Casinos are Bad Bets for Urban Renewal

June 17, 1996 - Casinos are in the news this week. Last week we heard about Gary, Indiana, whose long-suffering steel industry now employs only a third of the people it did back in the seventies. With a frighteningly high crime rate and one of the most blighted downtown areas in the nation, Gary has turned to the gambling industry in a desperate attempt to brings jobs and revenue into its ravaged local economy.

The main market for Gary's lakeside casinos is Chicago; but Gary is not a place that Chicagoans relish going to. Folks had to be convinced of easy access to parking by the shore and promise that casino patrons wouldn't have to go near the dangerous downtown district.

Have Gary's casinos caught on? Well, after a fashion: a thousand or so jobs have been created, and folks from Chicago are finding the casinos safe enough. Citizens are unsure of the long-term benefits, though. While many acknowledge that jobs are desperately needed, they worry about the degrading effect of gambling on the already-fraying moral fiber of the community. Indeed, the rise of gambling in St. Louis and many other midwestern towns has had devastating social consequences.

Meanwhile, the social and political stresses brought on by the gaming surge are being keenly felt by Indian nations - who, taking advantage of their rights to run casinos on sovereign reservation land, have quietly been making some considerable profits for over a decade. The Oneida Nation runs a very profitable casino in Verona, New York. According to their home page, all of the Nation's decisions - including the distribution of gaming profits - are made via the traditional structure of tribal government. But this is disputed by other tribal leaders, who claim that Ray Halbritter, the Oneida leader, is subverting the Nation's traditional process to gain control of the casino's $60 million annual profits for himself.

This is not the first time gaming has brought controversy to the Oneida nation. In 1987 an armed group of traditionalists seized control of Oneida lands and burned down the nation's profitable bingo hall.

According to the American Indian Gambling and Casino Information Center, although Indian gaming is only 5% of the entire gambling industry in the US, it is "the industry that tribal governments can use to overturn 150 years of federal neglect." It also maintains that "a majority of Americans support Indian gaming," although the general public tends to oppose "expanded non-Indian gaming opportunities."

So gambling is a last resort, when all other economic avenues have been either taken away or proved fruitless. That unhappy state of affairs may have seemed sensible on Indian reservations, which have always been the poorest communities in the US, established on remote, unwanted land and denied any meaningful economic aid for generations. But when once-proud industrial cities seek to implement the same last-ditch strategy, something is clearly very wrong. This course contains the fiscal remedy by which cities can reverse their self-destructive local tax incentives and re- establish healthy, self-supporting urban communities. It won't be long now before we have tried - literally - everything else.

Lindy Davies - June 17, 1996