Is gambling the new opium of the people?

Thursday January 27, 2011

Is gambling as harmful as we are led to believe? The Democracy Institute’s Patrick Basham believes that it is time to look at the real costs and benefits, both economic and social.

Without doubt, gambling’s social and economic reach is now so vast that it may actually influence international affairs. Hence, Joshua Kurlantzick wrote in Foreign Policy that, “Legal gambling today may be the world’s most globalized industry” and one estimated to be worth US$335 billion a year.

And, as far as gambling is concerned, Miles’ Law is deeply applicable. That is, where you stand depends upon where you sit. When it comes to regulation of the gambling industry, positions generally reflect financial or institutional self interest.

Disentangling fact from fictional self interest is that much more difficult because, on both sides of the Atlantic, the media showcase the dark side of gambling. All that can be said in the media’s defence is that they are in good company.

Gaming research that looks at the social and economic impacts of gambling is very uneven. There are many more studies, for example, researching the connection of gambling to crime than there are studies examining the workplace impacts of gambling. Problem/pathological gambling and its harmful consequences have received a great deal of attention, while studies of beneficial aspects, like the impacts of gambling revenues that are used for the public good, are rare.

The public health establishment mantra regarding gambling research may be summed up as, “We don’t predetermine our answers to research questions – but we simply don’t ask certain questions”. Suffice it to say, there is plenty of money in researching the problems associated with gambling; there is little, if any, money in researching gambling’s beneficial aspects.

Beneficial

As of 2002, only one peer-reviewed scholarly journal article had been dedicated solely to the beneficial impacts of gambling on individuals. And there were no studies that dealt specifically with the potentially beneficial impacts of gambling on the gambler’s proximal environment, defined as spouse, children, family, friends, and life at work, at school, or in the local community.

In striking contrast, my perspective is an endorsement of the position that gambling simply should be viewed for what it is. That is, commonplace behaviour practised responsibly by the vast majority of people in our society. Recall that Thomas Jefferson endorsed state-sponsored gambling as a tax assessed “only on the willing”. I share Jefferson’s view that the revenue the government receives from gambling is more desirable because it is voluntarily given rather than coercively extracted.

Following several decades of tremendous growth and change – technological, political, and cultural – for gambling, my unsolicited opinion is that today’s challenge for the gambling industry is to alter the policymakers’ perception of gambling as a business that is economically ambiguous but clearly socially detrimental. Gambling’s supporters focus on its economic benefits for communities that use gambling to attract investment and jobs.

This is a necessary argument in policy circles, but it is not sufficient to carry the day, politically. The debate must change from ‘potential economic benefits versus guaranteed social costs’. It should, instead, become a debate rooted in empiricism. That is, a debate over real costs and actual benefits, both economic and social.

Dr Patrick Basham is director of the Democracy Institute and a Cato Institute adjunct scholar