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In New York Casino Vote, a Dance With Temptation


state revenue gambling

2013-11-03 08:33:05

In the 48 states that permit at least some form of commercial gambling, lively debate continues over the industry’s relentless efforts to expand. On Tuesday, New Yorkers will vote on a proposed constitutional amendment that would permit up to seven new full-scale gambling casinos in the state. (The state’s five existing casinos are confined to Indian reservations.)

Gov. Andrew M. Cuomo argues that the amendment would create jobs, increase school aid and lower property taxes. And, yes, it would do all those things. But it’s still a bad idea. Other strategies would accomplish the same goals more effectively, without the disastrous spillovers that invariably accompany expanded gambling.

The ostensible attraction of the amendment is its promise to relieve budget woes without new taxes. In proponents’ eyes, state income from gambling is a form of voluntary

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tax payment. But modern casino revenue comes mostly from slot machines, and the relationship between them and some of their patrons is voluntary in only the most superficial sense. “Addiction by Design” (Princeton University Press, 2012), Natasha Dow Schüll’s gripping account of slot machine gambling in Las Vegas, looks into the technical wizardry underlying modern slots and their effects on players. According to slot designers and casino managers surveyed in the book, the mission of these machines is simple: to separate patrons from their money in the most ruthlessly efficient — yet psychologically agreeable — ways possible.

The machines create an experience so compelling that some people stop playing only when they’ve exhausted every available resource. Ms. Schüll, a cultural anthropologist on the M.I.T. faculty, interviews a slots player who sees the machines as so immersive that winning becomes a distraction, something that matters only because it lets her play a little longer. “It’s like being in the eye of a storm,” the woman says, later adding, “You aren’t really there — you’re with the machine and that’s all you’re with.”

Psychologists describe this state as flow, a feeling of being so absorbed in what you’re doing that you become completely unaware of the passage of time. Artists, writers and others who achieve flow in their work call it one of the most pleasurable psychological states, one that greatly enhances productivity. But in hindsight, at least, flow as experienced by some slots players is a state that leads to ruin.

If casino gambling were expanded, most New Yorkers wouldn’t be directly affected. Even in places that already have it, only a small proportion of people become problem gamblers. But much the same could be said of crack cocaine. If it were legal, most people wouldn’t even use it, much less become addicted to it. But in both cases, the number who would become addicted, though small in proportional terms, would be disturbing. If governments shouldn’t raise revenue by sharing revenue with sellers of crack cocaine, why should they enter similar pacts with casino operators?

A 2004 study of legalized casino gambling in Ontario estimated that about one-third of casino revenue came from patrons with significant gambling problems. Libertarians contend that if gambling addicts freely choose to waste their own money, that is none of society’s business. But addiction also harms the innocent, making marriages more fragile and bankruptcies more likely. Properly accounting for these spillovers exposes casino expansion as not only an inhumane policy, but one that could actually reduce state revenue.

Historically, societies have tried to shield their most vulnerable members from dangerous temptations, including many forms of gambling and addictive drugs. Discreet private gambling and soft drug use are seldom targets of these prohibitions. But active revenue sharing with casino operators crosses a bright line. It lends the state’s imprimatur to activities that ruin lives. Governments have been properly reluctant to take this step.

As parents tell their children, the best way to get ahead is to get more education, work hard and save for the future. For many years, however, New York has encouraged its citizens to rely instead on luck, to dream about what they’d do if they won the state lottery. “I’d buy the company and fire my boss,” intoned one artfully produced, state-funded television spot.

New York does need more revenue. And though no one relishes higher taxes in the abstract, there are many things we should be taxing but aren’t. When we buy heavier vehicles, for example, we put others at more risk. If vehicles were taxed by weight, we’d have an incentive to consider that risk when buying. Companies may emit pollution not because they want to ignore the environment, but because cleaner processes are expensive. If we taxed pollution, businesses would emit less of it. Instead of promoting gambling, the governor should explain that the state should be taxing activities that cause more harm than good, even if we didn’t need the revenue.

Politicians naturally fear taking unpopular positions. But voters are sometimes willing to cut them some slack. Mr. Cuomo might reflect on the repeated vetoes of death penalty laws by his father, Mario M. Cuomo, when he was governor in the 1980s and ’90s. The death penalty was extremely popular at the time, yet voters sensed that the vetoes sprang from sincere conviction, and they were quick to forgive him.

Voters might be similarly tolerant if the current Governor Cuomo advocated more principled methods of generating new state revenue. He’ll be more motivated to do so if voters reject an amendment that’s sure to increase addiction by design.

ROBERT H. FRANK is an economics professor at the Johnson Graduate School of Management at Cornell University.

View Original Article: nytimes.com
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