A "Golden" Gopher?
The Unfair Gambling Business in America's Northland
Reservation gambling p; casinos, bingo palaces, reservation-sponsored
lotteries or otherwise p; is wrong in only one specific case: when the
state government favorably supports Reservation gambling over other private
entrepreneurs. Selectively choosing and supporting certain industries over
others interferes with the competitive pricing process and the principle
of economic privatization. State-favored industries can easily evolve into
parastatal bureaucracies, distorting demand and sapping state economies
of scarce public funds. The State of Minnesota is such a culprit.
A few years ago, the U.S. Government granted Minnesota's Indian Reservations
the right to build casinos on Reservation territory. The Supreme Court
said the State had no power to limit the Reservations, as that land is owned
by a separate Indian nation, not covered under the U.S. Constitution. Casinos
and bingo halls sprung up almost instantly in Minnesota and business skyrocketed.
Yet, the State rejected zoning and permit requests for private casino entrepreneurs,
limiting gambling instead to the Minnesota Lottery, a state-operated and
financed scratch-off game. Moreover, the State accepted the Court's ruling
with complacency and obedience.
This decision follows a consistent pattern of behavior for Minnesota.
The State's track record for targeting individual industries worthy of "special
support" is long and impressive. The Mesabi range mining industry
has received surplus public expenditure and social benefits for nearly the
State's entire history. The contract negotiations over the land on which
the MegaMall now sits were heavily facilitated by the State, which often
"won" arguments with the city of Bloomington, the location of
the Mall. Northwest Airlines has traditionally relied on the State, most
recently receiving a below-market interest loan to prevent bankruptcy p;
a loan unavailable to other airline firms. And the Legislature recently
agreed to purchase the Target Center with public funds so that the Timberwolves
basketball team would stay at home, despite record-low ticket sales and
consistently poor seasons compared to other NBA franchises.
This type of policymaking is deplorable. The State obviously favors certain
firms over others, regardless of economic benefit to the entire Minnesota
population. Not everyone flies Northwest and MegaMall/Target Center trips
to Minneapolis are expensive vacations for residents of Northern or Western
Minnesota.
Parastatal business dominates market share in Minnesota, which arguably
classifies as "unfair business practices" since competing firms
cannot match price or supply in a state-supported monopolized environment.
Clearly, the State of Minnesota has created policies to artificially stimulate
demand in its own state-monopolized markets. This ensures the State protection
of its own bureaucratic territory and interests, which often originate in
Minneapolis/St. Paul urban elite groups and contradict the needs and desires
of the out-state population. Reservation gambling in Minnesota is an example
of bureaucratic predation, plain and simple.
Many arguments counter my view. Governmental "targeting" of
specific industries and firms (i.e. industrial policy) has proven very successful
on a wide scale in emerging East Asian countries, most notably Japan. America
has been less committed to industrial policy on a federal scale, but nevertheless
has intervened successfully in specific markets to prop-up infant U.S. industries.
Further, American democracy prioritizes states rights over federal jurisdiction
to facilitate decentralization, which might justify the current situation
in Minnesota.
The question remains, however, about why Minnesota is willing to accept
gambling on the Reservations while privatized gambling remains illegal.
Is not the State simply micro-managing its tax base by favoring one group
of businessmen over another? Minnesota politicians argue moralistically
that the Lottery is sufficient gambling for Minnesotans, particularly combined
with the Reservations' casinos and Lions Clubs' pull-tabs. This response,
however, is merely a veil for two economic truths about Minnesota's political
economy; namely that the Native lobby is one of the Minnesota's strongest
interest groups and that Minnesotan consumerism is indeed a valuable commodity.
Matt Kelso, co-term International Policy Studies
Featured Opinions
Everyone Wiuns with Indian Gaming; Time Sanchez
A Modern "Small-pox" for Native Culture;
Clay Akiwenzie
Background
Gaming and Violence on Reservations; Dan
Stettler
Other Opinions
A "Golden" Gopher?; Matt Kelso
Quick Thoughts . . .
Return to Indian Gaming
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This page created: January 1996
Copyright 1996, The Thinker All rights reserved.