Legalized gambling has always been a struggle between morals and Mammon. Slots, lotteries, horse racing, and card games have been a guaranteed way to swell the coffers of any state that decides to accept social cost of gambling revenues.
However, that bubble may have burst. Maryland tried to staunch its financial bleeding in 2008 by passing a referendum allowing slot machines into the state, expecting a return of $90 million up front and $660 million a year. It turns out that those expectations were over-optimistic. According to the Urbanite, in the two years since the referendum, not one is open—all the construction that wasn’t scrapped has been severely delayed.
Failed attempts like Maryland’s have triggered what the Urbanite calls a “gambling arms race” where states losing casino revenues up the stakes by legalizing new forms of gambling to attract out-of-state gamblers. Here’s what that looks like:
Pennsylvania slots took money away from Atlantic City’s boardwalk casinos. Delaware snatched horse-racing revenue away from Maryland tracks by using slots as a draw. And when Maryland passed its own pro-slots law, a county in West Virginia—worried that new competition might cut into the 96 percent of Charles Town gambling revenues that come from outside the state—voted in blackjack and poker. Delaware upped the ante further by trying to corner the East Coast market on professional sports betting, a matter that is winding its way through the courts. And now Pennsylvania is expanding table games beyond slots.
If you’re a state legalizing gambling, it seems the more you permit, the more you’ll soon need to allow to keep bettors coming back.