Thanksgiving and People On The Wrong Side Of The Economic Table

"It's a lonely, lonely road we're on
This side of paradise."

-Bryan Adams

My late father was a professional gambler. Towards the end of his life, he was active in helping at a soup kitchen in Cincinnati, which was run by the Sisters of Charity.

One Thanksgiving, as dad was dishing out food to homeless people, my father was approached by the Sister who ran the program.

"Joe," she said, "What do you do for a living?"

"I'm a gambler," replied my father.

"Joe," she said "This is the first time we ever had a gambler on this side of the table."

The key to my father's success was that he was always on the house side of the table.

He understood that if the house has the odds in its favor long enough, the house will eventually and always win out. As he often noted, "You never see them tearing down a casino because people beat them out of money."

First with lotteries, and then with video slots and casinos, governments realized that a very easy way to gain revenues is by allowing and sponsoring gambling.

The lottery and other games that have been legalized bring in much of their income from those on "the wrong side of the table."

Some European countries limit access to the casinos to those who prove they have sufficient assets. Various forms of stock and option trading, which can be considered a more elite form of gambling, require that those who invest in those instruments have the net worth to survive a loss.

In my father's era, bookmakers cut off bettors on losing streaks. Las Vegas casinos carefully monitored their customers and cuts off their credit when they lose too much.

There have been few, if any, moves by states to monitor the losing of their lottery customers.

Legalized casinos, which have several games of skill and reasonable probability, gear most of their operations to the highly profitable slot machines and video games.

Lotteries have evolved from a form of gaming called "numbers," formerly very popular in poor, urban neighborhoods. If you go into a grocery or liquor store in any poor neighborhood today, you will see people who can't afford to lose even a few dollars, standing around playing scratch off lottery games until all of their money is gone.

I rarely if ever gamble. I can't stand to part with my money on something that is such a bad bet.

My few trips to casinos have been bad experiences for the house. I bet very little and I am a terror at the low price buffet. I play high probability games and won't go near a slot machine. I have a certain profit margin in mind and leave the second that I hit it.

In short, I am a person casinos do not want to attract.

Making gambling illegal was an attempt to protect people from themselves.

It did not stop the tide but pushed it underground. Gambling for rich people, such as options trade and sophisticated stock market games, have always been allowed. Most of the crisis on Wall Street was caused by corporations gambling with stockholders money.

When I passed the stockbroker's (Series 7) test many years ago, I called my father and asked, "Why is futures trading legal but betting on the Bengals illegal?" There is no logical answer.
States like are under pressure to legalize casinos and slot machines, and just like the lottery, they eventually will. It is much easier than raising taxes or cutting services.

When legislators do expand legal gambling, someone must think about and speak out for the person on "the wrong side of the table."

When I was growing up, my father would go around to the sleeping room hotels and give out bottles of low cost champagne on Thanksgiving and Christmas. Just like the patrons at the soup kitchen, many of those men were gamblers. Often the bottle was the only gift they got.

Legalized gambling is not responsible for most of these people being in their positions in life, but states needs to take extreme care that we are not keeping them there.

Don McNay, CLU, ChFC, MSFS, CSSC is the founder of McNay Settlement Group in Richmond, Kentucky. He is the author of Son of a Son of a Gambler: Winners, Losers and What to Do when You Win the Lottery. The book draws parallels between his childhood as the son of a professional gambler and Don's experience in the world of personal finance. You can write to him at [e-mail] or read his award winning, syndicated financial column at www.donmcnay.com

Follow Don McNay on Twitter: www.twitter.com/Donmcnay

Comments

[Samalabear]

I do play the lottery -- $2 to $4 usually in a week, at the most. I have noticed that the majority of people who win the lottery either play small sums sporadically or small sums regularly. The ones who spend large sums from money they clearly cannot afford do not win seem to win. You also hear about the "curse of the lottery," people who win a lot and lose it all really quickly. But I don't believe that is the majority. The majority of lottery winners who win decent sums do indeed pay down debt first, help family and go on quietly with their lives. Sadly, there will always be addicts. They're not the majority of us, but they do have a devastating effect on those around them.

[Fleurdamour]

I had a relative who was a gambling addict and he bankrupted his family not once but twice - during the Great Depression. It's truly a sickness that isn't understood by most people. Gambling is mostly seen as fun or exciting. I've been to Atlantic City, and honestly I saw very little fun and a great deal of compulsion. The customers mostly seemed like lonely people with no where else to go, parked in front of the slots for the day and fixated on the $20 bait the casino handed them when they got off the bus from NYC. My friend and I had more fun walking on the boardwalk there and eating lunch than we did in the casino. People do win sometimes and sometimes they win big, but look who owns the casinos - people like Donald Trump. He would not bet on a bad business, and he's certainly on the winning side of the table.

[rabb046]

FYI - Trump HAS made bad bets in business. I would advise not mentioning his name in Atlantic City. His bankruptcy allowed him to get out of paying a lot of contractors, plumbers and other hard workers that contributed to his "success". Look up the word charlatan in the dictionary. Unless it's been replaced by GWB, Trump's picture will come up.

[Samalabear]

Trump deserves absolutely no respect. I don't know how he gets away with what he does, but he is an odious human being. Just ask people in New York City and New Jersey how they feel about Donald Trump. Oh, and now Long Island. He's doing a lot of damage to the environment at Jones Beach with one of his ridiculous projects for high rollers. Whatever he supposedly "gives" is crumbs compared to what the takes and the number of people who are screwed. He has utter contempt for the middle class and the poor, and his father wasn't much better.

[altima boy 2001]

Look at the Touchplay fiasco that happened in Iowa a year or two ago. They legalized a form of slots that were installed in many convenience stores, etc. After people realized how much money they made and how much of Iowa now looked like Vegas the gov't banned the machines and then got sued by the machine vendors