Gambling: Not the Answer to Budget Woes

As Red Flags Over Texas correctly points out, Texas is facing a huge deficit, and budget cuts are looming. However, it seems as though legislatures are grasping at straws when they consider legalizing gambling as a source of revenue. This trying time, during which Texas is facing draconian budget cuts, is merely an opportunity for gambling associations to prey on the vulnerable legislature. The promise of revenue seems like a pipe dream, and there are many negative attributes of legalized gambling to also consider.

Proponents of legalized gambling promise increases in state revenue, but the numbers from other states with legalized gambling are less than promising. According to CNN, the state gaming revenue has decreased in recent years, namely in part to the downturn in the economy.  The report cited by CNN concludes that gaming revenue plays a relatively small party in the state budget, amount to only 2.1% > 2.5% of state-generated revenue. This seems like a very small reward to reap when we consider some of the problems associated with legalized gambling.

It’s true that conservatives are considering the well being of family life and the poor, but the debate extends much further. According to a source cited by Texas Insider, when looking at gambling in Illinois, for every $1 produced in gambling revenue, the state must pay $3 in additional costs due to higher crime, broken families and increased poverty. Red Flags is correct, the government shouldn’t tell people how to spend their money, but we also cannot ignore the fact that gambling does lead to more crime and more people with less money. It begs the question if we are in fact enabling those with poor money management to spend their money even more recklessly—something that will cost tax payers even more money when these reckless spenders are forced to ask for more government assistance via food stamps, Medicaid, etc.

Aside from how casinos might affect one’s personal finances, there is documented evidence to suggest that when people are spending more money on gambling, they are spending less money on consumer goods and services. In a study cited by Texas Insider they found that in one area populated with slot machines people spent 10% less on food. This decrease could potentially lead to less jobs in the consumer goods and services sector—a loss that would probably be greater than the number of jobs added by legalized gambling.

While Red Flags Over Texas makes the very valid point that Texas needs to look for more creative ways to fill in the budget gap, it doesn’t seem like uplifting the ban on gambling is a “winning” option for Texas.