Monday, July 1, 2013

Casino Gambling May Be Reaching a Limit on Some Areas – And in an Ironic Twist of Fate Delaware Considers a Bailout

Yes, Casinos Were Supposed to Help States, But . . .

One of the great mysteries of life is how casinos can continue to open and not saturate an industry to the extent that they start to fail.  After all, how many gullible people that have no problem losing the mortgage payment every month can there be?

Delaware is bailing out its casinos. Wait, what?

Total gambling tax revenue
Total gambling tax revenues by state, 2001-2011 (University of Nevada Las Vegas Center for Gaming Research. Revenue in millions.)

The solution to the mystery may be that there is no mystery at all.  It just takes enough casinos opening before ones start to go under.  And now that may be happening in Delaware.

Lawmakers appear ready to support Gov. Jack Markell’s plan to use $8 million in an unexpected windfall from higher state tax collections to bail out struggling Delaware casinos. But they admit that it’s not clear the state money will forestall threatened layoffs at casinos that have seen revenues plummet from regional competition.

So the news here is not that casinos in Delaware are tanking.  After all Pennsylvania has become the largest state in terms of gambling revenues and Maryland is opening casinos.  The news is that the state of Delaware is considering bailing out the casinos.

Really, in what world does that make sense? 

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