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Legalized gambling in the United States is increasingly under attack, not only within individual states regarding its proposed expansion into new jurisdictions, but also on the national level. This August, Congress enacted legislation that establishes a commission to investigate the social and economic consequences of gambling. Despite the many forms of gambling that are currently permitted in most states, gambling opponents tend to focus on privately owned casinos—while virtually ignoring state lotteries, which remain the most popular and widespread form of legal gambling. The preoccupation with casinos is puzzling, because almost every argument that is raised against casino gambling applies with greater force to lotteries.
Those making the moral case against gambling frequently depict casino patrons as hapless victims of unscrupulous “gambling kingpins.” Their wagers, it is claimed, are born of desperation and ignorance. Yet casino patrons tend to have above-average levels of income and education. Compared to lottery players, they are less motivated by a desire to win money, because they perceive casinos primarily as forums for socializing and entertainment. State lotteries, on the other hand, cater to a segment of the population that is relatively less affluent, less educated, and disproportionately black and Hispanic. While casino advertising is restricted, lottery advertising is ubiquitous. Moreover, lottery ads generally portray the lottery as a viable means of generating income and frequently mislead people as to their chances of winning. Lottery advertising often exhibits a penchant for denigrating work, and it is calculated to appeal to minority populations and the less educated. While commercial casinos are privately owned and operated, lotteries exist exclusively as state-run monopolies. Lottery advertising campaigns are paid for by citizens’ tax dollars. Yet those who believe that the spread of private gambling activities erodes civic virtue often fail to appreciate fully the significance of the state’s own role as sponsor and operator of lottery gambling.
The economic critique of gambling rests heavily on the notion that casinos deprive other businesses of revenue. Competing successfully against other businesses, however, is what firms are supposed to do in a market economy. Protecting existing businesses by erecting legislative barriers to casino development would run counter to the interest of consumers. Implicit in the economic criticism of casinos is the view that gambling itself can yield no benefit to society, regardless of the spending preferences of individual consumers. Opponents further claim that casinos are overrated as conduits for job creation and economic growth. As private business enterprises, however, casinos should not be regarded as having a special obligation to spur general economic prosperity.
Whatever policy decisions are made in regard to gambling, they should be made at the state level. The genius of federalism is that it permits those units of government closest to the people to respond to contentious issues in a manner that reflects local values and opinions. The newly established national gambling study commission, on the other hand, may well be used by leaders of the anti-gambling movement to assert federal regulatory authority over gambling, thereby usurping power and responsibility that properly belong to the states.