Alabama Town Hall Meeting on Tuesday Discussed Pros and Cons of Gambling
Montgomery, Alabama was the scene of a public debate on the pros and cons of gambling on Tuesday. Citizens on both sides of the debate gathered to discuss whether Alabama lawmakers should pass laws to allow lottery and casino gambling in the state.
Tourism Committee to Vote Soon
The Tourism and Marketing Committee of the Alabama Senate hosted the public hearing. At the heart of the discussions was a bill being sponsored by State Senate President Pro Tem Del Marsh, a Republican from Anniston. The bill would authorize a state lottery, while allowing casino-style machine gaming at Alabama’s four dog tracks.
To approve such a measure, the voters of Alabama would participate in a statewide vote. While the debate is not likely to have a direct impact on such a statewide vote, many thought it could have an impact on the committee’s deliberations. The Tourism Committee might vote on the bill as early as Thursday of this week. If approved by the committee, the gambling bill likely would be sent to the floor of the senate for a vote.
Boosting Revenues without Taxation
Del Marsh was present to defend the bill. Sen. Marsh told the assembly, “This is a big piece of legislation, a very controversial piece. But I think it’s an option that should be put there as an option to help try to solve some of the budget problems in this state.”
Senator Marsh presented the gaming bill as an opportunity to collect revenues without raising taxes. Such arguments are made anytime gambling is debated in the United States and around the world, and it is is a powerful argument. Casino gambling of one sort or the other has been approved in nearly 40 states, while 45 states have joined the multi-state lottery associations (Powerball and Mega Millions).
Social and Real Costs of Gambling
Joe Godfrey, executive director of the Alabama Citizens Action Project (ACAP), does not see it that way. Mr. Godfrey says there are hidden costs to legalized gambling and people need to be aware of them.
Godfrey told the assembly, “It [Gambling] is a tax. It’s a tax on the poor. It preys on the people who can least afford to pay it.”
Once again, Godfrey’s arguments are made anywhere the gambling issue is debated. Opponents of casino gambling point to machine gaming as the worst form of casino betting–the “crack cocaine of gambling”–because slot machines have a high house edge and produce results with machine efficiency. While games like poker, blackjack, roulette, and craps take longer to play because of human dealers, a slot machine produces instant results with the push of a button.
Is Gambling a Tax on the Poor?
Opponents of lottery gambling often make the argument Joe Godfrey was making: that the lotto is a tax on the poor. The house edge on lottery tickets can be as high as 40%, which would be illegal if it was not run by the state. Casino games have much smaller house edges, such as blackjack (1%), craps (1.41%), roulette (5.2%), and slot machines (usually 5% to 10%). Of every $100 paid in to the lottery, players lose $40 of it.
Proponents of the lottery point to the amount of money raised for school funding. They also point out that lottery gaming is a discretionary expense. If it’s a tax, then it is tax a person can easily opt out of. ACAP and the anti-gambling lobby don’t see it that way, because lotto tickets lure the poorest residents with the promise of life-changing payouts.
Whether Gambling Helps the Treasury
Katherine Robinson, VP of the Alabama Policy Institute, suggests that Del Marsh’s arguments are flawed at their very premise. Robinson discussed the number of states which have lottery gambling and casinos, but still face a budget crisis. Robinson said, “It might be a quick fix, but it is not going to sustain us for the long term.”
Del Marsh and his political allies would say Robinson is making a straw man argument–she is arguing against a point no one made. Gambling proponents do not claim that gaming is the sole answer to the budget problems of Alabama. No one suggests that the installation of casino gambling or a state lottery would end the budget shortfall. What they do say is gambling is a part of the solution. Without cutting services or raising taxes, the state can cut into the deficit by passing a law or two.
Gambling Laws in Alabama
This is the first time such a bill has been discussed since 2010, when a scandal surrounded a similar proposal. At the time, lobbyists for the gambling industry (including VictoryLand owner Milton McGregor) were accused of buying votes of senators. Had the 2010 bill passed, it would have allowed struggling bingo casinos like VictoryLand to remain open.
Previous to the 2010 proposal, Alabama had not had a major vote on gambling since 1999, when a state lottery was proposed. At the time, the social conservatives in the state were able to undermine the drive for a state lottery. The same section of the Alabama population is expected to provide a substantial obstacle in passing any pro-gaming legislation this year.
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