Current practices leave economic impact in doubt
South Carolina successfully completed a campaign in 2000 to ban video poker machines from the state. At the time, it was a $3 billion-a-year industry that generated tax revenue for the state — and massive campaign contributions for its politicians. Once the addiction was finally broken, it seemed like there was little desire to allow gambling back into the state.
Twelve years and one recession later, the pressure is back on. A wave of lawyers and former politicians are now serving the gaming industry as lobbyists, touting the positive impacts of casinos on job creation and the economy. Both the Cherokee and Catawba tribes in the state are attempting to build casinos on their lands, while new plans involving Internet poker cafes and sweepstakes machines attempt to bypass the decade-old ban on legalized gambling.
There are mixed theories on the benefits of gambling for the economy. Some economists point out that gambling is little more than one-sided banking, where no new goods or values are created. The other side points out the usual costs of enforcing a ban on vice, like special police operations and officials bribed to look the other way.
Ultimately, the only way casinos and other forms of gambling create wealth is if tourists visit from outside the state, or if locals who traveled stay put. South Carolina already has two casino boats that dock in the state, but sail to international waters for gaming; Florida and Georgia offer similar opportunities. North Carolina has one slot casino , while Florida has eight multi-game facilities. So perhaps there is opportunity.
Legalizing casinos has mixed results; no better example of the extremes can be found than Las Vegas and Atlantic City. The former has blossomed with the introduction of the casinos, becoming a cultural center through music and shows. Atlantic City, however, has never truly escaped its status as a worn-down city; all of the side industries that might benefit from the tourists lured by the casinos, like hotels and restaurants, are supplied by the casinos themselves, thus limiting the spread of wealth to a select few.
Tunica County, Miss., has seen success. Once the poorest county in the poorest state in the U.S., welfare recipients and unemployment plummeted after gambling was legalized, and studies show that casinos tend to focus hiring efforts on minorities who are more likely to be disadvantaged. However, crime rates in the county jumped by nearly 20 percent at the same time.
Today’s economic situation means we can’t leave any means of revenue unexplored. Yet we cannot rush into re-legalizing gambling simply because we are in a recession. Crime and corruption are serious issues that come with gambling, and they cannot be ignored. Lobbyists should be taken with a grain of salt, and independent research should be done to ensure that casinos — if allowed at all — are developed in a responsible manner that benefits the state as a whole, not just the casino owners.