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More Gambling Means Losses For State

More Gambling Means Losses For State

By ROBERT STEELE, TONY HWANG April 20, 2015

 

Three shortsighted proposals could dramatically expand legalized gambling in Connecticut.

First, legislative leaders are pushing a bill to allow the Mashantucket Pequot and Mohegan tribes, owners of Foxwoods and Mohegan Sun, respectively, to jointly open three off-reservation commercial casinos. The purpose is to encourage Connecticut residents to gamble here and thereby slow the decline in state casino jobs and revenue caused by growing out-of-state casino competition. The tribes want to open the first "convenience casino" along I-91 north of Hartford to defend against the MGM casino being built in Springfield. They are eyeing locations along I-95 and I-84 in Fairfield County as a defense against New York's casinos. The Hartford area casino would be heavily oriented to slot machines, with up to 2,000 slots and 50 to 75 table games, no entertainment and limited food and beverages. (There are just over 5,000 slots and 300 table games at Foxwoods.)

Second, the legislature's Finance Committee has revived a proposal to let the state lottery offer keno in convenience stores, restaurants, bars and taverns. Keno was signed into law in 2013 but ultimately dropped because of strong public opposition, including concerns that it would extend casino-type gambling to neighborhoods and allow it in unregulated environments where children are present.

Third, the federal Bureau of Indian Affairs has proposed new regulations to ease the requirements for granting federal recognition to Indian tribes and greatly increase the likelihood of Connecticut's three state tribes — the Eastern Pequots, Schaghticokes and Golden Hill Paugussetts — gaining recognition and opening casinos. Gov. Dannel P. Malloy and the state's congressional delegation are engaged in a battle to get the bureau to change the proposed regulations in a way that would prevent further Indian casinos in Connecticut. Passage of the new casino bill, however, would fly in the face of the state's argument that it opposes more casinos, making it almost impossible to win that fight.

Moreover, Attorney General George Jepsen has warned that the bill permitting the Mashantuckets and Mohegans to open commercial casinos could face serious legal challenges from other gambling entities that claim the legislation is unconstitutional. This could throw the door wide open to even more gambling expansion.

In addition to heeding the attorney general's warning, we would urge legislators to weigh the following as they consider expanding gambling.

 

1. The primary economic benefit of Connecticut's casinos has come from drawing more than half of their combined customers and billions of dollars from other states. These customers are increasingly disappearing, however, because they have new casinos in their backyards. Building new, scaled-down casinos and legalizing keno will do nothing to bring out-of-state customers back. It will mean that an increasing share of the state's gambling jobs and revenue will be funded by the gambling losses of Connecticut people, an exchange Nobel Prize-winning economist Paul Samuelson called "the sterile transfer of money or goods, creating no new money or goods."

2. While opening convenience casinos would encourage current Connecticut gamblers to stay in state to gamble, it would also encourage them to gamble more frequently and attract thousands of other Connecticut residents to gamble, with an increase in gambling addiction and its attendant social and public health costs.

3. There is a growing body of research on the negative effects of casino gambling, from a Western Connecticut State University study of crime in the towns surrounding Foxwoods and Mohegan Sun to a landmark report from the Institute for American Values, a leading think tank, on the impact of casinos on the country as a whole. According to the latter, local and regional casinos drain wealth from communities, weaken nearby businesses, hurt property values and reduce civic participation, family stability and other forms of social capital that are at the heart of a successful society.

More casinos are not an answer to Connecticut's economic problems. Instead of encouraging our citizens to gamble away their savings, we need to attract productive, living wage jobs, promote stable revenue streams and end the runaway spending that's put the state so deeply in debt.

Robert Steele of Essex was a Republican U.S. congressman from eastern Connecticut from 1970 to 1974 and is the author of "The Curse: Big-Time Gambling's Seduction of a Small New England Town." State Sen. Tony Hwang, R-Fairfield, is an assistant senate minority leader.