Posts Tagged ‘Teamsters Central States Pension Fund’

On Chicago and Illinois casinos

Sunday, June 5th, 2011

On 5/31/11, the Illinois Legislature approved more casinos for Illinois, including one for Chicago. The measure awaits Illinois Governor Pat Quinn’s signature.

In response, I return to my op-ed essay published in the Chicago Sun-Times on 4/18/92, and then offer some additional comments.

Don’t gamble with the future of Chicago

At far ends of our American cultural history stand the figures of the thrifty Benjamin Franklin and the expansive Thomas Jefferson. Franklin retired among the wealthiest in the nation, turning to statecraft in midlife after franchising his printing enterprise. Jefferson, although a former president, died more than $200,000 in debt – a staggering sum in today’s dollars – and was reduced in his final years to offer his beloved home, Monticello, up for sale in a lottery – a lottery, by the way, that failed.

Jefferson found that it is one thing to build a beautiful building, but quite another to keep it. For all his fastidious record-keeping, he did not have the economic skills to match his ideals.

There is something very prophetic for us today in Chicago as we again take up the question of legalized casino gambling.

The debate contrasts the themes of thrift and largess. It also highlights the clashing views of those factions who think they know how to run a city.

If we did know how to run a city, we Chicagoans would not have lost more than 100,000 housing units since 1970. We would know the empirical limits to local taxation. We would know how to encourage businesses to remain, and we would know how to run our schools. But we are failing at all these things, despite all the movers and shakers who, for all the glitz, account for but a fraction of our city’s economy. Our industrial and commercial shopkeepers and our landlords account for much more.

To build casinos in Chicago, we must forget what it took for us to close down our infamous “levee” district, since we are about to make possible another one. We must forget the painful experience of cleaning up Chicago – and our police force – in the 30 years that followed Al Capone. We have to forget the difficulty our police have in curbing penny ante crimes, and proclaim our great confidence that our police can keep up with criminals with access to millions.

We also have to forget the warnings of careful research by respected economists following Rutgers’ George Sternlieb, who have demonstrated that gambling soaks up key dollars for international hoteliers that are not cycled back into local economies. The “jobs, jobs, jobs” are on the front end of casino development. After that, you start looking for places to build an industrial park, as Atlantic City has done.

We would also have to forget how Nevada gambling authorities could not prevent the Teamsters Central States Pension Fund here in Chicago from being tapped for more than $100 million to capitalize Las Vegas mob operations in 1974. They couldn’t prevent the Chicago mob from skimming Las Vegas casinos and vendors (where today’s real money is) time and time again. It is ironic that, just as the federal government is crushing the mob leadership, we provide the crushees with a convenient pl ace to cycle their dough. The casinos might mean “jobs, jobs, jobs” – but we might get stuck with mob, mob, mob.

We Chicagoans like to think that, despite our confusion about how to keep a city, somehow it will all work out if we have big shoulders and make no small plans. Some local columnists have long called for legalized gambling, drawing parallels between investing in stocks, bonds and options, and plain old gambling. But while both involve risk and chance, investment at least can lead to economic wisdom through hard knocks. Legitimate investment provides a hedge for agriculture and enterprise against the vagaries of weather and recession, during which most of the uninformed and superstitious investors either get out of the market or lose their shirts.

Yet casino gambling is chance, pure and simple, and it reinforces economic ignorance and superstition. When we use the power of the state to encourage people to bet their horoscopes, we lead entire populaces away from economic wisdom to state-reinforced stupidity. And when you destroy a civilization, the physical destruction of the city necessarily follows.

Like the lesson of Jefferson gambling on his magnificent home, it is one thing to build a city, but quite another to keep it. When we do not know how to keep a city, we must build it, and build it, and build it again, because it is we who through our ignorance continue to destroy it.

If the proposed casinos are built, I ask one thing. Let us place a plaque in front of them on which would be permanently inscribed the names of all public figures, business and labor leaders and editorialists who boosted the idea. Above their names should read: “These people thought this would work.” Then let us see whether the casinos deliver on their grand promises over the decades. Maybe then, finally, we’ll get the idea out of our system that we can keep a city alive by violating the tenets of our civilization. After that, we can do what it takes to build a city that we can keep.

A few additional comments:

  • Illinois, connected by history, rail, and culture to the Deep South, threatens now to equal the Deep South in terms of reliance on gambling for public finance, in terms of political corruption, and in terms of wealth frozen by an accompanying hornet’s nest of bureaucracy.
  • The Catholic Church in the US, which normally would have something to say about the morality of gambling for public finance, long ago compromised its position by relying on gambling for fundraising, making itself dependent on the state for permission to continue small-scale gambling. Therefore, the response of the Church, and religious bodies in general, has remained muted toward state-controlled gambling.
  • As large-scale state-supported casino gambling expands and becomes entrenched in local economies, watch for pressures to legalize prostitution in order for regional casinos to remain competitive with casinos in other regions. For that reason, casino legislation should always include permanent provisions that prostitution should not be legalized within the municipalities or regions surrounding the casinos or gambling establishments. Since religious organizations have not compromised their positions on prostitution, I would expect that they would join in calling for such anti-prostitution provisions to be included in all casino legislation.
  • The state, by trying to engineer and to tax vice, often becomes dependent upon, and thus perpetuates, the very vice that it seeks to limit.
  • The state best limits vice by developing and supporting legitimate pathways to wealth, and by containing vice without establishing its own financial dependency upon it.
  • Franklin’s strategy of thrift, and not Jefferson’s strategy of largess, is still the best financial pathway for government. We may be a Jeffersonian democracy in many ways, but our public finance must follow Benjamin Franklin and Alexander Hamilton.
  • Please see my earlier post on the connection between Parkinson’s disease, a class of drugs called dopamine agonists, and chronic gambling.
  • © Copyright 1992, 2011, Albert J. Schorsch, III
    All Rights Reserved