The Pros and Cons and Unknowns of Casinos

After all the hoopla, Massachusetts lawmakers passed a Bill that allows us to have casinos. There was a lot of talk and debate about the pros and the cons of casinos in Massachusetts - are casinos good for our communities or not? Here is a summary of the arguments.

First, what do we mean by good or bad? Casinos have good aspects to them and some bad aspects. The research showed that depending on what issue we are curious about, it depends.

Generally speaking, the pros gambling, according to the pro-gambling site www.777.com, are tourism, employment, charity and entertainment and tax revenues. And a Yale study found some health benefits for older Americans in terms of increased activity level and enjoyment.

The cons of gambling are that they are associated with higher suicide rates, bad for compulsive gamblers or those with that personality trait, an increase in personal bankruptcies, the breakup of some families. There are six different kinds of gamblers but only two are problem gamblers according towww.overcominggambling.com. Should a few ruin it for everyone? What if the latter two categories are the majority? We really would need to know Massachusetts’ rates to make a decision.

I found one research paper that looked at several studies concluded that, contrary to common belief, there is little evidence that casinos are associated with higher crime rates. And another researcher at UNLV found that online gambling on sports in America has surpassed the total handle of Las Vegas casino-based sports books, so what’s the harm? The Nevada Gaming Revenue Report, December 2009 states that the win rate for slot machines was 6.1percent and for table games 12.04 percent. I could wonder if people here would still gamble as much on those venues if they knew the odds. I suspect, yes.

There have been lots of promises of job creation and economic development. And there has been a lot of concern about social ills that come with casinos.

So what should we expect from casinos specifically in Massachusetts?

Casinos operate on odds, probability and statistics – and the house always wins. I say, we should learn something from an approach that always wins.

Since there are legitimate concerns, we should have measures in place that will alert us to problems in communities. Measurements are about facts – what trends are going on in the real world. We should determine what we value, what we want and expect to get and hope not to get from casinos. From the very beginning we should collect the right data so we can answer the questions we want to know — is the casino making us worse off in some areas and are we realizing benefits in others; how can we mitigate the problems; and what is the tipping point when we won’t tolerate casinos anymore, as Massachusetts recently did with greyhound racing?

Just because a casino hires 2,000 employees, it does not necessarily mean that 2,000 jobs were created in Massachusetts. We need to look at net job growth. If casinos hire new employees and these employees just come from other businesses and those businesses don’t hire new employees as a way to cut costs, then there is no net job growth. Net job growth is what politicians don’t tell you when they talk about their accomplishments.

We need to not just measure outputs, which are very basic and not always useful; we need to measure outcomes, which look at changes compared to another equal but non-affected group. Outcome measures have to be set up well in advance and often take at least a couple of years to get results. If measures show we are getting what we want, good; if measures show we are not getting what we want, or getting what we don’t’ want, it is good that we know that, too. Proper measurement is a win-win, regardless of the results, while results based on measures not properly done are useless.

If we want to know if casinos are good for us or bad for us, politicians and leaders must keep in mind that good measurement leads to confidence in results; bad measures lead to no confidence in results. Politicians need to remember that meaningless accountability does nothing other than undermine citizens’ confidence in government and future efforts at meaningful accountability. Citizens need to remember that politicians generally don’t know much about statistics and should be extra careful when listening to politicians advocating either direction.

Based on the findings in other communities, there is reason to proceed with concern. If we want to know if casinos are delivering goods here in Massachusetts, let’s find out.