If you’re serious about economic development…

Like most Torontonians who’ve been drawn into the casino debate, I’m not an expert in economics or the gambling industry.  But I share the sense of skepticism aroused by government’s desperate pressure to turn public opinion.

Today, for example, the media reported that 52% of Torontonians are in favour of a Toronto casino.  This survey’s release coincided with accounts of yesterday’s presentation by MGM’s Chairman in which he talked about casino building sites and guessed that the odds of a majority voting in favour of his proposal for Toronto were about 50/50 .

This is consistent with the poor quality of arguments and evidence presented so far in this debate.

In answer to the question, “Overall, would you say you strongly support, somewhat support, somewhat oppose, or strongly oppose the idea of building a casino in the City of Toronto?” the result was ambiguous at best:

Strongly support: 20.9%

Somewhat support: 31.2%

Somewhat oppose: 18.5%

Strongly oppose: 23.2%

Not sure: 6.2%

The media decided to go along with the interpretation offered by the survey’s funders (Ford-friendly talk radio stations and the National Post), grouping the somewhat supportive in with the strongly supportive.  That assumes that the “somewhat supportive” respondents have actually decided in favour of the proposal, as the headlines state.  Of course, this isn’t true, they’re still considering their decision.  In fact, there are more who are strongly opposed than those who are strongly in favour.

I would interpret it differently, putting the “somewhats” together, resulting in 50% undecided, and only 21% decided in favour.  Coincidentally, the total of undecideds and opposed respondents (73%) is almost precisely the vote registered against a Toronto casino in the last referendum (1997).  Is history repeating itself?

When government uses our own money to persuade us of things, it casts the value of public consultation into doubt.   Frustration and suspicion about the public consultation process is already boiling over.  Tax-funded efforts on the pro-casino side (cinemas, television, print, lobbying, and media management) are obviously well financed, compared with the meager allowance for public participation in impartial information.

Does this overwhelming control of the agenda explain why the debate has leapfrogged fundamental issues, and moved on to arguments about location?  If we allow casino proponents to keep us arguing about building sites, the pro-casino forces have effectively won.

No one has argued that gambling is good for society, only that casinos have an economic value.  That’s where the issue needs to be decided, and that’s where the casino proponents are weakest.

You can’t estimate the economic value of something without knowing its full cost, and that’s something casino advocates don’t like talking about.  Last year the OLG spent $67 million making us feel better about the billions that were gambled and lost in the province, but this represents only a fraction of the real social cost to Ontarians.  The balance was made up by tax-funded social services dealing with the radiating consequences of gambling in affected families, businesses, and communities.

It’s difficult to quantify the consequences because the transmission from cause to effect happens in so many ways, on so many levels.  Whatever the total cost turns out to be, the City will disproportionately bear the brunt of these health and social service costs.  This isn’t adequately factored into the public debate, in my opinion, perhaps because the costs aren’t fully known or because the social harm is deemed to be economically insignificant.

Part of this oblivion results from the way we distance gambling from its consequences.  We use the term, 'problem gambler' in the same way that gun lobbyists in the United States separate the availability of guns from the consequences of their availability.  The gambler is the problem, not the gambling.  Blame resides in the victim, not the perpetrator – the promoter of the addictive behavior.

In fact, the gun rhetoric translates perfectly into a defense of gambling:

Gambling doesn’t impoverish, people do.

It’s a mental health problem, not a problem of easy access.

The problem isn’t that there is too much gambling, the problem is that there isn’t enough!

What makes gambling different is that agencies of the government actively promote it.  States don’t own gun factories or gun shops and don’t market weapons to the public.  Nor for that matter does the government market its own brands of whisky, cigarettes, or tobacco.  But the Ontario government markets lotteries and casinos as aggressively as any consumer product.  Witness the full court media press put on the residents of Toronto by the OLG, its consultants, lobbyists, and allies in the Mayor’s office.   The Province isn’t governing the industry in a fiduciary role; it’s an active industry player.

This 'blame-the-victim' rhetoric is almost undetectable in the debate.  Even the anti-casino people use terms like, 'problem gambler' in depositions about how the effects of excessive gambling diffuse outwards through society.  Yet we know that every bankruptcy, addiction, adoption, intervention, foreclosure, and suicide comes at a price to us all, and we know that price is far greater than the $67 million OLG paid into mitigation programs last year, even if we don’t know the precise amount.

Specious research, media manipulation, blitzkrieg advertising, political brinksmanship… these wouldn’t be necessary if the OLG, Dwight Duncan, and Rob Ford had a solid economic case to make in favour of a Toronto casino.  In fact, the incoherent forms of argument and evidence they provide only add to the doubts of ordinary citizens.

Anyone who’s serious about developing Ontario’s economy wouldn’t have a Toronto casino as a top priority.  Common sense tells us that sucking billions of after-tax dollars from Ontario households is not the best way of enriching them, even if it helps top up the provincial treasury.

The real needs of the economy aren’t the same as the financial needs of the government.  To improve their electability, governments use casinos and lotteries to collect money for popular things like healthcare, while avoiding responsibility for unpopular things like taxes.  State run gambling shouldn’t be necessary, financially or politically.  It’s an admission of failure.

Government’s dependence on gambling should be recognized for what it is – taxation.  Experts agree that a lone casino in the midst of a metropolitan area will draw mostly local traffic.  Torontonians will be making an investment in this casino every time they pull on a slot machine.  In 'games of chance', fixed in favour of the house, the outcome is certain.  Ultimately Torontonians will be underwriting the cost of everything – the buildings, everything that goes into them, and everything that comes out – including the repayment of capital costs (with interest), fees to casino management companies, social service costs, as well as the payoffs to government that legitimize gambling as an industry.

Viewed in this way, it’s reasonable to wonder how the net benefit sought from a Toronto casino might be matched or exceeded by more positive economic initiatives.  If the Ministry of Finance can’t think of any, I could pull some ideas out of the NetGain files (see here, here, here, and here, for examples).

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