$600 Million Slot Revenue: Jackpot or Ripoff?

Pennsylvania’s Democratic legislators are very proud of themselves for reducing property taxes by offsetting them with slot machine revenue.

“Pennsylvania’s budget secretary this week certified that the state’s slot machine facilities have now produced enough revenue to begin reducing property taxes – more than $600 million for homeowners statewide.”

I do not understand why this is good news. Sure, it sounds good. After all, who doesn’t want their property taxes lowered? Unfortunately, that which sounds too good to be true, likely is.

Since property taxes are proportional to property values, they are independent of income level. The likelihood that a person or family can afford to purchase and retain property decreases with increasing net cost. Consequently, those who stand to benefit most from lower property taxes are those with smaller incomes and less discretionary spending power. So, generally speaking, lowering property taxes should increase the number of people who can afford to be home owners. The hidden problem here is that the same people who benefit most from lower property taxes are most negatively affected by gambling. In fact, we’re back to where we were when Act 72 was introduced in an attempt to fund education without raising property taxes. Gambling is a “desperation tax” on the poor who are hoping against hope to win the jackpot that will save them (I’ve uncharitably called it a “stupidity tax” in the past.”)

Making money off the poor while ostensibly lowering their tax burden isn’t the only problem with filling the State’s treasury with gambling revenue. It also creates yet another unethical alliance between government and business, similar to Pennsylvania’s governmental control of wines and spirits sales. Do we really want the body that makes rules and regulations about legal business practices deeply invested in a particular industry? Isn’t that kind of like letting a wolf guard your hen house? This is an unhealthy blurring of public and private sectors. This arrangement makes casino owners very powerful lobbyists. How can we expect state legislators to act in citizens’ best interests when they have a vested interest in high profit margins?

These questions only scratch the surface of the ethical mess Fast Eddy Spendell and his cronies have gotten into. Secondary community effects that follow casino openings (organized crime, prostitution, etc.) take us from bad to worse. Why oh why does anyone think this is a good idea?!

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