In recent years a debate has been brewing in the public administration community regarding the issue of gambling. Accredited online public administration degree programs are talking about it, city councils are talking about it and tribal committees are talking about it. As more states have authorized gambling, revenue has grown dramatically and overcome moral objections of residents in many areas.
Many of those who object to casino gambling do so based on moral or religious grounds. Christians, Jews and Muslims are all prohibited from gambling, although the practice is widespread amongst adherents to all 3 religions. Others claim that gambling is immoral because even the winnings are tainted by the lack of production or work. And many bemoan increases in crime associated with gambling and casinos, such as drunk driving, prostitution and drug abuse. Social workers cite the extensive literature describing the costs of problem gambling, which include bankruptcy, divorce, absenteeism and job loss in order to put what many consider to be a harmless pastime into a social context.
Yet despite the detractors, gambling in some form has become legal in 48 out of the 50 states. Many states, counties and cities that would have objected to casino gambling establishments 40 or 50 years ago, now compete to attract the major casino operators. In 1997, Fortune rated Mirage Resorts as the #2 most admired corporation in America. Throughout the 1990s, casino gaming was the fastest growing industry in the U.S., enjoying more than 10% growth in the early part of the decade.
Clearly governments see casino revenue as a panacea for tight budgets. This has been a critical factor driving the growth of casino operations. The operators are happy to comply with public perception that casinos create economic growth, jobs and increased personal income.
The truth of the economic benefits of casinos is less certain. A recent study of the published literature in the American Journal of Economics and Sociology, suggests that casinos and gambling do not provide any long-term economic benefit to the community. While the initial construction and opening phase of a casino may bring a temporary boom, within a year or less, those gains evaporate for the community at large. The primary factors which prevent the hoped for economic growth from occurring are competition amongst gambling venues and that casinos tend to simply shift revenue from other local businesses.
The case of Atlantic City is often used as an example. In 1974 when the casinos first opened, there were 250 restaurants, in less than 20 years, despite population growth, over 100 restaurants had closed.
But many locations in the U.S. and internationally look toward the miracle in the desert, Las Vegas, as a model for attracting tourism and growth. Macao is positioning itself as a gambling and tourism center, attracting visitors and their money from all over the Pacific Rim. Singapore allows gambling, but maintains tight controls. In both countries, the resident populations are ambivalent about gambling in general. As in the U.S., there are concerns amongst many that gambling is a vice, which leads to increases in petty crime.
Another issue of concern with casino gambling in particular is regulatory capture. Casinos tend to become politically powerful and over time exert a great deal of influence, even writing laws favorable to themselves. The large sums of money for political contributions, number of employees, and tax revenues are very influential in the political process. This leaves many local residents and businesses concerned that once the door to casino gambling is opened in their region, it may in time overwhelm other competing social interests. Studies have shown that this is almost always the case.
While to gamble or not to gamble is a personal choice, there are clearly moral and social consequences to the casino industry. Governments and citizens should understand that gambling is not a quick fix for other economic problems, employment or tax revenue. Casino gaming is a form of entertainment which competes with other choices in the free market. Economic benefits associated with casinos come with social costs. Each country, culture and community must carefully weigh the pros and cons within their own context.