No more easy money in gambling
posted at 6/3/2012 9:48 AM EDT
Forty years ago, the state lottery was a means to an end. Although a lottery had been proposed many times before, the state generally opposed gambling and never created one. However, the end of Prohibition in 1933 also ended the prime source of mob income. The mob went after gambling with a vengeance. The biggest racket was always numbers, easiest to play and easiest to run. The usual number was the thousands digits from the total daily shares traded on the NY Stock Exchange. The usual payoff was $500 on a $1 bet.
By the 1950s, Boston alone was estimated to house well over 1,000 bookie joints--almost all of them paying for "protection" covering regular bribes to "vice squads." Smart alecks who didn't pay got raided, for the public edification and the mob's monopoly. The cops particularly liked being able to nab prominent figures. In January, 1943, state troopers raided a Brookline dentist, a night-club singer and more than 20 others in one series of raids--some found at prestigious addresses. The feds also got into the game, going after tax evasion. In the 1950s the total handle in numbers was figured at $1 to $2 billion a year for the state.
Huge increases in state spending during the 1960s demanded revenue. By the early 1970s a 3% sales tax enacted in 1966 was no longer enough. In 1972 a state lottery was squarely aimed at the numbers racket, paying out 60 percent instead of only 50 percent of the bets in winnings--to drain mob business. It was successful in that aim. Within a few years the FBI started to get some cooperation from underemployed mobsters. Richard J. Connolly, the Globe's all-time expert on the New England and New York mobs, fingered the main targets for newspaper readers in the early 1980s. [ As Time Goes By for mob chief Patriarca, October 11, 1981, archived at http://www.laborers.org/BOSTNGlobe_Patria_10-11-81.html ]
The lottery, regulated racetrack gambling and--starting in the early 1990s--Connecticut casinos, have all but eliminated bookie joints and the main source of mob money after the end of Prohibition. Gambling urges, which parts of the state's population seem unable to resist, are satisfied. Legally allowed gambling has evolved, more or less, into an ordinary part of the economy. We are now in an era of supply and demand.
That most elementary principle of economics seems to have escaped prominent politicians. Gov. Cuomo in New York, like Gov. Patrick in Massachusetts, still dreams about endless rainbows of new gambling income, when wagons have circled around gambling centers that are failing for lack of customers. [ Michael Sokolove, Foxwoods is fighting for its life, New York Times, March 18, 2012, at http://www.nytimes.com/2012/03/18/magazine/mike-sokolove-foxwood-casinos.html ]
Sharper reporters at the Globe and the NY Times are starting to wake up. It might actually take less than a decade to light some of the dim bulbs at the State House. There really are no more easy takings. What one place is able to get, for the most part another place is going to lose.
[ Mark Arsenault, Rocky rollout for Massachusetts casino gambling, Boston Globe, June 3, 2012, at http://www.boston.com/news/local/massachusetts/articles/2012/06/03/rocky_rollout_to_era_of_mass_casino_gambling/ ]
[ Thomas Kaplan and Danny Hakim, Cuomo’s $4 billion plan for Queens convention center and casino collapses, New York Times, June 2, 2012, at http://www.nytimes.com/2012/06/02/nyregion/plan-collapses-for-queens-convention-hall-and-casino.html ]