Legalized Sports Betting Won’t Save Atlantic City Casinos

Casinos have failed to save Atlantic City, so it is unclear how sports betting is the answer. (Who would want to bet on the 1-4 Eagles these days anyway?) Increased competition from Pennsylvania and other states has sent Atlantic City’s casino revenue plummeting. So to lure more gamblers to A.C., lawmakers in New Jersey want to legalize betting on sports. A non-binding referendum is on the November 8th ballot. Voters should reject this measure. It is a bad bet on several fronts.

Sure, the move will attract some new gamblers to Atlantic City. Supporters say sports betting could generate as much as $200 million a year for the casinos. As usual, there is no estimate as to how much sports betting will cost from increased crime, divorce and personal bankruptcies that always come with more gambling. Such social costs are often ignored or downplayed by supporters and the media.

In addition, the economics of taking $200 million from gamblers’ pockets won’t grow the local economy. Instead, it’s less money spent on things like food, clothes, movies and entertainment. Or in extreme cases, car payments, rent and child support. (Full disclosure: I work for a think tank and edit a blog opposed to gambling.)

To some, legalizing sports betting may seem harmless. It’s legal in Las Vegas, so why not Atlantic City? Plus, many people already bet on football and other sports, albeit illegally. Some argue that it will reduce the criminal element. In reality, legalizing sports betting will only grow the customer base. Many don’t bet on sports because it is illegal and they don’t want to deal with bookies. The state endorsement of gambling signals that it is a good thing. At the same time, illicit sports betting won’t go away, just like state lotteries didn’t end street numbers.

In a sports-crazed market like Philadelphia, legalized betting on games is sure to hook more fans. Given the addictive and destructive nature of gambling, that is all the more reason not to legalize sports betting. More troubling, sports betting will attract younger gamblers to the casinos, leading to more addiction problems. About 67 percent of college students already bet on sports, and 80 percent of high-school students have gambled for money, according to the National Council on Problem Gambling.

The other issue is the integrity of the games. Professional and college sports officials oppose sports betting for fear that athletes will be tempted to influence the outcome of games. Fixing games is not a relic from the infamous 1919 World Series when eight players, including star Shoeless Joe Jackson, were banned for their role in throwing games. Betting scandals have rocked sports for years, including many college programs such as Northwestern (1998), Arizona State (1997), Boston College (1996 and 1981), Tulane (1985) and Kentucky (1952).

A number of scandals have Philadelphia ties. Former NBA referee Tim Donaghy of Havertown went to prison in 2007 after pleading guilty to gambling-related charges that included betting on games he officiated. Former Flyer Rick Tocchet was accused in 2006 of financing a gambling ring. Of course, former Phillies star Pete Rose was banned from baseball in 1989 for betting on games. Lenny Dykstra received a one-year probation from the baseball commissioner after admitting to losing $50,000 in high-stakes poker games. (That’s the least of Dykstra’s problems, given his indictment earlier this year for bank fraud and other charges.) Former Phillies owner William Cox was ordered to sell the team in 1943 after he made a handful of bets on baseball games.

There must be something in the Schuylkill. But just imagine the added temptation if players can swing in to Atlantic City and bet on games.

More broadly, where does the gambling arms race end? If sports betting is allowed in Atlantic City, other states will follow. Initially, Pennsylvania legalized just slot machines in 2004. That quickly morphed into full-blown casinos. Ohio and Maryland lawmakers legalized casinos in part because residents there were gambling in Pennsylvania. Now, lawmakers in New York, Florida, Illinois, Massachusetts and several other states are at different stages on the road to legalizing casinos.

That’s not all. Lawmakers in New Jersey and other states want to legalize Internet gambling. So do some lawmakers at the federal level. If that happens, everyone could gamble around the clock from their home or mobile phone. The entire country will become one giant floating craps game. Sports-betting is just one more step in the race to the bottom.