Carol Dover: Casinos in Florida would harm local businesses

Carol Dover

President, Florida Restaurant & Lodging Association

October 22, 2013

Gambling interests say they will create thousands of jobs in Florida if we legalize Vegas-style casinos. When Bugsy Siegel essentially created Las Vegas by building casinos in a barren desert in Nevada, his enterprise did create jobs – because virtually nothing existed before the casinos.

The problem is when casinos are introduced into an existing base of commerce, they simply re-shuffle the deck of consumer spending. This is called “cannibalization” — when existing consumer spending shifts from one pocket into another.

Quite simply, the economic problem with adding casinos in Florida is that Florida is not a barren desert in Nevada or a remote swamp in Mississippi.

When casinos move in, they don’t simply compete for consumer spending. They use the predatory business practice of giving away things that are a source of profit for longstanding Florida businesses — things like “comp” meals and hotel stays.

But don’t take my word for it, just look at Atlantic City, where 40 percent of restaurants and a third of the retail stores went out of business after casinos opened. Crime skyrocketed and the population actually shrank. That’s what happens when casinos are dropped into an already-developed economy.

The euphemistic term “reallocation of consumer spending” was a key phrase in testimony last week in Tallahassee before the Senate Gaming Committee. Spectrum Gaming Group, the gambling industry’s go-to economic experts, were paid $400,000 by the state to study how Vegas-style casinos would affect Florida’s economy. They dryly noted that much of the impact would not come from new spending, but from “reallocation of consumer spending,” otherwise known as cannibalization.

The closure of so many restaurants and retail establishments after casinos moved in was a searing experience for Atlantic City.

And thirty-five years after casinos opened in Atlantic City, things have gotten worse, not better….

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