On sports bets, Vermont should cash out
Readers: This story was updated at 5 p.m. Wednesday, May 16, to correct that Hinsdale OTB is open for business. An earlier version confused the business with Hinsdale Greyhound Park & OTB, which is closed.
Monday's U.S. Supreme Court decision striking down a federal law banning sports betting everywhere but Nevada opens the floodgates for states to make their own decisions about whether to allow residents to wager on college and professional sports — and turn losing bets into state revenue.
First, the elephant in the room: Vermont is already in the gambling business, as it makes money off a lottery. That money might go to the education fund, and "Cash Cow" scratch tickets are undeniably charming, but it's still gambling.
There's also precedent: For 30 years, southern Vermont had legal parimutuel betting, first on thoroughbred horses, then on greyhounds, at Green Mountain Racetrack in Pownal.
But as a VTDigger.org investigation revealed, Vermont's lottery has developed a strange habit of repeatedly paying winnings to small groups of convenience store employees. Before it even thinks of deputizing the clerk at the general store to take bets on the Red Sox or the Catamounts, the state had better get a grip on its lottery system and address whatever irregularities may exist.
And whatever short-term revenue boost the state realizes in legalized gambling is likely to be lost in the social costs that come along with expanded betting — gambling addictions, lost wages and families left in need by the cost of one more bet.
Considering Vermont's own budgetary challenges, the state might be tempted to consider sports betting as a means of keeping money from disappearing over the border to states that are poised to allow it. "Everyone else is doing it" is a lousy reason to do anything, but the threat of lost revenue in the short term is real. Here's what the neighbors are up to:
- New York is all but ready for sports betting, having allowed casinos and passed a law in 2013 that provisionally legalized sports betting if the federal law was ever struck down.
- In Massachusetts, MGM Resorts International, which this fall will open a $960 million resort casino in Springfield, told MassLive.com that it's ready to work with Bay State lawmakers on sports gaming.
- Connecticut Gov. Dannel P. Malloy and House Speaker Joe Aresimowicz say they support a special session to revisit a bill legalizing sports gambling. Considering the shaky state of Connecticut's finances, passage seems likely.
- New Hampshire still has a law on the books banning gambling, though there's still an off-track betting parlor open in Hinsdale. But Gov. Chris Sununu told USA Today that the odds are "3-to-1" that the Granite State would legalize sports betting.
Despite these temptations, turning Vermont's lottery commission into a state-sanctioned sports book is a bad bet at long odds.
It's one thing to capitalize on people's willingness to play the numbers, burn a few dollars on scratch tickets, or to take a flier on the longer than long odds they'll win the latest mega-jackpot drawing. (You're more likely to be hit by lightning.) It is true these games can be as addictive as any other form of gambling. But they are games of (slim) chance, in which actually winning a prize is widely understood to be accidental.
Sports betting adds to the pathology of lottery gambling by preying on fan loyalties and the misguided belief that the bettor knows more than the Vegas wiseguys who set the lines. (Hint: The wiseguys never play to lose.) And once they start losing, those players are hamstrung by their own optimism bias — that they'll make up for their bad bets on the next race, the next game, the next fight. It rarely happens.
And years of evidence on gambling, academic and anecdotal, points to an uncomfortable reality about who bets the most: those who can afford to lose money the least. An expansion of gaming would naturally increase the amount that economically disadvantaged Vermonters bet and lose, and the social costs of unmet needs and petty crimes committed to cover for gambling losses would follow.
That's not wise social policy, or a good way to add revenue to state coffers. Vermont can do better.
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