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Predatory Gambling in the USA

Les Bernal is working on a ranking of the states with the worst predatory gambling problems.

He hasn’t completed it yet. But he gave us a sneak preview. Bernal is the national director of the public interest group Stop Predatory Gambling.

If he were to call it right now, which would be the five worst states?

Oregon, West Virginia, New Jersey, Illinois, Pennsylvania.

What about Nevada?

“We don’t debate Nevada,” Bernal told Corporate Crime Reporter in an interview last week. “If you were going to have one place to gamble, have it be Nevada. I always exclude Nevada.”

What are the best five?

Utah, Hawaii, Alaska, Nebraska – with New Hampshire and Vermont tied for the number five slot.

“It’s hard to do a ranking,” Bernal said. “Oregon has one tribal casino. But the Oregon lottery has video gambling machines. Technically they don’t have many casinos in Oregon. But Oregon is as bad as any state in the country in terms of harming the public.”

“West Virginia is there as one of the worst. Oregon is right there. It’s not a uniform thing.”

“Our goal is to have a ranking of the biggest predatory gambling states in the country. And factor in the different forms of gambling they have.”

How would you describe the politics behind the movement to stop predatory gambling?

“We are one of the most politically diverse movements in the United States. We have people from all political stripes who work together. You would be hard pressed to find a more diverse network of citizens involved with this.”

Is your group opposed to all gambling?

“We are opposed to the role of government in actively promoting and sanctioning commercialized gambling to citizens.”

Isn’t that all gambling?

“If you and I went bowling or were playing golf and we had a friendly wager on the game, that is technically gambling. I’m not talking about prohibiting that. We are talking about gambling for profit.”

You would prohibit gambling for profit?

“We would prohibit running a gambling ring for profit, yes we would.”

If you prohibited gambling for profit, you are prohibiting 99 percent of the gambling in the United States, right?

“Running it as a business.”

Isn’t that 99 percent of gambling in the United States?

“No. There are all sorts of social gambling where people have Friday night poker gamers, office Super Bowl pools.”

What percentage of all gambling in the United States is gambling for profit?

“In 2016, the American people lost $117 billion to government sanctioned gambling.”

How much did they lose in other gambling?

“The numbers on illegal gambling don’t compare.”

The legalized gambling piece is $117 billion in 2016.

“That’s what they lost. What they wagered is close to $200 billion.”

And illegal gambling is much less?

“Well, if you and I are in a Friday night poker game, that’s gambling.”

How about bookies?

“Those guys are doing it for profit. That’s called illegal commercial gambling.”

How big is that market?

“The American Gaming Association make up a number of $150 billion on illegal sports gambling.”

Give us your argument against government sanctioned gambling.

“The American people lost $117 billion to government sanctioned gambling in 2016. At the same time one out of two citizens in this country own zero net assets – no stocks, no property, no bonds.”

“Here you have an enormous number of people who lack assets to grow into the middle class. And the public voice of government is targeting that same constituency to play games that are rigged against them.”

“We start with this moral belief that all men and women deserve a fair opportunity to have the best life possible for themselves and their family. That’s why we show up every day to compete on this.”

“You have citizens losing $117 billion a year. And meanwhile, half the citizens don’t have any assets at all. The public voice of government to most citizens today no matter where you live is gambling.”

“We see a lottery class of citizens. You don’t have a chance to improve your life. You are stuck with a lack of mobility out of poverty. And your best hope is to try and play a rigged game to make some cash to pay your rent every month.”

“At the same time, government is advertising these games relentlessly to citizens. We spend more than $1 billion a year advertising gambling to the American people on lotteries alone. That pales in comparison to any other form of government advertising.”

“When I was a kid growing up I used to see advertisements with John Wayne saying – invest in your country – buy US Savings Bonds. The idea behind that was to encourage citizens to build assets. Everyone points back to the 1950s where there was a growing middle class and a chance for people to climb out of poverty.”

“We had a high savings rate. People were building assets. That was an understated part of keeping people in the middle class. We talk a lot about wages, but wages are only one part of the equation. You also have to encourage people to build assets.”

“We come off the great depression during World War II. And the public voice of government then was – we have to put people to work. Imagine government encouraging people back then to go out and spend their money on lottery tickets to raise the money for the war. Instead they encouraged the citizens to go out and buys savings bonds, to invest in your country, invest in your neighbor. It created this strong sense of a common good. It was stronger then than it is today.”

Of the $117 billion that the American people lost, how much of that came from poor people?

“Without question, a large portion is coming from the poor. David Just and his team at Cornell have done the best research on that. And it consistently shows that the people who are participating come from the least favored sections of our society. And they are playing out of financial desperation. It’s a Hail Mary investment strategy.”

“Two-thirds of the public doesn’t gamble at all. You have one third of the public participating in this government sanctioned gambling. The messaging that is targeting those folks is – this is a chance to change your life. They sell scratch tickets that say – money for life. This is going to be your answer to get ahead in society.”

“The average person sees the lottery as Powerball and Megamillions. But the truth is that those two games  represent only a small portion of lottery revenues. Where lotteries make most of their cash are on what are called scratch tickets. Scratch tickets are the number one money maker, unless you are a state like Oregon that has these electronic gambling machines, which are the most lucrative of all.”

“Scratch tickets are these high frequency games where you play many times a day at higher and higher wagered amounts.”

What impact does gambling have on the poor?

“Government sanctioned gambling goes to the heart of many issues that the poor face. It’s a big factor in the lack of mobility out of poverty. By encouraging people to gamble on these rigged games, instead of being able to build a savings account, they are spending on these rigged games at the street corner on a daily basis.”

“What are the key elements of mobility out of poverty? Family structure. If you can keep a family unit together, you have a better shot of getting out of poverty than if you don’t. Two of the biggest factors shown to disrupt family structure are infidelity and financial problems.”

“Here you have a government program that directly attacks the family structure and the family structure is the key to pulling people out of poverty. Government sanctioned gambling is designed to get citizens to lose their cash as frequently as possible at higher wagered amounts. It directly intersects with rising inequality. We define it as a lack of opportunity.”

[For the complete q/a format Interview with Les Bernal, see 32 Corporate Crime Reporter 24(11), June 7, 2018, print edition only.]

 

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Russell Mokhiber is the editor of the Corporate Crime Reporter..

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