Sen. Neal, conservatives & Gov. Dudley Do-Right agree
Expanded from the 9-19-99 Daily Sparks (Nev.) Tribune
Updated 4-16-2007

Longtime readers know me as a sensitive guy who loves to make everybody happy and will do anything to avoid ruffling feathers. This column will be no exception.

Conservatives are generally the unhappiest of folks. They've been in a bad mood ever since libertine America embraced that Presley fellow and his devil music. Not even the election of Ronald the Vague could cheer them up for long.

Fear not, smile time is here. Turns out that my former Tribune colleague in columny, Ralph Heller, is right. So is the current occupant of the south 40 of this page, Ira Hansen. Even that hissy retired corporal who shills for corporate Nevada in the Reno paper.

All of the above have been conservatively carping for years that based upon Nevada's rate of growth, government has mushroomed far larger than statistics or prudence indicate.

Sen. Joe Neal, D-North Las Vegas, leads the loyal opposition in what seems to be a contrary view, that the state doesn't collect enough money to take care of a population beset by social ills.

What if both sides are right? I submit that the evidence is now at hand to prove it and comes from no less than the administration of Gov. Dudley Do-Right hisself.

Last year, the gambling industry paid for a study by the Arthur Andersen accounting firm and UNLV. It produced predictable results: the state's major industry is paying more than its fair share and other sectors of the economy are not.

The Smoking Gun:

State study confirms that gambling industry does not pay its fair share.

Big mistake. They took a potshot at somebody with a research staff and a constituency.

"In effect, the (casino-funded Andersen-UNLV) study concluded economic development efforts do not bring sufficient tax revenues to justify the program and results in further burdening an already overburdened gaming industry," states rebuttal research released last month by the Nevada Commission on Economic Development (NCED). It is headed by Lt. Gov. Lorraine Hunt, R, who Gov. Kenny Guinn, R, just made interim state chair of the Nevada Republican Party.

For the last several legislative sessions, the gambling industry has facilitated tax increases on everyone else while exempting itself. The casinos are now trial-ballooning a sales tax on services, everything from doctor bills to dry-cleaning. (Las Vegas Business Press, 9-13-99. )

Before his maiden state of the state address in January, Gov. Guinn leaked to the media that he would propose a major shift in the way the state funds its operations. He was forced to back off. (By whom, I wonder?) At speech time, he timidly announced only that he would undertake the latest in a long line of studies.

Gov. Guinn, whose candidacy was funded and foisted upon us by the gambling industry, was nonetheless forced to admit that Nevada cannot meet its needs with the current tax system.

Before the end of the legislative session, Sen. Neal and the teachers' union both said they would circulate initiative petitions next year. Neal wants to raise Nevada's gross gaming tax, currently lowest in the world, on the largest, most profitable casinos. The Nevada State Education Association wants to raise somebody's taxes, but probably not gambling's. (Mining is already exempt due to a clever strategy in getting the legislature to grant it a special constitutional amendment election in 1989.)

During the 1999 legislative session, "the gaming lobby attempted to prove diversification of the economy strains the resources of the state rather than strengthens them. An additional implication was that the manufacturing industry does not generate sufficient tax revenue to support further recruitment and retention of business," the NCED study states.

The evidence not only proves that gambling is wrong, but also that Neal and the conservatives are both right.


The commission study looked at the results of creating 8,000 new gambling industry jobs versus 8,000 new manufacturing jobs. They were careful to eliminate any short-term jump in construction employment.

The results are little short of astounding, especially in the area of growth spawning more growth. "After the fourth year, the hotel industry continues to generate population growth long after the manufacturing segment influence on population slows," the study found.

"The significance of continued population growth caused by increased hotel industry jobs should not be understated. The higher growth rate of population due to the hotel industry is significant because of the increased burden in government services which population growth brings," the study concluded.

The state commission found that manufacturing jobs pay a lot better than casino jobs. No news there. But for the first time, it placed evidence on the record that casino jobs breed bigger government. Comparing the long-term impact of 8,000 jobs, "the hotel segment starts with an initial decline of about 28 employees and then increases during the next 20 years to over 120 more government employees than manufacturing would have caused."

That means about $4.3 million per year in salaries, not including benefits, at 1998 wage rates.

Hard evidence now exists that gambling jobs place an inordinate demand on government services, in effect forcing government to supply benefits the industry is too stingy to provide. During winter downsizing a few years ago, managers at the Reno Hilton were advised to encourage workers to reduce their hours and apply for partial welfare to make up the difference.

So the progressive Sen. Neal, in the opinion of the Guinn administration, is correct that gaming is not paying its fair share for the growth it causes. And the right wingers are also right that government has grown larger than it should.

I love it when I can make everybody happy.

Be well. Raise hell.


UPDATE: April 16, 2007, 7:51 p.m. PDT, 02:51 GMT/SUT/CUT —

For Nevada Newsmakers viewers
Here's the landmark Nevada Commission on Economic Development "smoking gun" study laying our growth problems at the silk-stocking feet of the gambling industry

View Barbano vs. GOP moonhowlers on statewide TV

Much more at Casinos Out of Politics

Sen. Joe Neal's website is a treasure trove about the depredations of the gambling industry



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Copyright © 1999, 2007 Andrew Barbano

Andrew Barbano is a member of Communications Workers of America Local 9413 and editor of U-News, where the past three years of columns may be accessed. Barbwire by Barbano has originated in the Daily Sparks Tribune since 1988 where an earlier version of this column appeared on 9/19/99.

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