Presto! Casinos' magic distracts senators from core issues
By Michael Lewis
State senators debating gambling have lost sight. Instead of asking whether more gambling is best for Florida, they're looking at who gets the payoffs.
Gambling forces mimic stage magicians. While legislators watch the hand dispensing the goodies, the other hand does the monkey business.
It's an expensive show. Beyond scores of lobbyists, gambling firms catch legislators' eyes by contributing tens of millions to political machines.
Watching the big money distracts lawmakers. Instead of deciding whether Florida needs more or less gambling, they're eyeing only how to slip in more games at how low a tax rate — and they keep cutting that rate.
When legislators gave pari-mutuels slot machines, they set a 50% tax. Then they cut it to 35%. Now they plan 10% to match super-low rates for mega-casinos. Some states tax up to 70%.
But that leads to an off-target debate of how much can we get rather than what is paramount: how best to improve our economy.
The hype for massive gambling has been jobs. As Florida's economy recovers, however, hot air is leaking out of the boast that casinos will save us.
We do need more and better jobs. But a legislature that can't see farther than casinos to create them is dangerously shortsighted.
The Genting Group and other casino firms clothed themselves as angels come to our aid. But monthly job gains stripped them of ill-fitting wings and revealed mere mortals who aim to fill carpetbags with Florida's riches and send home the bounty.
Absolutely no economic gain springs from emptying pockets at a gaming table.
Still, casinos call the legislative shots. Their lobbyists might have written the casino bill, and they alter it to their ever-greater benefit as it rolls along.
When Sen. Ellyn Bogdanoff tried to raise her proposed casino tax from 10% to 18% — still less than a third of what some states levy — casinos told her it was a deal-breaker. She backed off.
Don't you wish you had that clout? Tell government how much you'd like to pay and, presto, that's all you'd pay. What a magic trick!
So the senator reverted to 10% and then cut the pari-mutuels' tax from 35% to 10% to match. What a tough negotiator!
Her magic trick had been to rein in gambling by adding three mega-casinos each investing a minimum of $2 billion to play. Yes, that's what she said.
But that trick would cost this state in everything from addiction to social service costs, from massive congestion to business closings as casinos steal hotel and restaurant business at loss-leader rates.
From sham cutbacks via mega-casinos, the bill now would permit pari-mutuels to grow to full-blown casinos too and would slash taxes to hand the industry billions more profits.
That's pure greed. But then, what could we expect from what Genting's president himself labels the sin industry? Forget those halos and wings.
The bill doesn't mention Genting's promise to build roads. It doesn't go into pledges to the Arsht Center and others that Genting would stifle. It doesn't deal at all with Genting's Omni casino.
Those all would be left to the county to negotiate, using what little control the state might permit.
That's no consolation. In its last big deal, the county handed the Marlins a tax-financed stadium and all its income in exchange for the team putting "Miami" on its uniform.
If gambling legislation passed this year, we could expect similar creampuff negotiating.
But gambling operators' overwhelming greed has leaked out from behind the Wizard of Oz's magic curtain. That plus foot-in-mouth casino hyperbole, the flip-flop on pari-mutuel expansion and an improving economy might stall a gambling bill this year.
It wouldn't, however, end the fight. Casinos for decades have sought the magic combination of local desperation and greed. A magician waits until you're not paying attention to pull his tricks.
Meanwhile, watch Genting, which promised a resort no matter what. Without a casino OK, will we see construction?
It's asking a lot of legislators to deal with substance and not goodies. Hope rests on those who frame the discussion around not the division of spoils but the proper economic development for Florida.
Even if they decide to develop more and more tourism and not diversify into higher-paying fields, they'll still need to choose whether the best models are South Beach and Disney or Atlantic City and Las Vegas.
If they're thoughtful, odds are that their aim won't be to pile more gambling burdens on Floridians.
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