Capital Commentary is the weekly current-affairs publication of CPJ, written to encourage the pursuit of public justice.

Gambling With Our Future

Luis Lugo


August 19, 1996

An unlikely coalition of liberals and social conservatives has persuaded Congress and President Clinton to establish a National Gambling Impact and Policy Comission. The nine-member commission is charged to conduct a comprehensive study of the social and economic impact of gambling on individuals, famlies, and communities throughout the United States and to report its findings within two years.

The public's growing apprehension over gambling is easy to explain: since 1974 the amount of money legally wagered in this country has risen almost 3,000 percent, to about $500 billion annually. This represents six times the revenue of all American spectator sports combined. During the period, legalized gambling has spread from just two states to 48 states. No wonder the casino industry's lobbyists fought a fierce battle, throwing money at Republicans and Democrats alike, in an effort to derail the legislation and protect its share share of the fastest growing industry in America.

The commission will more than justify its $5 million expense if it succeeds in bringing into full public view the hidden personal, social, economic, and political costs of gambling. Opponents of gambling claim, for example, that the $40 billion per year casino industry targets compulsive gamblers. Such problem players comprise only five percent of all players, but they account for twenty-five percent of casino profits. At the very least, public policy should aim to ensure that the gambling industry is taxed steeply enough to allow government to recover the financial costs of treating these addicted gamblers as well as dealing with other consequences of this form of social pollution.

There may be good reasons for governent not to criminalize gambling, but there are even better reasons why it should expose gambling's human costs and seek actively to discourage it. This presents a problem, however, because many state governments themselves have become complicit in the tawdry business and increasingly addicted to this quick and easy method of raising revenues. Along the way, they turn a blind eye to the highly regressive nature of this "tax" (the money comes disproportionately from those who can least afford it), remain silent about the high human costs, and fail to face up to the corrosive effects of state-sponsored gambling on our political system. As one of the sponsors of the bill, Rep. Frank Wolf (R-Va.), has stated: "Government is supposed to be the protector of society, not a predator upon it."

Americans often complain about taxes, but the fact is that taxes are a very powerful way of ensuring public accountability. If our representatives believe that a certain legislative initiative is needed to advance the public good, they should be willing to come before the taxpayers and convince us to fund it. To the extent that government turns to alternative sources of funding, such as a percent of gambling revenues, it becomes less accountable to citizens and more dependent on the gambling industry.

In the old communist regimes accountability was underminded through government ownership of business enterprises; in ours it happens primarily through deficit spending, where taxes are deferred to the next (and nonvoting) generation, and through state lotteries and other games of chance. In raising money "painlessly" through state-sponsored gambling, states loosen the crucial link between citizens and their elected representatives, thus weakening democratic accountability.

One of the top agenda items for the new gambling commission should be to expose government's involvement in the gambling business and help us citizens understand gambling's corrupting influence not only on individuals and society but also on representative government.

—Luis E. Lugo, Associate Director
   Center for Public Justice

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Capital Commentary is a weekly current-affairs publication of the Center for Public Justice. Published since 1996, it is written to encourage the pursuit of justice. Commentaries do not necessarily represent an official position of the Center for Public Justice but are intended to help advance discussion. Articles, with attribution, may be republished according to our publishing guidelines.”