To boost their economies, state officials should be discouraging gambling, not trying to expand it.
Here's a thought experiment worth pondering as the US recovers from recession.
What if all the states with legalized gambling had outlawed it last year and asked gamblers to instead put their money into savings, job retraining, paying off debts, or buying goods from local merchants?
Alas, states didn't even consider that productive route for disposable personal income, which would have helped revive the economy faster.
In fact, as state coffers have shrunk – in part because of less tax revenue from gambling – many states have tried to increase the opportunities and enticements for gambling.
In Ohio, for instance, voters are being asked to change the constitution to allow casinos. Illinois wants to give free drinks to riverboat gamblers. New Jersey has lifted a ban on smoking in bars with gambling machines.
Like the gambling addicts they help enable, many states are in denial about this perverse dependence on a fickle revenue source that, as studies show, costs more in social problems than the money it brings in.
And they do so despite estimates that the "market" for gambling is saturated in many areas with more states competing against one another for a limited number of gambling dollars.
Legalized gambling, especially a state lottery, is a zero-sum sport. It simply transfers wealth largely from the poor to the statehouse. It doesn't "create" wealth.
By further tapping the poor in this way when nearly 1 in 10 workers is jobless, states with gambling only highlight that they run a "reverse welfare" program. And Congress doesn't help by giving tax breaks for gambling technologies.
To balance budgets, states must not unbalance society with games of chance. They can do it the old-fashioned way by trimming spending or hiking taxes.
Leave luck out of it.