Can Oklahoma smoke, drink & gamble to prosperity?

Weekly Opinion Editorial

ROLL THE DICE OR NOT?

by Steve Fair

     Oklahoma State House Appropriations & Budget Chair Leslie Osborn, ( R-Mustang), and Senate Appropriations Chair Kim David, (R-Porter), are running a bill in the legislature to increase the prize amounts for the Oklahoma state lottery.  HB # 1837 passed through the Senate committee last week by a vote of 24-9 and now heads to the Senate floor.  It passed the House earlier by a 70-25 vote.  The bill, if signed into law, is projected to increase the amount the lottery will give education by about one third.

     State lottery officials have been lobbying for increasing the amount of winner payouts for years because they say Oklahomans are not buying lottery tickets because the prizes aren’t large enough.  “We have the lowest payouts in the country and that impacts sales,” Jay Finks with the Oklahoma Lottery says.  Finks claims the lottery has peaked as to what it can give to Oklahoma education and it is now on the decline.  According to Finks, the lottery has given $783 million since it was implemented twelve years ago.  Oklahoma voters approved the lottery in November 2004 and it was implemented in 2005. 

     When the lottery was on the ballot back in 2004, then Governor Brad Henry predicted if the lottery was approved by voters, it would generate $300 million per year for Oklahoma education.  The former Guv missed that estimate by about 80%.  

     First, gambling produces nothing.  No product or service is derived from gambling.   Years ago, the late Andy Rooney said: “The thing that bothers me most about gambling is that people fritter away money so they don't get to spend it on things that someone else has been paid to produce. Gambling produces nothing. There's only so much money in the world and if it's lost at a gambling table, it's money that isn't spent on things America makes.” Gambling does not involve gain by reason of labor or exchange of values.  It adds nothing to the economy.  For government to promote an industry whose only product is false hope is immoral.

     Second, the lottery, in particular, is referred to by gambling insiders as a ‘tax on the stupid.’  The odds of winning the lottery are astronomical and the vast majority of those who play it are poor.  In that sense, it is a regressive tax on poor people.  The economic utility of money spent on lottery tickets is far less and uncertain when compared to the certain value it could make in the everyday life of a poor person.  Senator Marty Quinn, (R-Claremore), voted against the bill in committee, saying, “I don’t think gambling is good for society. There is plenty of evidence of the harm it causes our society. It preys heavily on the less fortunate. They(the poor) have the most to lose.”  Buying lottery tickets is not a good investment, especially for poor people. Although the exact odds depend upon many factors, in a lottery in which you pick 6 numbers from a possible pool of 49 numbers, your chances of winning the jackpot, meaning you correctly choose all 6 numbers drawn) are 1 in 14 million.  Estimates are that 50% of the lottery tickets purchased are by those living below the poverty line.

     Third, does Oklahoma government want us to gamble, smoke and drink or not?  It’s hard to know.  On one hand, the state runs television commercials and print ads encouraging people to quit smoking and then the Governor proposes the state increase the tax on cigarettes to get more tax revenue.  Like most states, Oklahoma state government is a prime example of an addict and a pusher.  They publically said they want a healthier population, but privately wish the citizens would light ‘em up.  Instead of compensating for the shortfall of gambling revenue, they instead encourage citizens to gamble more and in different ways.  Talk about mixed signals.

     Fourth, gambling is a losing proposition.  According to Baylor University Economist Earl Grinol, the social costs of gambling outweigh the benefits by a factor of 5.6 to 1.   Grinol says lost productivity, bankruptcy, suicide, child abuse and stress related illnesses dramatically increase in proportion to the expansion of gambling in a state.  He says 40% of the costs of those social ills are picked up by the taxpayers with the reminder being privately paid.  Grinol says, “Gambling taxes are worse than a conventional tax collecting identical revenue.” 
     If Oklahoma is going to move forward as a state, it can’t be by generating revenue on the backs of poor people by promoting false hope.  The poor among us can’t smoke, drink and gamble enough to get state government out of this budget hole.