Gambling in economic down times
By
While scanning rows of flashing lights and spinning cherries for a game that was going to multiply my dollar bill by a million, I expected to see everyone at the St. Croix Casino to be hoarding their money and chips as if their mortgage payments depended upon them in response to the declining economy and rising gas prices.
But then there was the man sprinting down a row of eight slot machines hitting the “max bet” button at each one, and the older gentleman sitting at a blackjack table with his oxygen tank and pile of retirement money, and the man sitting next to me with five stacks of poker chips each taller than a can of Pringles.
And then there is the Jackpot Junction Casino Hotel in Morton, Minn., breaking ground on a $25 million expansion including an 86,000-square-foot event center, an additional six-story hotel wing, a renovated pool area and expanded dining simply to accommodate an increase in guests.
And in December, the Grand Casino Hinckley celebrated the opening of a 22,550-square-foot event and convention center, a hotel expansion and the Grand Harmony Spa.
The need for casino expansion is not surprising considering Indian gaming profits increased 11 percent from 2005 to 2006, according to the National Indian Gaming Commission (NIGC). Tribal gaming nationwide profited more than $25 billion in 2006 (the 2007 report has yet to be filed).
“Indian gaming has seen increases since the beginning,” said Shawn Pensoneau, Director of Congressional and Public Affairs for the NIGC. “When you have growth in the billions, the percentage might level off, but we haven’t noticed any sort of leveling-out or plateau and we definitely haven’t seen a decrease.”
I sat next to Pringles man, also known as Jon Gahn from Rogers, Minn., at a Pai Gow Poker table. He said nothing would stop him from spending money on entertainment. “I’ve worked hard for long enough,” said Gahn. “If I want to go out and have a few beers while playing poker, then I’m going to go out and do that. It’s the good life.”
Gahn, 35, said the many benefits of being a reward member at a casino often allow him to spend more on gaming as he saves on hotel rooms and food. “If I’m going to get away, I can either go far away and spend $120 a night on a decent hotel room or I can drive an hour and stay in a $60 hotel room just as nice and spend the rest of the money playing games. It’s the ideal last-minute getaway.”
A deep sigh of relief interrupted the conversation as the dealer flipped her cards to reveal a jack high for her high hand and a ten high for her low hand.
“Ha! Pai Gow!” Gahn exclaimed. Table win!
The members of the table claim their winnings and my $1 fortune bonus bet increased to $5 as my reward for being dealt a full house. I was only $30 away from winning back the $40 my husband had already lost.
“About time she has a crappy hand,” said the other gentleman next to me, Jeremy Hansen, 27, of St. Cloud, Minn., of the dealer. “I’ve never lost money so fast at this game.”
Hansen disagreed with Gahn about casinos being an ideal getaway. “I feel guilty just walking in the door,” said Hansen. “I can’t afford to just give away my money for a couple of hours, sometimes minutes, of fun.”
There was a time Hansen was more carefree with his money at casinos, he said, “but then I realized that the $100 I lost playing two hours of poker could have bought me two weeks of groceries.” He said the only reason he was at the casino was for a friend’s bachelor party.
Cautious gamblers, such as Hansen, may not be a threat to the casino’s profits, but other sectors of the gaming business have been affected by a decline in gambling spending habits. A report released by the Minnesota Gambling Control Board stated that gross income from legalized charitable gambling, including bingo and pull-tabs, decreased 3.3 percent from 2006 to 2007.
The exact cause of the decline is unknown, said Gary Danger, Compliance Officer for the Minnesota Gambling Control Board. “We do not have any research that would conclude we’ve seen the economy affect the discretionary income and therefore sales of gambling; there could be a little of that involved,” Danger said. “Some organizations have noted a decrease in sales because of the smoking ban that took place in October.”
Despite decreasing profits, the Minnesota Gambling Control Board is still able to report net income of more than $100 million per month from charitable gambling. A report by the National Association of Fundraising Ticket Manufacturers found Minnesota ranked first in gross receipts.
I was determined to leave the flashing lights and spinning cherries without contributing to the billions of dollars the gaming business will make this year. I cashed out the moment I won enough money to cover my husband's $40 that he had such high hopes for with his blackjack skills.
Comments
Phenomenal stuff X-tina. Bruce Benidt would be proud.
Posted by: Nicholas Backus | February 15, 2008 11:55 AM