The Casino on Main Street vs. the Casino on Wall Street; Gambling Ballot Initiatives This Election

Press Release

21st October 2008

GamblingResort.com takes an ironic look at gambling initiatives on the ballots in six states this election year, 2008, as seen in the context of the current economic crisis facing the country.

This election year, voters in six states will get the chance to decide the fate of ballot initiatives related to casino gambling or lotteries.

Casinos provide a way for local governments to collect additional revenue without raising taxes especially when the tax base is dropping as in the current economic crisis.

Bad financial news has everybody worried. The money managers on Wall Street rolled the dice by over-leveraging complex financial instruments and the dice came up snake eyes. The American taxpayer has been left with the markers. It may take years to overcome this disaster and for confidence to return to the financial system.

Many Americans have investments in stocks or own a home or both. Over the past year, the value of these investments has plummeted. As a result, confidence in the institutions of government and in the capitalist system is at an all time low.

Before the recent calamities, bank activities have never been more opaque. The financial dealings of publicly held banks and corporations are supposed to be transparent. Investors, with the assurances of analysts and rating agencies, make decisions based on the belief in this transparency. But some of these businesses were apparently leveraged to the tune of forty dollars borrowed for every dollar held as an asset. This ratio was not sustainable. Most investors were kept in the dark.

Investments in good stocks, bonds and real estate traditionally pay off over time. These investments are not defined as “games of chance.” When someone applies disciplined investment skills with proper due diligence and investigation in a time when the economy is growing and both public and private debt is low, success has a better of chance of, well, succeeding.

When Americans dig for the money in their pockets to make a bet, their expectations of success depend on the type of game they choose to play.

Who among us believes that he will ever consistently beat a slot machine except with some luck? Who doesn’t believe that over time one’s real estate investment will not pay off? Or, that one’s investment in a growing and ever more profitable company will not be safe?

It seems that the casinos on the main streets in the gambling towns across America are more honest than the casinos on Wall Street because even though the casinos in these towns take a decided edge, everybody understands this.

And people like to go to places like Vegas. The gambling resorts there are comfortable and beautiful. Playing craps or blackjack in such an environment is fun and entertaining. And winning is even possible. One can improve one’s own chances with certain games by employing the proper strategies.

Perhaps the biggest irony in the financial meltdown of 2008 is that even though Vegas casinos are more highly regulated than the Wall Street casino, the ramifications of the dealings on Wall Street on the health and well being of America are more widely felt.

Billions of dollars of investment in so called “real estate derivatives” and “credit default swaps” had virtually no oversight by government regulators.

Another irony is that Congress, in its infinite wisdom, likes to protect the main street gambler from himself, at least when it comes activities like online poker.

Congress, which regulates interstate commerce, has made the ability to play online poker with other players across state lines and international borders virtually impossible. Poker is considered too sinful. Poker is a game where players compete directly with each other. Yet, some congressmen who decry government interference in the lives of its citizens made government clamp down on poker games and the sites that sponsor them.

A game of Texas Hold ‘Em is more transparent than the games on Wall Street. Sure, the player is disadvantaged by not knowing the hole cards of the other players, but all players are similarly disadvantaged. Players with the right poker skills will ultimately triumph without the need for subterfuge. Subterfuge is the name of the streetcar that runs through the investment houses on Wall Street.

The folks on Wall Street gamble with trillions of dollars of other people’s money with little regulation while the online poker player with a few hundred dollars at his disposal is treated with contempt.

This moral prohibition against online poker seems so comical and petty in light of the dire situation we all find ourselves in.

But since Congress won’t act to legalize online poker, in a way that would also regulate it and tax it, the average citizen really has no way to realize his hopes on an issue like this.

Perhaps this is the time to promote the idea of national referendums to overcome the inertia and corruption of Congress. Let the people do on a national level what they are able to do on a local level. Gather enough signatures in enough states, get these signatures certified by a proper authority and then allow a vote on the initiatives that qualify.

Gambling initiatives will, however, appear on ballots this November, 2008, in the states of Arkansas, Colorado, Maine, Maryland, Missouri and Ohio.

This article is not written to defend or endorse any of the issues. Each measure has its pros and cons. It is best to let the voters of each state decide. Here is a brief rundown of them:

Arkansas. Proposed Constitutional Amendment 3. Allows for the state General Assembly to establish and operate a state lottery with the proceeds going to help pay for college scholarships.

Colorado. Amendment 50. Gambling is currently legal in three towns in Colorado: Black Hawk, Central City and Cripple Creek. This measure would increase the betting limits from $5 to $100. It would allow for 24-hour operations. It would also allow casinos to add other games besides blackjack, such as craps and roulette. If voters in the state approve the measure, the three local communities would also have to approve the measures by ballot.

Maine. Question 2. Like Ohio, this measure will allow for the construction of one casino, this one to be built in the town of Oxford, Oxford County. It will be called the Oxford Resort, Spa Casino. No other gaming facility could be built for ten years in the state. Tax receipts would be divided among various projects and causes. The gambling age would be lowed to 19 from 21.

Maryland. Question 2. Would allow up to 15,000 video lottery terminals to be installed at five different locations. About half the revenues will be spent on education in state schools from pre-k to the college level..

Missouri. Measure A. Would remove the daily loss limits for gamblers. Today, no gambler can buy chips in excess of $500 in any given two hour period. Also, players must be tracked by ID cards as a way to enforce this rule. This measure would limit the number of casinos in the state to the current thirteen. Provides additional funds for education. Provides new funds for veterans’ services.

Ohio. State Issue 6. This is a constitutional amendment that would allow the construction of one gambling resort in Southwest Ohio in Clinton County. Tax revenues would be shared by all 88 counties in the state.

GamblingResort.com can come to no over-arching conclusion to the discussion points outlined in this article. Ironies in the way government regulates both the casinos on Main Street and the casinos on Wall Street have been merely noted. The politicians seem to have drawn the line against those who wish to play online poker. Now they are too pre-occupied with the current economic crisis to even give the issue the logical re-evaluation that it deserves.

GamblingResort.com is a travel website dedicated to those who like to visit gambling destinations like Las Vegas, Lake Tahoe, Reno, Laughlin and Atlantic City. It is a great information resource as well. All sorts of useful and timely information can be had here. One can also book hotels directly at the site.

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