Social Costs of Introducing a Casino
Briefing prepared March 6, 2003

Financial Costs to Society

Background Studies:
· Kindt, 1994: The social costs of an individual compulsive gambler is between $13,000 - $52,000 a year.

· Volberg, 1994: The average per pathological or problem gambler is estimated at $13,600.

· NORC, 1999: The annual average costs of job loss, unemployment benefits, welfare benefits, poor physical and mental health, and problem or pathological gambling treatment is approximately $1,200 per pathological gambler per year and approximately $715 per problem gambler per year. Lifetime costs (bankruptcy, arrests, imprisonment, legal fees for divorce, and so forth) at $10,550 per pathological gambler, and $5,130 per problem gambler.

· Politzer, 1981: The average "bottomed-out" gambler imposed a cost of $61,000 upon society over the last year of gambling (inpatient sample). A "more average" pathological gambler imposed an annual cost of $26,000 upon society or approximately 43% of the costs from a "bottomed-out" pathological gambler.

· NGISC, 1999: Social costs emanating from problem gamblers were approximately one-half those from pathological gamblers.

· Schwer, 2003( The average cost of a pathological gambler (from a GA sample) was $19,085 annually. Using the Politzer finding that pathological gamblers at-large produce 43% fewer costs to society (the assumption is at-large problem gamblers are less severe, lesser severity = fewer social costs) then the adjusted cost per-person to society falls to $8,207 per year.

Domestic & Social Issues

Effects of Adult Problem Gambling on Children:
· "Children of compulsive gamblers are often prone to suffer abuse, as well as neglect, as a result of parental problem or pathological gambling" (NORC, 1999)
· Research consistently shows higher rates of pathological gambling in teens whose parents gamble too much (Gupta & Derevensky, 1997; Jacobs, 2000; Wallisch & Liu, 1996; Winters, Stinchfield & Fulkerson, 1993)
· Children of problem gamblers have higher levels of use for tobacco, alcohol, drug use, and overeating than do their classroom peers (Gupta & Derevensky, 1997; Winters, Stinchfield & Fulkerson, 1993)
· Children of problem gamblers experience twice the incidence of broken homes (separation, divorce, death of a parent) before age 15 (Jacobs, 1989)
· Child endangerment and child abuse increase (NRC, 1999)
· Child endangerment was exemplified in our state by the September 2001 report of an Oregon licensed day-care provider who left three children (1, 2 and 3 years old) in a van for over 11 hours while she gambled in a casino (Lawrence-Turner, 2001, September 15)
· The NRC reported on two studies indicating between 10 and 17 percent of children of compulsive gamblers had been abused" (NRC, 1999)

Domestic Violence:
· According to the National Research Council (1999), studies indicate that between 25-50% of spouses of pathological gamblers have been abused

· Several studies suggest that crime rates rise with increased availability of gambling to communities, but this issue is under intense debate
· Up to two-thirds of pathological gamblers commit crimes in order to pay off debts or to continue gambling (Brown, 1987)
· Studies of Gamblers Anonymous (GA) members report that approximately half of the participants had stolen to gamble and over one-third had been arrested (Thompson, Gazel, & Rickman, 1996)
· The vast majority of crimes are non-violent
· Embezzlement, check forgery, stealing credit cards, fencing stolen goods, tax evasion, insurance fraud, employee theft and fraud are common gambling-related crimes
· Reports of fraud and/or forgery were found in 56% of one problem gambling sample (Lesieur, 1984)
· "As access to money becomes more limited, gamblers often resort to crime in order to pay debts, appease bookies, maintain appearances, and garner more money to gamble" (NRC, 1999)

· The suicide rate among pathological gamblers is six times higher than that of the average population--the highest rate among all those with mental illnesses (Heineman, 1992)
· A major depressive disorder is likely to occur in 76% of pathological gamblers (Unwin Davis, & Leeuw, 2000)

Alcohol or other drug abuse:
· Pathological or problem gamblers had 7 times the rate of alcohol dependence than nongamblers and low-risk gamblers (NORC, 1999)
· A 1999 study (Pasternak & Fleming, 1999) revealed that almost one in every three persons with a gambling problem also abused alcohol (compared to about one in ten without gambling problems)
· The same study (Pasternak & Fleming) showed almost twice as many problem gamblers used tobacco compared with those without gambling problems
· In a study of over 21,000 high-school students, (Proimos, DuRant, Pierce, & Goodman, 1998) regular cocaine use and anabolic steroids were significantly associated with a report of problems connected to gambling

Minorities and Gambling
· Minorities spend about two and a half times more on gambling in a typical month than Caucasians (Moore, 2001; Volberg, 1997)
· With the exception of Asians, ethnic minority groups are over-represented among individuals classified as problem gamblers (Moore, 2001)
· Minority populations most likely have much higher rates of pathological gambling than Caucasians (Moore, Jadlos, & Carlson, 2000,)

Youth Gambling
· Seventy-five percent of teens reported having gambled (4% reported gambling every day) (Carlson & Moore, 1998 -
· One in ten teens is an "at-risk" gambler (he or she may be moving toward problem gambling) (Carlson & Moore, 1998).
· One in every 25 Oregon teens is a problem/pathological gambler (Carlson & Moore, 1998)
· Almost 1/3 of teens have played the Oregon Lottery within the last year (minimum legal age to participate is 18 years old) (Carlson & Moore, 1998).
· The rates of problem gambling among youth are 2-4 times higher than the rates for adult gambling (Carlson & Moore, 1998; Gupta & Derevensky, 1998a; Shaffer & Hall, 1996), and Oregon youth are gambling at a younger age than in the past
· Youth can hide gambling problems well-there aren't outward, notable physical signs (e.g., smell on the breath, needle marks)
· Many pathological gamblers report having started gambling at an early age-approximately age 10 (Gupta & Derevensky, 2001; Gupta & Derevensky, 1998a; Gupta & Derevensky, 1997; Wynne, Smith, & Jacobs, 1996)

The Risks (Gupta & Derevensky; 1998a; Gupta & Derevensky, 1998b; Vitaro, Ferland, Jacques & Ladouceur, 1998; Wallisch & Liu, 1996; Winters & Anderson, 2000; Wynne, Smith, & Jacobs, 1996)

Teen problem gamblers have higher rates of:
· Crime (theft, robbery, embezzlement)
· School problems (e.g., lower grades, truancy, behavior issues)
· Family problems (e.g., withdrawal, behavior issues)
· Peer relationship problems
· Legal and money troubles
· Depression
· Suicidal thoughts and attempts
· Dissociative, "escape" behaviors
· Risk for co-occurring addiction(s), including alcohol and substance abuse

Public Opinion-Teens (Gallup, 1999)

Teens 13-17 years old (n=500):
· Ten percent (10%) of teens report that gambling causes problems in family
· Twenty-nine percent (29%) of teens claim to have made their first bets when 10 years or younger
· Twenty-seven percent (27%) bet on professional events, 18% bet on college games
· Twenty percent (20%) of teens say they gamble more than they should (compared to 10% of adults)
· Teens are also more positive about gambling successes-sixty-one percent claim to be ahead on wagers (only 26% of adults make same claim)

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