
a Strategy for Economic Development", describes the effect of gambling
on local business. He indicates that a study in South Dakota a year
after legalizing video gambling in the state did "..show significant
declines for selected activities such as clothing stores, recreation
services, business services, auto dealers and service stations."
Professor Goodman's report, further quotes Timothy Ryan, a University of
New Orleans economist, who reported that a proposed casino in New
Orleans , "..will direct over $62 million from all retail businesses,
excluding hotels." He reported that in, "Atlantic City, homelessness
increased after the introduction of casinos, while clothing stores and
eating and drinking establishments declined. Only a few retail stores
opened in the off-Boardwalk and downtown areas." He further stated,
"Researchers calculated that the growth of crime in the Atlantic City
region reduced property values by $24,000,000 for each easily
accessible community to Atlantic City.." He points out that compulsive
gambling is a major influence causing regional economic decline. His
research, along with the research of Yaffee and Politzer show that
compulsive gamblers drain regional economies of billions of dollars per
year because of costly social programs and damage to existing
businesses.
Research sponsored by the Illinois Business Review in the Spring of 1994
was done on four riverboat communities to determine if the communities
really experienced increases in employment as promised by gambling
proponents. After studying the employment figures for these four
communities, the reports states that the, "...simple before and after
comparisons suggest that riverboats did not create the jobs that were
promised, and in fact, had little effect on reducing unemployment."
They further found that, ".. none of the riverboats for which a full
year of post-opening data was available showed a significant effect of
the riverboat on reducing unemployment or increasing employment, though
one showed a significant negative effect on employment." The Albuquerque
Journal reported in June of 1992 that riverboat towns in Iowa suffered
the loss of hundreds of jobs because of the capricious will of the
gambling industry when Fort Madison had its two floating casinos pulled
out unexpectedly. Casinos promise to create th ousands of jobs, but
Professor John Kindt, a professor at University of Illinois, said, "The
field research indicates that nationwide you stand to lose 1.5 jobs for
every job the casinos create. In Chicago the field research indicated
that 2 to 2.75 jobs would be lost if a land-based casino were built and
that is why Governor Edgar vetoed the proposal." Kindt says of gambling
in general, "...for every dollar legalized gambling interests indicate
is contributed in taxes, it really costs the taxpayer $3.00 to address
the increased socio-economic costs to society."
