Casino and social implications

Dennis Morrison, Contributor

IT IS no secret that the casino legislation before Parliament has generated less controversy than was at first thought. This is partly because over the past decade, the gaming industry has been liberalised and put on a more systematic regulatory scheme in accordance with best practices in New Jersey and Nevada. But it is also the case that the more receptive environment stems from the wider recognition of the economic importance of the tourist industry and the role that casino gaming and other attractions can play in enhancing the industry's prospects.

More immediately, the legislation is meant to serve as a hook for huge tourism investments in two luxury resort developments being planned by Palmyra Resorts and the Tavistock Group for Jamaica's north coast. These developments, which seem to have credibility with the public, are intended to upgrade and expand the luxury segment of our tourism product and introduce the concept of integrated resorts here. In fact, the bill states as its main objective the encouragement of substantial investment in integrated resort developments consisting of a mix of tourism facilities, including hotels, villas, casinos, attractions, entertainment and sporting facilities and shopping centres.

Catalyst for investment

Local tourism interests have long lobbied for the introduction of casino gaming, arguing that it would be an important addition to our tourist attractions and be a catalyst for hotel investment and job creation. But strong opposition by the Church made our political parties hesitant to make the move. Religious rejections of casino gambling on the grounds of the immorality and concerns about its links to organised crime overwhelmed consideration of possible economic benefits. There were even rumours of investors who, having been turned away by Jamaica, went on to undertake major casino-linked resort developments elsewhere.

When the decision to set up casinos was announced in 2008, the reaction from the Church was unusually muted. Opinion polls suggested that support for casinos had increased significantly, with 45 per cent of those interviewed being in favour, outstripping the 38 per cent against, a reversal of the results of 2003 surveys. It appeared that the prospect of casino-propelled tourism investments generating thousands of new jobs and boosting the economy had trumped the objections of the Church. Indeed, the results of polls conducted in 2008 showed that 70 per cent of respondents had favourable views about the potential contribution of casino gaming to the economy.

While the debate about casino gaming might have shifted from a religious and moral focus, there are other issues related to the possible social and psychological impacts that are of serious concern even to those who support its introduction. The possible impact on crime is perhaps of greatest significance to the public. For what it is worth, the casino bill identifies efficient and effective regulation of casino gaming as an important objective of the legislation, as well as prevention of crime and protection of children from exploitation due to the introduction of this activity.

Where the efficiency and transparency of the regulatory system are concerned, it is highly likely that Jamaica can achieve best practice based on the models applied in the jurisdictions mentioned above. The more difficult matter will be its capacity to handle the social impacts, especially as the intention is not to bar locals from playing in the casinos as is done in The Bahamas. Importantly, the findings regarding its impact on crime indicate that pre-existing conditions, such as the effectiveness of laws and law enforcement, the level of crime, and particularly the extent of drug violations, are critical. Jamaica's high crime rate and ineffective law enforcement are, therefore, real risks in terms of the negative side of casino gaming.

Serious consequence

Those risks may, however, be countervailed by virtue of the fact that it is resort casinos catering in the main to tourists that are now to being planned, as exists in Las Vegas and The Bahamas. These are unlike urban or neighbourhood casinos whose clients are locals and, therefore, have more direct negative effects on adjoining communities. Nonetheless, public policies and interventions will be required to deal with the problem of pathological gambling that is recognised by all researchers to be a serious consequence of casino gaming and that exists in other Caribbean countries. Further, strengthened law-enforcement presence will be necessary as large numbers of tourists with substantial sums of money could provide increased opportunities for criminal activity.

Another negative impact of casino gaming is that it tends to feed the sex industry, a feature in evidence in Las Vegas and some other large resorts. This would add to the troubles that we are already experiencing in this area. Thus, the authorities are being urged to put mechanisms in place to deal with these problems very early in the planning process (Ian Boxill -
Casino Gambling in Jamaica: Lessons and Policy Options
).

Weighing the benefits of casino-propelled developments against these and other negative impacts, I am inclined to come down in support of the move, but everything will depend on the urgency and priority given to the formulation of public policy and intervention programmes to address the downside risks. Moreover, the benefits will be severely restricted if strategies are not implemented to optimise the linkages of the resort developments with the other sectors of the local economy.

Dennis E. Morrison is an economist. Feedback may be sent to columns@gleanerjm.com.