Jewish World Review May 9, 2002 / 27 Iyar, 5762

Joe Bob Briggs

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Consumer Reports


Fort Vegas fends
off the Indians


http://www.NewsAndOpinion.com | (UPI) Just how scary are the Indians to the Mecca of gambling? Is it better to get involved in partnerships with Indian casinos or to just ignore them and hope you can beat them?

"I'm neutered on Indian gaming," says Frank Fahrenkopf, head of the American Gaming Association. "I can't give you a position on it, because I have members that support it and members that don't. Some people are very opposed to Indian gaming, because, among other things, they pay no taxes and so they have an unfair advantage."

His phone buzzes. "Sorry, I have to take this call from Ralph Nader's lawyer."

I'm in the office of gambling's chief lobbyist, not far from Capitol Hill. As he takes the call -- in his capacity as chairman of the Commission on Presidential Debates -- I scan his solidly Republican wall. Fahrenkopf with Reagan from the time when he was chairman of the Republican National Committee. Fahrenkopf with Colin Powell. Fahrenkopf with various Bushes. Fahrenkopf with other dignitaries from his days as the premier gaming litigator in Nevada. (He represented the Hughes estate in the Mormon will case.)

"Sorry, but I had to take that. Ralph was suing me. Anyway, some think the Indians are not playing fair. Others want to hug the Indians."

The battleground is California. There are 54 Indian casinos in the Golden State, with more on the way, and for the past 10 years they've been dismissed by Las Vegas as day-trip joints for lipstick-lizard slot players with a paper cup full of nickels.

All that changed on March 7, 2000, when Proposition 1A was approved, allowing the Indians to run full-scale gambling resorts without any limitations or regulation. Historically, 35 percent of Vegas tourists come from California. Soon every one of them would be within a half tank of gas of all the gambling he could ever want.

Harrah's is the hugging type. "Look, the Indians are gonna be there," says Tom Jenkin of Harrah's Las Vegas. "They're gonna operate casinos. You can put your head in the sand, or you can go into business with the Indians. We have a management contract formula that has been very successful for us AND for our Native American partners."

Privately, the Casino Men say they're not concerned at all about 45 of the 58 casinos. Most of the reservations are so scattered through rural areas that they'll never be able to offer the amenities of the Strip. They'll even provide a service to the Strip by siphoning off all the undesirable degenerates who will play at the first slot machine they find.

What the Casino Men ARE worried about is the cluster of four casinos in the Palm Springs area, and the cluster of five near San Diego. Palm Springs is accustomed to dealing with tourists, and four casinos would be enough variety to create a mini-Vegas experience for those too lazy to drive to Nevada.

It could be "another Foxwoods," they say. That's the Disneyesque Indian casino that rose up out of the Connecticut forest eight years ago and now has more gaming space than any casino in the world. The 650 Mashantucket Pequots are now the richest Indians in the world -- every tribe member becomes a millionaire on his 18th birthday -- and they're protected from competition by the Connecticut state government, which takes 25 percent of all slot revenue.

San Diego is an even thornier problem. The drive from San Diego to Vegas is NOT pleasant, and as a result that market has fostered mega-casinos that, like Palm Springs, are clustered and offering all the amenities. Those casinos have the resources to siphon off up to 6 million people who would otherwise make the drive.

Yet the same thing was said when casinos opened in Atlantic City, and when the riverboat states legalized gambling in the early nineties, and in both cases the Las Vegas economy boomed.

"Most casinos are regional," says Rob Goldstein. "We are Mecca. Ask a customer in, say, Chicago. What's happening is, they go to the boat when they want an evening of gambling. When they want the whole experience, they come to Vegas. We've gone way beyond gambling."

"When New Jersey pressed its gambling initiative," says Fahrenkopf, "there was panic in Las Vegas. But guess what? Las Vegas got stronger. When California instituted a state lottery, there was panic in Las Vegas. 'Oh my God, we're gonna be devastated.' But guess what? It had no effect. When Indian casinos were legalized, everyone in Vegas thought that was the end of the world. But guess what? People still felt like 'I gotta go to Vegas.' And now the Internet comes along. Internet casinos are scaring some people. Guess what? Las Vegas will survive."

But that's not necessarily true for other Nevada gambling towns. The most likely result of the California casino boom is that Reno will become even more depressed, that the resort of Laughlin will be a big loser, and that Primm, Nevada, the little three-casino tourist attraction on the California-Nevada border, will be lucky to avoid becoming a ghost town.

The greater threat to Vegas this year comes from the U.S. Congress, which, for the third year in a row, seems determined to pass a law making college sports betting illegal. Since it's only legal in the state of Nevada anyway, the casinos are crying foul. One of the biggest Vegas events of the year is Final Four Weekend. Betting on the NCAA tournament is bigger even than the Super Bowl.

"Unfortunately," says Fahrenkopf, "I've got Joe Paterno and Lou Holtz and Dean Smith against me. I've got senators calling me saying, 'Frank, I know it's a bad law, but I've got the football coaches calling!' Every college campus has its student bookie.

Law enforcement says $380 billion is bet on sports. We're only collecting $2.3 billion of that in Nevada, and only about one-third of THAT is bet on college sports. Unfortunately, Nevada's an easy target. The anti-sports-betting bill is a high-profile bill and an easy bill to vote on."

And yet I think Las Vegas will survive that as well. The Indians can't compete with Vegas, and the Congress can't compete with Vegas. Only Vegas can compete with Vegas.



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