Pros and Cons of Casino Gambling in Michigan - Research Paper Example

Casino gambling in the US between 1931 and 1978 was outlawed in all states except in the state of Nevada, where casino gambling was on the rise. In the period between 1978 and 1989, Casino gambling was officially legalized in the state of Nevada and New Jersey, and by 1990s, more than 25 states have legalized this venture. Casino gambling is an economic development strategy that has experienced massive growth and popularity in many areas around the world especially since the early 1990s; many areas have legalized casino gambling as a development strategy due to its vast socio-economic impacts. Studies have indicated that casino gambling has the potential to foster development especially in poor communities despite its moral implications to the communities involved. For instance, between 1982 and 1990 in the US, the rate of increase in revenues from casino gambling was more than twice the rate of increase in revenues from industrial sectors. In this respect, casino gambling has been legalized in most of the states in the US except in the state of Hawaii and Uttah; however, unlike many other economic ventures, casino gambling has been mired with skepticism especially due to its probable negative moral implications to the society. In this regard, casino gambling is controlled by governments, and this is to limit the kinds of gambling practiced, number of gambling locations, and the size of the ventures. Casino gambling has the enormous potential to drive economic development due to its massive impact on tourism as a form of entertainment; many tourists are attracted to cities with casino gambling. This paper will examine casino gambling in the state of Michigan, and it will focus on various aspects including but not limited to the socio-economic impact of casino gambling and its background information. Casino gambling was introduced in Michigan in the early 1990s, and this made Michigan the 11th state to authorize casino gaming in America (Moufakkir and Holecek 2). The city of Detroit voted in 1996 and passed legislation (Proposal E) that led to the establishment of three commercial casinos (“History of Gaming in Michigan”); these comprised of Greektown, Motorcity and MGM Grand. The legalization of casino gambling has been received with positive enthusiasm in the state of Michigan; this is evident in the large numbers of tourists trooping in the casino gambling destinations. However, the authorization of casinos in Detroit was immensely motivated by the fear of losing tourists to the rival Winsor, where gambling casinos had been established, and many tourists were flocking there (Shie). The Caesars Winsor establishment across Detroit River in Ontario Canada was a prominent tourist attraction, and this was a potential threat to Detroit’s tourism industry. In this respect, Detroit responded by passing legislation that led to the establishment of its first three casinos; this was meant to protect Detroit’s tourism industry, and foster its economic development accordingly. The establishment of the three casinos has been a significant source of revenue to the state and city of Detroit; this revenue has been collected in the form of wagering taxes and licensing charges imposed on the establishments. For instance, the Michigan Gaming Control board has revealed that the Detroit casinos generated about $1.3 billion, out of which $122 million was directed to the state, and the remaining $149 million was for the city of Detroit. According to these statistics, the casinos generate approximately 11.1% of the Detroit’s revenue, which a massive boost to the city’s income that had declined due to recession (Shie). The establishment of the casinos has had a number of socio-economic impacts on the city of Detroit, and these have mostly been positive impacts in nature. For instance, the casinos have been a powerful attraction to tourists from everywhere, and this has greatly increased Detroit’s revenue earnings from its thriving tourism industry. According to statistical data, the number of tourists arriving in Detroit’s casinos has been on a gradual rise; conversely, the number of tourists arriving at the rival Winsor establishment has been on a steady decline. With the increase in tourism activities, Detroit has also experienced a rapid growth and expansion of businesses allied to the tourism industry (Moufakkir 2). This has also been a great boost to the city’s revenue earnings in the form of taxes, because of the increasing trade. The casinos have alleviated the problems of unemployment because they have provided employment opportunities to a large size of the city’s population. This has been a great relief to the city that had suffered great loss businesses in the deep recession period that led to the destruction of many jobs. However, despite the positive impacts that emanated from the establishment of the casinos in Detroit, recent studies have expressed concerns over the negative impacts of the casinos. Currently, an increase in crime rates and criminal activities is inevitable in areas that have casinos; however, it is very clear that casinos in themselves do not trigger the rise in crimes. For instance, a study of Detroit’s case indicates that the casinos did not increase crimes rather, crime increases proportionately to the increase in population, and this is because of the many tourists in Detroit. Therefore, the large population of tourists in Detroit makes the city an easy target for crimes and criminal activities, but the casinos have nothing to do with them. Perhaps direct negative impacts of casinos to the city of Detroit include personal bankruptcy, mortgage foreclosures, alcoholism and increase in the number of prostitutes arriving from other cities (Saber). Currently, most people have turned the casinos into strategies of quick enrichment, but this eventually leads to greater losses of their hard-earned income. Casino gambling is highly addictive to individuals, and even after losing everything in gambling, individuals will do anything to satisfy their craving. This is what leads to the accumulation of gambling debts, and eventually, individuals are forced into bankruptcy, and alcoholism as provides a gateway for escape. Most gambling victims often undergo mortgage foreclosures due to financial problems associated with perennial gambling. The worrisome influx of prostitutes into the city is because of the tourists allure, and this further alleviates prostitution in the city, in addition to its negative consequences. From this premise, one can argue that the residents of Detroit have little to gain from the casinos as they have aggravated the poor status of the gambling addicts. It is clear the residents have turned the casinos into moneymaking ventures, to supplement their constrained budgets; for instance, majorities of the gamblers are local residents in high society who are trying to increase their pay cuts. Ultimately, it is obvious that Detroit has managed to rip both negative and positive impacts from the establishment of casinos; based on economic benefits, Casino gambling has been successful, as it has enabled Detroit to retain its tourism and increasing its revenues accordingly. Apart from increased revenues, the casinos have created many job opportunities to the city residents who have been hired to work in the casinos. Employment has also been generated by other businesses that have mushroomed in Detroit due to tourism activities, and all these factors have led to an increase in revenues accruing to the city of Detroit. However, the establishment of casinos has also instigated a multitude of social problems that have bedeviled the city of Detroit up to date; it is from this premise that opponents of casinos have argued that the idea of casinos has been a curse for the city of Detroit. Ironically, majorities of these critics agree that, without the casinos, Detroit itself would be bankrupt too by now (Saber); this indicates that the city has become what it is today due to the casinos. In this regard, it is true to say that, the casinos have been successful in revamping the old Detroit into its new form, especially in view of the increase in tourism revenues, tourism business establishments and employment opportunities. Works Cited Saber, Arial. “Detroit casinos offer promise, problems”. Baltimoresun.com. 2004. Web. 20th Dec 2012. Shie, Kevin. “Detroit's Unsustainable Casino Economy”. Ips-dc.org. 2010. Web. 20th Dec 2012. “History of Gaming in Michigan”. Michigan.gov. (n.d). Web. 20th Dec 2012. Moufakkir, Omar and Holecek, Donald F. “Impacts of Detroit’s Casinos on the Local Community”. (n.d). Print. Read More