Profiting from the 'casino culture' in Victoria

[Green Left Weekly, #214, December 5, 1995]

Since its 1992 landslide election win, Jeff Kennett's Coalition government has made an indelible impact on Victoria as it has sought to increase corporate profits at the expense of the state's working people. The "can do" government has done so much to revive business confidence and restore the bottom line to its rightful place in our lives.

Nevertheless, in drawing up a list of Kennett's accomplishments (for want of a better word) three broad areas stand out. Education, health and welfare services have been slashed — the Premier himself nominated cutting 50,000 public sector jobs as his government's landmark achievement. Then there is the car-based urban nightmare Kennett is imposing on Melbourne residents, symbolised above all by the monstrous City Link freeway project with its horrendous financial, social and environmental implications stretching ahead of us for the next 40 years and beyond.

Finally, and this is the focus of this article, there is the "casino culture" which is such a marked feature of the new "on the move" Victoria. Gambling has exploded in Victoria and although the massive Crown Casino project rightfully symbolises this phenomenon, it is only a part of it.

Australia-wide, poker machines dominate gambling expenditure, with a $3.1 billion take in 1994. By way of comparison, racing took $1.6 billion, lotteries $1.1 billion, casinos $814 million (part of which derived from their own gaming machines) and other $377 million. (Claire Miller, The Age, September 30, 1995)

In Victoria, poker machines were first introduced by the Kirner Labor government in 1992. Since then the numbers have grown from an initial 5000 to a current 25,000. The projected number for the end of the decade is 45,000! The pokie tide is not confined to Melbourne but has spread right across the state — in pubs, clubs and, now, even in shopping centres.

The pokies are fun say the slick ads on TV. Everyone's a winner; they never show losers. But in real life it's just not like that. The mass of ordinary punters lose regularly, and these days they're gambling more and losing more. According to Rob Wootton, executive director of the Victorian Council on Problem Gambling, in 1994-95 the state's gamblers lost an average of $18.50 per week, compared to $12.29 per week in the previous year. Even without Crown Casino, this represents a 22% growth. Crown, he said, was "just one large venue in a sea of over 400 venues where problem gamblers thrive".

Gambling makes a very big contribution to the state budget. Despite all the cuts and all the rhetoric about curbing state spending, under Kennett state expenditures have actually increased considerably — especially on an army of expensive private consultants. The 1995-96 budget has been balanced solely by the $2 billion increase in state taxes since 1992: Victoria is now the highest-taxed state in the country. The largest single part of this increase ($448 million) has come from gambling taxes which now make up $961 million of the $7.55 billion total tax take — an almost 50% increase over three years! (Pokies will contribute $440 million of this and the casino $82 million.)

Close relationship

Crown Casino has so far been operating in temporary quarters at the World Trade Centre. The permanent complex, now under construction, will be huge. As well as the casino proper with 350 gaming tables and 2500 pokies there will be 15 cinemas, 16-18 restaurants, two theatres, four nightclubs, up-market shops and convention facilities. There will also be hotels and a sports complex. However, gambling is expected to provide at least two-thirds of the total revenue.

By the year 2000 Crown expects to employ 8000 people full-time, making it one of the state's largest employers. The relationship between Hudson Conway, the consortium that owns Crown Casino, and the Kennett government is a close one — and very profitable for Crown. Hudson Conway defeated US hotel chain ITT Sheraton for the right to run the casino. Subsequently the government has acquiesced as almost every major detail of its winning bid has been altered significantly. Crown's gambling turnover tax to the state is only 20% whereas clubs pay 33% and hotels 42% — leading to outraged calls by the clubs for a "level playing field".

City retailers have mixed feelings about the massive edifice taking shape on the Yarra bank at Southgate. Many fear that it will suck trade and custom away from the central business district across the river. Already, in fact, there is evidence that the big increase in gambling overall has hit retail activity across the state, especially in many regional centres.

In the November 13 Age, Megan Jones reported that across Australia "retail sales have crash landed, with major national chains reporting no sales growth during the past six weeks. Spending on homes, furnishings, cars, tyres, clothing, jewellery, television hire and recreational products has ground to a halt." The situation was worse in Victoria than in other states, and most retailers here attributed the crisis above all "to increased spending on gambling and gaming machines".

According to Sportsgirl managing director Frank Whitford: "Everyone's competing for the same amount of disposable income. You can't get an increase in gambling dollars without impacting on traditional retailing, especially the clothing business." And Tony Chrisdekakis, executive officer of the Combined Retailers' Association, is of the opinion that gambling has redirected the whole retail scene in Victoria. "You can see that in the regional centres", he said.

Shocking realism

A very small part of the river of gambling taxes finances the government's Community Support Fund which is supposed to settle the question of the social consequences of the gambling explosion. However, just like the health warnings on cigarette packets, this is merely a fig leaf to cover up the extremely lucrative nature of the whole business, for the state coffers and for the big corporate gambling interests (Crown, Tabcorp, Tattersalls and the rest). Not so long ago the government rejected an anti-gambling advertisement for TV which showed a family home being flattened by a huge falling die: presumably the realism was deemed to be too shocking for the public.

The problem with gambling can't be reduced to the extreme cases of compulsive "problem gamblers". What is behind the gambling frenzy? Why do so many ordinary people gamble? One might as well ask: why do people shop or go to movies? Gambling is a market which the big corporate players have created and are now expanding to the limit. Governments are happy to oblige because this is what powerful business sectors want, and also because it is a rich source of tax revenue. (This is all the more important as the government now engages the services of a horde of expensive private consultants and it also has to make up for the dividends which vanish as utilities and other public enterprises are privatised.)

The "gaming industry" exploits the emptiness, pain and fundamental insecurity of life for the mass of ordinary working people condemned to live in capitalist society where money is valued above all else. Gambling is a chance to change our luck, to find a quick painless road out of poverty or financial insecurity, to have the means to be able to take control of our lives. Who hasn't dreamed of winning the lottery?

Of course, the "solution" it offers is not only illusory for all but the necessarily tiny handful of winners, it is also supremely individual. However, we can safely predict that as big sections of the working class begin to take charge of their destiny and struggle collectively to change society the gambling juggernaut is likely to fall on hard times.