Casino gambling costs outweigh benefits

The Legislature cut spending enough to erase a $1 billion budget deficit last year without raising taxes.

Things are looking better this year, thanks to strong farm income and relatively low unemployment, but as usual, lawmakers are looking for ways to bring in more money in relatively painless ways.

One example is State Sen. Paul Schumacher, who is thinking about sponsoring a constitutional amendment to allow casino gambling so Nebraska won't lose revenue to neighboring states.

He has a point; he estimates that Nebraskans provided about $70 million of the $284 million gambling tax revenue that Iowa and South Dakota brought in last year. He said Nebraskans lose about $300 million annually in out-of-state casinos each year.

But the key word there, is "lost." In other words, Nebraska should take advantage of losers so that other states can't.

"Gambling is a tax on ignorance," said one observer. "I find it socially revolting when the government preys on the ignorance of its citizenry. When the government makes it easy for people to take their Social Security checks and pull [slot machine] handles ... it is not government at its best."

The speaker knows a thing or two about gambling; Warren Buffett has played the odds for decades and made himself and other key investors billionaires in the process.

As another financial whiz puts it, gambling is a tax on the poor and people who can't do math -- studies show that people in lower-income ZIP codes spend four times as much as anyone else on lottery tickets.

And, even if they win, the price is high. Lotto winners have a divorce rate four times the national average; and 65 percent of Lotto winners are bankrupt within 15 years.

The fact that Nebraska's lottery system includes funding for treatment of problem gamblers -- provide the cure with the disease -- is an illustration of the immorality of state-sponsored gambling.

While Schumacher's possible constitutional amendment might help recover some of the $70 million in tax revenues now going to other states, expanded casino gambling would cost far more than it was worth in social problems, not to mention expanding them statewide, to places like Southwest Nebraska, relatively free of gambling fallout.

While supporters point out the good that gambling revenues do -- educational innovation and environmental projects as examples -- gambling is not a reliable source of income for vital services.

For example, Powerball lottery organizers plan to double ticket prices to $2 on Jan. 15, increasing the odds of winning by an infinitesimal amount while maneuvering for position with rival Mega Millions, which is staying at $1 for now.

While Nebraska does allow keno, horse racing and a lottery, voters turned down video keno in 2006 and two casino gambling proposals in 2004.

If casino gambling makes it to the ballot this time, they should turn it down again.