Monday, April 27, 2009

Casinos Harm Local Economies

Friday, I had the opportunity to hear Earl Grinols, professor at Baylor University, speak about the economic impact of gambling, and especially casinos, on communities.

The bottom line: His research leads him to the following conclusion: Economically speaking, the social costs of casinos exceed their benefit by a ratio of $3.10 to $1.00.

When a casino comes to town, the economic health of the community decreases because of an increase in judicial costs and social costs. The judicial costs rise because casinos bring an increase in crime. The social costs rise because gambling tears at the moral fabric of families and communities. Gambling addiction increases, and family savings are gambled away, and family possessions are pawned.

Two other reasons that casinos do not raise the economic health of communities:

  1. Most casino revenues (75%) come from the surrounding community, thus not attracting as much out-of-town business as normally thought.
  2. Any out-of-town revenue is dropped at the casino and nowhere else. There is no spillover money to other businesses in town with one exception. Gas stations close to the casino always seem to do well. As an example, 3 towns in Colorado allowed casinos to come to town in order to attract tourist money. In truth, there has been no spillover tourist money; it's all ended up in the wealthy hands of the casino owners.

We don't want a casino in Fort Wayne.