State of Stealth

A battle is being waged in the state of Maryland over the state's desire to expand casino gambling. Huge in the rhetorical arguments of both sides is the claim that more casinos equals more money for education.
History, and the state constitution, teach us one thing. The amount of money collected through the collection of taxes on gambling will equate to a commensurate rise in the total state budget, but the necessary funds for education would have been found regardless.
Look at it this way.
Suppose the state budget included $100 million dollars for education. The state tells us that we don't have sufficient funds to give our children a quality education. Okay, you say. The state promises to allocate the taxes collected from the casinos to education, so give me more gambling statewide.
The first year's tax collection nets $50 million in casino taxes, and you see the education budget rise by $50 million. Ah, you say to yourself, the state was telling the truth. The money did go to education.
But this is a half truth.
You see, the state is obligated to provide a quality education for our children. If that meant to raise the education budget by $50 million that would have occurred whether or not the casinos were taxed. Without the casino tax, either discretionary spending would have suffered, or other taxes would have been raised to cover those discretionary items.
Let's say you live on a fixed income and the cost of food goes up. What do you do? If you have no way to increase your income, you need to pull money from somewhere else in your budget to cover that increase. Maybe you give up going out to the movies. Maybe you cancel your cable subscription. But you still eat. Cable is discretionary, eating is not,(although you can do a better job with the cash you have for food by making better choices at the grocer.)
A less that ethical individual would go to the local food bank and ask for food but not reduce their discretionary spending, thus having their cake and eating while watching the movies too.
This is precisely what the state is doing.
I'm sure spending on education will rise.
But at what cost to the citizens? The casino money came from the citizens in the first place.
Can you say "Stealth Tax?"

Slots for Tots

Gambling has become a national obsession. The promise of millions of dollars annually has cleared the way for casinos in many states. The state of Maryland now has five casinos, the largest and most lucrative, recently opened adjacent to the Arundel Mills Shopping Center.
Slot machines were legalized in a number of Maryland counties back in the 1940s, generally with the promise that proceeds would pay for children's education and lower property taxes. Stories of bankruptcy, theft, and malfeasance soon followed. Several public officials admitted being approached by interested parties to sell their votes for pro-gambling initiatives. By July of 1968 gambling was once again illegal in the state.
But the lure of a cash flow without raising taxes on the public soon brought a state-wide lottery, with the promise (can you see it coming?) of better educations for the children of the state. Then in 2008, voters (again warned that their children's education would suffer without it) voted for casino gambling.
Before the first slots were set in place, State Senate President Mike Miller began saying that five casinos were not enough. If children were to continue to receive a quality education, a sixth casino (in his home county) would be needed.
Before the largest casino was opened, a state official remarked that revenues were not what they'd expected, and therefore table games should be added to the casinos. Who could argue with such logic? After all, you wouldn't want the children to suffer, would you?
The sad truth is that Maryland is no different than any of the other states with lotteries and/or casinos. Raising taxes on the citizenry costs votes, offering fun and excitement doesn't. But what of the real cost? How about the families devastated by bankruptcy, divorce, or jail time for a loved one because of addiction to gambling?
Gambling is a stealth tax that disproportionately reaches into the pockets of those least able to afford the loss of income. That's not to say those who are well off do not gamble, or suffer from the effects of their gambling. They have the luxury of disposable income.
Casinos are the worst form of taxation. With smiles, bright lights, and good food they promise riches and glory one token at a time.
And the children's education? Somebody please show me a state where the education budget went up in direct proportion to the amount of taxes generated by gambling. The truth is this is a shell game. The money exists for the education budget. Monies that would have been allocated for education are redistributed into other departments, leaving the gambling receipts to cover the load.
Some refer to gambling as the "stupid tax." It's more of a luxury tax. One that a lot of people don't have the luxury to afford.

For a nice study of gambling in MD:
http://maryland-politics.blogspot.com/2008/11/marylands-sordid-slots-history-about-to.html

Some info on the effects of gambling:
http://www.troubledwith.com/AbuseandAddiction/A000000707.cfm?topic=abuse%20and%20addiction%3A%20gambling