Grasping At Straws
Illinois is broke, plain and simple. We have about a $11 billion budget deficit which the last budget impasse really didn't take care of. However, the Illinois General Assembly has come up with one idea that some believe will help cut into that gaping hole of our deficit - legalizing video poker. Where do I start with this boondoggle?
First, how can the leadership in Springfield count on video poker to net enough profits to fill part of the budget? They can't because in this law that Gov. Quinn signed, counties and townships can opt out of legalizing video poker, which would cut into the projected revenues totaling $300 million a year. In fact, Peoria has already been talking about banning video poker. DuPage county has already banned video poker. The geniuses in Springfield have failed to take into account that there are less people playing these machines. At a local drinking hole, 2 years ago there was a line waiting to get on the machines, so they added another. Now? Because of the current state of our economy, there might be 3 or 4 people that play A WEEK, whereas one machine used to see that many people to play it in ONE NIGHT. Because nobody has any disposable income! Remember, these are the same geniuses that convinced us that the Illinois Lottery would pay for education in this state. Oops.
Gambling is big business. The casino lobby has a strong presence in Illinois and they helped kill a provision a few years ago that would allow slot machines at race tracks like the now defunct Fairmount Park in Collinsville, IL. With video poker, the casino lobby lost the first round in Springfield, but they know it will be easier to convince localities to ban the machines because some people might not travel to their facilities to gamble and will stay home. If gamblers do decide to stay home, then cities are also out of sales tax, and other tax monies like hotel/motel taxes. Casinos in Illinois need to keep as many people going to their gaming stops because casinos are hurting because of the economy and the smoking ban.
Third, this is nothing short than another way to tax both the poor and businesses in Illinois. Poor people gamble more often than middle class or rich people. As I've said before, law makers know they cannot raise income taxes on the poorest of our society, so legislators find ways of taxing them in other ways - fat taxes on soda and beer, sin taxes on cigarettes and beer, and now expanding gambling. Springfield cannot stand being left on the outside while someone makes money in this state. Not too mention, now businesses that have machines will have to split their profits with the state, be buried under more paperwork, and open themselves up to investigations by both the Illinois Gaming Board and Illinois Revenue Service.
The biggest problem is regulating this new expansion of gambling in the Land of Lincoln. Right now if you play the video poker (also known as Cherry Masters), the machines are usually set at 80/20 which means that for every $100 put in, you should expect about $80 in return. Of course, you don't know how many people have played the machine before you and how much is paid out so that 80/20 can fluctuate accordingly. There are some places where the machines are turned down to 70/30 or even as low as 60/40. This problem will only explode if the number of machines increases. If you go to a casino, the machines there are strictly monitored for tampering and other methods of "putting the thumb on the scale". How can the state regulate every machine in every bar or other businesses that have video poker? With businesses seeing their profits cut from video poker because the state wants their share, you can bet that the poker machines will be turned down to make up for that lost revenue exacerbating the problem - which in turn lessens the likelihood of someone playing them. You're not going to play a gamble on a game when it's harder to win, especially when the return is lower than most other gambling games. The simple answer is they can't regulate it all, at least not without hiring a massive amount of people to do compliance checks - thereby increasing the cost of a state agency, thereby adding to the state deficit or cutting into the state's projected take on the poker machines.
In the end, legalizing the video poker machines seems like a way of raising revenue without taxing individuals, but the simple fact is that like the Illinois Lottery it will never live up to the advertised benefits. What's next? Are they going to go after your Saturday night poker game with your buddies? NCAA tournament pools? Beer frame bets during bowling? Grandma's bingo winnings? Double dog dares?
I'm not against gambling. I believe it should be limited and regulated so that it's fair as possible. I don't believe that the state should have their grubby hands in every profit making venture in this state also. The real gambling here is the being done by Springfield that video poker can cure the ills of the deficit. The real way to get out of this budget mess is to cut taxes and fees on businesses, and cut taxes on individuals. This would increase the sales tax revenues as more people have more of their money to spend. This would also draw people businesses back to Illinois. Every new person that comes into the state and becomes employed in Illinois is now a new tax payer. Every new business is also another source of revenue. It's a snowball effect to where people have money to buy new things like houses where the local governments get to tax the property. Every time taxes are cut, revenues increase. The Laffer curve has been proven to work by JFK, Ronald Reagan, and George W. Bush. Please read the ideas and math behind the Laffer Curve courtesy of the Heritage Foundation. And please forward that info to our law makers in Springfield and DC. For some odd reason, they just don't get it!
First, how can the leadership in Springfield count on video poker to net enough profits to fill part of the budget? They can't because in this law that Gov. Quinn signed, counties and townships can opt out of legalizing video poker, which would cut into the projected revenues totaling $300 million a year. In fact, Peoria has already been talking about banning video poker. DuPage county has already banned video poker. The geniuses in Springfield have failed to take into account that there are less people playing these machines. At a local drinking hole, 2 years ago there was a line waiting to get on the machines, so they added another. Now? Because of the current state of our economy, there might be 3 or 4 people that play A WEEK, whereas one machine used to see that many people to play it in ONE NIGHT. Because nobody has any disposable income! Remember, these are the same geniuses that convinced us that the Illinois Lottery would pay for education in this state. Oops.
Gambling is big business. The casino lobby has a strong presence in Illinois and they helped kill a provision a few years ago that would allow slot machines at race tracks like the now defunct Fairmount Park in Collinsville, IL. With video poker, the casino lobby lost the first round in Springfield, but they know it will be easier to convince localities to ban the machines because some people might not travel to their facilities to gamble and will stay home. If gamblers do decide to stay home, then cities are also out of sales tax, and other tax monies like hotel/motel taxes. Casinos in Illinois need to keep as many people going to their gaming stops because casinos are hurting because of the economy and the smoking ban.
Third, this is nothing short than another way to tax both the poor and businesses in Illinois. Poor people gamble more often than middle class or rich people. As I've said before, law makers know they cannot raise income taxes on the poorest of our society, so legislators find ways of taxing them in other ways - fat taxes on soda and beer, sin taxes on cigarettes and beer, and now expanding gambling. Springfield cannot stand being left on the outside while someone makes money in this state. Not too mention, now businesses that have machines will have to split their profits with the state, be buried under more paperwork, and open themselves up to investigations by both the Illinois Gaming Board and Illinois Revenue Service.
The biggest problem is regulating this new expansion of gambling in the Land of Lincoln. Right now if you play the video poker (also known as Cherry Masters), the machines are usually set at 80/20 which means that for every $100 put in, you should expect about $80 in return. Of course, you don't know how many people have played the machine before you and how much is paid out so that 80/20 can fluctuate accordingly. There are some places where the machines are turned down to 70/30 or even as low as 60/40. This problem will only explode if the number of machines increases. If you go to a casino, the machines there are strictly monitored for tampering and other methods of "putting the thumb on the scale". How can the state regulate every machine in every bar or other businesses that have video poker? With businesses seeing their profits cut from video poker because the state wants their share, you can bet that the poker machines will be turned down to make up for that lost revenue exacerbating the problem - which in turn lessens the likelihood of someone playing them. You're not going to play a gamble on a game when it's harder to win, especially when the return is lower than most other gambling games. The simple answer is they can't regulate it all, at least not without hiring a massive amount of people to do compliance checks - thereby increasing the cost of a state agency, thereby adding to the state deficit or cutting into the state's projected take on the poker machines.
In the end, legalizing the video poker machines seems like a way of raising revenue without taxing individuals, but the simple fact is that like the Illinois Lottery it will never live up to the advertised benefits. What's next? Are they going to go after your Saturday night poker game with your buddies? NCAA tournament pools? Beer frame bets during bowling? Grandma's bingo winnings? Double dog dares?
I'm not against gambling. I believe it should be limited and regulated so that it's fair as possible. I don't believe that the state should have their grubby hands in every profit making venture in this state also. The real gambling here is the being done by Springfield that video poker can cure the ills of the deficit. The real way to get out of this budget mess is to cut taxes and fees on businesses, and cut taxes on individuals. This would increase the sales tax revenues as more people have more of their money to spend. This would also draw people businesses back to Illinois. Every new person that comes into the state and becomes employed in Illinois is now a new tax payer. Every new business is also another source of revenue. It's a snowball effect to where people have money to buy new things like houses where the local governments get to tax the property. Every time taxes are cut, revenues increase. The Laffer curve has been proven to work by JFK, Ronald Reagan, and George W. Bush. Please read the ideas and math behind the Laffer Curve courtesy of the Heritage Foundation. And please forward that info to our law makers in Springfield and DC. For some odd reason, they just don't get it!
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