The Other Side of Gambling

Published September 28, 2003 by OCR Editor

The Other Side of Gambling

Maryland faces staggering social costs if it opens the door to slot machines, an array of speakers told anti-gambling activists at a national conference in Linthicum yesterday...

In his remarks to the National Coalition Against Gambling Expansion, state Attorney General J. Joseph Curran Jr. pointed to a research study that shows the economic costs of gambling far outweigh the benefits.

The report by Earl Grinols, an economics professor at the University of Illinois at Urbana-Champaign, found that casino-style gambling costs a state's economy $219 per adult annually. That compares to $46 per adult in benefits - including new jobs, tax revenue, profits back to the gambling operator and other economic activity.

Curran, who led a 1995 study that concluded casino-style gambling would be bad for Maryland, said that legislators need to look beyond the tax revenues that gambling promoters say slots would generate for the state treasury.

Another speaker, William N. Thompson, a professor of public administration at the University of Nevada, Las Vegas, said his research suggests that social costs in Maryland, if slots are introduced, could range between $571 million and $674 million a year. Those estimates are based on the state's population size and what it costs society, on average, for each new problem gambler and pathological gambler, he said.

John Warren Kindt, a professor of business administration at the University of Illinois at Urbana-Champaign, said that every $1 in tax revenue generated through money spent on gambling is more than offset by $3 in social costs.

"This is not a close call," said Kindt, who also spoke at the conference. "Any economist will tell you the only people who are going to get rich out of this are the gambling [companies and the people they cut in on it."

Gambling industry officials have challenged studies done by Grinols, Kindt and Thompson, saying that they grossly overestimate the social costs and give an inaccurate picture of the impact of their business.

The social cost of gambling was the main theme of the two-day national anti-gambling conference, which ended yesterday. Those who attended heard from a panel of lawyers about a growing number of lawsuits being brought against gambling companies. Similar to lawsuits against tobacco companies, the suits argue that gambling companies are knowingly selling a dangerous product.

Other panels dealt with Internet gambling, compulsive gambling, casinos run by Indian tribes and effective political strategies to block casino-style gambling from coming into a state.

Maryland was selected as the site for this year's conference because it is seen as a key battleground to stop the spread of gambling nationally, said the Rev. Thomas A. Grey, executive director of the National Coalition Against Legalized Gambling. He said he expects a tough fight next year as the General Assembly again takes up the contentious issue of legalizing slot machines at horse racing tracks or other sites.

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