Unpredictable returns
Casino revenue can also be unpredictable because of competition from other states. In Illinois, two riverboats ran into financial distress because of competition from Iowa boats that were permitted to offer gambling without leaving the dock. Meanwhile, the success of a riverboat in East St. Louis, Ill., helped spur Missouri's move into casino gambling.
And some of the gains from gambling can be illusory because casinos "cannibalize" the revenues earned and taxes paid by existing businesses, said Terry Brunner, executive director of Chicago's independent Better Government Association.
"They've blown out all the restaurants and bars in downtown Elgin," he said, citing the location of one of the state's most successful riverboats.
Even proponents of legal gambling admit some people will be hurt by its expansion, though they contend anti-gambling crusaders wildly exaggerate the downside.
Donald Hunter, an Annapolis-based economist who consults for business groups and governments on gambling issues, said the industry is correct on two counts but not on another.
Hunter, who said he does not do work for casino companies, said claims that legalized gambling leads to organized-crime involvement and significantly increased street crime are not supported by evidence. But the objection that wider legalized gaming leads to increased gambling addiction is "the Achilles' heel of the business," he said.
"I think it is a bigger problem than most people realize," he said.
Opponents say that before states turn to casinos as a revenue source, they should realize that gambling can be addictive to governments as well. Illinois' Hall admits it would be tough to kick the habit now.
"If you were to wipe out gambling overnight here, education would be short by over $500 million," he said.
Pub Date: 8/12/96
