Saturday 12 May 2001
HUBERT BAUCH - The Gazette
OTTAWA CITIZEN /
Gambling's $500-billion "handle" makes it the biggest industry in the U.S., expert says.
Sol Boxenbaum was reflecting on the changes in attitudes toward gambling. "You have to wonder," he said, "how anything that used to be so bad can now be so good." As befits a ranked expert on the subject, Boxenbaum has a ready answer: "It's fine if the government is doing it. If anyone else is doing it, it's very, very dangerous."
Boxenbaum is the CEO of Viva Consulting, which provides hands-on treatment for gambling addicts and lobbies for greater recognition of government-run gambling's social consequences. To him, the big difference between today and 30 years ago, when governments started cutting in on the action, is that gambling has lost not its sting, but its stigma. "Now we find we have a generation was born into this, that doesn't even know that at one time gambling was illegal."
There was a time when gambling was commonly held as a wickedness in proper society, the preserve of fallen heirs and shifty lowlifes. Not that proper society wasn't prone to gambling, but it wasn't something one did in front of the children, or advertised to the neighbours. A fairly common childhood memory among Montrealers of a certain age - and not only of a certain extraction - is of their parents and otherwise-dignified uncles furtively trafficking in Irish Sweepstakes tickets. Today it's not uncommon for parents to slip a 6/49 ticket into an adolescent's birthday card.
Governments have encouraged this new attitude, and in the bargain cloaked the venality of their plunge into what they once outlawed as the gambling rackets, with the common political device of calling it something else. In the same spirit as carpet bombing has been construed in recent wars as pacification, and civilian casualties are called collateral damage, so gambling under government auspices has become known officially as "gaming."
"We've gone from sin to vice to gaming, thanks to the government," said Rina Gupta, a psychologist with McGill's International Centre for Youth Gambling Problems and High Risk Behaviours. "I'd say public attitudes on gambling have followed government actions. Gambling has been present since the earliest recorded time of man. It was turned into a sin and a vice by governments. Now they promote it as a fun thing that benefits everyone."
"Gaming" is an even more come-hither weasel word for state-run gambling than the one coined by that master of seductive rhetoric and the 180-degree political turn, Jean Drapeau. It is one of the great ironies of local history that the late great Mayor of Montreal was the one who pried open the floodgates of state gambling in Canada, with his audacious "voluntary tax" dodge in 1968.
Drapeau had ridden to power at Montreal city hall as the fire-breathing champion of a moral backlash movement against the rampant illicit gambling and prostitution which flourished during Montreal's so-called open-city days, when this was widely reputed as the most sinful town in North America. Drapeau railed against gambling as a pestilence on good French Canadian families whose breadwinners were helplessly lured to squander their sweatshop wages in barbotte parlours and bordellos. But barely 15 years later, strapped for cash to finance his eternal-Expo "Man and His World" folly, he hit on the idea of raffling off gold bricks.
Blatant Lottery
It was blatantly a lottery scheme, at a time when lotteries were illegal. When challenged by federal authorities, who had jurisdiction over gambling at the time, Drapeau brazenly claimed that it was not a lottery, but a means for citizens to voluntarily pay extra tax, in aid of a civic cause.
He got away with it, partly due to his standing in those post-Expo, pre-Olympic-scandal days as one of the most popular political figures in the country, in unassailable command of Montreal public opinion. By then, senior levels of government were already eyeing gambling as a potential revenue source.
The situation raised the question, "Why not?" Gambling was already big business in North America, despite all laws to suppress it. Historically, moral crusades against gambling caused only short-lived remissions in the growth of the underground gambling industry.
John Scarne, one of the foremost authorities on gambling in modern times, estimated in his definitive Scarne's Complete Guide to Gambling that by the dawn of the 1970s, gambling was America's biggest business. "Its ($500 billion) handle," he wrote, "surpasses the combined total money volume of the 100 largest industrial organizations in the country, including such corporate giants as U.S. Steel, General Motors, General Electric, Metropolitan Life, the Ford Motor Company and any others you care to name." Of the $500 billion, he reliably estimated, a mere $50 billion was wagered legally.
It wasn't just a matter of getting a piece of the take for the public purse in what politicians reckoned was a painless way, compared to the risk of imposing new taxes. Legalized gambling was also a way of undercutting organized crime, whose overlords controlled most illegal gambling and whose operations could corrupt public officials.
Illegal gambling could flourish to the extent it did in only one way, wrote Scarne. He estimated that of the $450 billion annual illegal gambling handle, $5 billion wound up in the pockets of officials charged with enforcing the gambling laws, in the form of bribes and protection payments, known in the vernacular as "ice."
With this argument, governments were able to put a public-spirited front on their gambling turnabout. This was further enhanced by the tried and true method of associating gambling schemes with good works, as pioneered by the Irish Sweepstakes, whose profits allegedly went in aid of Irish hospitals, and which was later taken up by Jean Drapeau for the Man and His World benefit lottery.
The next time Drapeau wanted to run betting operation, the feds gave him formal approval for a special national lottery for the Montreal Olympics, in lieu of a direct federal subsidy for the project, which would have been politically unpopular in the rest of the country.
Moved Quickly
In an early '70s Criminal Code overhaul, the federal government also gave provinces authority to license and regulate gambling. Some provinces took this as license to mount their own gambling operations. They started with lotteries, variations on the age-old numbers racket, and eventually moved into full-scale casino gambling palaces and ultimately video lottery terminals - notoriously dubbed the gambling equivalent of crack cocaine - in neighbourhood bars and corner grocery stores.
Gambling experts tend to agree that legalization had its merits. "Gaming" now delivers $9 billion annually to Canadian public coffers, money that might otherwise have to be raised through taxes. Of this Quebecers contribute $2 billion, in rough proportion to their percentage of the national population. (Contrary to some enduring prejudices, the deepest studies on the subject have shown that neither ethnicity nor nationality nor religion nor culture have any significant effect on the percentage of gamblers in a given society.)
Legalization did loosen the mob grip on the industry, though without removing it entirely. Nor did it cripple organized crime, which moved on to drugs as its prime revenue source, as it had moved into gambling in the first place after the repeal of Prohibition pulled the plug on bootlegging as America's major criminal enterprise. Illegal gambling, mainly on sporting events, is still a flourishing business, and operates with more impunity than ever. It is abetted by the casual new attitude toward gambling in general, and by newspapers whose editorials rage against the festering gambling plague, while their sports sections helpfully publish the odds on heavyweight title fights and the point spread for National Football League games.
Gambling experts tend to concede that legalization has afforded to the many people who gamble within reasonable limits access to honest games of chance, in an environment healthier than the old mob-run dens. "By regulating it, you do remove a lot of damage that would come about from leaving it up to organized crime to run the industry," said Gupta. But there are signs, however feeble for now, of a backlash against what some consider the excessive promotion of gambling by government "gaming" corporations. The ultimate protest was staged by Daniel Naudi, a 47-year-old Verdun man, who recently committed suicide, in despair over his gambling addiction, in the parking lot of the Montreal Casino.
Tales such as Naudi's were not uncommon in the days before legalized gambling. But through most of history gambling casualties were commonly regarded as victims of their own folly, and at best the dupes of degenerate elements that governments could be called on to deal with harshly. Today they are increasingly viewed as victims of government avarice.
This comes at a time when the social implications of organized gambling are being studied more closely than ever before. Until recently, there was little reliable research in the field, in large part because its underground nature made it difficult to study.
More Young Addicted
The social cost of virtually untrammeled gambling is just beginning to become apparent, with the rise in the number of problem gamblers, say Gupta and Boxenbaum. For a long time, the percentage of problem gamblers in the population was relatively stable at an estimated 5 per cent. But recent studies have shown an alarming rise in the percentage among people under 25 - those who grew up in the modern gambling culture - whose addiction rate is three to four times that of the general population.
The full social cost of gambling will always be hard to measure, but is becoming more and more apparent, said Gupta. "What are the costs of a suicide, how many people does it affect? What are the costs to the individual and to society of someone not getting an education because they flunked out of school because of a gambling habit? Those are big consequential costs down the line that are impossible to measure right now."
Every problem gambler, experts calculate, adversely affects 10 to 15 other people, including friends, relatives and employers. The fallout includes squandered life's savings, business failures, criminal behaviour to support gambling addictions, child neglect and spousal abuse, and absenteeism and declining productivity at work.
Both Gupta and Boxembaum say they are not against gambling per se, and recognize that there's no going back to pre-legalization days. What can be curtailed, they argue, is the aggressively seductive promotion of state gambling. "The problem is that they put it right in your face everywhere, on TV, on billboards and store signs," said Gupta. "And not only do they advertise it, they're trying to make you feel like you're doing a good thing for society when you buy a lotto ticket or go to the casino." Both say governments are slow in coming to grips with the social cost of gambling because they are dazzled by the profits. "Governments have become like gamblers with the addiction," said Boxenbaum. "They don't want to look at the consequences down the line. What they're ultimately doing is gambling with people's lives."
Copyright © 2001 CanWest Interactive and The Montreal Gazette Group Inc., A division of Southam Publications, a CanWest Company.
