Friday, February 22, 2008
Gambling on Stupidity
A state representative from Delaware County is concerned that the opening of seven slots parlors across the state has cut into lottery revenues. He cites lottery revenues from the last two years—$1.41billion in 2005-06, $1.35 billion in 2006-07, and a projection of less than $1.3 billion this year—as proof that this is happening and is worried about the Lottery Fund’s balance which is used to pay for senior citizen programs. The Lottery Fund is expected to fall from $476 million in 2007 to $35 million in 2009. Is the lottery a victim of the slots casinos or are these decreases just circumstance?
Of course lottery revenues were going to fall once slots casinos were up and running. Gamblers have a fixed pot of money that they will gamble with. For every dollar spent at the casinos is a dollar that cannot be spent on the lottery. People who were regular lottery players are more likely to be frequent guests at casinos. The casual lottery player, who played the Powerball once in a while, will still do so, but they were not the driving force behind lottery sales. While it may be too early to tell if slots will completely cannibalize lottery revenues, it will surely eat into lottery profits. Just think, there are more slots parlors yet to open, and the state will likely raise the issue of table games at some point. Thinking that casinos was not going to affect the lottery was just gambling on stupidity.
Of course lottery revenues were going to fall once slots casinos were up and running. Gamblers have a fixed pot of money that they will gamble with. For every dollar spent at the casinos is a dollar that cannot be spent on the lottery. People who were regular lottery players are more likely to be frequent guests at casinos. The casual lottery player, who played the Powerball once in a while, will still do so, but they were not the driving force behind lottery sales. While it may be too early to tell if slots will completely cannibalize lottery revenues, it will surely eat into lottery profits. Just think, there are more slots parlors yet to open, and the state will likely raise the issue of table games at some point. Thinking that casinos was not going to affect the lottery was just gambling on stupidity.
