Regional casinos prey on problem gamblers, study says

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Forget images of glamorous high rollers gambling in exotic resort casinos. Modern regional casinos use the lure of highly addictive computerized slot machines to prey on the weakness of low-income to middle-income patrons, according to a new study by experts in the behavioral, health and social sciences.

casino gambling400“Casino gambling as a once- or twice-a-year vacation has largely given way to casino gambling as a once- or twice-a-month or once- or twice- or more-a-week pattern of life,” the study by the Council on Casinos says.

“Whether or not you personally gamble in them, the new casinos matter. They are influencing the nation as a whole. They are affecting our health, our economics, our politics, our ideas and social values, and perhaps even our sense of who we are as a people and what obligations we have toward one another.”

‘Why Casinos Matter’

The 33-member council—which includes Earl Grinols, distinguished professor of economics at Baylor University’s Hankamer School of Business—produced the report, “Why Casinos Matter: Thirty-one Evidence-based Propositions from the Health and Social Sciences.” Financial support for the study came from the Bodman Foundation, the John Templeton Foundation and other contributors to the Institute for American Values.

earl grinols130Baylor University professor Earl Grinols helped produce the report.Regional casinos in the 21st century differ significantly from Las Vegas-style resort casinos, the study asserts. Instead of drawing customers from around the country or the world to play table games of skill, they typically attract patrons from within 70 miles who arrive at casinos filled primarily with computerized slot machines engineered to create fast, continuous and repeat betting.

“Modern slots are hooked up to a central server that collects player information, preferences, and speed of play and has the capacity to program each machine to each player’s style. In short, the laws of pure chance or probability no longer dictate wins and losses. The modern slot experience is deliberately engineered to take in much more than it pays out,” the report states.

Computerized gambling machines are designed to ensure the longer someone plays, the more he or she loses—but with just enough small victories along the way to keep them playing, research shows.

Highly addictive

“Modern slot machines are engineered to make players lose track of time and money,” the report says. “Modern slot machines are highly addictive because they get into people’s heads as well as their wallets. They engineer the psychological experience of being in the ‘zone’—a trance-like state that numbs feelings and blots out time/space. For some heavy slot players, the goal is not winning. It’s staying in the zone.”

Slot machines draw 40 to 60 percent of their revenue from problem gamblers, and proximity to a casino increases the odds of becoming a problem gambler, the study notes.

Economic impact studies that tout the short-term benefits of casinos fail to measure long-term social costs more difficult to quantify, the report asserts. Furthermore, casinos tend to reduce property values in host communities and hurt local businesses—at least most of them.

“There appears to be at least one exception to the rule that casinos tend to weaken nearby businesses. Regional casinos do seem to promote the flourishing of nearby pawn shops, check-cashing operations and high-interest lending establishments such as payday lenders,” the report says.

Special concessions

States typically grant special concessions to casinos, giving them legal, administrative, regulatory and promotional advantages over other businesses, the study adds.

“Like big banks, state-sponsored casinos are not allowed to fail. When casinos come up short, states usually provide new infusions of money, reduced taxes, reduced funding for gambling addiction measures or other concessions such as lifting smoking bans, in order to sustain revenues and profitability,” the report states.

Regional casinos represent a regressive revenue source for states, the study asserts.

“With the spread of regional casinos into economically struggling communities, more working and middle-class people are drawn to casino gambling. … Easy access increases local participation and drains dollars from local residents into the state’s coffers,” the report says. “As a consequence, women, low-wage worker and retirees are contributing a disproportionate share of states’ take of casino revenues.”

State-sponsored casinos contribute to social and economic inequality in the United States, the study concludes.

Draws in lower-income Americans

“As gambling has spread into economically distressed communities, it has drawn more Americans in the lower ranks of the income distribution into its venues. Low-income workers, retirees, minorities and the disabled include disproportionately large shares of regional casino patrons,” the report says.

“In this way, state-sponsored casino gambling creates a stratified pattern that parallels the separate and unequal life patterns in education, marriage, work and play that increasingly divide America into haves and have-nots.”

Gambling industry disputes findings

A prominent gambling industry leader disputed the findings of the study.

“Basically, they have just taken out of mothballs a lot of long-discredited arguments against casinos that have been made by gambling opponents for decades,” Judy Patterson, executive director of the American Gaming Association, told Deseret News.

Gaming industry representatives insist casino opponents overstate the prevalence of problem and compulsive gambling, asserting it affects only 1 percent of the adult population in the United States.

However, the Council on Casinos study criticizes that statistic as misleading, since it includes only the most severe form of problem gambling—people who exhibit three or more clinical symptoms observed by professionals who diagnose mental health disorders.

“It excludes gamblers who have less severe gambling problems and people whose lives and livelihoods may be adversely affected by their gambling but who do not meet any of the criteria of a mental health diagnosis,” the report says.

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