There’s a Nobel Prize in Economics (or something) for whomever can figure out how to disentangle gambling from politics. Case in point: Iowa, where Gov. Chet Culver (D, left) has a heavy thumb on the scales of regulation. Culver’s made it amply clear that he wants four new casinos, economics be damned. Since he can sack members of the Iowa Racing & Gaming Commission at will, what are the odds he’ll get his wish? In fact, were Culver’s logic — “If communities vote in favor of gaming, then they should be given the opportunity to build one.” — carried to its logical conclusion, Iowa could give Nevada a run for its money in the most-casinos-per-state category.
What would-be casino owners (understandably) and Culver (less understandably) are indifferent towards is that, given their wishes, the cannibalization of the Iowa market will escalate into a feeding frenzy. Even though it would take at least a year for the first new casino to get up and running, to ask that Iowa absorb so much new casino capacity and generate enough new business to offset is basically requesting the impossible.
And if, as a consequence of expansion, Terrible’s Lakeside Casino loses 14% of its business, it’s on the state’s head. That’s the price of having your hand directly on the faucet knob that controls how much casino capacity can flow into the Hawkeye State. Yes, new jobs will be generated in the four communities that are applying — but it’s a dead certainty that others will be lost at extant casinos elsewhere in the state, making the expansion proposition a wash at best.
The Des Moines Register offers a lengthy analysis of the pros and cons of each project. If distant Lyon County is the front-runner, it’s because it’s the only project that’s positioned to draw out-of-state players (with Ottumwa a distant second). With the possible exception of Lyon County, a maintenance of the status quo seems no-brainer public policy. However, given the inordinate influence held by Culver, either the fix will be in or there will be gubernatorial hell to pay if it’s not.
