That giant sucking sound you hear is a Boston Business Journal editorial
Boston Business Journal doesn’t want Massachusetts to license three casinos to operate in the state:
As a matter of economic policy, expanded gambling is a non-starter. The commonwealth stands to skim $600 million off the top in licensing fees, one-time revenue that quickly becomes lost when it gets absorbed into $26.8 billion budget. Then it expects $400 million per year in additional tax revenue. But has anyone counted the taxes it won’t take in when $1.5 billion — the amount gamblers will need to spend in the state annually to raise the tax expected tax revenues — is sucked out of the local economy?
That’s some odd reasoning. A one-time take-home of $600 million and an annual revenue stream of $400 will “quickly become lost” when “absorbed into [the state's] $26.8 billion budget,” while $1.5 billion will be “sucked out of sucked out of the local economy?”
Those $400 million are 1.5% of the state budget. Those $1.5 billion are less than 0.5% of the state’s gross domestic product (based on a Bureau of Economic Analysis estimate that puts Massachusetts 2006 GDP at $337.6 billion). It should be noted $500 million of the $1.5 billion is expected (or hoped) to be money re-directed from tribal casinos in Connecticut, so we’re really talking about $1 billion, not $1.5 billion, that will be “sucked out of the local economy.”
Please note that the Governor plans to skim more than a quarter of the casino revenue, while the state budget is about 8% of the state GDP. If the Journal can think of a way to raise state revenue at a greater margin without hurting the basic functionality of the economy I’d be happy to hear about it.
The best solution would of course be to shut down tribal gambling all across America, but the U.S. Cavalry has apparently stopped answering the phone.
