USA Today: Those evil casinos!

Carrie NationWith the gaming industry temporarily exhausted from over-expansion and saturation, USA Today has chosen this moment to pounce with an anti-gambling editorial. The graybeards on the USA Today editorial board clearly haven’t been paying close attention — racinos in Delaware, for instance, are hardly a ‘recent’ phenomenon. And they do make a couple of good points, such as: “The farther gambling spreads, the less likely it is to produce the gusher of revenue that entices states to approve it in the first place.”

However, the paper’s solution would do Carrie Nation proud. “Ultimately, states with gambling will be primarily be extracting money from their own residents. At best, this is a wash for the local economy. While gamblers do spend money and create jobs, they would likely spend it in other ways that sustained other jobs if casinos were unavailable.”

In other words, get rid of gambling. If the point weren’t clear enough, USA Today recommends tax increases and spending cuts in lieu of casinos … not exactly the most humane solution.

American Gaming Association President Geoff Freeman was quick to counterattack, arguing that “policymakers should view gaming as one piece of a multifaceted economic development strategy.” He pointed to the $150 million a year tax windfall that Neil Bluhm‘s Rivers Casino has been for Pittsburgh and to the business-meeting Mecca that is Las Vegas (also noting Downtown’s reinvention as a high-tech corridor).

Freeman wanders off the path when he calls for deregulation of the industry as the panacea that will provide more gaming jobs. (Please explain, Geoff, why this is Problem #1.) However, he recovers and concludes with, “We are a highly competitive business uniquely capable of creating thousands of local jobs, supporting small businesses and partnering with communities.”

I’d agree with that.

* Since August began and ended on a weekend, there’s probably some as-yet-diceunreported slot revenue lurking in the Nevada Gaming Control Board‘s revenue count for Nevada. That being said, the Silver State was down 4% and the Strip was -6%. The house got its clock cleaned at baccarat, as casinos won -14%. (In fairness, it would be difficult to beat last year’s 55.5% increase and 19% hold.) Overall, J.P. Morgan analyst Joseph Greff observes “a significant improvement from where trends stood following the first two months of the year.”

Despite a 6% increase in coin-in, Strip slot revenue was but 1% more and a slippage in table play helped non-baccarat table games to decline 4%. Locals casino play was weak for the second August in a row, falling 4%.

The Strip falloff wasn’t as bad as Deutsche Bank analyst Carlo Santarelli was expecting (he thought it would be -13%). Santarelli reckons that Boyd Gaming was 5% down for the month, although Downtown was up 4%, offset by a matching decline on the Boulder Strip. North Las Vegas saw a 7% increase, while the rest of Clark County was down 5% and Laughlin was off by 7%. Lake Tahoe had an extremely good month, up 33%, while Reno was 2% off last year’s pace but still had a healthy, $53 million gross.

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