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Thursday, June 14, 2012

An Indictment of the Industry

I just received my copy of the June edition of Trot magazine and from just looking at the copy of the magazine, you can tell the impact of the upcoming end of the Slots at Racetracks program are already being felt.   This edition of the magazine appears to be much smaller than it has been before, suggesting there is less advertising in the magazine. 

In the Speaking Out section of this publication, there was an astute letter from owner/breeder/investor Ken Morden, who chastised the industry for being in denial.  As Ken Morden stated "Again the industry did not and still does not understand that the Ontario government has already made the decision to withdraw from the partnership-and our partnership share of the slot revenue is gone, gone, gone".  Morden was basically bemoaning the industry was looking back instead of looking ahead, figuring out how racing is going to survive in the post revenue sharing era.

But Morden was not done.  He indicted racing's leadership for inaction.  As he said "Years ago we were given the proverbial inheritance from a relative with the implication that we should be using the slot revenue to reform our industry and attract real fans....Instead, we have been betrayed by our leaders who did not see this coming and if they did, even worse, did not do ANYTHING.  Damn the torpedoes, full s team ahead.  Take the money and run!"  If you can get a copy of this month's Trot magazine, you need to read Mr. Morden's comments in their entirety as he is spot on.

Well, the American standardbred industry would be well served to take heed of Mr. Morden's comments.  While no one state has been crippled by the government as Ontario (though one can argue New Jersey has been via the ending of the Atlantic City purse subsidies) appears to be, we are pretty much acting the same way the Canadian industry has been, taking the money and run.  Even with what is going on in Ontario now, what is the American racing industry doing?  With the exception of New Jersey, trying to get slots in states that don't already have them.  Even in New Jersey, where Jeff Gural and the NJTHA are working to bring back an industry which was near death, horsemen are basically dreaming of the day slots will come to the Meadowlands and possibly Monmouth Park.

With regards to all breeds of racing, no one is seriously addressing the over supply of racing; meets which run too long; the extended period between races; attracting new customers; excessive takeouts; fighting exchange wagering (California);integrity (racing and pool) and medication issues; breakdowns; whipping; the plight of horses whose careers are over. 

Some action is taking place in New Jersey, but one state alone can do little.  Instead of working on these problems seriously, the industry remains splintered with each segment of the industry worrying about their own parochial interests instead of the greater good, ignoring the fact this industry is in a bubble, artificially supported; praying the government doesn't take the pin out and burst the bubble as being done in Canada.  Unless things change, what is happening in Canada will be taking place in America. 

Racing interests should be concerned about the European Euro crisis which may be the pin everyone is dreading. You would think the impact on American racing and Canadian racing would be limited to fewer Europeans coming to the yearling sales, but the impact could be much worse, one that would send chills down the spines of horsemen.

Remember when the economy tanked in 2007-2008? The American banking problems impacted other economies because we live in a global economy. As a result, should the European crisis deepen or a European country's banking system collapse, it would send the American economy into the tank, perhaps worse than the 2008 credit crunch. It doesn't matter who is President, this is really out of our control.

Why should this concern racing interests? If the economy tanks again, the pressure will be on states to raise revenue. Taxation will not be the answer so where are the states going to get the necessary revenue? Racino subsidies. While most efforts to raid the slot revenue have been fought off successfully or the impacts mitigated in the first crisis, racing may not be that lucky if the economy goes back into the depths of a serious recession.

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