The Associated Press recently ran a story on racino subsidies (our previous posts on the subject) for the racing industry, explaining how these subsidies translate to corporate welfare for an inexorably declining industry. (This decline has two root causes: competition – the younger generations prefer full-service casinos; changing sensibilities – more and more people find the whipping and killing of sentient beings for gambling repugnant.) The article begins thus:
Horse track operators and breeders are concerned the good times might be trotting to a close as some states move to rein in a lucrative subsidy that’s helped prop up their long suffering-industry. Twenty states divert a slice of casino and slots parlors revenue to help boost horse racing prize money…but facing budget deficits and out-of-state casino competition, some lawmakers are reassessing.
…Such subsidies are a critical lifeline for racing, which has seen steady declines across a number of industry metrics, including the number of races and racing horse births and overall betting activity… Few tracks even keep attendance numbers anymore because the numbers of spectators has dropped off so dramatically… Nevertheless, there was over $1.1 billion in prize money available in 2014, thanks in large part to the racing subsidies, which generated over $400 million toward purses that year…
In New Jersey in 2011, Gov. Chris Christie ended a direct, $30 million subsidy to the racing industry from the Atlantic City casinos. Lawmakers in West Virginia have also pared back the percentage of slot machine revenues diverted to the industry in recent years, leaving owners and breeders there anxious. The debate has played out in Iowa, Indiana, Delaware and elsewhere too.
In Pennsylvania last year, state Rep. Todd Stephens proposed redirecting $250 million from the state’s horse racing fund to public schools, noting that a Saudi prince and other wealthy foreign horse owners were among the beneficiaries of the inflated prize money.
“It’s not government’s job to pick winners and losers,” Stephens said this week. “I generally oppose crony capitalism and corporate welfare-types of programs.”
This is America, where, at least in theory, businesses are left to sink or swim based on their merits – their goods and services. If that, one of our founding economic principles, is applied here, the bulk of American racing would go the way of the horse-and-buggy industry. So, for those looking to help (besides, of course, sharing the daily carnage reported on this site), please, if you reside in a racino state, contact your legislators; let them know that proceeds from state-promoted gambling should be flowing to education, health care, and other noble causes – not to an archaic, mostly no-longer-viable industry. Racing can be toppled. And sooner than you think.