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Tuesday, December 18, 2012

Why They Keep Nailing Racing

The New Jersey General Assembly passed legislation allowing Internet gaming in the State of New Jersey.  The bill now goes to the Senate where it will pass on Thursday and then head to the Governor who will sign or veto the bill (Christie vetoed a similar bill last year).

Jeff Gural, operator of the Meadowlands, has come out to no one's surprise against the bill.  As I have mentioned in the past, Gural indicates that if this bill becomes law, it will be "another nail in the coffin of horse racing' and he is absolutely correct.  Who doesn't expect Joe Gambler to divert some of his gambling bank roll from horse racing to casino games, especially with the lower takeout rate?

But it goes further.  Gural correctly indicates this will result in the unemployment of casino workers.  After all, if people can gamble from their home, why should they make the trek to Atlantic City?  To quote Mr. Gural, "We tried this [account wagering], and now our racetracks are empty".

You may be wondering, why I am even talking about this again?  This legislation shows why state legislatures (and provincial parliaments) continue to pass legislation which hurts horse racing.  In New Jersey, the excuse used to keep a casino from the Meadowlands is it would hurt the casino industry and threaten the employment of thousands of South Jersey residents.  Well, what does this bill do? It threatens the employment of thousands of South Jersey residents. 

Even with racing in decline, do you remember how many tellers there were at your track prior to ADWs and automated wagering machines?  How many tellers do you see now?  Well, if online casino games are offered in New Jersey, how many blackjack dealers, roulette croupiers, slot attendants will be let go as less people go to the casinos.  If less people show up at the casino, how many drink servers, bar, buffet, and hotel workers will get their pink slips?  With less people at the casino, how many vendors of the casinos will go out of business? 

If Governor Christie vetoes the law, it will be because of the constitutional issues, not because of the damage it may do to racing.

So why pass such a law?  Partially it is because the technology is there; part of it is so the state makes more money for their coffers; but it is also about making sure the Wall Street Investment Banks are not left holding the bag.

And if it means racing takes another blow, so be it.

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