Governor Deval Patrick is looking to legalize gambling in the state of Massachusetts. While the momentum has been going for some time the Legislation will not finally be voting on it until early 2009 this time around. While the plan is based on economic stimulus it is never as simple as that, which is one of the reasons it may have been turned down in the past.
Patrick wants to propose three casino licenses be granted at $200 million each in Boston, western and southeastern mass. He estimates the taxed revenue at 27% will bring in $400 million to help with the state’s budget deficit. Some estimates have put this a bit higher, but it is clear they are aiming to make up the $1.3 billion deficit within a few years of the casinos opening. Whether these numbers are realistic once they are put into a realistic scenario is unclear.
Right now citizens often drive to Connecticut to visit Foxwoods or Mohegan Sun casinos to gamble. It is estimated that the residents of mass spend $800+ million a year at these casinos which nets the state of Connecticut $122 million in revenue through the taxation of that amount. Many residents have said they would stay in state given the chance though. Many don’t like the drive (which can be from 2-4 hours) just to gamble but have little other choice.
By setting up a monopoly on gambling they will be able to fix the budget, or so they say. Some have asked why gambling if the state just needs a business to run to get money to fix the budget. The truth is that just running a chain of successful coffee shops wouldn’t be enough. The plan relies on the taxation of large revenues, as well as the fact that its a new niche not one where they would have to compete with established businesses. There are an estimated twenty thousand permanent jobs which will be created by these casinos, along with many more temporary and seasonal jobs. This could help out more than just the state budget in harsh economic times.
But some are wary of the dangers such a plan would bring. Problem gamblers make up somewhere between 1-2 percent of all wagers made yearly. Crime and other social issues would also escalate with the introduction of a casino, especially if not placed well. Many things that are a concern could eat into the $400 million in revenue the state would be planning on gaining from the casinos yearly.
While problem gamblers only make up a small portion of the overall gambling group they make one third of all wagers placed. This is obviously grossly disproportionate. Also taking into account that the gambling population is denser in areas surrounding gambling establishments the actual number (as opposed to just percentage) goes up alot. One percent of a thousand isn’t much, but one percent of say ten thousand is pretty scary.
Often times these problem gamblers are not middle to upper class citizens but lower class, who have the least to lose. This sets up a dangerous precedent, with the state baiting them into dangerous financial decisions. After they try to get help they often go to treatment centers which use the popular Twelve Step method to treat the addiction. Many of these would be state funded, which will eat into those profits from taxing the casinos. Those with gambling debts may also turn to thievery to pay them off, starting with friends and family members before escalating to larger markets.
Unless the casinos are set up away from communities and cities there is an added danger of crime. Big winners often are unprepared for such a windfall and flash their cash which draws thieves. This means more police presence, which further cuts into casino profits for the state. This can be somewhat circumvented by placing casinos out on the outskirts which would require deliberateness to get to. A well kept parking lot and security for it can help keep criminals from easy pickings.
So while the state is looking over the proposal once again, it is keeping other things in mind as are the citizens which have repeatedly shown their disinterest in allowing legalized gambling in their state. No doubt there will be more studies done to determine the impact of the decision before the voting is done. But perhaps there doesn’t need to be. The citizens of Massachusetts may have decided for themselves without fancy studies what is best for their state.