Md. missing an option in slots debate


SHOULD MARYLAND have slots, or not? And if slot machine gambling is legalized in Maryland, who gets what share of the potential revenues?

The debate in the General Assembly has been circumscribed by these two questions. But by limiting the debate to a yes or no on slots, while ignoring the question of who will be pumping money into those slot machines, state leaders have blinded themselves to a better option: phasing out state-sponsored lotteries and legalizing full-venue casinos immediately.

Instead, politicians in Annapolis have focused on racetrack slots, a half-measure something like a man resolving the question of whether he can afford a new pair of shoes by purchasing only one. To understand why replacing lotteries with casinos is a better solution for almost everyone (except, perhaps, the horseracing industry), consider the profile of contemporary American gamblers who provide these voluntary taxes.

As reported last week in The Sun, a study by John W. Welte and his colleagues at the University of Buffalo, State University of New York shows that gamblers' incomes affect their playing preferences. Those at the lowest end of the economic spectrum are more likely to play lotteries than gamblers from higher income brackets, according to survey results.

The lottery lure is exacerbated in Maryland by the fact that games are available in many liquor stores and bars. Drunk or sober, the reality is that the $443 million Maryland netted last year from state-sponsored lotteries came disproportionately from residents least able to afford it.

Combined sales for Keno, Pick 3/4, MegaMillions and Match 5, as reported by the State Lottery, reveal that annual per capita purchases in Montgomery ($137) and Howard ($112) counties are dwarfed by the figures in Baltimore City ($429) and Prince George's County ($334) - two jurisdictions that account for 42 percent of all sales.

Because bettors with higher incomes favor slots, legalizing slots at racetracks could improve the situation somewhat.

Still, women and senior citizens favor slots over table games like blackjack, roulette and craps at higher rates than men and younger gamblers do. And, whatever their sex or age, those in the highest income brackets favor table games the most.

Does a state that draws gambling revenues disproportionately from the urban poor really want to solve its fiscal problems by asking grandmothers to siphon from their pensions to feed quarters into slots while young, male professionals bolt for the $25 blackjack tables in Atlantic City, N.J.?

This caricature is an oversimplification. But as a form of voluntary taxation, the fact is that table games are the most progressive, slots and video poker the next most, and lotteries the least. Slots at racetracks in economically disadvantaged communities will only redistribute money from some of Maryland's poorest residents to an ailing horseracing industry that needs help, but isn't at the top of the list of those in need. Buying one shoe is dumb; buying one horseshoe with money from people who cannot afford it is worse.

Is it politically feasible to legalize full-venue casinos? Gov. Robert L. Ehrlich Jr. does not have the influence now to push for casinos. But in 1992, Ehrlich, then a state delegate, sponsored a bill to legalize casinos, indicating that as governor he would likely support a casino proposal if it gained political momentum.

Perhaps the Maryland Legislative Black Caucus - which represents many of the constituents who fill the state's lottery coffers - can generate that momentum. Del. Howard P. Rawlings, caucus member and House Appropriations Committee chairman, is one of the legislature's most powerful members. The Baltimore Democrat supports legalizing casinos. The caucus has an opportunity to restructure state finances for decades.

If black legislators advocate casinos-for-lotteries, the first shoe drops. At that point, Ehrlich could drop the second shoe and prove he is a moderate by quietly slipping into the casino bill a small income tax increase on the most affluent Marylanders while he trumpets loudly that casino investors will pay higher start-up licensing fees than the $350 million proposed in his slots plan. In the short term, the state would have more cash to reduce its debts; in the long term, mandatory and voluntary gambling forms of taxation would be fairer.

Liberals, wary Democrats and other gambling opponents would have to concede that such a package is more egalitarian and fiscally responsible than racetrack slots. Only horseracing interests are likely to oppose it, though surely the state's fiscal health and a fairer gambling-as-tax burden should not be sacrificed to appease one satellite of interests.

Ehrlich could broker a deal to dedicate a small percentage of casino receipts for racing purses to pacify horseracing interests and silence critics who dismiss him as the racing industry's lapdog.

Expanded gambling in Maryland might be a short-term, poorly conceived solution to the state's present, and future, fiscal woes. A fuller debate - perhaps led by a statewide commission - should begin to consider the merits of all forms of state-sponsored gambling, especially the question of who pays as well as who gets. State leaders may decide that Maryland doesn't need a new pair of gambling shoes after all.

But the governor and the legislature will likely conclude that legalized gambling must continue, and that a year is too long to wait. If so, they might as well buy both shoes and replace state-sponsored lotteries with full-venue casinos.

Thomas F. Schaller is an assistant professor of political science at the University of Maryland, Baltimore County.

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