Here, I will discuss gambling. I will use my home state of Indiana as an example. I will discuss what brought about the rise of gambling in the state of Indiana, its limitations, as well as its impact. Since many states within the United States have similar rules concerning gambling, these limitations, and impacts of gambling apply in most places across the country.
Proliferation of Gambling
Gambling – Indiana has, I believe, 12 casinos spread throughout the state, with a few in Northwest Indiana, a couple in central Indiana, and several in the southern part of the state, especially along the Ohio River. Some of these casinos, such as the one in Anderson and the one in Shelbyville (Fairland) started out in the pari-mutuel industry, having horseracing as its mainstay, and eventually got permission to attach a full-fledged casino to the facility. In French Lick, the new casino there is best described as a regentrification, or revitalization, of a former casino resort that previously functioned there back in the early part of the twentieth century.
It seems, though, that most of our casinos sprang up, like the National Gambling Impact Study Commission says in their Final Report, to try to glean money from players from other states after neighboring states tried to put up casinos to try to glean money from our state’s citizens, causing, or almost forcing, a need to put casinos in peripheral locations, as a reaction, to try to counteract the effects of other neighboring state’s casinos. For example, in Indiana, we have casinos in East Chicago, Hammond, and Gary, all vying for the potentially large amount of money that can be gotten by potential gamblers in the Chicago area, right across the state border in Illinois. There is another casino in Michigan City which is in close proximity to the Michigan state line, and tries to get Michiganders to come to the Indiana side, also built to compete with another large casino right across the Michigan border in New Buffalo, Michigan. In southern Indiana, there is still another casiono just outside of the Louisville area which tries to vie for the money from the residences of that metro area, particularly those who live on the Kentucky side of the Ohio River. There are still other casinos in the southeast part of the state, along the Ohio River, which try to glean money from people in the neighboring Cincinnati metro area, southwestern Ohio, and its Kentucky suburbs, while still another casino in Evansville tries to glean other Kentucky money.
Besides the casinos, and the horseracing facilities that we have here in Indiana, we also have the Off Track Betting (OTB) facilities, where a person can wager his/her money on a horserace in some other state, such as at Pamlico or Churchill Downs. In Indiana, we have three such locations, Indianapolis, Fort Wayne, and Merrillville, which have become just another way for people to gamble their hard-earned money away.
Lottery – In Indiana, we do have a lottery program, and have several different games that can be played, some of which are national lotteries, some of which are state lotteries, include quick-pick and daily number draw games, as well as many other scratch-off and pull-tab games. Since research seems to show that lottery games are like a voluntary regressive tax on the poor, where the lower a person’s income, the higher percentage of his/her income is spent on lottery, and gambling in general, the larger the number of possible games a person can play, the higher the temptation for those who are down-and-out to play those games. There are so many lures to try to get people to volunteer their money, in the hopes that they’ll win big, even though they have a better chance of getting struck by lightning.
Rules and Limitations to Gambling
What are the limitations to gambling and lottery in our state, that might also apply to the rest of the country? There are several that I can think of:
- A person/company cannot supply riverboat casinos with gaming equipment and supplies unless they have a supplier’s license, and there is a strict code on who is required to have that license, including many different positions within the casino, as well as a very detailed background check with fingerprinting.
- A person working in the casino must get an occupational license, which also includes a very detailed background check and fingerprinting, and pay a fee.
- The state, according to the Riverboat Gambling Act, passed in 1993, limited the number of possible casinos to 11, and limited them to being on riverboats, although since that time period the rules have changed, as we now have more than 11, and have some casinos that aren’t on a riverboat.
- All the gaming equipment must be primarily electronic in nature, including the blackjack tables, the roulette tables, and slot machines. This allows the revenue streams to be more strongly monitored by the state for tax purposes. Of course, if there is a glitch in the computer system, like there was at the casino by Louisville back a few years ago, where people have to wait hours to get paid, that can be a negative side effect.
- For a casino to open up in the state of Indiana, it must get licensed to do so from the Indiana Gaming Commission.
- The purpose of the Casinos, and Lottery, is to offset and lower taxes for the state and municipal governments in which they operate.
- The Hoosier Lottery earnings in the state of Indiana, besides going to pay individual winnings, store commissions, and to compensate for lower excise taxes on our vehicles, go to pay for the pension and disability funds of retired firefighters, police officers, and teachers.
Impacts of Gambling
What impact has gambling, the pari-mutuel industry, and lottery had on our state? I can name some things that are found in the National Gambling Impact Study Commission Final Report, in chapter 1, s.s. 2, chapter 4, and chapter 7. Here is a list of some of the issues:
- Increasing the proliferation of places where people can gamble increases the likelihood of problem gamblers, and the issues that stem from that, such as broken marriages, family and work problems, financial problems including bankruptcy, suicide, and crime from people desperate to get money to gamble some more. If gambling were limited to distant locations, such as Las Vegas, then it would put gambling out of reach of people that didn’t have the extra discretionary income to afford it, greatly reducing problem gambling.
- Gambling and the Lottery have been shown to be very similar to a regressive tax, where, the lower the person’s incomes, a higher percentage of their wages are gambled away. One reason for this is because the higher a person’s income, less of their income can go the same distance. Another reason may be that the higher a person’s income, the more educated they may be, suggesting that they may be more well-informed about gambling.
- When gambling institutions open up in an area that is blighted, not only does it help to create jobs among those people in that community, but it is also just as likely for the blighted individuals to go there hoping that the casino is their route out of poverty, when, in fact, quite the opposite is true – those people are more likely to end up in a worse state of poverty. For example, within two decades of the casinos opening up in Atlantic City, most of the other businesses within a half-mile radius of the casino locations had shut down, except for the occasional pawn shop and payday loan places. In other words, casinos can cause more blight in their immediate surroundings, but improve the situation for their region.
- Many of the arguments used by proponents of gambling (as well as some of its opponents) are based on faulty research that are short-sighted in its scope, not seeing the long-term impacts, or look at the benefits of a region without looking to see if it benefits the immediate locale, and so forth.
- Even the lottery can be abused. I remember one individual that I used to know would go to a gas station, go up to the scratch-off ticket vending machine, put five or six 20-dollar bills in, take all those tickets, scratch them to see what her winnings were, take the winning tickets to the cashier, get the money, and go back to the vending machine, repeating this cycle several times, each time with less money, until all the money was spend and there was no more to be had. Of course, even those who aren’t problem lottery ticket purchasers need to acknowledge all the money they spent on those tickets over the course of a year.
Possible Solutions and Conclusion
So, what are some things that we can do to resolve the issues that arise as a result of gambling and lottery? First, I would suggest that we replace our present lottery system with a Prize-Linked Savings (PLS) account system like they have at banks in the United Kingdom and elsewhere in Europe, that links putting money in savings with getting prizes and jackpots rather than linking throwing money in a big sinkhole with those same prizes. I would also suggest that we create a national database that requires, by law, that all people have their ID’s checked, and all people that have financial problems that are related to gambling be blacklisted for life from entering any casinos, purchasing any lottery tickets and getting any scratch-off tickets. This would help substantially to relieve the problems that are associated with problem gambling.
There is another, more drastic, approach that we could take, but I’m sure that it wouldn’t turn over well with most people, particularly the casino owners. We could limit gambling to the state of Nevada, giving them a special status since they don’t have much other economic interests as a mainstay to their state economy like other states do. In order to allow all of the other states to benefit, half of the profits, or a quarter, depending on what was agreed upon, would be divided up between the other 47 contiguous states, using some ratio that was formulated for fairness, and which allowed all states to benefit from gambling earnings like they do under the present gambling proliferation that we have now.
Anyways, there is much more that can be said about gambling, both good and bad, and about the present multi-faceted gambling situation we have here in Indiana. And, the case is almost exactly the same in most other states across the United States. We are left with many problems because of the nature of gambling in our state, and we also have possible solutions to our problems as well.
The National Gambling Impact Study Commission Final Report can be found at http://govinfo.library.unt.edu/ngisc/reports/fullrpt.html, although the website does not seem to work anymore.
