Sports Betting Instead of Casinos (Column for Jan 8)
Don McNay's Blog (From www.donmcnay.com)
Sports Betting Instead of Casinos
“Every gambler knows, the secret to surviving, is knowing what to throw away and knowing what to keep”.
-The Gambler by Kenny Rogers.
I regret that we did not have someone sing the Gambler at my father’s funeral in 1993. Dad started working in a bookmaking operation when he was 15 years and gambled until the day he died. He was very good at it.
Almost all gambling in my father’s era took place behind closed doors. State lotteries did not exist and casinos were only in Las Vegas. The popular forms of gambling were sports betting, horse racing and card games.
Bookmakers like Dad were small business entrepreneurs. They couldn’t advertise or sue non-paying clients but made a good living anyway. Gambling allowed my parents to move from an extremely poor neighborhood to a nice one. It put food on our family’s table.
While 48 states have some form of legalized gambling, only Nevada has legalized sports betting services.
States that make gambling legal seem to focus on lotteries, slot machines and casinos. This is disturbing for two reasons.
Lotteries and slot machines are terrible bets and only large corporations can own a casino. Talented people can work for a casino but there is not a chance for those people to own one.
Instead of starting lotteries and try to lure big casinos, states should license small gambling operations like the one my father had.
Dad was able to make money in the days before ESPN and the explosion of televised sports. Millions of people participate in college basketball office pools and there are newer sports like NASCAR keeping bookmakers busy. Thousands of people bet with illegal bookmakers every week and the states should be taxing that money to provide better schools and services.
Sports gambling is a fair bet. In a football game, one team is going to win and the other will lose. It is not a trillion to one bet like the lottery.
A friend in Washington state told me that legalized poker rooms are popular there. Poker is one of the hottest shows on television and poker rooms would allow states to get a cut of a growing form of entertainment.
I don’t like having a state’s tax revenues tied to the few big corporations that own casinos. If the corporations do stupid or illegal things, like the people who ran Enron, they could take a state down with it. Licensing a variety of smaller companies would give states a wider tax base.
States can license and regulate gambling operations, just like they license and regulate banks, insurance agents and pharmacies. That would allow innovators to get into the gambling business and create more opportunities for wealth.
As a betting man, my proposal is a long shot. No one is pushing sports betting, while the casino and slot machine companies are spending huge amounts of money on lobbyists and political donations. Even though illegal and off shore bookmaking is widespread, colleges and professional teams would fight legalizing sports betting. Also, there are people who legitimately oppose gambling for moral or religious reasons.
I am opposed to the lottery because I think it exploits poor people.
The 37 states that have lotteries seem to ignore the fact that lotteries target their poorer citizens. Sports betting and poker rooms are better alternatives that are fair to the state and to the gambler.
My Dad ran a fair and honest operation where people got paid on time and were cut off before they got too deeply in debt. His career caused him to break the law but he was one of the most honorable men I have ever known.
Dad detested gamblers that preyed on people who could not afford to lose and hated games like the lottery that targeted those people.
Next week, I am going to discuss some ways to improve the lotteries. Before states rush off to embrace casinos and slot machines, I hope they think about allowing small businesses to operate sports betting operations and poker rooms.
As Kenny Rogers said, “The secret to surviving is knowing what to throw away and knowing what to keep.” Sports betting might be the ace that states should keep.
Don McNay is President of McNay Settlement Group where they try to increase the odds of their clients doing well financially. You can write to him at email@example.com and read other things he has written at www.donmcnay.com