The Pioneer strikes again

Maybe Archon Corp. Treasurer Sue Lowden was right to play down her casino-industry involvement, after all (although gaming executives aren’t hated around here with anything like the passion reserved for bankers). Her family’s Laughlin grind joint, the Pioneer, occasionally makes the news but never in a good way. In the late Nineties, it caused industry colleagues to blush with a TV spot that slammed Native American casinos by deploying negative Indian stereotypes — and you can bet besieged Sen. Harry Reid (D-NV) is digging hard for that footage. Five years back, Archon had a nasty run-in with its own shareholders over some nepotistic stock grants. So it was only a matter of time before the Lowdens stepped in it again.

Archon’s annual SEC filing was overdue and when it tardily dribbled out the Reid people were all over it like a cheap suit. Lowden’s peeps returned fire at once, pointing out a factual error in the Reid release but otherwise ducking all the ugly corporate-governance stuff and pivoting to campaign talking points.

While Mrs. Lowden may not have been an entirely innocent bystander to the events chronicled in the filing, they raise far more questions about hubby/CEO Paul Lowden. For starters, you do not award yourself a $200K bonus (and let’s face it, “compensation committees” are puppet shows) in a year in which you’ve pulled the plug on your employees’ 401(k) match and in which you yourself made 785 dimes. Archon’s real estate activities aside, that makes Paul Lowden one of the better-paid executives in the gaming industry.

Even more interesting –and totally unrelated to the Lowden/Reid scrum — was this tidbit: “As of December 9, 2008, the Company employed 12 executive and administrative personnel and the Pioneer employed approximately 459 persons.”Fast-forward one year and the Pioneer’s workforce has shrunk to 353 … but Archon still employed 12 execs and administrators. Which raises this question:

Why is it that whenever a casino company has to “control costs,” it usually doesn’t lose a couple of executive vice presidents, streamline its PR operation (as MGM Mirage did) or fly commercial but rather it makes cuts in those areas where customers are likeliest to notice? Whether it’s maintenance, cleanliness, service staff, food quality, sweating comps, cutting back points, etc., the industry’s default setting is to do the things that are most apt to piss off players, diminish return business and amplify bad word of mouth.

Is there any industry more customer-service intensive? And yet, that’s always the first thing on the chopping block. This is self-defeating behavior, constantly repeated. And we all know the one-word definition of doing the same thing over and over, yet expecting a different result.

(In the interests of walking the walk, Stephens Media did the right thing when they paid me — very generously, I might add — to bugger off from the Las Vegas Business Press. Organizational changes had rendered my position and particular skill set superfluous, so there was nothing to be gained by my sticking around. So if Paul Lowden has 23% less casino personnel, experience tells me he can probably do without a few executives, too.)

That the Lowdens run a casino with a crummy reputation isn’t exactly news … but their business practices are the same as the rest of the industry’s, merely writ small. And if Harry Reid has any hope of saving himself (and we’re no fan of him here at S&G), he needs to forget about the Pioneer and remind people that the Lowdens closed and tore down Wet ‘n Wild. Now there’s a sore point … and, say, what did happen to that megaresort project for which Archon received approval  — seven years ago? Given that she’s the odds-on favorite to become Nevada‘s junior senator, one hopes that Sue Lowden’s job-creation and economic-stimulus skills exceed those of her husband.