Conservatively Speaking

"America is on a gambling binge. The more available and accessible it becomes, the more gambling is acceptable to people.”

Tom Grey, executive director of the National Coalition Against Legalized Gambling made that concession during March 2006. Grey’s next line was the following:

"But shouldn't government be encouraging people to save their money instead of encouraging them to gamble?"

Even if you believe the answer to Grey’s question is yes, the stark reality is just the opposite. Government is expanding gaming options, even searching for creative ways to separate gamblers from their money.

Stateline.org reports, “States are more addicted to gambling revenue than ever as the lure of easy new money for schools, tax relief and public services has led to an explosion of state-sanctioned casinos, slot machines at racetracks and lottery games. Twenty-five years ago, gambling was legal in only three states. Now every state except Utah and Hawaii rely on gambling to generate revenues to help avoid raising taxes.”

Wisconsin is right there with other states, enabling gambling that rivals Las Vegas and promoting games with clever marketing in radio and TV ads. The heavy concentration of games has evolved despite the fact Wisconsin voters took a firm stand against the proliferation of gambling.

The Wisconsin Legislative Reference Bureau wrote a report during May 2000 entitled, “The Evolution of Legalized Gambling in Wisconsin.” The report details the 1993 statewide vote that asked voters if Wisconsin had enough gambling:

“Governor Thompson called a special session in June 1992 to consider amending the constitution to permanently exclude casino style gambling from inclusion in the state lottery. After considerable debate and a series of legislative hearings held around the state, the following question was presented to the voters:

Gambling expansion prohibited. Shall article IV of the constitution be revised to clarify that all forms of gambling are prohibited except bingo, raffles, pari-mutuel on-track betting and the current state-run lottery and to assure that the state will not conduct prohibited forms of gambling as part of the state-run lottery? 

Republican Governor Thompson and Democratic Attorney General Doyle stumped for the amendment in joint appearances around the state and expressed a shared desire to restrict the expansion of gambling. The Wisconsin Conference of Churches and the Wisconsin Catholic Conference also favored passage, asserting that gambling activity had exceeded the bounds of moderation and was a threat to community values and health. On April 6, 1993, the amendment was ratified by a vote of 623,987 to 435,180. As things now stand, state-operated or private casino-style gaming in Wisconsin would require subsequent constitutional change.

The results of the advisory referenda, which also appeared on the ballot, indicated the voters’ preference for maintaining the status quo regarding gambling. They voted against allowing casino gambling on excursion boats (604,289 to 465,432); against video poker and other forms of off-reservation video gambling (702,864 to 358,045); for a continuation of pari-mutuel on-track wagering on racing, such as on horses, dogs, or snowmobiles (548,580 to 507,403); and for the continuation of the state lottery (773,306 to 287,585). A fifth advisory question, asking voters if they favored a constitutional amendment that would restrict gambling casinos in the state, was made moot by the ratification of the amendment, but it passed by a vote of 646,827 to 416,722.”

Despite those votes, Governor Doyle has signed gaming compacts with tribes that have resulted in an explosion of gambling never foreseen. After Louis Butler replaced Diane Sykes on the state Supreme Court, the court made a ruling that essentially okayed the expended gaming negotiated in the compacts.

My July 17, 2006 column said, “Thanks to the ruling, the state’s largest gambling operation, the Potawatomi Bingo Casino in Milwaukee will now advance with plans to triple its floor space, currently at 70,000 square feet. That will give the facility 210,000 square feet, more floor space than any casino in all of Las Vegas. The MGM Grand Hotel is the largest casino in Las Vegas at 171,500 square feet.

The Potawatomi also plan to double the number of slot machines from 1,500 to 3,000. That would rival the MGM Grand’s 3,700 slot machines, and the expanded Potawatomi facility would have more slots than any other casino in Las Vegas; Wynn (2,500), Venetian (2,500), Bellagio (2,433), Mandalay Bay (2,400), Mirage (2,294), Circus Circus (2,255), Excalibur (2,250), Caesars Palace (2,100), and the Palms, Luxor and New York New York hotels, (2,000).”

As predicted, last week the Potawatomi Bingo Casino advertised the grand opening of its expansion, now featuring 3100 slot machines.

The director of the Wisconsin Lottery now wishes games could be offered online. 

This follows a national trend of states searching for new ways to expand gambling opportunities, from “racinos”, slots at racetracks  to state-owned casino resorts. 

Is there no end to what states might do to recruit more gamblers? Probably not.

The Denver Post reports the Colorado Lottery is now selling coffee-flavored scratch-and-sniff scratch-off lottery tickets with chocolate and flower flavored scents coming soon. A spokeswoman for the Colorado Lottery, Erika Gonzalez says, "We could even have a Corona with lime."

A survey of bank CEO’s in Wisconsin shows the majority believe the state’s economy is still getting worse.

The Wisconsin Bankers Association (WBA) questioned CEO’s, 124 completed the survey, and 65 percent feel or economy is weakening with only 35 percent saying Wisconsin’s economy is improving.

Why the gloomy outlook? CEO’s cited flat demand for loans, more delinquencies, foreclosures and past due payments for their lack of optimism.

Here’s more from the WBA.

MADISON – Governor Jim Doyle today announced that the Federal Emergency Management Agency (FEMA) has declared a state of disaster for Adams, Calumet, Green Lake, Jefferson, La Crosse, and Walworth counties.

“FEMA is working hard to expand individual assistance to people across southern Wisconsin who have been hit hard by floods and severe weather,” Governor Doyle said. “I thank them and all those who are working together to recover and rebuild. We are committed to getting people the help they need.”

Governor Doyle declared a state of emergency in 30 counties after severe weather this month brought record floods and other damage across southern Wisconsin. FEMA is in ongoing damage assessments in those counties to make disaster declarations.

The U.S. Treasury is advising Social Security recipients who live in flood-affected areas to make arrangements for their checks to be deposited directly into their accounts.

Here are the details.

Wisconsin Emergency Management of the Department of Military Affairs has issued a news release containing flood health and safety tips.

It says, “Whether you are repairing your home, helping someone with theirs or helping as part of your job, you will need to protect yourself against the hazards you may encounter.”

Read the news release here.

You can add bananas to the list of foods that are seeing a sharp increase in price thanks to the rising cost of fuel.

Like the corn tortilla in Mexico, the banana is an important part of the daily diet in Britain.

There seems to be a consensus that ethanol has been a major factor in the rising cost of food that has led to food crisis conditions in many parts of the world.

It is encouraging to see the editorial board of the Milwaukee Journal/Sentinel write that ethanol mandates should be reconsidered.

The Federal Emergency Management Agency (FEMA) is reporting scam artists are going door-to-door in flood ravaged Iowa, claiming to offer speedy assistance on claims and repairs..

The scammers are also surfacing in Wisconsin.

The Janesville Gazette is reporting that the Rock County Sheriff’s Office is aware of a scam in Racine County where individuals posing as FEMA agents were knocking on doors. The fake agents claim they’re assessing damages for the homeowners and a charge will be issued for their services.

That’s a scam because FEMA doesn’t charge for assessment services.

Residents are asked to call 9-1-1 immediately if they suspect anyone posing as a FEMA agent. Homeowners are also advised not to pay anyone claiming to be a FEMA representative for any services.

Here’s more from FEMA.

Many Wisconsinites spend a great portion of each year living in Florida, attracted by good weather and a favorable tax climate.

These snowbirds need to be aware that they might be targeted for tax increases.

The Wall Street Journal reports:

“Florida voters in January amended the state's constitution to further limit property taxes. The state has long protected "homesteaders," or Floridians who live in their houses for more than six months of the year, by limiting the increase in the assessed value of their homes to 3% annually. In January, voters built on those limits. Over time, the difference between the assessed value and the market value of homesteaders' properties becomes substantial; the new measure ensures that homesteaders who move to a new home won't lose the tax benefits they've built up in their old home.

Such changes are already putting the squeeze on Florida school jurisdictions, which may tap "snowbirds" -- retirees who live in the state only part of the year -- to make up lost revenues. Those out-of-state property owners aren't eligible for most of Florida's property-tax protections.

Mr. Calabro (Dominic M. Calabro, president and CEO of Florida TaxWatch) is most critical of a Florida proposal on the ballot this November that would further roll back property taxes and increase state sales taxes to do so. With no state income tax, Florida relies on its 6% sales tax to a larger degree than any state save two -- Washington and Tennessee.”

The Wall Street Journal reports Florida is one of several states looking to curb property taxes.

Read the entire article.

I am very pleased to learn that the Wisconsin Supreme Court has ruled a tape recording capturing Milwaukee Public Schools bus driver Brian Duchow’s statements as he abused a boy with Down syndrome could be used in court. The boy’s parents, suspecting he was being threatened and abused, placed a tape recorder in their son’s backpack.

Duchow’s conviction in a Milwaukee County Circuit Court was overturned by an appellate court that ruled the tape recording should have been inadmissible. The state Supreme Court has now ruled the tape recording was allowable.

I have been very close to this case, working with the boy’s parents on a bill I authored on school bus safety that became law in 2004. 

Here is more background from the Attorney General’s office and an article about the case from the Milwaukee Journal/Sentinel.

The Internal Revenue Service (IRS) says flood victims in five Wisconsin counties, including Milwaukee County could receive tax relief.

Here is more information from the IRS.

So far, only a handful of states have decided to raise taxes to address their budgets.

The 2007-09 Wisconsin budget that I voted against that was signed into law increased taxes. So did the budget repair bill that I voted against.

it is unfortunate that Wisconsin has failed to follow the path taken by most other states and reject tax increases during tough budget times.

Stateline has the story.

One of the biggest concerns I have blogged about and discussed extensively as I travel throughout Senate District 28 is Wisconsin’s propensity to lose our high-income level citizens and many of our best and brightest to other states. We can point fingers at the weatherman but the taxman shoulders much of the blame.

During November 2005, the Wisconsin Taxpayer Alliance issued a very troubling report entitled, "Moving In, Moving on: Migration in Wisconsin."  During the five years prior to the 2000 census, almost 669,000 people either moved to or out of Wisconsin. However, the net in-migration into Wisconsin was a meager 7,282.

Individuals with college or advanced degrees were more likely to leave, while those with less education tended to come. Individuals with household incomes above $75,000 left Wisconsin. Those with incomes of $200,000 or more had the highest rates of leaving.

The huge exodus of wealthy Wisconsinites leaving the state caused a loss of an estimated $4.72 billion in net worth and a loss of $455 million in income over the five years of this study. 

During November 2007, USA TODAY reported that Americans are moving across state lines at the highest rate since the early 1990s. U.S, Census Bureau data shows lots of people are moving, but not to Wisconsin that ranks at number 45 among the states, with 1.9 percent of the state’s population in 2006 having moved here from another state.

Arthur Laffer, president of Laffer Associates and Stephen Moore, senior economics writer for The Wall Street Journal editorial board confirm that high taxing and spending have had a negative impact on Wisconsin’s ability to compete and cause many people to relocate elsewhere. Laffer and Moore wrote in the Wall Street Journal,  “Five of the states near the bottom of our competitiveness ratings -- Illinois, Maryland, Michigan, New Jersey and Wisconsin -- have enacted major tax increases in the last two years. Maryland and Michigan just raised business and income taxes on upper-income earners, while arguing that raising the cost of doing business will attract more businesses. More likely it will induce companies to stay away, and people to move out.”

The latest USA TODAY analysis of Census data shows 35 states, including Wisconsin lost population during 2007 in the age category 25-44. Wisconsin’s population in that age bracket dropped by five percent last year.

William Frey, demographer at the Brookings Institution tells USA TODAY that older industrial states are facing the loss of the younger, high-fertility workers.

In Massachusetts, that suffered a 9.6 percent drop in its 25-44 population, the research director at MassINC, a non-partisan think tank in Boston, Dana Ansel made an understatement when she told USA TODAY, "Losing people in their prime working years is not positive."

The new USA TODAY analysis fails to offer specific details why states like Wisconsin are losing workers aged 25-44 but my suspicion is that economics plays a vital role. That all goes back to our high level of taxing and spending.

Please read the USA TODAY article and my blog on this issue, “Taxes go up, people move out.”