Gamblemania

 

(originally published on 1/24/06)

In the 1972 film, The Great Northfield, Minnesota Raid, the famous 19th century bandit Cole Younger, as played by Cliff Robertson, happens upon a game he's never seen before. "It's called baseball," someone tells him, "and it's our new national pastime." Whereupon, Cole pulls his six-gun and, with amazing accuracy, shoots the ball, blowing it to bits of fluff and terminating the game. "Our national pastime is shooting," he says. "Always will be."

Though millions of Americans love to shoot, few today would argue that it's our national pastime, at least not in terms of economic impact. But what is? Those of a certain age would probably continue to argue that it's baseball. A different demographic would argue for football. While a third group might opt for NASCAR. They would all be wrong.

Cole Younger, in fact, was probably closer to the truth than any of these folks. America's national pastime, far and away, is now a form of banditry otherwise known as gambling.

We're not talking about the stock, commodities, futures, petroleum or precious metals markets, either. Many folks consider them a pure gamble, but for purposes of this discussion we'll exempt them, and confine ourselves to activities in which someone directly places a bet.

Would you be surprised to learn that money spent on legal gambling in the U.S. exceeds that spent on major league baseball, the NFL, NASCAR, movies, CDs, concerts and Broadway shows... combined?

When a friend told us that, we were skeptical, so we looked into it. Here are the figures for 2003, the last year for which reliable numbers are available. Total spent on spectator sports in the U.S.: $10.9 billion. On non-sport live entertainment: $10.7 billion. On recorded music: $12.9 billion. On movies: $32.5 billion. Total: $67 billion.

2003 gross gambling revenues: $78.6 billion. If this were the revenue of a publicly traded corporation, it'd be the 12th largest in the country.

Many may think that this is primarily due to the popularity, and ubiquity, of state lotteries. It isn't. Lotteries are an important factor, of course, but they take in only 25% of this total. The biggest beneficiaries of the gambling binge are casinos. By far. Commercial casinos (split between land-based and riverboat) rake in 36.5% of the total, and Indian casinos about another 21.5%. That's 58% of the take, or $45.5 billion dollars.

Now, we don't know very many casino patrons, and had in the past thought of their numbers as relatively small. Were we ever out to lunch. According to recent Gallup polls, a stunning 30% of adult Americans physically visit a casino each year. Beyond that, two-thirds of our citizens reported that "they have participated in some form of gambling activity in the last 12 months." One in two had bought at least one lottery ticket. 15% had participated in an office pool, 14% had played a video poker machine, and a full 10% had bet on professional sports. Internet gambling, still in its infancy, is already generating half as much revenue per year as all spectator sports combined.

And the bookie business probably dwarfs all of this. Legal betting on sports is only a $160 million/year business, primarily because it is confined to Nevada (casino sports books) and, to a lesser extent, Oregon (a lottery game). On the other hand, the 1999 National Gambling Impact Study Commission estimated illegal sports betting at somewhere between $80 and $380 billion annually.

No wonder Gallup headlined its article, "Gambling a common activity for Americans." It has gotten about as mainstream as it could possibly be.

Industry growth over the past two decades has been-no other word for it-explosive. Consider: Lotteries, unknown until New Hampshire introduced the first one in 1964, are now found in 40 states. A generation ago, the Indian casino didn't exist; today, 221 tribes operate 348 casinos in 30 states, with another 200 applications pending (who is and is not a tribe is hotly contested these days). Prior to 1989, there were no riverboat casinos, then Iowa (of all places) legalized them, followed in short order by Illinois, Mississippi, Louisiana, Indiana and Missouri, and prior to the damage inflicted by Katrina, more than five dozen plied the rivers of those states. Fifteen years ago, legal casinos existed only in Nevada and New Jersey; now 32 states have them, with total prohibition of gambling to be found only in Utah and Hawaii. And, tellingly, the Las Vegas metropolitan area is the fastest-growing population center in the United States.

All of this is quite a surprise in a country where most people now alive can remember a time when gambling was stigmatized as an unwholesome and frivolous, if not downright immoral pursuit. Not to mention illegal. Governments that once criminalized the numbers racket now routinely spend tens of millions on ads shilling their own numbers games, which have come to provide a crucial source of income.

We've come a long way, baby, and in such a short time. Like it or not, we are a nation of riverboat gamblers. And how does that old song go? Riverboat gaaaambler, bound to lose...

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Posted 06-12-2007 12:48 PM by DougHornig
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