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Issue #1714      December 9, 2015

Fightback against gambling corporations

The 30-year rise in the rate of gambling on poker machines, sports betting, lotteries, Keno and casino games is likely to continue with the arrival of overseas sports betting firms like William Hill and Sportsbet, and new casinos like the proposed monstrosity at Barangaroo in Sydney. The incidence of family breakdown, divorce, homelessness and suicide will doubtless rise in proportion.

Poker machines pose a particular menace to ordinary working families. In 2003 gambling firm Tattersalls noted regarding poker machines: “We derive enormous value, 57 percent, from a very small group of customers, 15 percent, that is, [of] those who spend $100 plus per visit.” The Productivity Commission says 15 percent of regular players are in effect addicted to the machines.

Last year gamblers in Victoria lost $5.8 billion. Losses on poker machines rose to $2.57 billion, including $141 million in Melbourne’s disadvantaged Brimbank Council area. NSW poker machine gamblers lost $7.3 billion, with a staggering $760 million loss in Fairfield, Sydney’s most disadvantaged district, giving local operators a $300 million profit.

Since 2011 the amount fed into NSW poker machines has risen $7 billion per annum. One third came from five Sydney local government areas, four of which are the most disadvantaged in the state. Profits increased by $415 million (12.5 percent), $160 million of which came from those five areas.

The vampire zone

The gambling industry is Australia’s fourth largest advertiser, seeking a market audience of young men aged 18 to 25 who watch sporting activities. Last year’s Big Bash cricket league series attracted $2.2 billion in bets.

Some 50 percent of sporting bets are now made by phone. The gambling industry also wants the federal government to allow online live sporting match betting, which would increase the betting market, with a proportionate rise in social trauma.

And the industry hates criticism. Federal MP Andrew Wilkie may face court because he described as bribery an attempt by a gambling industry representative to make an illicit payment to former MP Peter Garret.

The poker machine industry, which refers to gambling as “entertainment” and to betting as “wagering”, is particularly concerned about its image.

It should be. Lawyer Jacob Varghese commented: “…what is coming more to light through neuroscience is that players are helpless because of the design of the machines.” The longer the gambler plays the poker machine, the more profit the operators make, and the machines are designed to make the player stay as long as possible.

Journalist Jonathan Holmes noted: “…‘problem gamblers’ are people who play the pokies in precisely the way they are designed to be played… Pokies are designed to be addictive; the music, the flashing lights, the number of enticing ‘near misses’, above all the tiny injections of dopamine produced by the ‘wins’ the machines pay out every few seconds – all are precisely calibrated to produce the trance-like state that addicts call ‘the zone’”.

Poker machine rooms typically have no windows or clocks, and one player interviewed by Holmes commented: “You don’t know if it’s day or night. Nothing, absolutely nothing exists except that machine and the button you’re pushing.”

When the machines pay out they play bright graphics and emit soft jubilant beeps, even if the payment is much smaller than the bet. Monash University public health professor Charles Livingstone says this simulates reward. Players in “the zone” register the moment as a win, or close to a win, encouraging them to keep playing.

Since the 1980s NSW clubs have also raised the rate of return in the form of winnings. Rather than lowering profits, the extra temptation made gamblers stay longer at the machines, and profits increased.

Some clubs have even offered to bring food and drink to players so they won’t cease playing the machines. The operators’ tactics have been so successful that some gamblers are said to have remained playing until they lost control of their bodily functions.

However, the introduction of anti-smoking laws alarmed the operators. A Tattersalls report noted: “Smoking is a powerful reinforcement for the trance-inducing rituals associated with gambling”, but patrons forced to go outside to smoke would exit the “zone” and probably cease playing.

Profits fell after the introduction of the laws, but the clubs then created special partially-enclosed “outdoor” poker machine areas, and the profit rate rose once more.

Hooking the government

In a tactic that bears a bizarre resemblance to bribery, the gambling industry repeatedly reminds state and federal governments not only of the tax it pays but also of the tax it would pay if its operations expanded.

Since 2011 NSW poker machine taxes have risen 8.5 percent. The Victorian government gained $1.6 billion from gambling last financial year.

In return for a $5 million payment now, $272 million by 2022, and construction projects in Brisbane, the Queensland government has offered Star Entertainment a 20 percent tax on casino tables, compared to Sydney’s 29 percent.

The NSW government has, admittedly, placed notices outside gambling establishments about the miniscule chance of beating the poker machines, and has reduced the state’s number of machines. The Victorian government also wants to link the state’s gaming machines and allow gamblers to pre-set loss limits.

But it’s not enough. Taxation payments and political campaign contributions have dissuaded the major parties from curbing the poker machine industry’s rapacious growth.

But that can change. The Alliance for Gambling Reform will soon commence court proceedings against the gambling industry, arguing that poker machines’ operations are deceptive, misleading and breach consumer laws, and are therefore illegal.

And there are other means of struggle. Australia has already reduced the number of smoking addicts by banning cigarette advertising and smoking in offices and public places, and by introducing plain packaging laws for cigarettes.

We could dramatically reduce the amount lost in poker machines by banning the use of trance-inducing music, sounds and graphics. But to achieve that we have to place irresistible pressure on state and federal governments and vote for left-wing and progressive parties pledged to rein in the gambling industry.

It can and must be done.

Next article – Still manipulating the United Nations after 70 years

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