Our Own Worst Enemy

Our Own Worst Enemy
by Mark Luedtke

How would you like $185 tax rebate this year? That's the average tax rebate that Pennsylvania residents will receive thanks to the tax revenue generated by casino gambling. Pennsylvania's 7 casinos generate $2.7 million in tax revenue every day, and no small amount of that comes from Ohio gamblers. 60 to 65 percent of Presque Ilse casino costumers, about 90 minutes from Cleveland, come from Ohio.

Pennsylvania isn't the only state making money off of Ohio gamblers. Toledo residents gamble in Detroit. Southeastern Ohio residents gamble in West Virginia. Cincinnati area residents flood Indiana's riverboat casinos, and Indiana rakes in $800 million in tax revenue annually. Not wanting to be left out, Kentucky elected a new Governor to implement casino gambling, with tax revenues of $600 million projected annually. Once that happens, every one of Ohio's neighbors will have casino gambling, but not Ohio.

A study by Deloitte Touch estimated that Ohioans spend $560 million gambling out of state, money that would work for Ohio if we had casino gambling. It also predicted that casino gambling in Ohio would bring in $120 million from out of state. Those numbers have to be too low. Casinos in Pennsylvania are generating nearly 1.8 billion in revenue annually, with nearly $1 billion of that going into state coffers. If Pennsylvania and Indiana are making that kind of money, so can Ohio.

What does Ohio gain by not allowing casino gambling? Ohioans who are addicted to gambling are already gambling elsewhere. Our neighbor's casinos aren't generating any crime, but they are generating plenty of revenue and jobs. So while our neighbors prosper off of Ohio gamblers, we punish ourselves in some updated version of a Puritan self-flagellation ritual. Ohio gamblers are creating jobs and tax revenue, just not for Ohio.

This is a case study for what ails Ohio. Oppressive government is chasing people, jobs and money out of Ohio to other states. The only major city in Ohio that is growing is Columbus, and that's because of the growth of state government. But instead putting Ohio gamblers' dollars to work for Ohio, Gov. Strickland is issuing $1.7 billion in new bond debt to increase state bureaucracy and fund oppressive programs that are guaranteed to drive more jobs and more money out of Ohio to greener pastures.

And nearly every other state in the union is a greener pasture. The Tax Foundation ranks Ohio 46th in tax climate for business in 2008. Government is our problem, but Ohioans show no signs of reining government in any time soon.

Ohio would benefit greatly from casino gambling, but there's something unseemly about the models provided by our neighbors. Pennsylvania allows 14 licenses, 7 for horse racing facilities and 7 more for other casinos. Indiana has 12 casinos. Apparently its OK for rich developers to get richer by building casinos, but poor people need not apply. Our neighbors have freed their citizens to gamble, but they haven't freed their people to make money off of gambling. Why can't restaraunts or bars stick a couple of slot machines in a corner to make some extra money? Why are there no small, neighborhood casinos?

When the state protects businesses from competition, the resulting corportism is another dangerous form of socialism. It's inherently divisive and always favors the market leaders at the expense of smaller competitors, workers and consumers. In the United States, everybody is supposed to be equal under the law, but when the state holds out a dozen licenses, the dozen entities who get those licenses are far more equal than the rest of us. These exclusive licenses for large developers to build casinos to increase tax revenue reaks of the Kelo decision in which the Supreme Court allowed governments to use imminent domain to claim land from poor people and give it to rich developers to use so the governments could receive increased tax revenues.

And since when do free people have to ask permission from government to open a casino or put a slot machine in their place of business, anyway? If we have to ask permission at all, we're not free. And in this case, only 14 developers will receive permission in Pennsylvania, and only 12 so far have received permission in Indiana. That's wonderful for those chosen developers - they love having government limit their competition so they can maximize profits at the expense of the people.

But we have the opportunity to do better in Ohio by championing freedom. Ohio should simply legalize gambling, not with restrictive licenses, preferably with no license at, but at least with plenty of licenses so every Ohioan has the opportunity to make money by offering slot machines. Because we're behind the curve, the last state in the region to adopt casino gambling, we will need impressive developments to draw business in from our neighbors, but we should also allow small,  neighborhood casinos and slots to go in local businesses to augment their sales. Ohioans were wise to reject the recent proposal that would have given horse-race tracks a constitutionaly protected monopoly on casino gambling. All Ohioans should have the opportunity to share in the wealth, and competition will serve the interests of consumers and workers instead of just owners.