The Wall Street Journal (WSJ) published an editorial on March 1, 2002 entitled “Big Chief Pataki.” The editorial has generated a lot of interest, hostility, and hand wringing in its wake.  The editorial details Governor George Pataki’s dealings with the Seneca Indian Nation, the Mohawk Tribe, and the Oneida tribe of New York State.  The governor has the power, enacted by the legislature last year, to negotiate gambling pacts with the tribes for six new casinos.  Pataki claims that the casinos will help revitalize the depressed Buffalo/Niagara Falls and Catskills areas.  Part of the deal to open the casinos is for the tribes to settle some long-standing land claims.  Additionally, unions will have the right to organize some of the new casinos.

Part of the uproar caused by the editorial has to do with the terms that were used by its author, Micah Morrison.  Terms such as “Big Chief Pataki,” “new Indian Chief,” “traded beads with unions” and “Great White Father” are terms that can evoke very negative emotions in Indian country and exacerbate sensitive memories of a not-so-distant past, and Morrison’s ironic use of them has inflamed some writers for Indian newspapers.

The WSJ editorial further claims that the rush for recognition among Indian tribes has more to do with the lucrative gambling industry than anything else.  It concludes by saying that “The history of Indian gaming is…that it promises more than it delivers.”

Couple the editorial with news reports on March 1^st detailing how former Clinton administration official Michael Anderson granted recognition for the Nipmuc Indian tribe of central Massachusetts, the Mohawks and the Duwamish Tribe of Seattle after he left office.  Anderson took over as acting head of the Bureau of Indian Affairs on January 3, 2001, came back to the Bureau on January 22^nd, 2001, three days after his term ended, and signed some papers which were later backdated to create the appearance that they had been signed before he left office.  Anderson is now a partner in a law firm that represents Indian tribes.

Indian Country Today (ICT), a newspaper owned by the Oneida Nation of New York, took strong exception to the WSJ editorial and published a series of rebuttals to the editorial.  ICT expressed that it had lost respect for the Journal because of Morrison’s [satirical] use of inflammatory stereotypes.  Additionally, it highlighted four points of contention:

1) The belief that gaming enterprises are bad and attract “lowlifes and organized crime, drugs, prostitution,” etc.

2) That Tribes are currently seeking recognition “because of the windfall that usually follows,” implying gambling.

3) That the editorial dismisses the “economic development” argument and that Indian gaming “promises more than it delivers.”

4) That the “land into trust” swaps that accompany Governor Pataki’s casino deal are “another bit of corruption.”

The process of Tribal recognition is a complicated and time-consuming undertaking.  Some tribes have been in the process of seeking recognition for years.  Not all tribes that are seeking recognition do so for the ability to open casinos.  Once the Federal government recognizes a tribe, the tribe is then entitled to a considerable amount of Federal assistance.  And, many tribes do seek recognition to open casinos.  Indian gambling is a $10 billion per year business.  It is BIG business.

After 10 years of Indian gambling in the state of Minnesota, one is bound to see that gaming, or gambling, is not the panacea that is was touted as being.  Out of the eleven Minnesota bands and Indian communities that operate seventeen casinos, two are experiencing severe financial hardships because of growing too fast, too soon.  These two northern Minnesota Chippewa bands over-expanded their gambling and peripheral facilities and are now in such serious financial trouble that their overall financial situation is in jeopardy, and community dependence is increasing rather than decreasing.

As reported in Press/ON on January 25^th (Casinos, crime, and community costs, by Clara NiiSka), government-operated casinos are primarily a way for governments to raise money without raising taxes.  The National Gambling Impact Study Commission (NGISC) released its official reports in 1999 and recommended a national moratorium on the expansion of gambling, as well as urging more study of the costs, benefits, and effects of gambling.  In the September 2000 academic paper “Business Profitability versus Social Profitability” by economists Earl L. Grinols and David B. Mustard, many revealing facts are discovered, most notably that “the costs of casinos are at least 1.9 times greater than the benefits.”  So, while a government’s revenue coffers may swell at the onset of gambling, the broader societal implications and costs outweigh the economic benefits of gambling.

Grinols and Mustard continue by saying that a dollar’s worth of benefits are accompanied by $1.90 in “cost-creating activities such as crime, suicide, and bankruptcy” and that the consequences of gambling include expensive social problems engendered by “problem and pathological” gamblers.  Far from the key to Indian independence, the costs of gambling generate a net loss for Indian country in terms of social costs.

Crime does follow the casinos, according to an earlier study by Grinols, Mustard, and fellow economist Cynthia Hunt Dilley “casinos increase crime in their host counties and that crime spills over into neighboring counties to increase crime in border areas.  The onset of these social problems is not immediate and usually lags behind the opening of the casinos by a couple of years.  A honeymoon of large monetary influx is inevitably followed by a rude awakening: to latent social ills a few years down the road.

According to Grinols, Mustard, and Dilley, casinos create crime, rather than attracting it from elsewhere: casinos accounted for 10.3 percent of violent crimes and 7.7 percent of property crimes in casino counties.  And, as further reported in the January 25^th article, the economists claimed that their assessments of the damages caused by casinos were “conservative.”

In addition to the crimes created by problem and pathological gamblers, a perhaps even more serious concern is the potential for institutionalization of a big-money criminal element in government engendered by the casinos.  The belief that the regulating agencies are actually policing the casinos is belied the Minnesota Department of Public Safety’s defense of casino secrecy during Press/ON’s ongoing battle to obtain access to casino audits.  As Grinol told Press/ON, “the regulatory agency is often captured by the industry they are supposed to regulate.”

As subsequently reported by this writer in a follow-up to the NiiSka article, the claims of new jobs generated by casinos are often overstated as well.  Whereas initially news jobs are created, the jobs often go to people who are not tribal members.  Tribal members forego education or other training in the mistaken belief that a better job can be had at the casino.  There have even been claims that casinos have been trying to bring in illegal aliens to work the jobs. 

Between the chasm that separates the detractors of gambling in general and (on the other side of the abyss) the claims of Indian recovery lies the reality of the real face of gambling, as it has been discovered here, in the state of Minnesota.

Not all Indian tribes want gambling on their lands.  According to the General Accounting Office (GAO), 32% of Indian tribes are involved in some sort of gambling operations.  The Navajos, the largest tribe in the country, have voted it down twice and the Hopis have also rejected it on their reservation.  Less than half of the tribes with gambling operations have received U.S. recognition in the last 40 years.  Most of the other tribes can trace their existences as federally-recognized tribes back to the Indian Reorganization Act of 1934.  Out of the 250 Indian tribes currently petitioning for recognition by the Bureau of Indian Affairs, 175 or 75% are not ready for evaluation, 23, or less than 10%, are ready for evaluation, and another 20 have been resolved outside of the regulatory process.  While the number of tribes seeking recognition has grown over the past few years, the number of petitions for recognition average around 10 to 20 per year.  Certainly, not all applicants are tribal wanna-be’s lining up to open casinos, yet the allure of huge amounts of money coming into the tribe’s pockets has definitely turned some heads.  Perhaps a wiser route to consider is the long-term costs to the tribes of the social costs of gambling.

It is undeniable that there are economic problems on many U.S. reservations.  But, an effective Indian recovery, economically, will not occur when each $1.00 taken in siphons off $1.90 from the host communities.  This will only make matters more desperate than they already may be.