Now that the adult public are free to place bets as they like, economic tidal waves are rolling through the U.S. Well, through the states in which the bans have been lifted at least. The unchangeable popularity of the gambling industry has meant that it is once again making insane profits.
This time however the foundations turning that into bettering the country are far more focused and incorruptible.
Perhaps the more famous side of this circulation of money is the lottery. Given the revenue is both huge and the projects that are funded are specific and branded. Typically, in the U.S., the education system reaps a lot of this crop but since there is no national lottery, each state has its own project.
This form of extremely low odds gambling is interestingly legal in almost every state. But the far lesser talked about side of the country’s enrichment is that of legalized gambling through betting and casinos.
So, how does it work in this land of peak capitalism?
Putting winning tax aside, the casinos that are, let’s say, rather financially secure, have massive taxes to pay for obvious reasons. The governing bodies in decades gone by might have been conspiring with the casinos themselves (and the mobs ‘allowed’ to own some of them) to the end of lining their pockets with cash and their butler’s pockets with silver silk.
But now that the industry has come forward in leaps and bounds regarding corruption, it’s the downsides of gambling that get the silver lining. Help for those struggling with gambling debts and addictions benefit from the booming industry through government programmes and schemes funded by the taxes. A pertinent use of tax if there ever was one.
Further, regulation is what tempers the pitfalls of this sweeping industry. These pitfalls include corruption, cheating and addiction. The key to the industry being benign is for it to be substantiated by legal, authentic businesses.
Regulation can only be effective when companies are operating legally. Legality is welcome news even for the naysayers because, whether they approved or not, people will always be placing bets. Inside or outside of the law… and if they are inside then they are paying taxes and contributing to everyone’s welfare.
But what about infrastructure?
Aside from the fact that the health and security of the consumer contributes to infrastructure, the answer is simple: infrastructure is where taxes generally go. It is estimated that 2.3% of America’s local government and state tax revenue comes from gambling. If that does not sound like much, consider the fact that casinos are only legal in six of the fifty states, and then the sheer quantity of other sources to make that revenue a hundred per cent.
So, to observe the impact of legalized gambling look at how the economies of states that allow casino gambling (on and offline) have flourished. Given that sports betting is legal country wide it is a little harder to pin down the extent of its reinvestment.
But looking at the casino states, they are in the top half of all states ranked by nominal GDP per capita (bar WV and MI). This is certainly at least partly down to overall increased consumer spending. That’s because people who are gambling are more likely to spend money on other things and boost the economy that way.
Not to mention all the law-abiding citizens from elsewhere, keen to casino, making a pilgrimage to one of the legalized states. Particularly in the Southern states, such as Kentucky, Tennessee and the Carolinas, we’ve seen players travelling across state lines just to be able to play at West Virginia online casinos.
In Las Vegas a portion of all (physical) gambling revenue must go to city works which, if you have been, really shows when you drive down the street… which too is paved with taxed wins and casino revenue.
A study by the University of Las Vegas found that gambling has overall produced a 30-odd billion-dollar boost in economic activity and over half a million jobs. The American Gaming Association estimates that that number is closer to one million. Now that’s a lot of families keeping a roof over their head and a chicken in the pot. Americangaming.org calculates that to be $343 dollars off of every household’s tax requirement.
All in all it is an industry like any other, and it can either be a drain on the economy or boost it. Given the popularity and affluence of the business (the house does win at the end of the day), there are big numbers at stake, and it is truly fortunate that they are not just getting hoovered up by CEOs (said drainage).
Ultimately this boils down to the industry’s hilly history – the government will allow it but has no trouble dishing out some heavy tax bills lest it changes its mind. The fruit of legalized gambling is for everyone.