, Salem, MA


January 15, 2014

Watson: Casinos are a bad deal for taxpayers


Politicians who favor casinos, including Patrick, love to focus on the immediate gain to the state of the initial, one-time licensing fees, construction jobs, casino jobs and the state’s percentage of the gambling take.

But that’s not the whole story. The experiences of other states with casinos show that, for many reasons, the costs increase over the years, while revenues decline. Invariably, after a few years, casino owners renegotiate sweeter deals for themselves, with smaller revenue percentages for the state.

Other costs to the taxpayers expand over time. As the consequences of problem gambling start to kick in, the state is left to address them. The worst cases — addicted gamblers — lose their jobs, destroy their families, default on loans, bills and credit cards, and steal and commit crimes. Their actual financial burden on the taxpayers is significant. You and I pay for the extra costs that they place on financial institutions, insurance companies, the medical system, law enforcement agencies, the court system, social service agencies and the prison system.

In milder cases, where poor people simply gamble away their paychecks, society pays in subtler ways. First, there are the losses to the gamblers themselves. Their money won’t be used to support more constructive endeavors in their own lives that would have a much bigger economic multiplier effect for the growth and productivity of society as a whole.

Secondly, other members of their families then often need financial assistance and other help to compensate for the lack of family savings and resources simply to pursue normal, educated, productive lives.

All of these costs are obviously very difficult to quantify. But conservatively, if we end up with roughly 30,000 problem gamblers (or affected family members) after five or six years, each of whom requires an average of $10,000 every year in state services — ranging from brief counseling to full incarceration — that would total $300 million a year in costs, which is the estimated high end of what the casinos will give the state annually. And remember, the casinos constantly refresh the stock of victims.

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