Ridgecrest is in a Battle for Its Soul with an Indian Casino

Would a casino in a small desert town in California offend God?  Some appear to think it would.  At a public meeting on the casino project, Pastor Wayne Porter posed this question: “Do we want to risk the displeasure of God for $395,000 a year?”  To me it seems highly unlikely that a tiny casino in a tiny town would be a concern for the ruler of the entire universe.  But, what do I know?

Ridgecrest is a small town in the high desert of California.  It is located near major petroglyph sites and a naval base and one day Ridgecrest might have an Indian casino to round out its menu of attractions.  The Timbisha Shoshone Tribe has a reservation 160 miles away in Death Valley, but would like to have a casino in Ridgecrest.  The tribe claims the area is part of its aboriginal territory and that it has been for more than a thousand years.  Certainly the region has been home to Indian tribes for thousands of years; there are many rock paintings in the area and some might be as old as 10,000 years.  For the tribe, a move to Ridgecrest is not much of stretch, but for modern day citizens of the town, it is another matter.  The situation is complicated because the Timbisha Shoshone Tribe seeking an “off reservation” casino; or in California parlance “reservation shopping.”  Under federal law to take land in to trust for gaming a tribe must meet some clear federal guidelines. One of those guidelines is the support of the local community.

Recently Ridgecrest held a town meeting to discuss the subject, as one might expect; and as gaming debates generally are, it was very emotional. Over the course of the last fifty years gaming has expanded out of Nevada and spread into most of the rest of the country.  The expansion is the result of legislation or constitutional amendments; and each time it was a highly polarized and hotly debated issue.  Proponents touted revenue, job and economic stimulus; opponents warned of destroyed families, crime, drugs, prostitution and traffic jams.

Increased crime. Bankruptcies. Gambling addictions. Corrupting schoolchildren. Interfering with the mission of the base.  And, of course, the wrath of God.  The public turned out in droves to attend the Ridgecrest City Council meeting to voice their opinions on a casino, and what most of them said was “No!” “Do we want to risk the displeasure of God for $395,000 a year?” Pastor Wayne Porter said. Porter was one of several pastors who spoke up on the subject…Marilyn Neel took the idea even further, saying the community should not sell out its moral character.  We are prostituting ourselves, we are prostituting our children.” Jessica Weston, Ridgecrest Daily Independent, 4-22-16

“Don’t bring gambling to our town; it will ruin the character of our town and corrupt our youth!”, is the mantra of the opposition.  The rhetoric is essentially the same in Massachusetts, New York, Rhode Island or New Hampshire.  It is nuanced in each location, but the essence remains the same.  And by now, I thought I had heard every possible argument for both sides.  That is until the citizens of Ridgecrest took up the issue.  Besides Pastor Porter’s concerns about God, Marilyn Neel compares community hosting of a casino to prostitution.  “We are prostituting ourselves, we are prostituting our children,” Ms Neel said.  There was hardly a dry eye in the audience, or a vote in support of the casino.

It is too soon to predict the outcome.  Getting federal approval for an off-reservation Indian casino is not easy.  The process is long, complicated and subject to the changing polices of new administrations in Washington.  But whatever the final result, it may go down in history as the first time God took a personal interest in an Indian casino.

 

Fantasy Sports Visits Washington; But It Will Not Stay

In May, the House Energy and Commerce Subcommittee on Commerce, Manufacturing and Trade will hold hearings on fantasy sports.  The topic hit the national consciousness last September when FanDuel and DraftKings spent hundreds of millions of dollars advertising their product on Monday Night Football.  It ranks as one of the most debated subjects thus far in 2016.  So it is not surprising that Congress would like to investigate. Holding hearings is the Congressional equivalent to an athletic competition and in the District of Columbia it is a very popular sport indeed.

The daily fantasy sports industry is under fire from regulators across the country and now faces another crucial test before Congress. Lawmakers on Capitol Hill will hold their first hearing in May to look into the growing but controversial industry.  A spokesperson for the House Energy and Commerce Subcommittee on Commerce, Manufacturing and Trade said the hearing would focus on the legal status of the daily fantasy games. David McCabe, The Hill, 4-18-16

The House committee will not be the first committee to investigate the world of fantasy sports.  According to the Associated Press, 30 states legislatures have in some way discussed the issue.  The debate focuses on the nature of the activity, questioning whether it is gambling or a game of skill.  The major companies offering leagues for fantasy play maintain it is a game of skill.  Critics, including the Nevada gaming commission and the New York attorney general, say it is gambling and subject to the states’ gambling laws, regulations and taxes.

In the legislatures, the tally is pretty equally divided between the two poles, illegal and legal.  For every state that is willing to declare the activity legal, there is another state that finds it violates state gambling policy.   The pro-fantasy states are willing to permit, regulate and tax it; the others threaten to prosecute the purveyors and sometimes the participants.   The attorney general of Connecticut cut to the chase when he said, “There presently exists a high degree of uncertainty about whether daily fantasy sports contests constitute games of skill or games of chance.”   He did not pick a side, but he did opine that legalizing fantasy sports would conflict with Connecticut’s Indian gaming compact.  It is a very complex issue.

Every state has a different gambling policy and each state wishes to retain its control over all of the gambling activity in the state, which clearly includes the right to limit, regulate and tax any activity that by state law is characterized as gambling.  And that brings me back to Washington and the hearings.  Regardless of what the fine members of the House of Representatives learn in the process of “hearing” evidence on both sides of the issues, this is not an issue fit for national policy or regulation.  I have always thought internet poker – or any other form of online gambling – fell into the same category.  But online poker never grabbed the national attention the way fantasy sports has and even online gambling is clearly a “state’s rights” issue; it does not appear important enough to drive policy at a state or national level.

Although it is rarely part of the discussion on the subject, fantasy sports is an internet activity and I think there is a good chance that fantasy sports will do the heavy lifting for all online gambling.  The fantasy sports debate has generated a great deal of emotion and interest as each state staked a position on the issue.  It has become too emotional for anyone to concede to the feds the right to determine its legality.  It was clearly established as a state’s rights issue by the impassioned discussions in two thirds of the states.

Gambling has always been a state’s rights issue, with a couple of exceptions, most notably the Interstate Wire Act of 1961.  Nevada was the first state to fight for the right to control gambling within its borders.  Senator Estes Kefauver and Attorney General Bobby Kennedy both tried to rest that control from Nevada. Nevada fought back and won.  The federal government’s efforts failed, but not because of Nevada’s political power.  It failed because of the political power of the concept of state’s rights.   I think fantasy sports will once again arouse the emotions needed to limit the power of the federal government.

 

Looking for a Break from a Stressful World, Steve Wynn Doubles Down in Vegas

No one in the gaming industry is as entertaining as Steve Wynn.   He may fly below the radar for short periods of time, but then he bursts out with an announcement of something startlingly new and different.  Just when it seems Wynn has his hands full with his ex-wife, building a casino in Boston and construction delays in Macau, Steve surprises us again.  Wynn is going to build a new resort in Las Vegas with the working title Wynn Paradise Park.  In characteristic style, Steve says it will be the greatest project he has ever built, and of course that means better than any casino resort in the world.  Wynn is taking his golf course and turning it into a wonderland.

Almost giddy with excitement, Wynn compared the project to Disneyland, better and more fun than anything he has done in his 45-year career.  In fact, it is so good that he challenged outsiders to find faults in the plan because he and his staff can find none. It is vintage Wynn; it is what we have grown to expect from him and it is why investors put money into Wynn Resorts.  For investors, casual observers, competitors and citizens of Las Vegas, Steve Wynn is like a high speed roller coaster ride – a very exciting experience.

“Just like Disney,” said Wynn. The proposed project is the first major construction Wynn has undertaken in his home city since Encore Las Vegas opened there in 2008. The new resort, which will feature 1,000 hotel rooms, could cost as much as $1.6 billion, said Wynn. “This is the most fun project in my 45 years,” Wynn told investors. “Somebody take the other side, tell me what’s wrong with this idea? We’ve all drunk the Kool-Aid.” Christopher Palmeri, Bloomberg, 4-7-16

The expectation of his magic affects the way everyone thinks about anything Wynn.  That is true even in Macau.  Morgan Stanley has recently upgraded projections because of the “aspirational” effect; the company may have meant “inspirational.”  However, it might have been saying his casinos cause people to aspire to something outside of their normal, everyday lives.  Wynn caught a lot of flack over the way he expressed that aspiration.  He famously said, “Rich people only like being around rich people.  Nobody likes being around poor people, especially poor people.” Maybe that is his secret; he lets people feel rich and hides their poor selves when they are immersed in the Wynn luxury.

Morgan Stanley said it was making its revised estimates on the basis that Wynn Palace would be “an aspirational casino for gamblers and could take share from peers.” Macau’s casino industry faces a risk of overcapacity, as it is expected approximately 750 new live gaming tables are to enter the market over the next 12 months, says Morgan Stanley.  Gross Gaming Revenue Asia, 4-12-16

Wynn Palace is big news in Las Vegas and on Wall Street; it promises more visitors for Las Vegas and bigger revenues and higher stock prices of Wynn Resorts.  Although, there some cynics that question Wynn’s timing; “Why did he make the announcement now?” they ask.  Is he trying to take the spotlight away from the War of Roses between himself and his former wife, Elaine, over voting rights of her stock?  Does he want Wall Street to focus on the long-term future and ignore the expensive delays and questionable future of Wynn’s casino projects in Boston and Macau?

Those are big issues, by controlling his ex-wife’s shares for voting purposes, he maintains his position as the largest stockholder.  Without Elaine Wynn’s shares, Steve could lose his ability to control the company.  Even if Morgan Stanley has absolute confidence in Steve in Macau, there are significant challenges; Macau’s gaming revenue continues its double digit declines.  At the same time, market capacities continue to grow.  In the next year, 6000 new rooms and nearly one thousand table games will be added to the market.  Wynn Palace is part of that expansion.  The project has been delayed four times.  Although an August opening is predicted, Steve still does not know how many tables he will be allotted.  To add to his woes, Massachusetts has proven to be much more difficult than Wynn or anyone else thought.  At best, Wynn will not open before 2018 and 2020 is looking more realistic.

I think these are all reasons behind the new project in Las Vegas.  Steve Wynn in 74 years old; in 2020 he will be nearly 80.  The dynamic days of his forties are all in the real view mirror.  Now, even when he finds a great opportunity, such as Philadelphia, Boston or Macau, they come with endless problems.  Las Vegas has always been warm, welcoming and accommodating for Steve Wynn.  He cannot turn back the clock with a new Strip project, but he can escape the hassles, lawsuits, delays and uncertainties of the world outside of Las Vegas.

 

 

Good Public Policy versus Bad Public Policy

Nebraska is the latest state to discuss the expansion of gaming. It is in the process of establishing a renewed public policy regarding gambling.  Whether it will be “good” public policy or “bad” policy remains to be seen.  The facts are pretty straightforward. The Winnebago Tribe of Nebraska would like to build a casino at a race track in South Sioux City.

The tribe’s economic development arm, Ho-Chunk Inc. purchased a defunct race track in 2012 and plans to bring back racing and with a little luck, it will add a casino.  The tribe already has a casino in Sloan, Iowa, but would like one in its home state.  Ho-Chunk is supporting a ballot measure that would authorize casinos at the state’s racetracks.  Ho-Chunk and the good people of South Sioux City say Nebraskans are already gambling in casinos, but in Iowa.  Supporters of expanding gaming in Nebraska want to keep that money at home.

That is a common argument; it has been used in nearly every state during debates on expanding gaming.  But it is not a line of thinking that is finding favor with Pete Ricketts, the governor of Nebraska.  Ricketts is against the expansion of gambling; in fact he is against gambling period.  To make a point of its evils, Ricketts designated March as National Problem Gambling Awareness Month in Nebraska.  He chose March because of the NCAA College Basketball Championships and the gambling madness that surrounds it.

Lincoln: Governor Pete Ricketts signed a proclamation on February 3, designating March as National Problem Gambling Awareness Month in Nebraska. March is National Problem Gambling Awareness Month because one of the biggest sports betting events of the year, the NCAA College Basketball Championship tournament, occurs in March. Banner-Press, 3-17-16

As the tournament was winding down and the efforts of Ho-Chunk were ramping up, Ricketts came out against the racetrack casino measure.  In addressing the issue, the governor did not mince his words.

“Gambling is bad for economic development. For every dollar you collect in tax revenues, you are spending three (dollars) in social services, whether it is child abuse, spousal abuse, embezzlement. So, gambling is not an economic driver for the state,” Nebraska governor Pete Ricketts said. Lincoln Journal Star, 4-3-16

Wow! Child abuse, spousal abuse and embezzlement all driven by gambling; who would have guessed?  I wonder where Ricketts gets his facts.  I do not mean to imply that there are no social costs to legalized gambling.  All behaviors with a potential to become addictive have societal costs in their addictive form. Gambling, drugs (prescription and recreational), alcohol and shopping can be addictive in the extreme.  That potential means there needs to be good public policies that protects vulnerable people, but not total prohibition which denies people access to activities they enjoy.   I don’t know whether allowing casinos in Nebraska is good for Nebraska and I don’t know if Ho-Chunk’s plans are good for South Sioux City.  However, I am convinced that Ricketts is not making an honest or true argument.

Creating effective policy is the core issue in Nebraska as it is any state contemplating legalized gambling.  Professor William Eadington spent much of his career trying to point the way toward establishing “good” public policy with regard to legalized gambling.   At the height of the expansion of commercial gaming in the 1990s, he testified before state legislatures everywhere expansion was being contemplated.  Eadington was not against gambling, far from it.  But he did oppose expansion without policies to protect the average citizen and potential gamblers.  Bill was a man ahead of his times and often stood alone in advocating such measures. But today, good public policy is a position we can all endorse; it results from clear thinking and good facts. At the same time, we need be wary of bad policies.  Those polices usually result from polarizing, inaccurate and false rhetoric.  To paraphrase Geoff Freeman, bad public policy is a direct result of a misunderstanding.   The citizens of Nebraska need and deserve protection and economic possibilities based on good policy, not bad. It is a complicated issue.  Governor Ricketts did not add to a proper debate with his outrageous claims.

Two Went to War

While walking around my neighborhood in Reno in 1971, I discovered the American Legion hall, Darrell Dunkle Post #1.  It had been named for Dunkle because he was the first person from Reno to be killed in World War I. In 1917 at the age of 22, he left the university to join the army. On July 18, 1918, he was killed in France. World War I was called the war to end all war. I wonder if Darrell believed that?  His story intrigues; what would he think about the world today?  I composed a song in his honor; Darrell Dunkle, Darrell Dunkle, where are you, where are you?  Sung to the tune of Frère Jacques (Brother John), the question has stayed in my head for forty years.

Darrell Dunkle fascinates me because we traveled the same path. His took him to Europe to end war and make the world safe for democracy.  Mine led from Reno to Laos and Vietnam.  My war was meant to stop the spread of communism and to protect democracy.  In the end, we went in different directions. He was killed. I survived. However, the outcome of our efforts was the same.  The world is no safer today than it was in 1918 or 1963.  And thus my little tale.

Two Went to War

Private 1st Class Darrell Dunkle
long, long ago you went off to France.
You were going to fight a war, the Great War,
the last war, the war to end all war

You were so young, leaving university studies
sports and fraternities behind
Your friends cheered and clapped,
as you marched away to save the world

But instead you died in those foreign trenches.
In your grave now a hundred years,
do you think your death was worthwhile?
No, your death was for naught,
it did not end war or save the world.

For if it had, I would not have found,
an old man and his granddaughter dead.
Smelling like barbecued chicken,
faces cooked in a campfire,
bodies seasoned by our bullets.