Dicey Propositions

The things we do in the name of economic development! The current
craze is casino gambling. Across the country, Indian nations,
states, municipalities, and corporate interests have been trying to
get an advantage in the booming world of gaming. The fallout can be

Congress and the California courts have been tussling with one
of the thorniest issues to come out of gaming expansion: tribal
sovereignty for Native Americans. The issue, of course, is money.
Native American tribes, as sovereign entities, operate many of the
nation’s casinos. The tribes saw casinos as a way out of
long-standing poverty and unemployment, and a use for land that was
otherwise unprofitable. The most stellar casino success is in
Connecticut, where the Mashantucket Pequot Indian tribe projects
close to a billion dollars in revenues this year from the Foxwoods
Resort Casino in Ledyard. Ebony (June 1995) told the success
story, noting that about half of current tribe members are of mixed
Native- and African-American ancestry. The tribe requires people
only to prove they are at least one-sixteenth Pequot to benefit
from casino revenues, and many have shown they are one-eighth
Pequot. That lineage helped boost some people out of dead-end jobs
and into wealth, and along the way made the tribe the state’s
second-largest employer.

Indian successes have the federal and state governments looking
anew at the Indian Gaming Regulatory Act, which helped establish
the Indian gaming industry, with an eye to giving states and the
federal government more say in the planning and operation of tribal
casinos. Indian interests, fearing a loss of clout, formed the
National Indian Gaming Association to counter such attempts,
Barron’s reports (Dec. 26, 1994). Congress still hasn’t come
up with a solution to the standoff, and eyes are turned to
California; courts there are being asked to rule on what specific
games can be offered at Indian casinos, explained William
Eadington, a leading authority on the economics of gambling, who
teaches at the University of Nevada in Reno.

Meanwhile, Detroit tried another tactic to see if it could get a
share in Indian gaming: establishing a reservation in the heart of
Motor City’s Greektown section, specifically for a casino
operation. Detroit casino promoters saw people crossing the bridge
to Canada to casinos in neighboring Windsor, Ontario, and thought,
Why not get the Chippewa tribe to open a casino here? The New
York Times
(May 27, 1995) reports that Detroit could gain 4,400
jobs for residents, $25 million for the city government, and more
funds for economic development projects — plus traffic that would
benefit neighborhood merchants. ‘This is what the city needs,’ a
sports bar owner told the Times. ‘If we don’t get people
down here in the evening, we won’t survive.’ Voters approved the
idea in a referendum, but Eadington says it now appears stalled
because of Governor John Engler’s reluctance to go along with it —
and his OK is needed for the requisite land transfer.

The casino question is a dicey proposition even when it isn’t
complicated by Indian sovereignty issues. The professional gaming
and casino industry has been looking for new markets, and lots of
down-on-their luck areas have been considering whether making
themselves into mini-Nevadas or Atlantic Cities might be a winning
ticket, a source of new jobs and tourist dollars. Estimates cited
in the New York Times Magazine (July 17, 1994) indicate that
the way casino gambling is expanding, every American will
eventually be within a four-hour drive of a casino. Of course, many
people think that would be no blessing. They’re more worried about
street crime and compulsive gambling than they are jubilant over
job creation. The next couple of years will probably give us better
evidence about the good and bad effects of the more recently opened
casinos, Eadington says. We’ll need that data: the latest expansion
wave is slowing, but Eadington predicts it will pick up again when
we have another recession.

Earlier in the century, gambling was frowned on and viewed as a
moral vice; now the industry has become professional and promotes
itself as a source of entertainment. Of course, that claim means
that economic developers are likely to look at it just like any
other form of entertainment that has proliferated rapidly, and
wonder when the market will get saturated. Too many casinos in too
many towns eliminates the unique appeal of each casino, limits the
likelihood of new visitors, and questions the casino’s economic
reason for being. ‘If everyone has one, no one benefits,’ Eadington
sums up. ‘You can run out of tourists with money.’ And there isn’t
much reason for economically deprived areas to build casinos just
for locals: The very fact that they’re looking so desperately for
jobs in the casinos means they don’t have enough to blow at the
blackjack table.

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