Today, we are facing a gambling boom like none other in history. In fact, Utah and Hawaii are the only two States that do not allow any form of legalized gambling. Thirty-seven States run lotteries and casinos operate in 23 States. Americans now bet more than $300 billion legally every year. This is more than we annually spend on national defense and more than 13 times what we spend on Aid to Families with Dependent Children (AFDC). This figure is staggering and leads me to ask myself a basic question: Just what is the effect of all of this gambling on American taxpayers? Currently, we really don't have a good answer. But if we enact the Gambling Impact Study Commission Act, we will have at our disposal a comprehensive blue-ribbon report about all aspects of gambling in the United States. I'm not opposed to legalized gambling, but I do believe we must fully understand the costs and benefits of this growing industry and its impact on people. S. 704 will give policy makers and the public the information needed to make responsible and informed decisions about the proper role of legalized gambling in our communities. Chairman STEVENS. Our first witness today is Paul Simon. The other two Members of that panel are Senator Lugar and Congressman Wolf. Gentlemen, it is nice to see you here. We appreciate your courtesy in waiting for us to give our opening remarks. Senator Simon. TESTIMONY OF THE HONORABLE PAUL SIMON, A U.S. SENATOR FROM ILLINOIS Senator SIMON. Thank you very much, Mr. Chairman, Senator McCain, and Senator Glenn. I am pleased to be introducing this legislation with Senator Lugar and six other Members of the U.S. Senate and Congressman Wolf over on the House side. What we are asking for is very simple, a commission that will last 18 months and have a $250,000 budget just to look at where we are. Senator Glenn mentioned the Internet. How are we going to handle when someone 2,000 miles away in another country says you can sit down at your computer and use your American Express card or Visa card and gamble? I frankly do not know. That is why we should have a commission. I am pleased, if I may, to enter into the record, Mr. Chairman, a letter from President Clinton endorsing the idea of the commission. He says, "I have long shared your view about the need to consider carefully all the effects of gambling and I support the establishment of a commission for this purpose." If I could enter that into the record. Chairman STEVENS. It will be entered. Thank you. Senator SIMON. We do know some things. We know the exaggeration that the gambling interests make when they come out and say, oh, we will put this in Connecticut and you are going to do really great. The Better Government Association of Illinois has just completed a very intensive study, and I would like to enter that into the record, also. It is a 4- or 5-page, typewritten study in which they devastate the idea that there are going to be huge economic benefits. [The letter from President Clinton and The Better Government Association of Illinois study follows:] THE WHITE HOUSE WASHINGTON October 31, 1995 Dear Senator Simon: I deeply appreciate your efforts to draw attention to the growth of the gambling industry and its consequences. Too often, public officials view gambling as a quick and easy way to raise revenues, without focusing on gambling's hidden social, economic, and political costs. I have long shared your view about the need to consider carefully all of the effects of gambling, and I support the establishment of a commission for this purpose. My Administration is eager to work with you in designing such a commission and ensuring that its work is completed in a timely and effective manner. Your and Senator Lugar's bill, S. 704, and Congressman Wolf's bill, H.R. 497, provide a very sound basis for this process, which I hope will include further discussion of the exact composition of the commission and the exact scope of its duties and powers. Again, I applaud your efforts to place this important matter on the nation's agenda. BOARD OF TRUSTEES GRANGER COOK JR." Cook Egan, McFarron & Manzo Ltd JAMES J GLASSER GATX Corporation HAROLD P O'CONNELL Mid-American National Bank Otis Development Company *Also a Director BOARD OF DIRECTORS THOMAS A REYNOLDS Winston & Strawn VICE PRESIDENT ALVIN J ROBINSON Insurers Review Service TREASURER JULIE DAVIS Arthur Andersen & Co. SECRETARY RODERIC HEARD Widman Harrold. Allen & Dixon PWARD ALPER Ap Services Inc Congaree River Limited Partnership SCOTT A BRAINERD The Brackthorn Foundation WILLIAM G BROWN Bel Boyd & Lloyd RICHARD S BULL JR Atschuler Melvin & Glasser THOMAS CHURCH Bank of America SEYMOUR A COHEN SAC imports Ltd. GRANGER COOK. JA. Cook Egan McFarron & Manzo Ltd E DAVID COOLIDGE III Wam Blair & Company JAMES W DeYOUNG Winston Partners Incorporated WILLIAMS DONNELL Montauk Company JEROME DONOHOE Mayer Brown & Platt Community Bank of Lawndale Hammarx Corporation JAMES HILL JP Taylor & Company Monsanto Company Kirk and & Ellis MARK HOSFIELD Coppers & Lybrand MELVIN L KATTEN Katen, Muchin & Zavis ANN KELLY First Bank Bridge Investment Corporation ARTHUR LEISTEN USG Corporation Center For Urban Affairs & Policy Research RALPH MICKELSON BETTER GOVERNMENT ASSOCIATION 230 North Michigan Avenue Suite 1710 Chicago, Illinois 60601-5956 312-641-1181 BGA Statement of J. Terrence Brunner, Executive Director The Better Government Association (BGA), an Illinois The survey was designed by Professor William The Illinois riverboat legislation was passed in 1989 It is clear that our study shows there has been no The survey confirmed what many academics have suspected. Casino gambling does not create jobs, it creates nothing of value. There is no economic development and the study shows riverboat gambling in Illinois fails any test for tourism. Since we have no tourism or economic development what we have is a very sophisticated version of "taking in each others laundry. The clothes have been pulled off casino gambling and we are left with naked greed, enriching casino owners at the expense of the old, the poor, and local citizens sponsored by the state of Illinois. These preliminary statistical findings were presented to the Government Affairs Committee of the U.S. Senate at a hearing today by U.S. Senator Paul Simon (D. IL.) Senator Simon has sponsored legislation for a national commission to study the social and economic impact of legalized gambling. Please contact Bryan Doyle at the BGA office for additional information on Illinois gambling findings, (312) 641-1181. Only 4% of Illinois gamblers come from over 100 miles to gamble. Half of these people reported that visiting the casino was "not" the primary purpose of their trip. 96% of those people who traveled over 100 miles to gamble spent zero dollars outside of the casino. Data shows a significant correlation in that the further a person lives from a casino, the less likey it is for the purpose of the visit to be gambling. Who's losing Seniors: Seniors represent 15% of total surveys 65% of seniors reported losing more than $1,000/yr 71% reported a decrease in personal savings 7% earn less than $10,000 49% gamble more than a $100 per visit 10% gamble more than twice per week |