Wednesday, March 5, 2008

Casinos are the Answer?

March 4th, Wave-TV’s Steve Lankford’s Hot Button call out to House Speaker Jodi Richards to get it together and get casinos on the ballet compelled me to write.

Let's see how this is going to help Kentucky. First some facts. THE HOUSE ALWAYS WINS. So from all the funds generated by the casinos, the house (in this case the Sands Corporation) is going to take away the biggest portion of money. As any statistician will tell you, the odds are you are not going to win, and the casino stays ahead making money. THEY EVEN GET TO SET THE ODDS.

Now there are winners who take away money from the casino. Everyone I talk to tells me how much fun they had winning all the money. My friends are fortunate because they are the ones that win all the money. Of all my friends that enjoy games of chance, none of them ever mentions to me “how much fun they had losing their money to the casinos”. Again because they are the winners. I am a fortunate person indeed to have so many friends that can take advantage of the house odds. Does anyone have any friends that lose?

OK, I am told the winners will additionally spend their winnings in Kentucky but at the same time, I am told that our casinos will draw out of state visitors, so I will assume that out of state gamblers will be winning equally as well as our Kentuckians (Or are Kentuckians just better gamblers because of our rich history of gaming?) and I suppose that they will take their winnings back to the benefit of their state.

Lets look at Caesars as an example how casinos might operate in our state.
Caesar’s has a beautiful hotel for their guests. I assume they get to keep the profits of operating the hotel since they additionally have to “comp” the winners with luxury suites to keep them there an additional day so that the winners can break the house again or lose all of their reported winnings back to the house. I wonder how Kentucky hotels operators feel about more hotel competition coming into the state. I can only assume that the money generated on the casino hotels will also go to the Sands Corporation.

Well let’s assume that there is a big winner who is going to spend their money in our state. Well, not so fast, they still have to get out of the casino area first. Have you ever noticed the wonderful expensive restaurants that are in the casinos? Caesar's has two or three bars. Come to think of it I haven’t observed any Indiana restaurants or bars operating of out Caesar's. I wonder how restaurateurs and bar keepers of our commonwealth feel about this competition of their industry. Will local businesses be invited to occupy the casinos? I bet not.

Another curiosity is the number of luxury stores that are in casinos. As I walk through Caesar's I notice there are jeweler stores that sell very expensive jewelry to the big winners. You don’t even have to leave the casino to spend your money. Which also means it doesn’t make it to our state's businesses. They also sell inexpensive jewelry, I guess for the small winners. They even have a store where nothing is over 10 dollars. Since I don’t see any local Indiana jewelers operation in Caesars. I presume Caesars owns these jewelry stores and this is just an additional way to get their money back? So one can understand that casinos are well engineered and crafted to get all the winnings back from the gamer.

A long, long time ago, horse racing came to Kentucky and established a great tradition. Churchill Downs pays a tax that goes to the treasures of Kentucky, and because of the long tradition, they have been paying into the coffers for a long time. In 1988 Kentucky decided we still did not have enough money and brought the lottery to Kentucky. Since 1988 the lottery has expanded into several additional games, adding pull tabs and increasing the number of lotteries to two a week. Once again I will assume because we still did not have enough money.

(To better understand the lottery the reader can read my earlier blog on the KY Lottery. Saturday January 12th. Snake Oil Salesmen.)

Now once again there is not enough money in Kentucky and they want to institute casinos. I wonder if we might ask the legislators to just be fiscally responsible. An alternative is to live within our means. Is there a lesson here? I hope so. If we don’t quit living beyond the state's means, I don’t know where our commonwealth can go next to raise money? Well maybe prostitution or drugs could be the next options?

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