The Australian Labor Party have enjoyed an ongoing love affair with the Australian gambling industry (here, here, here etc). The latest romance between Packer and the pollies is panning out beautifully in NSW. A second casino for Sydney makes money-sense for James Packer – he can drag in more millions from desperate problem gamblers – but it defeats the social interest. Despite Packer’s claims that it will draw spending from free-spending high rollers from Asia the truth is that most revenue will come from mug, resident Labor-voting Australian bogans and the bulk of this will comprise the desperate losses incurred by problem gamblers in particular. The Asian big rollers now have plenty of opportunities to gamble in many other places.
Look at the political clout Packer has assembled to advance his gambling interests – mainly ex-Labor heavies but also some Liberals:
“He’s got (former ALP national secretary) Karl Bitar and (ex-Labor minister) Mark Arbib counting the numbers, (former Howard government minister) Helen Coonan on the Crown board, and the premiers of NSW and Queensland on-side.”
Of course Packer has also suggested former Victorian Liberal Premier Jeff Kennett as a new CEO for his gambling venture and proposed that he be given a board seat on Echo the casino operator in Sydney he is trying to control on the cheap. .
Packer is dressing up a low-ball bid for an extra casino as an attempt to bolster inbound Australian tourism particularly from China. He is getting good support on this from Geoff Dixon who is chairman of Tourism Australia and also from ex-advertising supremo Harold Mitchell. Of course Dixon, Mitchell (and fot that matter Coonan) are all directors of Packer’s Crown. What a coincidence and they are all saying such nice things!
The way Barry O’Farrell laps up all this nonsense sickens me – particularly as I knew Barry at university and thought he was no fool. But are the Australian people being taken for fools? Can blatant self-interest be allowed to override any sense of perspective on this issue? Packer has employed enough political punch to pull off a socially expensive fiasco.
Promoting problem gambling? The Labor Party’s ‘light-on-the-hill’? I feel a distinct revulsion at what is now happening in Australian politics. The greedy Liberals can be expected to follow their economic noses without a trace of idealism. But the hypocrisy of ex Labor politicians is breath-taking.
Up the workers the Laborite pollies might cry! Yes, right up them. Use their union dues to pay for prostitutes and keep them addicted to hopeless dreams of wealth through gambling. (1909)
Out of curiosity, where do the Greens stand on gambling? I can still remember the days when a casino in Victoria would have been thought impossible.
Not sure they have got much beyond pokies – they oppose more and want limits. Here is the Victorian Greens policy:
http://vic.greens.org.au/policies/gambling
There are plenty more, Ducker went to Ainsworth pokies and Jenny Booth to Star City Casino. Tab, pokies, lotto – punters love em.
No surprise really — it’s an easy extra source of revenue for state governments not willing to get it other ways, so everyone benefits except the stoopid punters.
Do not give the racing industry a pass as a source of misery and rather large scale political influence.
Racing is much more entrenched and well above the political fray compared to pokies and casinos. only difference is at the pokies they give you somewhere warm and inside to sit.
The politicians seem to see no downside to associating with gambling and also film-making and extravagant bids of major sports events such as the Olympics and world cups.
Politicians throw good (public) money after bad at these industries and then take jobs in those industries all seems to pass without comment, much less public outrage. Who said that public choice was overly cynical about politicians’ motivations?
See http://www.becker-posner-blog.com/2006/08/internet-gambling–posner.html for an interesting discussion
p.s. I once went to a meeting with Bob Hawke. I was specifically told beforehand to not mention racing because he would start and never stop. Punting was his only hobby after from sport.
The racing industry has a negligible effect on problem gambling compared to the pokies. In Australia at least gambling problems are overwhelmingly poke problems.
thanks hc, did not know that.
At least with racing, there is some skill with form guides etc. the heavy gamblers I know are perfectly safe at a race track but not at the casino or pokies
I do not understand the pokies because they are so boring.
The people I know who gamble far too much are highly educated. Error and misunderstanding is not the source.
In one case, winning $23,000 in one week-end turned a responsible punter whose float was $50 into a guy who gave it all back and cashed his money for years.
p.s. the reformed alcoholics I know say the only way for my gambling addicted friends to reform is for them to hit rock bottom. let them sleep in the streets; eat at soup kitchens.
Not sure if the reforms around at the moment help them hit rock bottom in this way. I assume that tough love is the correct way to cause addicts to change. I do not know.
Thanks for the link. At least the Greens statement on pokies is clear enough.
Outside of the casino pokies are illegal in WA and this has had a positive effect, if you can believe the correlation between playing sport and poker machines made by the Productivity Commission.
The case put forward by NSW clubs that they are a community service actively promoting sport is as silly as a Jim Rose argument, which sets the standard of “silly.”
rog, the question is whether in a free society people have the right to lose their own souls?
Are the various nudges suggested by the Commission for the benefit of gamblers themselves or are they to assuage the feelings of officious bystanders upset at others making bad choices. Out of sight, out of mind?
The classical liberal case partly rests on a presumption that being able to make mistakes through having the right to make one’s own choices leads in the long run to more self-reliant, competent, and independent individuals. The process of making choices leads to individuals who are more capable of making good choices. Mill called this process freedom.
That is also the advice from my recovering alcoholic friend. Let them hit rock-bottom. Only then do they face up to their demons.
All the addicts I know hate to lose and chase their money. Learning to accept what you cannot change is one of the 12 steps, as I recall.
We are not nudging cognitive and psychological quirks. The core of addiction is self-centeredness and an unwillingness to accept boundaries.
I want to help addicts. I am not interested in reducing my sorry and anguish for their fate. It is not about me or you. I want to them help themselves.
Sometimes that requires turning a friend away who is in desperate need because they must face up to their bad choices and stop making them. For example, sign one of those voluntary bans from a casino.
sometimes gambling problems are very hard to cure. Research says that gambling is as addictive as illegal drugs. “‘“’
Regards
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All this talk about free society and souls is just self indulgent twaddle, if you were to apply the “classic liberal” formula without prejudice there would be poker machines and mini bars in schools, so that students may become more self reliant competent etc.
Of course we don’t allow that as society has determined that on average people below a certain age are not able to properly inform themselves of the risks and consequences and make mature decisions. The reality is that people are often not average.
Whether you bet on sports, scratch cards, roulette, poker, or slots—in a casino or online—problem gambling can strain relationships, interfere with work, and lead to financial catastrophe. You may even do things you never thought you would, like stealing money to gamble or pay your debts. You may think you can’t stop but, with the right help, you can overcome a gambling problem or addiction and regain control of your life. The first step is recognizing and acknowledging the problem.;
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Demonising Packer is wrong. casinos open because the median voter has less meddlesome preferences than in the past.
Buchanan captures a mindset with the phrase “meddlesome preferences, whereby “the elitist, who somehow thinks that his or her own preferences are ‘superior to,’ ‘better than, ‘ or ‘more correct’ than those of other, tries to control the behaviour of everyone else, while holding fast to his or her own liberty to do as he or she pleases.”
Once politics was discovered a low-cost means of imposing preferences on behavior, a Pandora’s box was opened that shows no signs of closing itself.
Much of the culture war is about resentment that the other side of politics has had a chance to enact into law their own meddlesome preferences when last in government.
The progressive left preaches deference to the government, reverence for experts, the need to protect society from itself, and the right of democratic majorities, guided by elite experts, to govern as long as they do not interfere with their stash of dope and sexual privacy.
HT: offsetting behaviour blog
Gambling has catastrophic effects on Australian society – particularly the pokies but also casinos – and is worth thinking carefully about. In my view it is foolish thing to encourage and a good thing to discourage even if not to outright ban.
But gambling does exist and in many respects it operates as a publicly regulated monopoly. This post is about James Packer’s use of ex-pollies to gain monopoly provision privileges and the role of the ALP in delivering such pollies. That does not maximise the benefits that accrue to the public of offering these monopoly concessions.
HC, do monopoly concessions increase or decrease gambling? Is the under-supply of output by a monopoly a good or a bad thing when the good itself is seen as a public bad?
James Buchanan started his 1973 paper ‘In defence of organised crime’ quoting Samuel Butler: “we should try to make the self interest of cads a little more coincident with that of decent people”
Buchanan’s simple idea is that if a monopoly market structure restricts the output of goods then it must also restrict the output of bads!
Buchanan end’s his paper with ends with “It is not from the public-spiritedness of the leaders of the Cosa Nostra that we should expect to get a reduction in the crime rate but from their regard for their own self-interests”
Should gambling outlets be public monopolies because they would be smaller, badly run and slow to innovate?
HC, see http://www.cato.org/sites/cato.org/files/serials/files/cato-journal/1991/1/cj10n3-5.pdf for THE WAR ON DRUGS AS ANTITRUST REGULATION Gary M. Anderson and Robert D. Tollison.
by preventing the emergence of monopolies and cartels, the war on drugs makes drugs cheaper and more available to addicts.
Jim, Some of the issues you discuss are cited here:
http://www.harryrclarke.com/2007/08/30/preliminary-thoughts-on-gambling-economics/
thanks HC, one big casino in the center of town may be better than one in every suburb as with the TAB.