Indecent Proposals

Jane Sherman

If you click on a link at the website of the
Minnesota Indian Gaming Association, you will quickly discover something you probably wouldn't expect from an organization that represents Minnesota's biggest and most powerful casino interests--a litany of statistics illustrating the many evils casinos rain down upon their host communities.

The no-holds-barred assault makes its case with rotating flash graphics and some fairly astonishing assertions. Las Vegas has the highest suicide rate in the nation. About 50 percent of all gambling revenues come from compulsive gamblers. Gambling will soon surpass drug use as the country's number one youth problem. After a few more clicks, you arrive at the big dollars-and-cents argument. Casinos don't merely wreak havoc on the lives of less prudent customers and their families, they fuel crime and constitute a serious drain on the economy.

This message does not come directly from Minnesota Indian Gaming Association, which represents nine of Minnesota's eleven Indian tribes, including the operators of Mystic Lake, the state's biggest casino. Rather, the warnings are part of a campaign by a group called Minnesota Citizens Against Gambling Expansion, or MnCAGE. As its name suggests, MnCAGE is stepping into the opposition role in what promises to be the most contentious issue before the legislature this year: Gov. Tim Pawlenty's push for the state to get into the casino business via a partnership with the White Earth, Leech Lake, and Red Lake bands of Ojibwe.

Beyond the odd alliance between the self-interested MIGA (which has a long history of touting the economic benefits of gaming) and the antigambling folk at MnCAGE, there is the case of Pawlenty's own rather dramatic flip-flop. Two years ago, Pawlenty placed himself squarely in the antigambling camp, saying, "If the objective is to get money, aren't there better ways to get money than engage in an activity that destroys lots of people's lives?" Now, facing that option or breaking his no-new-taxes pledge, Pawlenty has contorted himself into an egregious two-for-one: a regressive tax that promises to destroy plenty of lives.

The desperate play for gambling revenue--the governor is also considering the "racino" proposal at Canterbury Park--has put Pawlenty at odds with both a majority of DFL lawmakers and, more tellingly, a number of former state Republican bigwigs. MnCAGE, for instance, is run by Tony Sutton, the former executive director of the state GOP, and Jack Meeks, a former Minnesota representative to the Republican National Committee. Last summer, Meeks quit that post in protest, specifically citing Pawlenty's drive to expand gambling. MnCAGE also includes several high-profile Democrats, such as former Gov. Wendell Anderson.

The fate of any gaming expansion proposal will probably be decided in the state Senate, where Pawlenty's plan is expected to be carried by the liberal St. Paul DFLer Sandy Pappas. Last year Pappas sponsored the legislation for a similar state-tribal casino partnership. Of all gaming proposals likely to be floated this year, Pappas argues that such a deal is most in keeping with the spirit of the existing agreements with the Native American bands.

"Gambling expansion is inevitable, Pappas contends: "It's just a matter of who is going to benefit." In an echo of Pawlenty's often-invoked "fairness" rhetoric, Pappas argues that some benefit should go to the three northern Ojibwe bands. Collectively, White Earth, Leech Lake, and Red Lake constitute approximately 80 percent of the state's Native American population, but because of their remote locations, the bands have been largely left out of the casino boom. For that reason, many reservation leaders are anxious to get a piece of the big-city action.

Two weeks ago, Pawlenty announced his partnership agreement with two of the three tribal chairs in a formal ceremony at the Capitol. The occasion gave the impression of universal support for the project among the northern Ojibwe. But the project comes with a hefty price tag for the tribes, one that would necessitate massive borrowing to pay for both casino construction as well as an up-front $200 million licensing fee. Given the long history of bad-faith arrangements between the state and the tribes (and their woeful finances), there is still considerable dissent on the reservations about the wisdom of partnering on a metro casino.


Bill Lawrence, a Red Lake member and publisher of the Native American Press/Ojibwe News, says he remains agnostic on the issue. "I potentially stand to benefit from it," he says. "But I don't know whether it's worth it." As Lawrence sees it, the advent of tribal casinos has exacerbated crime problems on the reservations. He has concerns about foisting the same on any metro community unlucky enough to host a casino. The relation between crime and casinos has not been studied in detail in Minnesota, Lawrence notes--and for a good reason. No one wants to know the answer.

Other Indian leaders worry that a tribal-state partnership might pave the way for nonnative interests to muscle in on the gaming action. Many point to the alternate casino proposal, very popular among Republicans in the Senate, that would transform the privately owned Canterbury Park racetrack into a slot-machine-filled "racino." Like any new state-tribal casino, Canterbury would pay an up-front fee ($100 million) and a cut of its annual proceeds to the state.

From the governor's perspective, both proposals offer the attractive lure of a quick fix to the state's burgeoning budget crisis. But there is one niggling problem: the growing mountain of evidence that gaming is a public policy disaster. "Nationwide, gambling interests have lost nine out of ten expansion proposals in the last four years," notes John Kindt, a professor of business and legal policy at the University of Illinois who has testified extensively on casino and gaming issues. "The reason is that the public is beginning to realize that this is a con job on the taxpayers."

Kindt points to studies that dramatically illustrate the up-ticks in crime in areas with gaming, especially those with slot machines. Additionally, says Kindt, various studies have shown that slots can lead to increases in bankruptcy filings, with each broke gambler costing the taxpayers an average of $30,000 per year. While casino interests have countered with their own studies about the benefits of gaming, Kindt says, they reliably ignore the cost side of the equation.

"They're out there pushing something that hurts your economy and hurts your taxpayers," Kindt says. "The cost of legal gambling is well established: three dollars of cost for every one dollar in benefit."

Among observers of the Minnesota Legislature, there is widespread uncertainty as to how the debate will play out. Vote counters don't see enough votes for tribal-state casino yet. But according to Shawn Towle, editor of the political e-newsletter Checks and Balances, that could change in a hurry. "The dynamics are really in flux right now," Towle notes. "Senator Pappas has to be able to sweeten the pot to get enough votes on the Democratic side. So the question really is, can someone be bought off, say, by getting a big project in their district on a bonding bill?"

Of course, vote-swapping scenarios are endless. Pappas, for instance, could lure more support for the state-tribal casino as part of a compromise in which Canterbury also gets a racino--or in which the state, Canterbury, and the tribes all take a cut from a single casino at the racetrack. That's far from a sure bet, she acknowledges, and in her view, not an especially attractive option. "It could make it easier to pass," she says. "But with legislation, sometimes the more you pile on, the more it sinks of its own weight."

For Minnesota legislators who view gaming as a viable solution to Minnesota's economic woes, Kindt has a final warning. "In Minnesota, if you take the same money that people spend on gambling, and make people spend it on consumer goods, you would probably have $3 billion in increased consumer sales. You'd have a pump-primed economy." He says. "The states that have gambling have bigger budget problems than those with little or no gambling."

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