A Slum with 12 Casinos

August 02, 1993

Fifteen years ago this summer, casino gambling came to Atlantic City. It promised to rejuvenate a decaying and once-great resort town. Instead, the casinos carved out a small enclave of great affluence for East Coast gambling aficionados while the rest of the town continued its decline. Legalized gambling wasn't the answer.

As the executive director of the New Jersey Council on Compulsive Gambling put it, "Atlantic City was a slum 15 years ago, and today it's a slum with 12 casinos."

While 30 million visitors a year pour into the luxurious casinos along the boardwalk and the inlet area of the city, spending over $3 billion a year, this has had little impact on the city itself, which contains some of the worst urban slums.

Loopholes in the original casino-gambling law allowed casino operators to avoid contributing to urban redevelopment projects as envisioned by the bill's sponsors. Forty thousand jobs have been created, but nearly all these workers live in outlying towns and boroughs. What's left in Atlantic City beyond the casinos is a large zone of boarded-up houses, vacant lots and 37,000 dispirited residents, most of whom are poor and black.

The situation is so bad that local officials cheered recently when it was announced there would be a new supermarket built in town. The last one closed decades ago. A revived development authority is underwriting the new market.

Corruption generated by the casinos lies behind much of the city's current malaise. A string of mayors and councilmen went to jail or faced intense investigations for taking bribes. Crime and prostitution are rampant. All this only feeds other urban ills: high teen pregnancy rates; high infant mortality; a huge number of homeless people.

Local officials believe the worst is over. The town has plans for resurrecting the downtown area with a new convention center, hotel, shops, theaters and restaurants, part of a $700 million tourist corridor financed by the development authority. Low-income housing is finally starting to rise.

Atlantic City needed a boost when the casinos came to town in 1978. It is still looking for a catalyst to restore vitality and prosperity. The lesson is clear for other resorts eyeing gambling as an economic development tool: it doesn't work.

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