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Social cost of slot machines said to outweigh benefits

Although slot machines would generate tens of millions of dollars for state government, they carry heavy social costs that far outweigh the benefits, an academic expert who studies gambling told Maryland lawmakers yesterday.

"It's not even a close call," said Earl L. Grinols, an economics professor at the University of Illinois at Urbana-Champaign.

Grinols and Attorney General J. Joseph Curran Jr., a staunch gambling foe, appeared before the House Ways and Means Committee to offer their views on the impact of legalizing slots.

Grinols told lawmakers that allowing thousands of slot machines at horse racing tracks is no different from creating casinos. And, he said, they create the same kinds of problems and costs to society.

Those problems include an increase in robbery, embezzlement, fraud and other crimes, he said, and social ills such as lost productivity in the workplace, bankruptcy filings and gambling-related suicides.

Grinols, whose research findings have been criticized by the gambling industry, said the state can expect $3 in costs for each $1 in benefits.

He also said slots are the "most addictive and most problematic form of gambling," far more than the lottery or horse racing.

"You can't easily lose $30,000 on the lottery in a night, but you can on a slot machine," Grinols said.

Several Ways and Means Committee members questioned Grinols closely about his research.

Del. David G. Boschert, an Anne Arundel County Republican and a slots supporter, said prohibition doesn't work.

"I just feel people are going to do what they want to do if they want to do it," he said.

He and other committee members said Marylanders who want to gamble can cross the state's borders to gamble where slots are legal.

Grinols said that bringing slots closer to Maryland population centers would create many more pathological gamblers in the state because they would be able to make daily trips to nearby slots parlors instead of occasional trips on weekends.

He said a racetrack casino or slots emporium can be expected to draw the vast majority of its patrons from a 35-mile radius.

Grinols said casinos rely on pathological gamblers for 30 percent to 50 percent of their revenues. The cost that each such gambler imposes on society is conservatively estimated at $10,300 a year, he said.

Del. Jean B. Cryor, a Montgomery County Republican, told Grinols that his research seemed to illustrate basic "human frailty." She said people are just as likely to embezzle money "to buy furs, jewels, whatever" or for some other purposes as they are to steal money to gamble, and that some people also abuse prescription drugs.

"What we're not looking at is what this [slots] revenue will do," Cryor said. "We've come a long way from talking about education funding."

Curran said legislators can't look at revenue from slots without also considering costs.

"Clearly, there are downsides, and to suggest there are not is wrong," he told the legislative panel.

Curran also warned that legalizing slots in whatever limited form inevitably leads to proliferation, much as the lottery grew from a single weekly drawing to daily games, instant tickets and Keno drawings every four minutes.

Copyright © 2014, The Baltimore Sun
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