Casino capitalism writ large

March 13, 2012 9:23 am

Casinos have generated $98 billion in gross revenue since 2008, compared with $20 billion in 1998. That’s more than three times what Americans spent on movie tickets. And most of the growth has occurred outside of Las Vegas and Atlantic City. Those are just some of the nuggets found in a fine piece in Salon.

“The billions of new dollars spent at casinos represent a net transfer of wealth to big business and to pay workers whose labor is not as productive as, say, repairing the nation’s crumbling infrastructure,” writes Daniel Denvir, who is also staffer at the City Paper in Philadelphia. “Casino capitalism is an apt metaphor exactly because — whatever one might think about legalized gambling — it is not generally perceived as a sound operating principle for the entire economy. Yet the steady march of casino gambling now sketches an eerie facsimile of our political economy writ large. In fact, casinos thrive amid economic misery.”

Denvir explains how the gambling industry has made great strides in many states during the recession, preying on desperate and struggling workers who can least afford to gamble. ”The growth of the gambling industry feeds on America’s job insecurity; people, whether gambling or seeking employment, have fewer viable ways to make good money. As the country has deindustrialized since the 1980s, and unions have been marginalized, real wages stagnated and then declined. At the same time, a deregulated and ascendant financial sector offered easier-than-ever credit cards and home mortgages, leading Americans desperate to maintain their lifestyle deep into debt.”

More broadly, casinos fail to produce the economic benefits that many lawmakers tout, Denvir writes. “In states that legalize gambling, casinos no doubt create jobs but they don’t necessarily stimulate the larger economy. A 1999 report by the National Gambling Impact Study Commission found that “few businesses can be found more than a few blocks from the Atlantic City boardwalk. Many of the ‘local’ businesses remaining are pawnshops, cash-for-gold stores and discount outlets. One witness noted that, ‘in 1978 [the year the first casino opened], there were 311 taverns and restaurants in Atlantic City. Nineteen years later, only 66 remained, despite the promise that gaming would be good for the city’s own.’”

Good food for thought as gambling industry lobbyists and lawmakers push to legalize casinos in New York, Florida, Kentucky and other states lining up to make a bad bet.