Maryland Question 7 - What is the Truth?

If you've watched any television for 30 minutes in the past 2 months or so, you've seen the Question 7 advertisements at least a million times.  What is the truth behind Question 7?  Is one side lying?  Are we being had?  Or is this the biggest revenue generator since the Maryland Lottery?

If you are not familiar with this whole issue, Question 7 is officially called Gaming Expansion Referendum.  On the ballot the question will read as follows:

Do you favor the expansion of commercial gaming in the State of Maryland for the primary purpose of raising revenue for education to authorize video lottery operation licensees to operate “table games” as defined by law; to increase from 15,000 to 16,500 the maximum number of video lottery terminals that may be operated in the State; and to increase from 5 to 6 the maximum number of video lottery operation licenses that may be awarded in the State and allow a video lottery facility to operate in Prince George’s County?

Martin O'Malley has been touting Question 7 as the answer to all of our prayers.  Question 7 will allow for a new casino in Prince George's County.  It will allow for table games in the state.  O'Malley says that the development of the casino will create thousands of construction jobs, provide thousands of permanent jobs, and will provide millions of dollars for education and teachers.  And he may have also said that it will allow Baltimore County to repave that terribly bumpy intersection at Deer Park Road and Lyon's Mill Road.

The truth is that many of the jobs will go to illegal, I mean undocumented workers.  As you know, construction work is not permanent work.  When the project is complete, those employees are terminated if there are no new projects.  As I've said before, the completion of construction projects is one of the leading causes of unemployment.

Second, we all know that most of the jobs at the casino will be low wage jobs.  I've heard the pro-Question 7 crowd say that the average salary of the new jobs will be $50,000.  Politicians and lawyers always lie by about 100%, so the real figure is probably closer to $25,000.  Additionally, the majority of these jobs will not require a college degree.  Do you need a college degree to operate a table came, wipe down a slot machine, serve food to overweight people, or to vacuum the floors?  There will be a modicum of skilled jobs for people with college degrees, such as supervisors (I'm stretching it there), managers, accounting, and other office jobs.  The people you see on the floor will not be skilled workers.

Furthermore, O'Malley loves to tell us how much we invest in our education.  I'm all in favor of investing in education.  But did you know that there is nothing in the new law that says the money HAS to be used for education?  It goes to the general fund and it allows state legislators to use the money as they see fit.  If they want to use it for education - great!  If they want to use it for building a new state office building in Baltimore City, then they can do that instead.  Even the Baltimore Sun agrees with that:

Moreover, nothing in the law says that the state is actually required to spend more on education than it would have otherwise. More money in the education trust fund can mean — and heretofore always has meant — that less general fund money is sent to the schools, freeing it up for other purposes. That's what happened with the lottery, keno and slots, and that's what would happen if Question 7 passes.

Moreover, O'Malley is trying to hypnotize us into believing that ANOTHER casino will help generate more revenue. Anyone who's taken basic economics knows that when there is a finite amount of money, it can only be spent finitely (unless you're the Federal government).  By adding another casino, you are spreading existing dollars from one casino to another.  Or, for that matter, existing dollars from other entertainment venues, such as the Ravens, Orioles, Redskins, theaters, and shopping, are being shifted away to the new casino.  So while the new casino will generate revenue, and predictably a lot less than state officials anticipate, surrounding establishments will suffer from declines in revenue.  We've already seen the impacts of the new Maryland Live Casino in Arundel Mills on the existing casinos Perryville and Dover Downs.

Additionally, studies show that gambling disproportionately impacts people that are poor.  Many gamble with hopes of getting out of poverty or their personal money problems.  Some studies show that poor people who gamble bet more money than higher income people that gamble.  I think it's safe to say that gambling is a regressive tax.  Poor people lose their money while smarter people stay at home, though they may venture to a casino a time or two for pure entertainment purposes.  It is like the FICA tax - poor people pay disproportionately more of their income versus higher income people toward the tax.  Why does Maryland and Martin O'Malley want to tax its poor people more than the middle class or upper class?  Regressive taxes do not help people move forward.

And finally, there are two campaigns funding the advertising on Question 7.  The anti-Question 7 group, pretending to be looking out for Marylander's best interests, are sponsored by the West Virginia gaming industry, whereas the pro-Question 7 group is sponsored by unions and the casino company that would manage the new casino.  Neither advertisement is sponsored by the real people of Maryland.

So, while no one is actually lying, everyone is certainly bending the truth.  I am going to vote against Question 7 because I think there are enough gambling attractions in Maryland and if the state wants to expand gambling, it should do so at the existing facilities.  How do you plan to vote?