From Local to Global: The Globalization of Gambling

The town of Mechanicsburg, Pennsylvania, where I grew up, is a quiet one. It is a suburban community in Hampden Township, full of tight-knit families. In 2010, discord began to occur as the county board initiated series of painfully long meetings to discuss the possibility of building a casino in the Holiday Inn on the Carlisle Pike, the main street that runs across the township. The main concern was the type of atmosphere this could bring to the small town.

Technology, tourism, and the economic benefits of casinos and other betting outlets have sped up the globalization of gambling. Casinos have been linked to the creation of haves and have-nots between social classes, corruption, debt, drugs, and alcohol (Alexander, 2008). Epstein (1998) explains that part of this is due to the idea of the “gambling fallacy” that occurs when one goes to a casino, not realizing that he or she is taking a large risk, and loses. He states “gamblers explain away losses and view wins as evidence of gambling prowess… gamblers overestimate their ability to control the outcome of play and they tend to believe that, over time, change-determined results will even out.” This gamble can lead to addiction through a feeling of risk and reward. The greater the risk, likewise, the greater the reward. Gambling has a psychological influence that “reconciles people’s vital needs for social belonging with their equally vital needs for individual autonomy and achievement” (Epstein, 1998). Additionally, gambling and other psychological factors associated with a person’s lifestyle can lead to addiction, “a narrowly focused lifestyle that functions as a meager(sic) substitute for people who desperately lack psychosocial integration” (Alexander, 2008). Epstein (1998) also notes that in desperation for money, there have been incidents of kidnapping and mafia-related cases, to which some countries, like Taiwan, now sell plans to offer “comprehensive insurance” as consolation for such occurrences. In Western countries, “society promotes disruption of collective social order resulting in anomie (feelings of alienation associated with absence of clear norms” (Alexander, 2008). To implement on an upper-middle class area is a real concern. But why would they pick such an innocent town like Mechanicsburg, a farmland in central Pennsylvania? How did the idea of building a casino in the area even come about?

To understand this conflict, we must first take into account the concept of “glocalization” as noted by Gotham (2005) who explains that “global-level developments affect cities and... cities shape and mediate global influences. Because the local is dependent on the global effects, and the global is dependent on the local, there becomes an increasing cultural homogeneity or increasing heterogeneity or a mixture of both.” He notes that “local actors and organizations can harness the ‘local’ to produce unique products, establish locally-specific social ties and networks, and build and enhance place distinctiveness by using different themes, symbols, and motifs.” In terms of the possibility of a Mechanicsburg casino, this implementation forces an interconnectedness “with local actions to facilitate the growth of urban tourism.” It would make the area unique, draw tourists, and link the area to other casinos in the state, nation, and around the world. But on the other hand, may promote gambling and lead to corruption and addiction.

The neoliberal ideals of privatization and deregulation have also acted as catalysts to the global spread of gambling around the world. Aided with the growth of media technologies, globalized gambling practices have become a source of revenue, and is quickly gaining speed. In a small town like Mechanicsburg, the majority of sales are stagnant, with the same people buying the same things all the time. To help attract new sources of revenue, Kevin Feeley, the Penn Harris Gaming spokesman said that the $75 million casino implementation, conveniently located at the exit of 581, will target RV travelers, bringing in audiences from all over the state (Gibson, 2010). Location is key. In general the practice of local tourism is a business investment “help produce tourist sites to attract consumers and investment” (Gotham, 2005). That being said, it is easy to see why local authorities, in a capitalistic society, would find a casino implementation beneficial to bringing in a more diverse group of audiences.

Practices around the nation have shown that bringing in a casino or two can boost the economic status of an area, like Las Vegas for example, by taking advantage of the psychological effects of risk and reward. Because of this, “legalization of gambling has increased over the last decade to fuel economy by taking advantage of that feeling of fulfillment that is achieved when a risk-taker’s gamble ends in their favor” (Kurlantzick, 2007). Mikler (2008) suggests that “states which share sovereignty with other states, such as via the market liberalizing institutional features… can extend the territorial jurisdiction of their national regulations.” The world famous tourist spot, Sin City, in Las Vegas, Nevada is a perfect example of this. Nevada itself is desolate, desert land. But with the establishment of Las Vegas and the new reputation of a place for tourists to come drink, try their luck, and enjoy dinner and a show, the state itself has been quite lucky. US 91, known as Las Vegas Boulevard, runs across Nevada’s desert; a straight shot road filled with billboard advertisements stretching all the way from Los Angeles to the city. The long line of billboards is the only form of visual stimuli across the desert, perfect for advertisers who want to encourage travelers to visit the area and buy their brands of alcohol, visit a certain hotel, and gamble the night away. When the ad has reeled them in, tourists can check into a European style Bellagio, with gondolas and Roman architecture, allowing them to fall to an “escapism” mindset. From there, the ground floor of every hotel is lined with slot machines and other casino attractions placed in a dimly lit area with no clocks. This lack of time perpetuates the gambling addiction that casinos bring when tourists lose track of themselves, the world around them, and escape to a place where they can bet their money away. From this, it is said that Las Vegas was able to rack up $6.5 billion in 2008 casino revenues for the state (Kurlantzick, 2007). On top of that, the Strip, Las Vegas’s main street is lined with hotels, casinos, and shops full of designer watches and handbags to encourage big winners to spend some of that money, promoting shopping, spending, and perpetuating capitalism. The Wynn in Las Vegas even includes its own Ferrari store, motivating tourists to try their luck at winning big to drive home in a new red sports car.

In China, investors were able to emulate America’s success and established a specific area for their population of 1.6 billion to gamble. The location for this economic jackpot was established in Macau, the only legalized area to gamble in China. Because this is the only place, Macau was able to monopolize on the tourism audience that comes to its casinos. According to Dense (2011), “tourism accounts for fifty percent of Macau’s Gross Domestic Product, with the gambling industry generating forty percent of Macau’s GDP. Even Las Vegas’s casino tycoon Steve Wynn, invested in a $1.2 billion Wynn Macau to help boost his revenues. His global expansion of his famous Wynn hotel brings to total number of casinos in Macau to 38 and in 2006, Macau’s revenues surpassed that of Las Vegas, at a total of $6.8 billion (Kurlantzick, 2007).

As a society that functions on the exchange of currency, it is essential to have money. We live in a capitalistic society and investors want to find the next best place to put their dollar. The rise of tourism in Macau, aided with legalized gaming being allowed in more locations, has led to opportunities rising consumer spending and opportunities for new casino markets. Gotham (2005) notes that “tourism can help promote as well as undermine local difference” bringing about “a multidimensional mix of production and [can effect] the local economy and capitalism market system.” According to a PricewaterhouseCoopers estimate, global gambling revenues was around $150 billion in revenues per year in 2010, whereas the global cruise industry was only about $17 billion (Dense, 2011). Today there are over 800 casinos in Russia, 1000 in Europe, and Latin America and the Caribbean have over 200 total (Kurlantzick, 2007). Additionally, the implementation of casinos can help alleviate taxes and relieves the stress for the government when it can’t collect from those with an inability to pay their fiscal taxes. Gambling taxes in Macau provided 70% of the government’s income, and $6.7 billion in the United States in 2009 (Dense, 2011).

Europe took this opportunity for growth to another level where there is a large corporate interest in interactive television. Great Britain utilized interactive television to provide a different route for gambling by developing the practices of privatization of horse race betting. Instead of going through the government and collecting taxes, horse wagering was broadcasted privately through media channels. With the aid of Great Britain’s media company, News Corp, Europe was able to copy American horse race wagering, and provide the only legal form of interactive TV gambling.

American television provides nationwide racing programs via Magna Entertainment’s Horseracing TV (HRTV), which allows account holders to bet on horses via various services like YouBet.com. The World Trade Organization notes that there is no federal regulatory agency for gambling in the United States. It is regulated at the state level, which allows for privatized processes. Additionally, Congress passed the Interstate Horse Racing Act which allows for the transmission of simulcast signals across state lines in the states are in agreement, allowing for bets to be placed through remote control (Kruse, 2009). BSkyB, an interactive British TV service, followed these practices and used satellite to broadcast horse races to select areas like France and other countries allowing for interactive wagering via TV, Internet, and the telephone (Dense, 2011). Easy access to gambling outlets brings a great attraction to the convenience of the game, further perpetuating the growth and global spread of interactive television wagering by eliminating borders. International horse racing has spread globally as well. Japan has its own Japan Racing Association (JRA) that works with TV Guide to provide horse racing and wagering opportunities to countries like Australia, South Africa, and Dubai (Kruse, 2009).

Interactive television betting is only one of the many ways that technology has been able to perpetuate the rate of gambling around the world through convenience. Perhaps the biggest influence, is the World Wide Web. The Internet, a more deregulated media outlet, has provided the perfect source for online gambling. This tool for rapid transmission of information is the opportune moment for commercialism. The Gaming Board for Great Britain notes that “a need to act quickly if a valuable commercial opportunity is not to be missed forever” (Mikler, 2008). By eliminating borders between countries, tourism and travel limitations all but disappear, leaving it easy for companies to reach out to a broader audience. This new advancement allows for international competitiveness between audiences and economic welfare as Internet users can gamble with people all over the world from the comfort of their own home. With the Internet, a user is able to easily access any betting forum without having to physically go to a specified gambling location. The Internet is a perfect vehicle for the gambling industry, “the Web matches instant access to credit with a diversity of games, plus a lack of regulation that allows virtually anyone to play. Online gambling essentially makes borders meaningless because players in the United States, for example, can access a game hosted in a place like Antigua, out of the reach of U.S. authorities. Online poker alone mushroomed from $92 million in revenues in 2002 to a $4 billion industry in 2006” (Kurlantzick, 2007).

The global spread of gambling and the possible future opportunities that arose from neoliberal policies of deregulation and privatization have allowed for a freer market in the gambling and casino market. What was once a “shady operation [with] a small number of casinos, the gaming industry now is booming – portending future social, economic, and political consequences around the world” (Epstein, 1998). Such influential spread from specified areas, national locations, and virtual locations have been able to increase the revenue of the gambling industry and corporations they are associated with. As a result, even a little town like Mechanicsburg, understands its economic benefit potential and must weigh it against the possible loss of local culture and negative results.

Sources:

Alexander, B. (2010). The Globalization of Addiction. A Study in Poverty of the Spirit. The Journal of Nervous and Mental Diesase, 198, 6. doi:10.1186/1477-7517-6-12

Dense, J. (2011). Gambling and Globalization: Still a Bad Bet. Gaming Law Review and Economics, 15, 1, 2. doi: 10.1089/glre.2011.15103

Epstein, J. (1998). Odds favor more gambling. The Futurist.32, 3, 16. doi: http://www.questia.com/library/1G1-20507769/odds-favor-more-gambling#articleDetails

Gibson, E. (2010). Casino proposal in Hampden Township encounters local indifference. Web. The Patriot News. Retrieved from http://www.pennlive.com/midstate/index.ssf/2010/05/casino_proposal_in_hampden_tow.htmlTourism

Gotham, K. (2005). Tourism from Above and Below: Globalization, Localization and New Orleans’s Mardi Gras. International Journal of Urban and Regional Research, Volume 29.2. doi: http://www.ataland.com/Files/Articles/4.pdf

Kruse, H. (2009). Betting on News Corporation: Interactive Media, Gambling, and Global Information Flows. Teelvsion & New Media, 10, 2, 179-194.doi: 10.11771/1527475409332046.

Kurlantzick, J. (2007). Raising the Stakes. Foreign Policy.doi: http://www.viet-studies.info/kinhte/Casinos_FP.pdf

Mikler, J. (2008). Sharing sovereignty for global regulation: The cases of fuel economy and online gambling. Regulation and Governance, 2, 384-404. doi: 10.1111/j.1748-5991.2008.0048.

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